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YOU ARE HERETotal Quality Management (TQM) 5 performance objectives

Total Quality Management (TQM) 5

performance objectives
Q a) Explain the 5 TQM performance objectives. Discuss these with the help of a real life
example of a process involving products & services, and analyze how the process can be
improved upon?
b) Illustrate & explain your chosen process with the help of a transformation model.
Answer a) “Many methodologies and techniques for improving operational performance
have been developed over the years – these provide structured ways of improving
company performance, but they do not explicitly tell us where to start. To be able to
improve performance effectively, it is important to identify the particular factors of
performance to work with. Furthermore, it is important to find those factors that have a
high impact on performance.” (www.emeraldinsight.com) Performance improvement
highlights processes and systems that need to be improved. Then, there is a follow-up
with an action plan to improve the outcomes. The five main performance objectives are:

• Speed
• Cost
• Quality
• Dependability
• Flexibility
We will discuss these five objectives using the drive-thru process of McDonalds:

• Speed- How much time does a customer spend in McDonalds drive-thru? McDonalds’
drive-thru target is 90 seconds. But, is it really able to achieve this target? No, not all the
time. Many people have complained about drive-thru errors, waiting for their meals in
busy times, being stuck in the queue, etc. As the line gets longer, more people choose to
bypass the restaurant and dine elsewhere. So, how can McDonalds overcome these
problems?
? Proper drive thru management: Since queuing is on a strict first-in first-out basis; later
customers are generally not served until all previous customers have been taken care of.
Therefore, a whole line of people with quick orders can be held up by a single complex
order. McDonalds can instead have a dual line layout & if the second customer’s order is
ready first, then a green light can be used to signal the second car, so that the person
takes his/her’s order & goes. Service times are improved dramatically for short orders,
yet not impacted for longer orders due to multiple wait queues.
The disadvantage of adopting the dual line layout is that it will take up a lot of time & be
costly for McDonalds to change the layouts of all their restaurants. Plus, some customers
will get really annoyed if they came in first but served second. To overcome this,
McDonalds can have two windows (both left & right), the left one for large orders & the
right one for small orders. Again, the question is how the small order meals will be
bought to the right window if the kitchen is on the left side. Well, an employee can be
especially dedicated to transfer the meals from the left window to the right one!
? Introduction of the use of mobile order entry terminals: will allow a restaurant
employee to physically go to the drive-through lane and enter orders, which increases
through-put by providing two points of entry: the menu sign and the mobile order entry
terminal.
Problems associated with this option include: (1) interfacing the mobile entry terminal to
the current POS (Point of Sale) system; (2) supporting multiple languages and interfaces;
(3) constant menu changes and additions; (4) safety of the employee; (5) weather
conditions; (6) hardware costs; (7) order sequencing; and (8) the customer is unable to
review the menu prior to ordering.
? Adopt a new system: McDonalds can also adopt a new system called Delphi Order
Confirmation where a digital camera is attached to the drive-through menu system.
“When an order is placed, a photo is taken of the car and/or the driver from
approximately the same angle and distance that the drive-through employee would view
when the car is at the payment or presenter window. The digital photo would be matched
to the order record created by the POS system. The photo and order record could be
presented in a variety of fashions, including a print out on the receipt with the itemized
order and number. Alternatively, a touch screen with the patron's picture and order
record for each of the cars currently in the drive-through, and when the order is
complete, the presenter would tap the photo on the touch screen indicating the order has
been filled and the photo record would be removed from the system. This system will
help shave about eight seconds from the order to delivery time. Besides order accuracy,
it will also aid in speeding up the drive-thru process and address customer courtesy
issues. Specific benefits to this system include easy installation and implementation with
existing QSR (Quick Serve Rest) drive-through installations; minimal ongoing support
required; limited risk of hardware loss/damage; increased employee safety; fully
supported in multi-language settings; and continues to provide the customer an
opportunity to review the menu!” (www.freepatentsonline.com)
People will be uncomfortable: with the idea, that they're being photographed every time
they make a quick stop for a double cheeseburger with fries. Though, it’s a "non-invasive"
procedure & the photos aren't stored in the system. They're deleted as soon as the order
is completed. A lot of restaurants already have surveillance cameras on their premises
that photograph people. Another trouble is that it will be costly for McDonalds to
implement this system. But then again, it will show good results in the long run!
• Cost- Is McDonalds charging a lot to its customers? Can they bring down its costs further?
? Value meal strategy: McDonalds can employ the value meal strategy which allows
customers to buy a sandwich, french fries, and beverage at a discount when purchased
together. Moreover, it can also offer daily specials of special menu items, such as “9 Dhs
Happy meal on Thursdays, from 4:00 PM - 8:00PM” or other similar specials. More number
of people will be attracted by such offers & hence McDonalds’ average cost will decrease.
However, the limitation is that these daily specials will bring in a lot of customers but
also make it harder for McDonalds’ staff to handle so many people together & serve
quickly!!! So, they should anticipate having so many customers & moulding their
operations according to that.
? During busy periods, McDonalds requires more than two to three people who are
dedicated to the drive-through process. If it adopts the Delphi order system mentioned on
page 2 & 3, it will not require a lot of employees to take the orders, enter in the system
& make mistakes in matching the orders with the cars, hence cutting down on its costs.
However, this might lead to some employees being made redundant.
? Use Customer order Display: When a drive through worker is taking an order, it can be
displayed automatically on a screen available to the customer outside, called the
Customer Order Display (COD). The customer can review the COD and correct any
mistakes, thus making the ordering process more precise. More precise orders eliminate
time wasted from correcting mistakes & the cost arising from order errors.
? Energy management: Energy costs represent a significant portion of restaurant
expenses. Parking-lot lighting, cooking appliances, ventilation systems, & other utility
expenses can add up. These are very real costs that impact the profitability of a
restaurant. McDonalds can invest in new equipment (which might be costly but beneficial
in the long run), maintenance practices and revising some operating procedures. “Some
cost-cutting strategies include are, investing in energy-saving equipment, securing long-
term energy contracts, joining energy co-ops, controlling lighting schedules more
efficiently, tinting windows, contracting with new energy providers, hiring energy
consultants and decreasing deliveries, regular cleaning and upkeep of refrigerator coils.
Furthermore, a calendar with the recommended maintenance dates for all parts and
equipment, including monthly, quarterly and annual checks can be made.”
(www.restaurant.org)
• Quality- Where does McDonalds stand in terms of is service? Not as good as it used to
be. Probably the meals are okay, but what about the employees serving the customers &
the overall experience which the customers go through?
? Surprise quality checks: For sure, all McDonalds restaurants already go through periodic
inspections in terms of quality checks, but they can have more surprise checks & if the
store fails to pass the inspection the second time, the corporate can take over the store
and bring in better employees to ensure that the proper processes and equipment are
being used properly.
? Improve the training process & taking care of employees: McDonalds can include online
e-learning tools for its restaurant staff. In addition to this, it should make sure that the
needs of its staff are met & they are given recognition for good performance. Once this is
done, automatically they will be happy to do their jobs & of course happy employees will
lead to a better service & eventually happy customers!
• Dependability- How can McDonalds make its processes more reliable?
? If McDonalds opts for dual line layouts & a reliable system like Delphi order confirmation
system (mentioned on pages 2 & 3,) then without any doubt its customers can rely on its
operations. They will be sure that their meals will always be ready within a specified time
without any errors & they’ll be able to get out quickly with the dual line layout.
• Flexibility- Can McDonalds adjust its processes to meet customer requirements?
? Multiple trained staff: McDonalds can have a multiple trained staff in order to be
flexible. Again, this will cost money but be beneficial in the long run.
? Ordering on a toll free number: McDonalds can give their customers the option to place
their order by calling on a toll free number & giving them a unique order number so that
their meals are ready when they come to pick them up. The drawback is that an
employee will have to be specially delegated to take the orders when customers call!
Answer b)
“A transformation process is any activity or group of activities that takes one or more
inputs, transforms and adds value to them, and provides outputs for customers. Where
the inputs are raw materials, it is relatively easy to identify the transformation involved,
as when milk is transformed into cheese and butter.” (openlearn.open.ac.uk) Where the
inputs are information/people, the nature of the transformation may be less obvious. For
example, a hospital transforms ill patients (the input) into healthy patients (the output).
•
Figure 1: The transformation model
Source: (openlearn.open.ac.uk)
The transformation model of a McDonald’s drive-thru process will look something like
this:
Feedback
Figure 2: Transformation model of McDonalds drive-thru
A customer enters the drive-through in his/her vehicle along a path and stops at a
sign/menu-board that contains a menu. The customer is prompted by an order-taker to
order his/her’s desired meal. Once the order has been confirmed, the driver proceeds
(while his/her meal is prepared & packed) toward a drive-through pickup window, in
queue behind any previous cars, where the driver submits his/her payment to a window
person and then receives his/her food. Some restaurants use a two-window system during
busy times, whereby the driver pays at a payment window and receives his food at the
pickup window.

Figure 3: Drive-thru process shown in pictures

Source: (www.google.com)
Inputs & Output
Some inputs are used up in the process of creating goods or services; others play a part in
the creation process but are not used up.
Three types of resource that may be transformed in operations are:
• materials – the physical inputs to the process
 • information that is being processed or used in the process
• customers – the people who are transformed in some way.
Many transformation processes produce both goods and services. For example, McDonalds
provides a service, but also produces goods such as food and drinks. Transformation
processes may result in goods/services (output) that are designed to deliver.
Feedback
A further component of the transformation model in Figure 1 is the feedback loop.
Feedback information is used to control the operations system, by adjusting the inputs
and transformation processes that are used to achieve desired outputs. For example, a
chef relies on a flow of information from the customer, through the waiter, about the
quality of the food. Adverse feedback might lead the chef to change the inputs (for
example by buying better quality potatoes) or the transformation process (for example by
changing the recipe or the cooking method). Feedback is essential & can come from both
internal and external sources. Internal sources include testing, evaluation and
continuously improving goods and services; external sources include those who supply
products or services to end-customers as well as feedback from customers themselves.
To sum up, operations performance is an important functional area because it plays a
crucial role in determining how well an organization satisfies its customers. Moreover, an
understanding of the principles of operations management is important for all
organizations, because they provide a systematic way of looking at its processes.
Furthermore, the overall transformation process can be further broken down into a series
of micro-processes. Attention to processes ‘within’ organizations can provide a powerful
tool for understanding organizational performance & minimize errors.

Bibliography

1. http://www.emeraldinsight.com/Insight/viewContentItem.do?
contentType=Article&hdAction=lnkhtml&contentId=851437
2. www.freepatentsonline.com
3. http://openlearn.open.ac.uk/mod/resource/view.php?id=161703
4. http://openlearn.open.ac.uk/mod/resource/view.php?id=161697
5. http://www.restaurant.org/news/story.cfm?ID=349
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