05/08/2013

Service management in a food franchisee

Kaustubh Chavan 10 Mukul Dave Kunal Khadse Bitesh Surti

Team Members: 13 41 24 43

Ulpesh Solanki

Submitted to : Prof. Poonam Pariya

No. 1 2 3 4

Sr

Title Acknowledgement Meaning and need for service management Company Profile Services provided by Pizza

No. 2 3 4 5 5 7 9 10 11 13 14 15

Pg

4.1 Services to the customers 4.2 Services to the Employees 5 6 7 8 9 Production Process layout in Pizza hut Service Blueprinting Benchmarks to Pizza Hut Conclusion Bibliography

6.1 Service blueprint of Pizza Hut

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Acknowledgement
I would like to acknowledge that this hard copy is a result of complete team effort, based on the survey and research conducted by my team. The subject of this hard copy and the presentation is to illustrate Service management in a Food Franchise, for this purpose our team has visited and surveyed the services management at Pizza Hut franchise located at Inorbit Mall, Goregaon west, Mumbai. I would like to thank and congratulate my team for coming together as an unit and for shaping the presentation and this hard copy, the way it is, Secondly I would like to thank Mr. Vilas Lokhande, Manager, Pizza Hut, for providing his valuable time and for providing resourceful intel about the organisation, Lastly on behalf of my whole team,I would like to thank Prof. Poonam Pariya for providing us such an opportunity and for adding some special value to our curricular.

Regards, Ulpesh Solanki (Team Leader)

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Meaning & Need for service management:

Service Management is monitoring and optimizing a service to ensure that it meets the critical outcomes the customer values and stakeholders want to provide. Service management is integrated into supply chain management as the intersection between the actual sales and the customer. The aim of high performance service management is to optimize the service-intensive supply chains, which are usually more complex than the typical finished-goods supply chain. Most service-intensive supply chains require larger inventories and tighter integration with field service and third parties. They also must accommodate inconsistent and uncertain demand by establishing more advanced information and product flows. Moreover, all processes must be coordinated across numerous service locations with large numbers of parts and multiple levels in the supply chain. Among typical manufacturers, post-sale services (maintenance, repair and parts) comprise less than 20 per cent of revenue. But among the most innovative companies in Service, those same activities often generate more than 50 per cent of the profits. The main drivers for a company to establish or optimize its service management practices are varied:

High service costs can be reduced, i.e. by integrating the service and products supply chain. Inventory levels of service parts can be reduced and therefore reduce total inventory costs. Customer service or parts/service quality can be optimized. Increasing service revenue. Reduce obsolescence costs of service parts through improved forecasting. Improve customer satisfaction levels. Reduce expediting costs - with optimized service parts inventory, there is no need to rush orders to customers. Minimize technician visits - if they have the right part in hand, they can fix the problem on the first visit.

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Service Management in Pizza Hut Company Profile of Pizza Hut franchisee, Goregaon

Type: Wholly owned subsidiary Industry: Casual dining Restaurant Founded: Inorbit mall, Goregaon (2004) Parent: Yum! Brands (1997present) Products: Italian-American cuisine (pizza pasta desserts) Annual Turnover: Approx. 50 lakhs per annum No. of Employees: 34 Key people: Mr Nikhil Khilachan (Owner of the franchise) Mr Vilas Lokhande (manager) Mr Pratik Shah (supervisor) Key Achievements: Ranked no. 1 since last 8 years. Website: pizzahut.com Telephone: 022 66450909, 022 39883988

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Services Provided by Pizza hut:

Pizza hut provides services from 11am to 11pm round the year, The services provided are customer centric and are fully digitalised i.e. right from Order processing to vigilant surveillance, handled by the employees by making the use of integrated Information technology; the ultimate motto of their services is customer satisfaction and customer maximisation along with profits maximisation. The services also include provision of expertise training to the employees to enhance the service quality [citation 1]. The services can be categorized as:

Services to the dine-in Customers:

The customers, who visit pizza hut, are welcomed by an employee and greeted at the entrance. Then the customers are offered to choose accommodation according to their preference of the two options i.e. Open table and Sofa lounge. After the customers are accommodated, menu cards are provided to them by the waiter and customers are guided to place the order by giving them suggestions. Once the order is placed, the customers are then provided with welcome drinks. The order is completed within 15 minutes (maximum time). The franchise provides customers with free Wi-Fi (wireless internet) services for entertainment. Also there is a new customer attraction added in the service of pizza hut i.e. special dance performances by the Employees. If all tables are occupied in the restaurant, then the customers are provided with the option of takeaway service which enables them to collect their orders from the restaurant with them.

Services to the online Customers:

Pizza Hut provides free home delivery services to the customers who book their orders online i.e. via telephone or internet (website: pizzahut.com). The entire order process is digitalised on the courtesy of their internal network i.e. their integrated call centres. The entire service process can be described as: The orders are conceived from the call centres i.e. the calls are directed to the call centre and there the order is placed. After the reception of the order is done, the order is then centralised to the franchise, where the further processing is done. The customer details and the order details are then taken into the circulation, first into the kitchen and then to the supply chain, where the order is packed into boxes.

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The order once packaged is then forwarded for delivery, the mode used for delivery is moped/scooters. The franchise does not entertain the orders that are outside the range of their operation i.e. the express delivery is only limited to the customers within the radius of 2 kilometres from the franchise. The orders are rather reverted to call centre, where the orders are forwarded to another franchise, for the purpose.

Recovery of Customers
The customers, who are not satisfied with the services/products of the restaurant, can address their complaints in writing to the manager. The written complaints are then scrutinized by the manager and prompt actions are taken to solve the dispute. The complaints are rectified under the direct supervision of the manager or the Supervisor. Once the grievances of the customers are dealt, remuneration is provided to them, whenever applicable. For e.g. If a Customer gets a pizza without the type of toppings ordered by him, then such an order will be immediately exchanged by the restaurant. The complaints are also received from electrical sources i.e. via telephone or internet, and are directed to the respective franchise through the call centres. The customers are provided the services with full dedication by motivated employees to attract them to visit the restaurant again. The ultimate aim of the promptness in the problem resolving technique is to recover a maximum no. of customers in order to maintain the lead in the business.

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Services to the Employees

The services that are provided to the employees by pizza hut mainly includes strict recruitment, Training and Development to understand the operations, management and the supply chain of the restaurant. Also the employees are motivated by paying them incentives on account of distinctive services provided by him/her and also granting promotions to the deserving employees. The services provided to employees include:

Team Member Readiness Interview (TMRI)

TMRI forms the basis of recruitment at Pizza Hut, It includes written tests, Personal interviews and practical tests. Initially, the applicant has to appear for a written test comprising of 30 questions in the questionnaire based on service management and intellectual questions to test the interpersonal and communication skills of the applicant. The person is evaluated on the basis of grades i.e. The applicants are shortlisted on the basis of grading, applicants with higher grades are selected for the personal interview, where they are judged on their language skills and then the shortlisted applicants have to give a demo of the job assigned to them and the person is finally recruited as a team member of the franchise.

Realistic Job preview training

A realistic job preview (RJP) is a recruitment strategy used to give potential employees detailed and balanced information about job expectations, the employer, and the worksite, so they can make an informed decision about accepting a job offer from the employer. This is a 2 days programme, wherein the employees are explained in depth of their job profiles and their future expectancies. This training includes the following aspects: On the job (What to expect) The rewards of direct support The challenges of direct support Qualities of a great direct support professional Lessons learned

CHAMPS training programme

Cleanliness Hospitality Accuracy Maintenance Product Speed

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In this training programme, the employees are trained to comply with the basic and the most important requirements of conducting service management in Pizza Hut, it is a 7 days programme that ensures the readiness of the employees to provide swift services. The 'CHAMPS check' is a tool used to ensure consistency of service and product quality across the entire Pizza Hut estate. This training is provided on regular basis to the employees.

Orientation
In this type of program, the employees who have excelled in their job profiles are given incentives in terms of job promotions or transfer to another franchise for their personal development and for the betterment of the other franchise. This program also ensures a check on the employees performing their jobs in a minute detail, in lieu of incentives. Orientation programmes at Pizza Hut is conducted for two days which is only limited to monetary benefits and placements at abroad franchisee. This program is also conducted to enhance the working of the employees in terms of providing better customer services and to maintain a level of customer satisfaction and their stand in the market.

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Production Processes layout in Pizza Hut.

In a casual dining restaurant like Pizza Hut, Services rests on the production process, to ensure a proper flow of service management, it is very mandatory for pizza hut to have their production process quick and responsive, to serve this purpose, following is the production process observed by Pizza Hut franchisee: The raw materials required for the production of pizzas, pastas and desserts that include flour, vegetables, meat, cheese, sauces, etc. are being kept in stock at the warehouses. The dough for pizzas and the pre-preparation processing of pastas and desserts is being done well in advance, before the need arises. Once the pre-preparation processing is done, then the material is brought to the kitchen of Pizza Hut, wherein the dough and the other pre preparatory materials are being utilised as per the demands. Production process is being done at 3 different layouts of kitchen at Pizza Hut viz. Middle of the House, Back of the House and Front of the House . The middle of the House area is being used to make Pasta, The back of the house area is being used to make pizzas and the front of the house area is used to prepare beverages/drinks. To maintain a smooth supply chain, the products are allotted certain time limits and the production is bound to complete within the time range. The process of preparation of pizza is timed at 7 min, the process includes: Dough processing: the dough is made ready for making a pizza by kneading it to a desired consistency; it is done for about 1 min. Base making: In this process, the dough is then flattened into a bake tray, which is specially designed for Pizza Hut, which reduces the Baking time by 50%. The bases are made in various sizes according to the customers choices, Base sizes are classified into small, medium and large. The time set for this process is ~1 min. Toppings: Once the base is ready, the toppings are being put on it, toppings are chosen by the customer, and includes both vegetarian and non-vegetarian ingredients. Time set for this process is ~2 min. Once all the steps are completed, the pizza is then set to bake for around 2 and a half minutes on a double convection Oven, which is specially designed for Pizza Hut. And then an employee cuts the pizza on the cutting table, and is allotted 30 seconds to complete this job, thus the pizza is ready within 7 minutes. The process time set for preparation of pasta is again 7 minutes. The beverages and drinks have to be served at the customers demand, and they have to be prepared at a constant basis.

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Service Blueprint
The service blueprint is a technique used for service innovation. The technique was first described by Lynn Shostack, a bank executive, in the Harvard Business Review in 1984. The blueprint shows processes within the company, divided into different components which are separated by lines. The service blueprint defines:

Customer Actions: The steps that customers take as part of the service delivery process. Onstage (Visible Contact Employee) Actions: This element is separated from the customer actions by a line of interaction. These actions are face-to-face actions between employees and customers. Backstage (Invisible Contact Employee) Actions: The line of visibility separates the onstage from the Backstage actions. Everything that appears above the line of visibility can be seen by the customers, while everything under the line of visibility is invisible for the customers. A very good example of an action in this element, is a telephone call; this is an action between an employee and a customer, but they dont see each other. Support Processes: The internal line of interaction separates the contact employees from the support processes. These are all the activities carried out by individuals and units within the company who are not contact employees. These activities need to happen in order for the service to be delivered. Physical Evidence: For each customer action, and every moment of truth, the physical evidence that customers come in contact with is described at the very top of the service blueprint. These are all the tangibles that customers are exposed to that can influence their quality perceptions.

Service blueprints have been depicted with lines and text boxes to depict anything from user actions to support processes. The process of structuring a blueprint involves six steps: 1. The identification of the service process, that is supposed to be blueprinted 2. The identification of the customer segment or the customers that are supposed to experience the service 3. Picturing the service from the customers perspective 4. Picturing the actions of the contact employee (onstage and backstage), and/or technology actions 5. Linking the contact activities to the needed support functions 6. Adding the evidence of service for every customer action step
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Service blueprint of Pizza Hut

Physical evidence

Shopping mall(inorbit mall) Parking. Exterior of Restaurant.

Uniformed staff. Waiting area. Seating arrangement.

Air conditioned Music, Posters, Paintings.

Plates, Cutlery, Napkin, Pans, Floor.

Menu Billdesk.

Food Delive -ry tray

Food Sauce Spices

Bill wait

Bell

Customer actions

Arrive at Pizza Hut

Select dine in option

Receive menu, wait for attendant (2min)

Give order

Receive food

Serve food

Eat. Ask for bill,

Wait for 10 min

Pay bill, Ring the bell, leave

Line of interaction

Onstage Contact person (waiter)

Greet

Inquire about takeaway or dine in

Take food Showed the order Delivery of food (commit (serve after 15 way to to serve min) table
in 15min)

Ask for more order

Prep -are bill

Proce -ss bill paid

Line of Interaction

Backstage contact person (receptionist)

Line of Interaction

Check in

Process food order

Check out

Support process

Registration Process

Prepare Food

Registration process

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Explanation to the service blue print of pizza hut

The service blueprint gives a complete overview of how the customers are entertained and how the services are managed. The process begins with the customers entering into the premises of the restaurant (inorbit mall in this regard), the physical evidence to the customers is the services provided right from the beginning i.e. parking space, pleasant atmosphere created by the music played in the restaurant, the attractive paintings, uniformed employees, seating arrangements and other aesthetic aspects provided by the employees. The second aspect in the blueprint is customer actions towards the services provided by Pizza Hut, it includes actions such as receiving the menu, placing the order, enjoying the refreshments and entertainment provided by them, receiving the bills and their feedbacks; the next stage is the Onstage interaction, wherein the employee reacts to the customers, this process includes greeting the customers, giving them suggestions for orders, receiving the orders, delivering the orders and then completing the process by providing the bills. The interaction between the customer and the employee is called the line of interaction/line of visibility, the next stage is the backstage interaction/Invisible interaction, this is a process between the employees of pizza hut, and involves the management of services to the customers by registration of check in and check outs i.e. by taking a record of the customers, processing of the orders, making the orders(food), Grievances damage control, and other services related to customer assistance. Hence, the service blueprint not only helps to understand the flow of services, but also provides a brief idea of the shortcomings of the business and helps the manager in decision making process, enables him to provide training to the employees, he can communicate the overall working of the restaurant with the owner, which results into transparency in accounting, better service management and to the most important aspect Consumer Satisfaction.

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Benchmarks to Pizza Hut services management:

Yum Restaurants India-owned Pizza Hut rolled out 4-5 inch pizzas in select markets such as Gurgaon-NCR at entry-level prices of Rs. 29 each - that's the lowest in the Indian market by any player and the lowest for any of 117 countries where Louisville-based $12 billion Yum Brands operates. While category leader Jubilant Food Works' promoted Domino's Pizza is aggressively pushing its 'pizza mania' umbrella priced at Rs 39, home-grown Pizza Corner has launched a pilot 'my pizza' range in Bangalore with prices starting at Rs 38 for a 7-inch pizza each. And US chain Papa John is not ruling out dropping entry-level prices. "Access to a wider base of consumers and driving volumes further is what led us to launch the new range," says Sandeep Kataria, chief marketing officer at Yum! Restaurants India. Pizza Hut has positioned its latest offering as a 'snacking option' rather than a fullmeal. It piloted the project in Chennai about a month back and is now in the process of taking the product national now across 30 cities Pizza Hut Delivery ( PHD) outlets have a presence in. Yum Restaurants India, which plans to invest $100 million (Rs 522 crore) in India by 2015 and double its stores to at least 1,000, was made only the third country after the US and China with a standalone reporting division, starting November last year. Last fortnight, Yum Brands, which runs the KFC, Pizza Hut and Taco Bell chain, for the first time announced stand-alone results for India - 8% same store sales for its 400-plus stores. For US chain Domino's too, India is its fastest growing country outside its home market, with a market capitalisation only second to its American parent. Without divulging specific details of forthcoming plans, category leader Jubilant FoodWorks' CEO Ajay Kaul says its 'pizza mania' platform is a 'runaway success and an industry benchmark'. The listed Jubilant FoodWorks, with a network of 439 stores across 100 cities as of December 2011, posted 49% increase in system sales and 30% same store sales growth in the last-reported October-December 2011 quarter. Adds Kaul: "Domino's Pizza, over the last several years, has become synonymous with affordability and value-for-money propositions." The Rs 1,800-crore organised pizza market is growing at 20-25%, Forbes advisors says. These brands also compete with other players for share of wallet. Nearly 70% of consumers who eat out are below 35 years, Booz & Company's Food Services Retail in India report says. They patronise the Rs 7, 000-crore organised India food services industry.
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Conclusion

Customer service is one of the most important ingredients of the marketing mix for products and services. High quality customer service helps to create customer loyalty. Customers today are not only interested in the product they are being offered but all the additional elements of service that they receive from the greeting they receive when they enter a retail outlet, to the refund and help that they receive when they have a complaint about a faulty product that they have paid for. And the success of Pizza Hut in terms of providing services to the customers has cleared a solid ground in the race of competitors and proves a significant point, the reason behind being the no. 1 in terms of casual dining.

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Bibliography Information collected through survey done at Pizza Hut franchisee, Goregaon West, Mumbai. [on the courtesy of MR. Vilas Lokhande] Concepts extracted from Vipuls Service Sector Management [Unit4. Service management pg no. 220-236]

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