Presentedtothe

DecisionScienceandInnovationDepartment
DeLaSalleUniversity

InPartialFulfillmentofTheRequirementsin:
QUALMAN

TalesofTwoRestos

Submittedto:
Mr.WillyCuason

Submittedby:
Chu,Joanne
Guiveses,Michelle
Hong,Sungwon
Tan,Reza
Yang,Mark

Submittedon:
September17,2015

TableofContents

I.

SummaryofFindings

II.

BackgroundInformation

III.

ProblemStatement

IV.

AnalysisofAlternatives

V.

DetailedRecommendation

VI.

AnswerstoCaseQuestions

Learnings

VII.

I.

SummaryofFindings

We can see two completely different companies which are Kelley Seafood
Restaurant and Jims SteakHouse. Based on the two companies, we see different
management styles and differentviewsof TotalQuality Management. KelleysSeafood
Restaurant presentsamoreconservativeand traditionalwayofmanagementandTQM.
Whereas Jims SteakHouse presents a more modern approach on management and
TQM.
In the case, it is clear that a problem persists in both of the restaurants. The
group has concluded two alternatives which are: (1) to Continue with the current
operations and (2) to Adapt new philosophies and strategies toimprovethe business.
After alternatives are discussed and studied, the group concludes that the two
restaurants should take into consideration adaptingnew philosophies andstrategies to
improve the business. This recommended alternative is a solution to the current
problems that Kelleys Seafood Restaurant is facing and for the continuous
improvementandgrowthforbothTimandJimsrestaurants.
Allin all,the grouplearnedthatnegativemanagementwillbringanegativeeffect
not only to the employees but to the whole company as well. Also, continuous
improvement in the company canbedone withdifferentmethodsaslongasitwillbring
positive effects and benefits to thecompany. Thegroupalsolearned that the trendsof
business are constantly changing and improving,businesseswho rely ontraditionand
oldschool management should learn how to adaptnew trendsin order for themto be
more competitive and to continuously improve as a whole. Lastlythegroupwasableto
apply their lessonsaboutprinciples oftotalquality management givenbyTQM experts
suchasDeming,CrosbyandJuran.

II.

BackgroundInformation

Kelleys SeafoodRestaurant, which wasfoundedbyTim Kelleyabout15yearsago,is

known to have excellent quality of food and because of this, it has become very
profitable. Justrecently, the restaurant ishaving problemswith consistencybecauseof
various suppliers. Kelleys Seafood Restaurant operations are dividend into the
frontend (servers) and the backend (kitchen). While the kitchen staff are doing well,
the servers are in contrast. The servers have few perks and minimal wages,andhigh
turnover. Timhires employeesifthey havethe ability to showup ontime.Thereislittle
communication between the frontend and backend operations, and the owner, Tim,
makessurethatserversaddresstheircomplaintsdirectlytohimdirectly.
The restaurantis neither fullyautomated norsemiautomated.Tim spends much of his
time focusing on negative behavior and in effect, tends to forget to hold regular staff
meetings.

Meanwhile, Jims SteakHouse, which is a familyowned restaurant, pays their cooks

with high wages to attract highquality employees. Servers get 70% of tips, bussers
20%, and the kitchen staff 10%. When hiring, Jim makes sure his that they are
courteous, responsible and creative. The restaurant host various activities and events
for its staff. It also offers various promotions to its customers and he interacts and
solicits fortheirfeedback. Jim visitsvarious restaurants and study their techniquesand
how they operate. As a result of these visits, Jim installed computers to schedule
reservationsandenterorderstothekitchen.

III.

ProblemStatement

Despite the different advancements done byboth restaurants, thequestion liesonhow

theserestaurantscanimprovetheirpracticesandtechniquestoyieldsmoothoperations
fromtheperspectiveandprinciplesofTQM.
Kelleys Seafood Restaurant has problems with the consistency of earning profits
because of numerous suppliers. There is little communication with hisemployees and
therestaurantlacksstrategiesandtechniques.

IV.

AnalysisofAlternatives
1. Continuewithitscurrentoperations

Timcan just continuewith its operations, butitwould be muchdifficultforhimto

compete with other restaurants especially those who have better relationships with its
stakeholdersand have computerized systems. It isagoodthingthathewouldwantthe
customers to get exactly what they want, butin the longerrun, it mightbe verydifficult
to keepupinfastgrowingenvironmentifhewouldnotconsiderevenabitofautomation
intheirsystem.
Jim, on the other hand, can also justcontinue doingwhat he currently does for
his restaurant. From the case,itseemsthattherestaurantis doingreallywell and that
the satisfaction ofthestakeholdersaretakencare of thus, nothing muchis wrongwith
howJimcurrentlyhandleshisbusiness.

2. Adaptnewphilosophiesandstrategiestoimprovethebusiness
Timcan adapt Demings Philosophy which states thatanimprovement inquality
decreasescost andcanleadtoanincreaseinproductivity.Thus,itcanincreasemarket
share and help the company stay in the business and expand. Also,he might want to
reconsiderhis views on automationbecauseitwouldbeveryhelpfulforthemespecially
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if the business continues to grow probably he could just ensure that this automation
wouldbeusedproperly.
Tim should also start doing his business probably the way Jim does. There
should be proper and sufficient communication between every employee of their
businesses. Also, it wouldnot hurtto assessthe currentoperationofthe business and
compareitwithanotherbusinesssoperation.

V.

DetailedRecommendation

After analyzing the possible alternatives forthe company, wethinkthat it would

be best not just for Tims but also for Jims restaurant to continuously find and adopt
new philosophies and strategies that could be verybeneficialfortheirbusinesses.After
all, the current environment is fastchanging. It would be very difficult to keep up
especially with new emerging businesses if they would just settle with their old
practices. Tim should be able to find a way to remove the communication barrier
between his frontend and backend employees because if their current relationship
continues, thiswill surelyaffectthe quality ofservice that they providetheircustomers.
He shouldalsostartconsideringthepossiblebenefitsandadvantagesthatthebusiness
could gain from starting to adapt automated processes. Lastly, Tim should also start
investing on his employees, especially on his frontend, to avoid the current turnover
problem.Afterall,asatisfiedemployeeisaproductiveemployee.
For Jims restaurant, he should just continue on his mission to providing the
moneys worth of his customers as well as emphasizing on teamwork between all his
employees.His currentmethodsandtechniquesareactuallygoodbecausehedoesnot
only ensure the quality of the internals of his business, he also makes sure that he
learns and understands how other restaurants operate inorder for his businessnotto
beleft behind.Hisconstantwantforimprovementisactuallywhatabusinessneedthus
ifhecontinuesandstriveformore,thenhisbusinesswouldcontinuetothrive.
VI.

AnswerstoCaseQuestions
1. Contrast these two restaurantsfromtheperspectiveof TQ.Howdo theyexhibit
ornotexhibitthefundamentalprinciplesofTQ?
Kelleys Seafood Restaurant has a different perception on quality
compared to Jims Steakhouse. Kelley puts much emphasis on its highquality
food but fails to focus on its service and stakeholders,specifically its suppliers,
employees and customers. Also Kelleys Seafood deviates away from the
principlesof TQ as hebelieveschangeisunnecessary,butwheninfactforTotal
Quality to be implemented, continuous improvement should be a attitude that
everybody in the organization should follow and abide to, and mostimportantly
the ownerof the restaurant,butMr.KelleyfailstoshowattributesoffollowingTQ
principles, and looks at his business in a manner that he would want to seeit.
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Focusingontheinternalscopeofthebusinessexcessivelycaneventually havea
negative effect for the company, it blocks the path for diversity and promotes
indifference of the external environment in the organization. Also the choice to
not adapt withthe changingtrends and innovationmayimprovetheimageofthe
company making it unique however, too much of ignoring the innovations may
create a gap between businesses making it hard for companies who did not
adaptburdenedwiththepressuretocatchup.
Jims Steakhouse, on the other hand, focuses both on its food and its
relationship with stakeholders. He shows appreciation for his employees by
giving them compensation pay and sponsoring outings. He also makes sureto
listen and act upon anyconcernsfromhis customers. Thoughhis walkaround
strategy seems to be informal,itis effectiveitis quitesimilar to thebusinessby
walking principle of TQ where the owner of the company, sees the operations
and transactions first hand while asking the questionsdirectly towhomeveritis
directed to, this paves the way for fast and efficient response inthepart ofMr.
Jim, it helps him as a manager tobe moreproactiveasitcan helphimprevent
problems instead of fixing them. One ofthe outstandingways thatthe company
owner Jim does is to look at its competitors and learn new techniques, this
impliesthemotivationforcontinuousimprovement,tolookatexternalsourcesfor
references and to overall be the best restaurant. Finally, he practices
benchmarking, which has convinced him to computerize scheduling and order
entry systems, this is aligned to adapting to the trends and speed of the ever
changingworldtoday.
2. Whatadvicewouldyourecommendtoowners?
Timmustinteractwithhisemployeesmoreoftenastheyplaya vitalrolein
the business. Compensation and incentives should be given as to boost
employees morale. He should also regularly conduct staff meetings and team
building activities tofosterteamwork.Because at the end ofthedayitwould be
the employeeswho run the company,andmostimportantlyinarestaurantwhich
is the service business, waiters and waitresses are the focal points for good
quality service, as they are the ones who interact with their customers face to
face.
For customer relationship management, Tim needsto survey customers
asto find out what they want.He mustthenusethisinformationtoimprovetheir
system. The supplier's input must also be taken into consideration in order to
maintain consistency of incoming materials. The group recommends Tim to
installacomputerizedsystemastospeeduporders andeliminatedelays,andin
order for his restaurant to compete with others. Like Jim, Tim should also
practice benchmarkingtobeabletoidentifyareasforimprovementandcompare
performancerelativetoclosecompetitors.

As for Jim, his system is sound, engaging inteam building activitiesand

having regular staff meeting can upgrade their efficiency. The fact that he is
seeking external sources as referenceto continuouslyimprovehis company fits
perfectly well with the Kaizen word. However Jim can improve the gap of tip
giving between the servicers and kitchen staff may cause the employees to
question and demotivate them of workmanship, it has a staggering 60%
difference between them. In a restaurant servers aretheoneswhogive out the
face tofaceinteractionbutthe product, whichis food, isjust asimportantasthe
servicegiventothecustomers.
VII.

Learnings

The group learned that inconsistent management brings negative behavior in

employees which can affect the customers perception on the organization. From the
case, Timskitchenstaffare verymotivatedduetopostitsnotesthatboosttheirmorale.
Furthermore, they are also cross trained and continuously seeks improvement.
However, Tims servers are not taken care of. We learned that in handling an
organization, one should equally train and encourage different departments staff to
ensurecooperationandteamworkamongthemselves.
Furthermore, thegroupalso learned that there aremanyways toimprove ones
organization. One can visit other restaurants to study their operations and learn new
techniques which we can incorporate to our organization. Not only that, the manager
can also solicit feedbacks from customers as to show care to the customers and to
continuously improvethe flawsofthe organization.Whengivenfeedbacks, oneshould
take into account if the feedback is deemed necessary and should not be afraid of
change. From the case,Tim rejected theideaofusingacomputerizedsystembecause
he was afraid of changing how the restaurants been operating for the last 15 years.
This was a mistake because using computerized system will speed up orders and
eliminatedelays.
The group learned that sometimes there will be scenarios where companies
should decide if theywould want to go withtraditional,orkeep up withthe newtrends.
Asweliveinatechnologydrivenworld,innovationsandcompetitionarearisingfromleft
and right, hence a tradition that has kept the company alive for a long time might be
obsolete in a few years time. Hence businessmen have to decide on those factors,
whether they keep with what they believe in, or adapt to the trends but allowing your
traditiontoberemoved.
The group also learned the importance of the principle of continuous
improvementwhichisoneoftheessentialcharacteristicsandprinciplesofTotalQuality.
Like what Jim was trying to do with his restaurant, he was notjustlooking athis own
restaurant in a one sided perspective, butwentaround other restaurants to adapt and
learn new techniques toimprovethecompanyand tokeep track withhow it competes
with its competitors. It is a recipe for success and a tool to properly implement the
philosophyofTotalQuality.
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