MANAGEMENT COURSE DESIGN

TITLE : Crafting Strategy for PIZZA HUT Company

1. Introduction
Pizza Hut is a subsidiary of YUM brand and forms the largest
restaurant chain in the world in terms of sales revenue and assets . The
brand differentiates from its competitors through three major areas
namely performance, quality and as the best place of employment.
The restaurant operation is the face of the organization. The distinct
role of operations is to be possessed with the quality of pizzas and the
experience that customers receive.

These operations are defined by the different concepts in Pizza Hut

including full service restaurants, home service restaurants, restaurant
based delivery, express units and franchise outlets. The operations at
Pizza hut cannot be highlighted for any single functional unit but is
the collection of many sets of activities carried out within the units
and bring success by turning customer expectations into reality. Pizza
Hut operations work to the CHAMPS policies like cleanliness,
hospitality, accuracy, maintenance, product and speed.

These policies become the key drivers of operations excellence into

the business. Despite the feasibility of such operation policies, the
capability of the operations manager to deal with the issues faced
during implementation is the key success factor. Therefore, this paper
presents the key strategic and operational issues faced by the
operations managers in Pizza hut.

2. Product development
According to Hill and Hill (2011), product design is involved with the
conversion of ideas into reality (p.28). Pizza Hut has to design,
develop and introduce new pizzas as a survival and growth strategy.
Designing and developing new products is the biggest issue faced by
the operations managers in many organizations including Pizza Hut.

The whole process needs identification to manufacturers of physical

products which involves three functions namely product development,
manufacturing and marketing.

Product development transforms the needs of customers into technical

specifications alongside designing the different features into the
products. Manufacturing is responsible for the selection of the process
through which the product can be realized. Product design and
development links customer needs and expectation to the activities
needed to produce the product.

In response to this, Pizza hut operations managers have the role of

ensuring the survival and growth of the business through effective
product design and development. Indeed, the success of the company
is not a matter of detached activities but rather it is the restless efforts
of the company to put innovation into realities by transforming
customer wants and needs into the shape of products. This is achieved
through product development team that runs focus group to research
on the customer behaviors towards pizza choices. Sometime, products
are launched after conducting selected research of the chosen
customer sample yet it fails to survive in the market. This usually
causes occurrence of unexpected costs or wastages in the stores. For
example, cheese bread, the four for all pizza, Indian pizza and
Bombay wings are the failed products that led to unnecessary costs.

However, Pizza hut has also launched successful products. For

example, cheese bite pizza offered has caused an increase of 24% in
pizza sales revenue . Maintaining such a legacy would require the
operations managers to spearhead strategic initiatives that enhance
innovation capability of the company.

3. Process Design, Planning and Control

Process design refers to the concept of operations management

that deals with macroscopic decision making of the whole
process route for transforming raw materials into finished
products. These decisions entail the selection of the production
process, choosing the right technology, and analyzing the
process flow.

Therefore, the important decisions in Pizza hut’s process design

are to analyze the workflow for transforming raw materials into
final products and selecting the work station for each individual
included in the work flow. The design process is a major
operations issue as it determines the costs as a result of wasted
materials and labor.

During the preparation process, all things that will help to

perform the operations in the store are prepared. This process
involves activities such as defrosting of dough, cheese and
starters. Failure to put the following day operations up to the
mark, it then becomes difficult or shortage of items occur
delaying the conversion process.
Operations managers have the obligation of ensuring that the
preparations are done on the basis of the business forecasts of
the next day. Failure to prepare the forecasted goods for the
following day operations, it becomes virtually difficult for the
following shift manager to oversee the business operations.
The make table is another step that is worth manager’s
consideration during the process design. This refers to making
orders that are received from customers and appear on the
micros system .

The managers need to determine when there are collection

customers, otherwise order work on first-in-first-out (FIFO)
system (collection time is 10-15 minutes while delivery time is
30-35 minutes). At Pizza hut, getting ready the make table is an
important part of operations.

The right proportion of ingredients, sauces, condiments and

products are prepared as specified. Operations managers must
consider vitally that the make table elements character,
freshness, aroma and taste are veracious and kept at right
conditions.

The cut table is also a worthy step in ensuring minimal wastage

and the associated costs. The operations managers ensure that
the pizzas are cut according to the customer check as well as
pouching them accordingly. More important is to ensure that the
pouched order goes with the right customer check otherwise the
flow of the cut table is broken down and may cause the mistake
of the target customer.

Finally, dispatching is another critical procedure that requires the

attention of the operations managers. This is tricky and
important work especially when more orders have been placed
and produced but the drivers are few. The geographic area is
usually subdivided into zones according to the postcodes and the
customer order deliveries with address and postcode.

Therefore, the operations managers’ keenness is to dispatch the

orders that can be delivered in masses in order to save time and
effort. Although, the time taken to deliver an order to a customer
is usually less than 30 minutes, the managers can influence the
 speed by adjusting the number of works according to peak and
off-peak hours.

4. FORECASTING
As Mahadevan (2010) suggests, forecasting is a major consideration
for operations management during the planning stage of operations .
Forecasting the expected demand is the foundation for every
operational activity in a business unit. Through this all factors get into
touch with planning, organizing and controlling of the operational
activities.

Eventually, this will lead to the total production of the business unit.
Derek Waller (2003) is a famous management scholar and connotes
that forecasting product and demand is the most essential activity for
any business organization . It is an imperative aspect to successfully
push forward the business on set objectives until the point of
efficiency is realized.

Similarly, forecasting at Pizza hut is a crucial item for the business

success. Before operations manager develops a plan for human
resource allocation or food checking, they must consider the forecast
of sales as well as the anticipated upcoming event in the period.
Resource allocation for the usual shifts works well in Pizza hut in
relation to the plans but other external factors may influence the speed
and service delivery. For instance, bad weather conditions and road
hazards in the form of accidents and blockades can slow service
ability.

In addition, unexpected orders can increase the demand for products

while the availability of ready-made products may be inadequate
according to the stipulated demand for the shift. Hence, the variation
in the stipulated demand and the actual demand may cause the
shortage of products and eventually make customers to feel
dissatisfied with the service.
Good weather and special occasions such as sports, festivals and
rituals can increase the demand. Given that all these variations relate
to Pizza hut operations, it is the role of the managers to ensure
minimal impact on the business through short-term strategies that
adjust production consistent with the demand changes.

5. Providing customer with experience

Behind any business, customer care is the central point of
concentration and should be treated with due respect. Most important
is to discover the ways through which the customer needs and wants
can be fulfilled. This begins from the top managers whereby they set
procedures and policies that ensure proper interaction with customers.

Customers do not look for a relationship in given brand but they rather
want to be respected, understood and get their products when they
want them. Thus, operational activities are best positioned to give
customers the good experience and reassurance they want. So when
the operation department facilitates the experience needed, the
opportunity to develop necessary relationship follows.

Pizza hut sell pizzas in a market where other competitors are doing the
same. Therefore, it is very important for the company to be
differentiated against the competitors in order to ensure sustainable
growth. The values and attitudes make important differentiations
while operation policies and the quality of pizzas are key factors .

In order to attain the desired outcomes, operations managers in Pizza

hut must enhance the beneficial interaction between the team members
and customers. One way of achieving this is to equip the order takers
with essential skills as they form the link between the business and the
customer. The other way is to ensure that the products are produced
with the highest quality through the use of appropriate production
gears and developing the skills of the individuals involved.
 6. Quality assurance
Quality control can be defined as the method used by the operations
management to maintain the desired level of quality in products. It can
also be considered as the systematic control of different factors that
leverage the quality of a product. For physical products, the aim is to
prevent defects at the source while relying on an effective feedback
system and corrective actions.

Quality control can also refer to the management method through

which product of uniform quality is produced. This means that there
should be the whole collection of operation activities which ensure the
production of optimum quality products and services at minimum
costs.

The aim of any business unit at Pizza hut is to achieve the complete
operational polices practices. It is expected that optimal strength
should be utilized into production process to get the maximum
outcomes and maintain 100 percent product quality standard. This
implies that all production activities should be timely and accurate.

In addition, quality without waste is the principle behind inventory

levels and timing systems in the restaurant. Failure to follow the
principle leads to the discrepancy of operations that eventually affect
the quality of products and customer satisfaction.

In that perspective, the operations managers in Pizza hut have the

obligation to ensure that the teams meet the desired quality. Therefore,
throughout the supply chain the quality lies with the overall team. This
must then be achieved if the managers set rigorous policies during
product development.

One way through which the managers have ensured standards is by

regular monitoring and auditing of the production system. Quality is
checked through CHAMPS Excellence Review while quality
assurance is attained by monitoring the complaints as well as
corrections through available corrective methods.