FINAL PROJECT - CASE

STUDY
ASM – MSMS I

Submitted by:
Hamza Ahmed Khan
Zil-e-Huma
Sanober Shaikh
Fizza Zafar
Seher Ifzal
Contents
FOODPANDA PAKISTAN: ON THE WAY TO DIGITALIZATION.....................................................................2
Food Panda Background..........................................................................................................................2
Food panda in Pakistan............................................................................................................................3
Digital Transformation.............................................................................................................................5
Implementation of Supplier Module.......................................................................................................6
How it works?..........................................................................................................................................6
Other Measures.......................................................................................................................................6
How the change has taken place?...........................................................................................................7
Issues and Challenges..............................................................................................................................8
HR Issues................................................................................................................................................9
Appendix...............................................................................................................................................11

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FOODPANDA PAKISTAN: ON THE WAY TO
DIGITALIZATION

The General Manager of Food panda could not just stop overhearing the heated argument going
on outside his office. As a leader, he had usually encouraged healthy debate on his team but he
was surprised to know that the Manager Human Resources and Manager Operations, were going
at it on their way.

“It was for company’s betterment! We cannot just keep employees stay that are no longer
needed.” Manager Operations said.

“But that is creating an unwanted situation for the company. The employees are demoralized as
they do not feel secure here anymore.” Manager HR said.

General Manager opened the door. “What is this all about?” He asked.”

“The consequences of recent digitalization.” HR Manager said.

Food Panda Background

Foodpanda (or Hello Food) is a main internet-based food dissemination commercial centre with
a worldwide presence. Its essential capacity is to permit clients to put orders at adjacent cafés
utilizing its site or versatile application.
Foodpanda is just utilized in Asia and Europe, however, it likewise works in Africa, Latin
America, and the Middle East under HelloFood. Foodpanda appeared in Singapore in May 2012
and immediately turned into a hit. It had spread to 16 nations across the world before the years
over and effectively stretched out its market to 23 nations worldwide before the finish of
February 2013. It currently has a presence on five main lands and in more than 500 urban areas
all over the planet. They have a significant worldwide group of in excess of 3700 laborers and
are cooperated with north of 38000 individuals. In 2012, Ralf Wenzel and Benjamin Bauer
cooperated to make Foodpanda. The organization's central command is in Berlin, Germany.

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Ralf Wenzel is the worldwide CEO of Foodpanda or Hellofood and one of its prime supporters.
"Foodpanda administration is tied in with conveying the most renowned dishes around Singapore
from kitchen to doorstep as fast as could really be expected," as indicated by Jakob Angele, CEO
of Foodpanda Singapore. Since we presently have our armada of riders, our administration is
more dependable and quicker than any time in recent memory, guaranteeing that food is
followed through on schedule." If the association attempts to acquire a piece of the pie in every
one of its geographic regions, the coordinated factors of its dissemination framework will
without a doubt be a key need.
In light of their easy to understand, superior grade, and hearty point of interaction, Foodpanda
has turned into a moment overall sensation. They've buckled down over the course of the years
to work on an assortment of highlights to support their web traffic. Clients can arrange their
cherished cooking utilizing either the Foodpanda site or the Foodpanda application. Both the site
and the product work likewise. Foodpanda's requesting strategy follows a bit by bit system. In
the first place, Foodpanda gathers the client's postal subtleties. The data is then separated
dependent on the subtleties of cafés in the area that offer conveyance. Notwithstanding the
fundamental eatery offers, there are a few extra arrangements that a client can utilize when
requesting through Foodpanda on both the site and the application. The eateries' menus are
additionally partitioned into subcategories dependent on the kind of food they offer. Clients get
an affirmation message from the Foodpanda administrators in the wake of putting in a request,
and they are informed of the normal conveyance time. Foodpanda sends the request subtleties
and the client's contact data to the eatery assuming there are any issues with the food
conveyance. Obviously, Foodpanda's prominence is centred around its eatery organizations as
well as on its armada of messengers.

.
Food panda in Pakistan

Foodpanda Pakistan was procured by Delivery Hero in December 2016 after it acquired its main
rival in 2014. Pakistan is a large market and food panda is one of the main few online business
organizations in the country. Since we can take advantage of the information base, skill and
monetary muscle of Delivery Hero, we intend to upset the requesting inexperience. With the

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proceeded with ventures and long haul vision, Delivery Hero can construct an entire environment
in nations, empowering direct/circuitous business, more incomes for cafés, more prominent
development for the group and more comfort for the clients. A normal request for home culinary
experts is Rs300-350 though for different cafés it is about Rs550," says Mr Aemad Mehdi,
overseer of tasks at Foodpanda. With around 90% of the market, we are working with near
20,000 merchants of which around 4,000 are home cooks, he adds. Back-of-the-envelope
estimations recommend that the everyday spend on food orders from the stage is in the vicinity
of Rs76.5 million per day, causing it a month to month to spend of Rs2.3 billion.

"The food conveyance business is around 15-20pc of the absolute business," says Athar Chawla,
convenor of the All Pakistan Restaurant Association (Apra). Working in reverse, a rough
approximation of the size of the café area is about Rs134bn yearly.

The Sindh Revenue Board's objective for the current monetary year is Rs135bn. To place it in a
setting, the people who partake in the advantage of eateries generally spend a similar sum created
through all common assessment exercises.
However, Mr Mehdi battles that the area has scarcely started to expose what's underneath.
"Regardless of whether we incorporate the dhabbas on GT Road, there are something like 75,000
cafés in Pakistan. Presently contrast this with, say, Bangkok that has 70,000 cafés on the
Foodpanda stage alone."

   “The food delivery segment is growing in the high triple digits”

Be that as it may, the area is filling in the high triple digits. "In July 2019, we crossed 1,000,000
orders interestingly. From that point forward we have developed by around 4.5 occasions; we
multiplied during the lockdown time frame. Consequently, the build development rate is
genuinely high which, considering that Foodpanda is the greatest player, is characteristic of the
development paces of the business overall," he clarifies.

"For this reason, Pakistan is perhaps the biggest market as far as nation populace and
development rate that Delivery Hero works in. We are most certainly in its best 10 objections,"

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says Mr Mehdi. Conveyance Hero SE is a European worldwide internet-based food-conveyance
administration situated in Berlin, Germany. The organization works in 40 or more nations.
Pandamart is essentially in its outset. This month, it will carry out in Islamabad in six areas and
afterwards Lahore post-Ramazan. "Around 15pc of all orders from Karachi are from Pandamart,"
said Mr Mehdi, calling the outcomes 'marvelous' and anticipating that it should match the food
conveyance business in a year.

Flaunting a 20-minute conveyance time, Pandamart depends on fast trade — the thought is that
the riders will convey in how much time it takes a client to head to the closest kiryana
store.Pandamarts are 12 actual dull stores across Karachi and Hyderabad that go about as
stockrooms for the conveyance business and not for client walk-ins. With a 4-5km conveyance
span, there are two distinct distribution centres adjusting the Defense region. Despite the fact that
Foodpanda's staple conveyance business has been around just for half a month, Mr Mehdi gauges
that the quantity of end of the week orders matches that of, for instance, all of Imtiaz stores at
around 20,000 with a normal request size of Rs500-700. Notwithstanding, a look through the
Pandamart would frustrate Clifton tea consumers as sugar and Nestle Milkpack are both missing
from the rundown and hence require the crisis morning outing to the closest store.

Digital Transformation

Undergoing a digital transformation was not much of challenge for the company because they
had been implementing and updating the system since day-1 and were quite successful but the
major challenge here was about the new startup of the company which is its Panda Marts which
are the dark stores located in different locations of the major cities across multiple countries and,
the system was upgraded directly from the Head quarter in Berlin, Germany. While successful
launching of the new start-up it was found out that there was a high growth rate but at the same
time managing the entire process was not easy as well. All the store employees needed to process
the relevant invoices they received from the vendors, and they had to perform a three-way
matching in order to process the payments to vendors.

Upgrading the systems and implementing changes in it has been followed by hundreds of
companies and Multi-National Corporations around the world to make their processes and

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mechanism as simpler as possible, when companies focus on automation the main reason behind
it is to make the step-by-step manual process much easier for the employees so that they could
get their job done within the required time. The basic reason behind implementation of the
upgrading system was to achieve more outputs and refine the process and to avoid any
discrepancies because when it comes to the finance department, mistakes are unacceptable as
vendors would stop sending stock to the warehouses and it normally impacts the image of the
organization.

Implementation of Supplier Module

Supplier module was the major update in the food panda portal which was implemented and
added to the system in mid-2021 when the new stores were open across the country, since
Pakistan was the first country where Panda Marts were opened successfully in very low amount
of time, a single dark store would successfully get operation in less than two weeks. Due to fast
growing operations employees had less time to focus on other matters so they weren’t quite
ready to jump into the new way of processing their invoices because they followed a traditional
step by step manual method.

How it works?

An accounts payable associate who is responsible for the payment process has to g through three
steps which is called a three-way matching method, in this method the invoices received at a
single warehouse are matched with a goods received note to match the quantity received and
then its net amounts are matched with the purchase orders to see whether the amount on received
invoice is profitable or in a loss. This method gives us a relevant result that either an invoice
should be processed or not.

The supplier module which was added to the online food panda portal was fed with an automated
invoice on which the finance department employees had to work upon. The problem came to
light when the finance department actually started working on the module, they came to know
that its not possible to start working on the module in their daily routine because it would
consume a lot of time to process their invoices within a given time.

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Other Measures

After the successful implementation of the supplier module, they failed to consider that a proper
training would be needed for the employees to start working on the system and run smooth
operations, growth and adaptation was necessary, but its outcomes and effect was also to be
considered in mind because when you go towards automation and upgradation you must consider
the outcome of all dimensions.

The process involved 3 employees involved in three different steps, now after the initiation of
module, it came down to only one accountant who could easily process the invoices just because
the remaining processes were automated. Employees were laid off and the remaining employees
were pressurized because a simple process where they needed 3-4 hours, now they are taking
more than 6 hours with no increase in the salaries.

How the change has taken place?

Understanding it with Kurt Lewin’s 3 steps model of change:

• Step 1: Unfreeze

Step 1 Unfreezing is more like preparing for the change. It is a human nature that people
resist to change, as they don’t want to adapt changes in their lives and want to go on with
the flow. Same is the case in organizations, employees resist any change which make
them unlearn and relearn because they are so use to with such processes and are efficient
to manage daily work. With digitalization, Foodpanda had to revamp organizational
processes and had to change routine habits of its employees so that they move from
manual work to software. For this, Foodpanda communicated through official emails and
notifications to employees 3 months before final implementation and conducted virtual
meetings to make them understand why the change had been implemented. Within 3
months, they had to prepare themselves for complete digitalization and had to move on
with the new system. Foodpanda conducted trainings in and tried to give extensive

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 trainings to the employees who lacked technical skills before implementation so that
employees can be flexible enough to face a rapid change.

• Step 2: Change

The step 2 Change is more like implementing the chain and moving into new state.
Foodpanda deployed the software after preparing employees for the change. The software
was deployed and processes were revamped at this stage. At Foodpanda, digitalization
now only led to process improvisation but also it made management to revise its
structure, goals, objectives, way to work, way to evaluate and much more. Now
employees were being evaluated for the new processes and were required to complete all
tasks with maximum efficiency. Employees tried to adapt the system and this lead them
to new behaviors. At this time, both the employees and management struggled as the
major challenge was to overcome existing thinking and working process of everyone at
the place. Several deployment issues were faces by users; both the technical and
behavioral. At the same time, employees were supposed to meet their targets and
generate revenue as they use to do earlier. The change process at Foodpanda
implemented.

• Step 3: Refreeze

The step 3 Refreezing is like reinforcing the change that has been implemented.
Foodpanda wanted to make sure that employees stick to the change and do not adapt
outdated behaviors in works so they developed monitoring committee which
continuously monitor the employee work performance and made sure they do not revert
back to their old way and old culture. Foodpanda also announced rewards for efficient
performers in the news processes for making the change positive for employees as well as
organization. Such monitoring process and reward were supposed to motivate employees
for reinforcing new behavior and generate better results in terms of performance which
ultimately led to greater revenue.

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Issues and Challenges

1. Due to such a rapid revamp, employees of Foodpanda felt overloaded every time.
Employees were being supposed to attend trainings, adapt changes and do their daily
work with maximum efficiency.

As stated by their employees below:

“I could not even have lunch peacefully” Mr. Abrar – Finance Executive said.

“I have daily operational issues to handle and various issues to address at the same moment. My
job simply does not allow me to manage hours to get trained for the ongoing change and wait for
bugs to get resolved.” Mr. Salman – Admin Executive said.

2. Many employees’ even Top performers have lost their morale to work in organizations,
which in turn affects the monthly and quarterly productivity and quality of organizational
outcomes

As stated by their employees below:

“I have worked hard for 2 years to get promoted. Now digitalization has brought 180 degree
change in processes which has affected my performance and I didn’t performed best in this
quarter.” Mr. Fahad – Accounts Executive said.

“You cannot expect everyone to perform the best soon after the implementation. It takes time to
get people use to it. Why to evaluate our performance on that so soon?” Ms. Maria – Compliance
Officer said.

3. Average number of employees don’t have enough technical skills to perform digitalized
operations because Foodpanda never focused on such ability while hiring earlier and it
led to such problem which required extensive trainings.

As stated by their employees below:

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“I am good with manual work and I think I am more productive with that. I am not tech savy”
Mr. Iqbal – Senior Manager Procurement

HR Issues

Such issues and challenges led employees to have job dissatisfaction, low morale, job insecurity,
low organizational loyalty and ultimately affected job performance. These problems led
Foodpanda into a serious trouble of HR crisis which the company never predicted as stated by
GM Foodpanda:

“We never thought we are heading towards several HR issues. We were only focused on
implementation and assumed it beneficial for both the company and our employees.” GM
Foodpanda

Conclusion

Foodpanda has gone through a tremendous change towards digitalization. Foodpanda not only
had to change its way of work, but also the orginazation’s goals, several processes and employee
attitude. It had rigorous trainings due to short of time. Such detailed plan may lead to successful
implementation, but created several other problems for Foodpanda. In rigorous trainings and
result driven strategies, Foodpanda missed to create pleasant workplace and learning
environmental conditions for employees. Such conditions enhance employee morale, job
satisfaction, and increase organizational loyalty and productivity.

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Appendix

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