Changing the Food Service in Healthcare - Term Paper Example

?Running Header: {Project Full {Project Full DeVry – Keller Graduate School of Management – Managerial Decision-Making (MGMT530) {Date} Table of Contents Executive Summary 3 Introduction – Overview of Decision Problem 4 Problem Statement 4 Objectives 4 1.To provide food services in a cost-effective manner 4 2.To improve the quality of customer service to enhance customer satisfaction 5 Improving the quality of foods provided at the restaurant. 6 Summary of Key Objectives: 6 Alternatives 8 Description of Alternatives: 8 Selection 9 Consequence Table with Original Values: Title 10 Ranking Alternatives: Title 11 Scoring Model: Title 12 Consequences 13 Risk Profile: Title 13 Implementation, Monitoring and Control 14 Timeline: 15 Summary 15 Executive Summary This report is a decision-making plan of a hospital restaurant, which is experiencing problems because its clients are complaining that the quality and price of foods offered by the restaurant are not up to standard. Several objectives are identified, including ensuring that the restaurant is run at a cost-effective manner, and the employees are given monetary and non-monetary incentives to boost their performance. The recommended alternative for addressing the problem is offering the workers a non-monetary incentive, which is reached after discovering that this will not cost the restaurant substantial resources, and because it is realized that such an incentive has many other benefits that address virtually all the problems that the restaurant is undergoing. A committee of implementation is, consequently, appointed to foresee implementation of the project by the end of the current fiscal year. The implantation will be accompanied by regular evaluations to monitor the progress of the project. Introduction – Overview of Decision Problem Problem Statement The studied hospital restaurant has failed to meet the expectations of most of its customers and employees due to a variety of reasons. Ideally, many customers have been frustrated for failing to get foods that satisfy their needs. At times, customers have visited the restaurant only to find that the kind of food being served does not meet the value for their money, perhaps because it is of low quality or it does not match their taste. Yet still, many customers have complained that the price of the foods sold in the restaurant is too costly, yet it is of low quality (Cannon & Morgan, 1990). In an attempt to address this problem, the Hospital has previously selected HealthFoods Inc. to help its employees in making value-based and informed decisions, but these efforts were not very successful. Since the hospital is operating within a highly competitive marketplace, there is a strong need to address the cost of food provision in the facility without compromising quality. After a comprehensive review of available solutions, the expertise of the Hospital’s clinical team will work together with the restaurant staff to offer a strategic opinion on benefits plan design. Objectives 1. To provide food services in a cost-effective manner This will be achieved by reducing the overall cost of each meal per patient by 2 percent by the end of the current financial year. The managers in charge of the food will be required to evaluate the cost structure of provision and delivery of the meals, currently, and make a decision as to whether a 2 percent reduction is practicable. It will also be important to identify the means through which changes in methods of preparation, reduction in staff, or any other modifications can be achieved by amending or formulating methods of production, but taking the consideration that all those who shall perform the tasks that will help achieve the objective will find some value in doing so; else they will not support the process. 2. To improve the quality of customer service to enhance customer satisfaction The restaurant will involve all the workers in a customer service improvement program intended to increase the number of loyal customers by 10 percent during the current financial year and 20 percent in the subsequent year. This will be achieved by providing high quality customer services, through integrated efforts to ensure the expectations of the customers are met or even surpassed. This will also be achieved by first identifying the customer needs, and then meeting them accordingly. In this respect, the management of the restaurant will have to recognize that the restaurant’s services and products have got no value if they do not constitute what the customers really want. Since the customers’ needs and preferences differ, especially considering that the restaurant serves customers from different backgrounds, a carefully planned strategy is required. To counteract these challenges, the hospital restaurant will persistently draw together market information, which will help the organization remain at par with the customer wants. This will be achieved through data collection methods such as market surveys, focus groups and customer interviews, just to mention but a few. The restaurant will also be guided by the principle that it is in operation because of its customers, and as such, it must focus on their interests and ensure that they are satisfied (Ambroz, 2004). Basically, achievement of this objective will require the organization to set aside some funds to offer the staff a refresher course to improve their service provision, while some will cater for their motivation. The budgeting committee will be entitled to assess whether a 10 percent salary increment and ?150,000 budget for the refresher course will be sufficient to achieve this objective. Improving the quality of foods provided at the restaurant. Since the restaurant has received some complaint from some customers because they are not satisfied by the quality of foods they are served, the management will purpose to upgrade the quality of foods to attain a 100 percent satisfaction by the end of the current fiscal year. In other words, efforts will be made to provide customers with foods of high quality such that no customer will leave a negative feedback in respect to the quality of food provided by the hospital restaurant. To achieve this, the organization will focus much on improving the skills of the current staff and employ about 5 employees, who must have worked for at-least 5 years in a top star hotel, by the end of the current fiscal year. By doing so, it will be expected that injecting new blood in the organization will bring in valuable experience, which will also be beneficial in upgrading the skills of the current staff. In addition, the refresher course described above will also include training on catering methods, especially the latest methods that will help the restaurant attain market competitiveness. To avoid worker’s apathy, appropriate efforts must be taken to motivate them, including increasing their salaries and allowances. Summary of Key Objectives: Fundamental Objectives Means Objectives Objective 1: To provide food services in a cost-effective manner Means Objective A: to reduce the cost of food provided by the restaurant Means Objective B: to eliminate unnecessary cost incurred in the process of proving foods in the restaurant Means Objective C: to train workers how to make foods in a more cost-effective manner Objective 2: To improve the quality of customer service to enhance customers’ satisfaction Means Objective A: to take the workers through a refresher training Means Objective B: to employ more experienced staff to bring a pool of experience in the organization Means Objective C: to offer staff monetary incentives to enhance their performance Objective 3: Improving the quality of foods provided by the restaurant Means Objective A: to employ more experienced staff to bring a pool of experience in the organization Means Objective B: to take the workers through a refresher training Means Objective C: to offer staff monetary or non-monetary incentives to enhance their performance Alternatives Description of Alternatives: Alternative Description of Alternatives Alternative 1 The first alternative is motivating workers by offering them monetary incentives. For a monetary incentive to motivate employees to improve their performance, it must have a meaning for them. Also, the amount of reward is very important in monetary rewards as it directly determines the extent to which it motivates the employees. According to Lawler (2000), the monetary incentive must be at least 5% of an employee’s annual salary for it to have substantial impact. He, however, adds that lesser monetary incentives can have substantial impact on the employee’s motivation if they are provided alongside other forms of appreciation. Alternative 2 The second alternative is to offer employees non-monetary incentives. Pitfield (1980) posited non-monetary incentives as fringe benefits made available to staff and are regarded as an addition to wages and salaries. It consists of direct and indirect benefits. The direct benefit may include profit-sharing, sick pay, pension schemes, et cetera. The indirect benefits may include welfare amenities, social and recreational facilities, et cetera. Gellermen (1976) insisted that pay, if only it could be properly packaged, would somehow bring about the desired approach to work. Alternative 3 The third alternative is offering foods at cost-effective ways so the customers can get it at more affordable prices. This involves cutting cost on all factors of production, including purchasing inputs from cheaper suppliers, eliminating unnecessary cost, purchasing goods in large quantities to enjoy quantity discounts, et cetera. Selection Offering employees non-monetary incentives is recommended. Since offering workers monetary incentives is likely to increase the cost of producing foods, while providing foods at cost-effective ways is not easily achievable without offering the workers some incentives, it is found that providing non-monetary incentives has the greatest results in achievement of the intended goals. What’s more, the non-monetary incentives such as training and development in the organization have positive influences on employee performances and training; and this may also bring about reduction of cost as well increase in productivity. This report reveals that promotion of employees, among other non-monetary incentives, will increase their efforts and performances in work place, while employee performance appraisal influences employees’ performance and employee welfare. Others like medical facilities will also facilitate effective performances. It will be very critical to find out the information on the circumstances under which employees would prefer monetary incentives to non-monetary incentives, in order to decide how to reduce the extent of potential tradeoffs. Consequence Table with Original Values: Title Alternatives Alternative A Alternative B Alternative C Alternative D Objective 1: To provide food services in a cost-effective manner Reduce cost of producing foods Offering employees non-monetary incentives. Motivating workers by offering them monetary incentives. Objective 2: To improve the quality of customer service to enhance customer satisfaction Offering employees non-monetary incentives. Motivating workers by offering them monetary incentives. Refresher courses Objective 3: Improving the quality of foods provided at the restaurant Offering employees non-monetary incentives. Motivating workers by offering them monetary incentives. Employing more experienced workers Ranking Alternatives: Title Alternatives Alternative A Alternative B Alternative C Alternative D Objective 1: To provide food services in a cost-effective manner Offering employees non-monetary incentives. Reduce cost of producing foods Motivating workers by offering them monetary incentives. Objective 2: To improve the quality of customer service to enhance customer satisfaction Offering employees non-monetary incentives. Motivating workers by offering them monetary incentives. Refresher courses Objective 3: Improving the quality of foods provided at the restaurant Employing more experienced workers Motivating workers by offering them monetary incentives. Offering employees non-monetary incentives. Scoring Model: Title Alternatives Alternative A Alternative B Alternative C Weighted Objective 1 70 45 45 50% Objective 2 40 85 85 30% Objective 3 40 80 80 20% TOTAL 55 55 64 100% Legend: Consequences The values for each alternative and their corresponding objectives are measured by the attribute “percentage of total food quantities being sold” over a certain period. The consequence table is as shown below. The forecast is based on similar occurrences in the past. The probability of those occurrences is also based on the past experience. To establish the confidence level, a survey will be conducted on potential customers and employees, and the results analyzed statistically (Govindarajan, 1989). Risk Profile: Title Uncertainty: Uncertainty 1 Outcome: Chance Consequences: cost of each meal per patient will be reduced by 2 percent by the end of the current financial year 50% More customers will patronize the restaurant. The restaurant will make more profits. Uncertainty: Uncertainty 2 Outcome: Chance Consequences: The employers will serve customers in a more hospitable and professional matter 60% Customer satisfaction will increase and hence more customers will become loyal. More resources will be required to motivate workers. Restaurant revenue will increase. Implementation, Monitoring and Control In order to implement the selected alternative (offering of non-monetary incentives to the employees), a worker’s welfare implementation committee will be instituted to foresee the process. The committee will start by collecting information on the needs and factors that affects worker’s performance in the restaurant. Consequently, a report will be compiled, recommending the most appropriate alternative to address the workers plight, which will be forwarded to the executive committee for action (Govindarajan, 1989). Most importantly, the report will provide a detailed analysis of the resources that will be required to ensure effective implementation, which will be forwarded to the budgeting committee for assessment and allotment of funds. Allocation of funds will be done on a priority basis. After this is accomplished, the implementation committee will appoint a project leader, who will see the execution and subsequent evaluation of the project. At the same time, the implementation committee will set targets, which will be used by the project leader in evaluating the project after every three months. In case of substantial developments that will require some amendments to be made, the project leader will submit an amendment request to the implementation committee, which will approve such amendments, but only if a majority of the members vote for the said amendments (John, 1999; Drucker,1973). Timeline: Month/Timeframe Implementation Plan January -February Institution of an implementation committee and preliminary information collection February- March Collecting of information on the needs and factors that affects worker’s performance in the restaurant. April -June Compiling of a report to be forwarded to the committee July Budget approval and allocation August-September Appointment of project leader and initiation of execution of the project December Performing Evaluation and submitting the first evaluation report Summary The report has provided details of the problem that affects the hospital restaurant, identified the objectives, and the different alternatives that can be used to address the problem. The most appropriate alternative has been determined as ‘offering the workers non-monetary incentives’ and the implementation process explained. What will follow is for the implementation committee with the help of the project leader to ensure that the project is implemented successfully, with evaluations conducted every three months to assess its success. References Ambroz, M. (2004). Total quality system as a product of the empowered corporate culture. The TQM Magazine, 16(2), 93-104. Cannon, H., and Morgan, F. (1990). A strategic pricing framework. Journal of Service Marketing, 4, 19-30. Cespedes, F., and Piercy, N. (1996). Implementing market strategy. Journal of Marketing Management, 12, 135-60. Drucker, P. (1973). Management: Tasks, Responsibilities, Practices. New York, NY: Harper & Row. Gellerman, A. P. (1976). Management and subordinates. London: Harvard Business Review. Govindarajan, V. (1989). Implementing competitive strategies at the business unit level – implications of matching managers to strategies. Strategic Management Journal, 10 (3), 251-69. John S. Hammond, R. L. (1999). Smart Choices, A Practical Guide to Making Better Decisions. Boston, Massechusetts, United States of America: Harvard Business School Press. Lawler, E. E. (2000). Rewarding excellence. San Francisco, CA: Jossey-Bass. Pitfield, R. R. (1950). Business Organization. London: Macdonald and Evans. Read More