Managing a Restaurant in the Hospitality Industry Essay

Introduction

The restaurant and dining industry comprises many types of players from cafes and restaurants to luxury hotel-based restaurants. The largest percentage of share of the restaurant industry however is taken up by the restaurants and the cafes. The restaurant and dining industry in the world is estimated to have a market value of $1,367 billion as of 2008 (Global Restaurants Industry Profile’ 2008). In the year 2007 alone, the industry grew by 4.2 per cent.

The industry has the variant type of business pertaining to restaurants, bars, pubs as well as fast-food restaurants. The leading company managing the restaurant industry worldwide is the McDonalds Corporation. “The global restaurant sector remains fragmented and made up predominantly of small and medium-sized enterprises, which suggests a high degree of competition. Restaurant operators are the main market players.

End-users are the buyers and they are generally highly price sensitive. It is possible to enter the market on a small, independent scale. However, to compete successfully with the strong, diversified brands, a significant investment outlay is required. The strong intensity of rivalry is mitigated by market growth and product differentiation.” (Global Restaurants Industry Profile’ 2008)

It is not easy to enter the restaurant industry, however, when a restaurant is able to survive the initial few years after its establishment, it needs to be spectacular in order to be able to attract and retain the attention of its customers and clientele while making a mark for itself. For this two strategies are available. One pertains to catering to a broad market and providing a variety of foods. On the other hand, the second strategy pertains to creating a niche market for the restaurant by creating the required theme around the restaurant and its food for providing the customers and clientele with a customized and differentiated experience.

The restaurant industry is part of the hospitality and service industry; therefore it is crucial to acknowledge that quality is presentation, service as well as in the management of the restaurant is very important. In the restaurant industry “staff costs are significant, as success in the restaurant industry is strongly influenced by the quality of the service provided. The leading companies have focused on expansion through acquisition or franchising in recent years rather than building new outlets, which are more costly, e.g. a majority of McDonald’s restaurants are operated by franchisees.” (Global Restaurants Industry Profile’ 2008)

Australia is one of the most diverse countries with a rich culinary industry providing a blend of different cultures and different tastes. Moreover the cosmopolitan nature of the city Sydney is the perfect background for high a five-star restaurant to cater to the different tastes of its clientele with excellent cuisines supported by excellent service. Restaurant Lebaen is one such restaurant, however, the personnel at Lebaen have taken their excellent food quality and the quality of their service for granted.

This paper explores how the service quality and the operations at the restaurant Lebaen can be improved while training the staff to work their parts cohesively in making the restaurants a success.

The Problem

The problem that is faced by the Lebaen restaurant is that the restaurant has been a high performing, five-star restaurant operating in the rich cosmopolitan city of Sydney. People have come to consider the restaurant as one of the best in its class and there expect their every visit to be excellent to the point of perfection. However, the staff of the restaurant has major issues specific to taking their excellence and the quality of the food and the service for granted.

Their attitude of the food and service as being a given has made the restaurant suffer in the recent months with a dramatic decrease in the quality of the food, the quality of the service as well as the hospitable environment of the restaurant. This has resulted in a change in the customers’ and clienteles’ perception about the expectorant from being a high profile, and high performing five-star restaurant to a restaurant with mediocre food and service quality.

This has decreased the traffic coming into Leben and in order to retain the stars, the reputation, as well as quality of the food and service, dramatic and immediate action, has to be taken by the management at the Leben. “At one level, regarding foodservice as a theatrical performance encourages managers to ‘put on a show– to use staff (actors), processes (scripts) and physical evidence (props and sets) to enhance the customer experience.

If, however, the metaphor is applied in a deeper way where the customer is seen not as the audience but as a participant in the show, then the managers’ role becomes one of providing the space in which the experience is co-created; a stage on which the customer is the star, and the staff the supporting cast. An analysis of the service encounter as a drama can reveal the role the customer is playing, the super-objective behind their visit to the restaurant, and the unspoken subtext behind critical incidents. The restaurant itself needs to remain in character, presenting a consistent message, for example of hospitableness and generosity” (Morgan et al., 2008)

The areas that need to be explicitly targeted in order to increase the quality at the restaurant pertain to the staff, who are the backbone of the service sector industry, the food which is the main product of the company as well as the service standard, which needs to be established and maintained in the long run. Aside from this the kitchen operations, as well as the reception counters and attendant service, needs to be revamped from a business process reengineering point of view. The following sections present the actions plans and the specific strategies that would be employed in increasing the quality and the level of service at the restaurant to rebuild the restaurant reputation.

Plan of Action & Strategies

Before embarking on making any changes, the entire current process flow of the restaurant and its reception, dining area and kitchen operations need to be evaluated. For this, the regular operating day needs to be observed from a third-person perspective to determine which operations are having backlogs and where the service starts falling apart. However, in order to carry out this exercise, the staff needs to be unaware of the observation to provide a realistic result.

The second step that needs to be taken is to take the results from the observation exercise and sit the staff of the restaurant down for a business meeting. The staff needs to be told about the results of the observation and their feedback specific to their reactions as well as their reasoning for the poor service and quality needs to be heard out. However, it must be stressed that in the restaurant business the service quality that is delivered to the customer is all dependent on the product and the person presenting. This takes into account the attendee, the kitchen staff as well as the reception staff all of who come together to create an experience for the customer.

The staff of the restaurant, similar to that of a hotel is the backbone of its service and quality which can drive the standards up or bring them down with their performance. “The results indicate that front desk, housekeeping, and parking employee performance have significant effects on perceived quality, whereas front desk and room service employee performance have significant effects on perceived value. The only performance cue having a direct effect on word-of-mouth intentions is the performance of housekeeping employees. Both quality and value increase word-of-mouth intentions; however, the effect of value is large relative to the effect of quality.” (Hartline & Jones, 1996)

In order to change the attitude of the staff, proper training needs to be provided where while delivering them the results of the observation-based study (‘How to treat your staff’, 2005). This would provide them with a holistic and real picture of their food and service quality standards as perceived by the customers. The training that would be provided would pertain to evaluating the personal performance of each individual member of the staff as well as their teamwork performance to provide a healthy competition which would increase the determination level of the staff to excel at their profession.

In order to increase the quality of the food, tough criticism, as well as restrictive training of the chefs, needs to be undertaken so that no mediocre quality dish is able to pass out through the kitchen doors. Moreover, the ingredients that go into creating a dish need to be ensured of being the best quality available. For this, a proper logistics management system needs to be set up in collaboration with local markets (Simchi-Levi et al., 2004) whereby a guaranteed purchase deal can be made for the best quality orders offered by the wholesaler.

This would benefit the restaurant as well as the wholesaler in terms of increasing business. The eight success factors for operating in the restaurant industry pertain to “single-unit operations, standard operating procedures, multi-unit strategic planning, interpersonal and social responsibilities, travel and visiting units, human relations, effective leadership, and unit level finances, which explained 75 per cent of the variance among the individual items” (Di Pietro et al., 2006)

Therefore in order to increase the service quality, the commitment of the management, as well as the management and development of the human resource at the restaurant, is important. “Organizational commitment exerts a strong positive influence on the service recovery performance of frontline staff as does empowerment and rewarding them for service excellence. When frontline staff are performing service recovery effectively, they are less likely to resign and report higher levels of job satisfaction” (Boschoff & Allen, 2000).

One of the best tools to train and develop the staff as well as to improve their performance and service quality is to call regular meetings before the opening time and discuss the performance of the individual staff for creativity, readjustments as well as consistent delivery of high-quality performance. The regular staff meetings “ensure effective staff communication in response to the growing ethnic diversity of the foodservice workforce.

Language barriers are tough to overcome in the foodservice operation, from staff communication and delegation of responsibilities, food safety and security to preparation instructions and customer interaction” (Riel, 2006) The meetings are a “place to share information, sharpen skills and build staff enthusiasm. Tom Miner, a principal at Technomic Inc., a Chicago-based food and restaurant consulting firm, says that communication is key to a healthy culture, and that is what these meetings are all about.

Effective meetings don’t just happen. They call for careful planning and creative thinking.” (Gerst, 2004) At such meetings, new recipes can be discussed and the feedback of the customer can be discussed with the staff. Moreover, any issues being faced by the staff can also be highlighted and brought to light for open discussion. A show and tell approach can be used whereby every staff member can be asked to act their roles as per their excellent performance and build on it for the business hours.

The strategic decisions that would be required in order to ensure impeccable delivery of service quality ad food to the customer pertaining to determining which staff is able to perform in which capacity under variant environmental conditions. The successor chain needs to be built and an internal competition on a weekly or a monthly basis needs to be put in to ensure the attitude of the staff is to keep on growing in terms of their service quality and performance. Another decision that needs to be made pertains to retain and train which of the staff, and to let go the staff which is not able to perform up the level of service quality that is required by a five-star high profile restaurant.

Making the Restaurant Effective & Efficient and Productive

The main factors that make the restaurant operations efficient, effective, as well as productive, include careful planning for the goals and objectives of the restaurant, strategy development and implementation of the strategies as well as a strong monitoring and development system which uses customer feedback (Gomes et al., 2007) to improve the operations of the restaurant.

In order to make the restaurant effective the efficiency with which the restaurant operates as well as its performance in the industry/ market needs to be taken into account. “For effective managerial planning in the restaurant industry, the planning procedure should derive: a forecast that predicts types of meals that will be served; a recipe or bill of material that calculates the ingredients needed for each menu item; a labour standard for preparing each menu item to develop the capacity requirements plan; and the hourly wages and burden costs for estimating the cost of material, labour, and capital equipment plan.

With this information, a weekly schedule of labour and materials can be derived to efficiently plan needed resources in relation to the planned output.” (Wacker, 1985) Aside from this, a detailed plan of operations for the restaurant including the specific roles and the job descriptions of the staff can be drawn up which would provide a comprehensive and practice plan for the operation flow of the restaurant.

The efficiency of the restaurant deals with the productivity of the staff by taking into account the inputs that are being employed in terms of the human resource, the material, the equipment etc, and the outputs that are being generated in terms of the reputation and the revenue of the restaurant, the performance of the human resource in terms of their service quality, the critical acclaim that the restaurant is able to achieve through its excellent food and service.

“A linear programming-based approach, data envelopment analysis (DEA), can be used to evaluate the efficiency of hotel and restaurant companies” (Sanjeev, 2007) However in order to improve the efficiency of Lebaen close attention needs to be fused on the costs and expenses of the restaurant for controlling the cost efficiency as well as training the staff to improve their attitude and increase their service quality.

Productivity is a direct result of operational efficiency. The increase in efficiency leads to increased productivity, however, capacity management needs to be employed to deal with the increase in customer and traffic coming into the restaurant as a result of improved service quality.

Conclusion

Managing a busy operation like a restaurant in the hospitality industry is highly competitive and requires extensive work and precision in terms of setting targets and strategies to above the goals and objectives of the company. In order to improve the situation of the service quality as it is depicted at the Lebaen restaurant, it is required that the human resource needs to be trained in terms of their delivery of food and service. moreover, the attitude of the staff needs to be adjusted which can be facilitated through internal healthy competition and regular meetings to discuss customer feedback as well as any staff issues. I addition to this the productivity as well as the efficiency of the restaurant needs to be monitored so the restaurant is profitable and effective in terms of achieving its stated objectives.

References

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