Operations Management Case Study: Analysis of a Restaurant's Flow and Service Variability

Objectives

The purpose of this case study are threefold: firstly, to provide students the opportunity to practice basic process analysis concepts, such as cycle time, throughput time, input rates, output rates, bottlenecks and utilization; secondly, for students to consider the analytical and psychological dynamics of queues and operational transparency; and thirdly, to enable students to consider the interrelationships between the design of an operation and the corresponding behaviours of customers and employees.

The assignment requires students to complete the following five questions.

1)Essay on Theory of Swift Even Flow (30%)

Students should read appropriate material regarding the importance of managing flow and productivity. The key theory to investigate is TSEF (Theory of Swift Even Flow). A list of books and articles* have been suggested to get you started. Students should also perform key word searches to supplement the directed reading. The objective of this scholarship is to help students to critically evaluate operations management relative to traditional management.

Restaurant Customer Queue Length when Carryout Orders are Being Processed

If the Paramount can process 90 customers per hour, let’s assume that Michael Conlon allows 10% of the customer orders to be carryout orders. This would mean that 9 customer orders per hour were for carryout food and 81 customers per hour could be processed in the restaurant.

·Use 81 as the value of  (service rate) and recalculate worker utilization  

·Use this new value of  to recalculate the number of customers waiting in the queue Lq

This will give you a good insight into the impact that accepting more carryout orders would have on queues at the restaurant.

3)Read the two articles referenced below*** which describe how customers in service industries introduce variability. (15%)

a)Use the knowledge acquired to discuss how customers introduce variability for the Paramount

b)Discuss whether the Paramount accommodates or reduces this type of variability.

(Reducing variability reduces operating costs, but often at the expense of customer satisfaction; accommodating variability enhances satisfaction at the expense of operating costs)

“Match supply and demand in service industries”, Harvard Business Review, Nov-Dec, pp. 133-140

“Breaking the trade-off between efficiency and service”, Harvard Business Review, Nov, pp. 92-101

4)Using the information from the case study and knowledge acquired from the calculations performed in part 1), students should consider the issue of carryout orders.

Your discussion should consider the following issues:

a)Where has the idea for carryout orders come from?

b)What are the business motivations for adding this type of service?

c)What impact will adding this service have on the restaurant customer experience?

(750-1000 words [a), b) & c)]

5)Management Decision. (10%)

Advise the owner, Michael Conlon, as to the best course of action to take. You should choose between more carryout orders or less carryout orders. There are several reasons why you could justify either of these choices so your answer should describe what these might be.

**** What factors would tempt Michael Conlon to increase carryout orders?

**** What factors would tempt Michael Conlon to decrease carryout orders?

It is expected that the overall written coursework will not exceed 4,000 words.

All published information that has been used in the preparation of the written assignment report should be properly referenced.

Mark Breakdown

Marks for the quantitative analysis will be awarded for the computations and the working out.

Marks for the other sections will be awarded on the strength of the arguments; these will depend on the quality of your reading of the case, the use of the calculations performed and use of the directed reading references. You are not expected to find your own references