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Acknowledgements

Any accomplishment requires the effort of many people and there are no

exceptions. The report being submitted is a result of collective effort.

Throughout the semester, our respected Instructor has given us advice and

helped us in many things regarding this particular task.

We convey our sincere gratitude to our competent instructor Mr. Fahad Zuberi.

Without his help and guidance, the making of this report would have been

impossible.

We are also thankful to Mr. Tahir Mehmood at Dunkin Donuts, without whose

cooperation, the completion of this report would have been very difficult.

Furthermore, we thank all those who cooperated with us for the research and

writing of this report.

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Executive Summary

Letter of Transmittal

Mr. Fahad Zuberi

SZABIST

SUBJECT: Submission of Management Principles Report

Respected Sir,

We are hereby submitting our analysis report on Dunkin Donuts. We sincerely

hope that you appreciate the report and the first hand material included in this

report.

This report is the semester final project of the course Management Principles

and covers the management processes of Dunkin Donuts. The primary source

of our information for this report was a questionnaire survey.

We hope appreciate this report and find it of satisfactory quality.

Yours Sincerely,

Abdul BasitNajamussaqib MehmoodMozzam Nasir AliNabeel HaroonAssad Ahmed

BBA 1E

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Executive Summary

Executive Summary

Dunkin Donuts offers a wide range of products and therefore it has a wide

management hierarchy. Its the world largest chain of coffee and baked

goods. In Pakistan its been working since 2000 and its major products are

Donuts, Coffee, Tea, Sandwiches and Drinks. It imports all its raw material

from USA.

The main goal of Dunkin Donuts is to increase customer satisfaction, to

expand sales and to get a higher share in market. Its plan is to increase the

quality of products. It always sticks to its plan and reduces the negative

effects of deviation from plan by working on it.

The analysis is also carried out using The BCG matrix at the organization. In

the organization decisions made at upper level as it is a centralized

organization. It focuses on Performance management and it monitors its

employees to get full potentials out of them. In the organization the managers

develop trusts between the employees and always work to motivate the staff.

Managers use methods of self evaluation forms to get feedback.

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Table of Contents

Table of Contents

ACKNOWLEDGEMENTS................................................................1

LETTEROF TRANSMITTAL............................................................2

EXECUTIVE SUMMARY...............................................................3

TABLEOF CONTENTS................................................................4

INTRODUCTION.......................................................................6

HISTORY.............................................................................7

HIERARCHY........................................................................10

THE PLANNING PROCESS..........................................................11

Planning......................................................................................................11

Goals and Objectives of Dunkin Donuts......................................................11

Plans...........................................................................................................12

Planning Strategy........................................................................................13

SWOT Analysis............................................................................................14

THE BCG MATRIX...............................................................16

Components of the BCG Matrix....................................................................16

Dunkin Donut BCG Matrix Analysis.............................................................19

THE ORGANIZING PROCESS.......................................................22

Organization:...............................................................................................22

THE CONTROLLING PROCESS......................................................25

Controlling:..................................................................................................25

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Table of Contents

Dunkin Donuts performance Evaluation and controlling:............................25

Quality Control:...........................................................................................25

Controlling Environmental Influences:.........................................................26

THE LEADING PROCESS...........................................................28

Leadership at Dunkin Donuts:....................................................................28

HUMAN RESOURCE MANAGEMENT:................................................30

Human Resource management at Dunkin Donuts:......................................30

Performance management..........................................................................32

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Table of Contents

IntroductionDunkin Donuts was founded in 1950 by Bill Rosenberg. It started operations in

Quincy, Massachusetts. The first franchise license was issued in 1955.

Dunkin Donuts is the worlds largest chain of coffee and baked goods. Having

52 varieties of donuts and more than a dozen coffee beverages, Dunkin

Donuts serves more than 4 million customers around the globe daily.

In 2000, Dunkin Donuts started its operation in Pakistan. It is franchised by

Phoenix Foods Ltd. in Lahore and Islamabad. Karachi operations are controlled

by IBL (International Brands Limited).Dunkin Donuts has opened around

twelve outlets in Lahore and Islamabad and around ten outlets in Karachi.

The major products provided in Pakistan by the company are Donuts, Coffee,

Tea, Sandwiches and Drinks. These products are manufactured using raw

Materials that are all imported from USA.

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History

History

In 1946, Bill Rosenberg collected $5,000 to start a small business to deliver

coffee and donuts to hungry workers at their workplaces. By 1948, Rosenberg

had opened a retail coffee and donut store

named Open Kettle. In 1950, Rosenberg

capitalized on the trend of Dunkin g and

Dunkin Donuts was born.

Next, Rosenberg thought of expanding his

business nationwide. In 1955, the first

Dunkin Donuts franchise was sold and

only ten years later, Dunkin Donuts had crossed international borders intoCanada.

By 1970, Dunkin Donuts opened its first overseas store, halfway across the

world in Japan. Today, there are over 8000 Dunkin Donuts stores in more

than 30 countries worldwide selling over 4 million donuts daily.

In 2000, Dunkin Donuts started its operation in Pakistan. It is franchised by

Phoenix Foods Ltd. in Lahore and Islamabad. Karachi operations are controlled

by IBL (International Brands Limited).Dunkin Donuts has opened around

twelve outlets in Lahore and Islamabad and around ten outlets in Karachi.

Figure 1: First Shop of DunkinDonuts

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History

1946 Bill Rosenberg invested $5,000 to start Industrial Luncheon

Services

1948 Bill Rosenberg opened a donut shop named Open Kettle

in Quincy, Massachusetts

1950 Open Kettles name was changed to Dunkin Donuts

1955 The First Franchise agreement was signed and executed

1963 Dunkin Donuts opens 100th Restaurant

1966 Dunkin Donuts University is founded

1970 First overseas Dunkin Donuts restaurant opens in Japan

1979 Dunkin Donuts opens 1000th Restaurant in USA

1980 Largest Dunkin Donuts Restaurant opens in Thailand, with

130 persons seating arrangement

1990 Allied Domecq purchases Dunkin Donuts

2000th U.S. Dunkin Donuts Restaurant Opens

1992 3000th U.S. Dunkin Donuts Restaurant Opens

1995

1000

th

International Dunkin Donuts Restaurant opens inThailand

1999 Dunkin Donuts celebrates eight billionth coffee cup sold

since 1950

2000 Dunkin Donuts starts operations in Pakistan

Dunkin Donuts opens 5000th International Restaurant

Dunkin Donuts celebrates 50th Anniversary

2004 Dunkin Donuts moves its headquarters to Canton,

MassachusettsTable 1: History of Dunkin Donuts

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Hierarchy

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Hierarchy

Hierarchy

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The Planning Process


PLANNING

The process, through which a company defines its main objectives & goals,

made its overall strategy for achieving the goals and develop comprehensive

set of plans to desegregate and organize the organizational work.

Strategic Plans: The plans which clearly defines the organizational mission,

analyze the opportunities & threats presented in internal and external

environment.

Goals: It is defined as The desired outcomes that gives directions to the

organizational plans and management decisions.

GOALSAND OBJECTIVESOF DUNKIN DONUTS

Goals

Main goals of the Dunkin Donuts are as follows

To open 100 branches in Karachi, Pakistan

Increase cater to satisfy the ever increasing customers needs

Need to expand the sales as:

More competitors than ever

Get a higher market share

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Objectives

Marketing

In marketing, the target of Dunkin Donuts is to achieve a high peak by a

substantial amount in sales. This peak can be achieved through high

frequency of advertising and publicity in colleges and universities. If the

consumer base can be increased by 6% and thusly increase our gross income

by $10 more per year from each new consumer/customer then it results in

large growth in revenue.

Advertising

The main purpose of advertising is to create awareness among the youth and

middle-aged working employees (between 18 40 years) by 15 18 % within

a year.

According to the survey, 24 35years old are who drinks coffee the

most

Targeted customers are whose

monthly income is between

Rs.60,000 to Rs.100,000 monthly.

Middle class increase revenue by 45 to 50%

PLANS

Figure 2: Advertising onVehicles

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The plans to achieve the stated goals and objectives within confined time-

period are:

To Improve Quality

To increase or expand the sales, quality provide to the customers should be

good that for the next time the customers would come back.

Effective Marketing

Dunkin Donuts do marketing of its products in such a manner the person who

is seeing, watching or revising the advertisement would definitely attract

towards it.

Looking For Good Places

Company is always in search of some good places where the outlet of Dunkin

Donuts can grow its business in very efficient and effective manner.

PLANNING STRATEGY

Strategic Plan

The strategic plan is to increase the sales by very high rate and to satisfy the

customers need in a good manner and increase the quality of products (i.e.

Donuts, Coffee etc.).

The company always sticks to its strategic plan in order to achieve its goals

and objectives.

There are many problems that deviates the plan from its original condition but

there is a strategy planned that reduces the negative effects of any deflection

or diversion that is not good for the company.

Plans for Each Pace:

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Company planned each and every move and step that how employees of the

company are going to achieve the target that is set by the Manager

SWOTANALYSIS

Strengths

The strengths of the company are:

1. Dunkin Donuts has a reputation for brewing high quality coffee for more

than five decades

2. Dunkin Donuts serves nearly 30 cups of freshly brewed coffee each

second or 1 billion cups of brewed coffee every year and approximately

2.7million cups a day.

3. Dunkin Donuts mails coupons to their customers.

Weaknesses

No weaknesses of the company were disclosed

Opportunities:

The opportunities of company are:

1. Franchises available.

2. The opening of new stores.

Threats

The threats, that decrease the companys growth level, are:

1. People want to eat healthier (low calorie/low carbohydrate).

2. Starbucks entry into breakfast sandwiches.

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3. McDonalds gourmet coffee

4. In Pakistan, the political and law & order situation

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The BCG Matrix

The BCG Matrix

The Boston Consulting Group Matrix, commonly known as the BCG Matrix is a

chart that was created by Bruce Henderson for the Boston Consulting Group in

1968. It assists organizations for the analysis of Business units or Product

Lines.

The BCG Matrix helps companies allocate resources and it plays a vital role in

Brand Marketing and Product and Strategic Management.

COMPONENTSOFTHE BCG MATRIX

The horizontal axis displays the intensity of the market share (low or high) and

the vertical axis indicates the anticipated market growth rate (low or high). A

business unit is analyzed using the SWOT (Strength, Weakness, Opportunities

and Threat) Analysis and placed in one of the four categories.

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The BCG Matrix

Stars

Stars are units with high market share and high growth rate. They generate

large amounts of cash because they have a very high market share. And

because they generate a high market growth rate, they also consume large

amounts of cash. Therefore there is net inflow and outflow of cash cancels out.

But if the star can maintain its high market share, it will, turn into a cash cow

when the market growth rate declines. All organizations should have stars in

their portfolio, so the organization can survive when the market growth rate

declines.

Cash Cows

Figure 3: The BCG Matrix

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The BCG Matrix

Cash Cows are business units with a high market share but they do not help

the industry to grow because of the relatively low growth rate. Cash Cows

generate large amounts of cash with minimal investment. The basic idea

comes from cows, which are milked to maximum with minimum investment

possible.

Cash Cows are regarded as calm and boring in a mature market. But every

organization wants to own as many as possible.

Question Marks

Question Marks are business units that have a high growth rate and low

market share. Because of the low market share, they do not give out muchcash. But at the same time, require a lot of investment to maintain the high

growth rate. This leads to net cash consumption.

A Question mark is often referred to as a Problem Child because it has the

potential to gain market share and turn into a star and then a cash cow when

the market growth goes low. If, however, the question mark does not succeed,

then, after years of cash consumption, it will deteriorate into a dog when

market growth rate falls. Question marks must be analyzed properly to

determine whether they are worth the investment required to increase market

share.

Dogs

Dogs are business units that have low market share and low growth rate. Dogs

are sometimes called pets. This is because they give almost no output and

take in few inputs.

These units generally break even. This means that they hardly generate

enough cash to maintain the businesss market share. Owning Dogs can

provide a social benefit such as jobs or synergies that assist other businesses.

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The BCG Matrix

But, generally such units are worthless because they do not generate any cash

for the organization. Dogs should be sold off because they depress the

organizations return on assets ratio.

DUNKIN DONUT BCG MATRIX ANALYSIS

Like all other organizations Dunkin Donuts also has a variety of business

units. Many of the products can be categorized as Stars, Cash Cows, Question

Marks or Dogs.

Stars

Dunkin Donuts star products include:

Donuts

o Boston Kreme Donuts

o Chocolate Sprinkle Donuts

The Boston Kreme Donut is a donut with Chocolate frosting and a creamy

vanilla or custard filling. It is not only a star product in Pakistan, but it was

designated as the official donut of Massachusetts in 2003.

The Chocolate Sprinkle Donut consists of a chocolate frosting covered with

multicolored coated chocolates sprinkled

These are considered as star because they help Dunkin Donuts to maintain

high market share and also lead to market growth.

Cash Cows

Dunkin Donuts considers Munchkins as Cash Cows.

Munchkins are a part of the Donut Hole category at Dunkin Donuts.

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The BCG Matrix

Donuts are not made by cutting out the central portion of a cake but by

dropping a ring of dough from a special nozzle into hot oil. However, soon after

ring donuts became popular, an opportunity to market holes emerged.

These holes seemed as if they were portions that were cut out to make the

ring.

Question Marks

The Mini Pizzas are considered as Question Marks for Dunkin Donuts. The

management is unsure about making further investments in the Mini Pizza

category or to discontinue its production.

Dogs

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The BCG Matrix

The Bagel with Cream is considered as the Dog for Dunkin Donuts. The

management is reluctant in making further investments in this product, as it

does not give the expected profit

Figure 4: BCG Matrix Analysis of Dunkin Donuts

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The Organizing Process


ORGANIZATION:

The arranging and structuring work to accomplish organizational goals is

known as organizing. It is important process during which managers design an

organizations structure. Organizational structure is the formal arrangement of

jobs within an organization. When managers change or create the structure,

they are engaged in organizational design, a process that involves decision

making, work specialization, departmentalization, chain of command, span of

control formalization, centralization and decentralization.

At Dunkin Donuts the decisions making takes place at upper level, top

managers make key decisions with little input from operating core. The lower

level employees like counter persons are not involved in decision making

process because they are not as much experienced as top managers are in the

organization. Dunkin Donuts is a centralized type organization.

Dunkin Donuts is giving more authority and power to shop managers to make

decisions. They are empowering shop managers to employees. In large

companies especially, lower level management are closer to the action and

typically have more detailed knowledge about problems and how best to solve

them, than do top managers. But empowerment is given to shop managers,

not to the counter persons.

Organizations dont have identical structures. Different organizations do

different tasks, so they have different generic models of organization design.

There are two types of organizational models, Mechanistic and Organic design.

A mechanistic organization is a rigid and tightly controlled structure

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characterized by high specialization, rigid departmentalization, narrow span of

control, high formalization, a limited information network, and little

participation in decision making by lower level employees.

Mechanistic organizational structures strive for efficiency and rely heavily on

rules, regulations, standardized tasks, similar controls. This design tries to

minimize the impact of different personalities, judgments, and ambiguity

because these human traits are seen as inefficient and inconsistent. Although

no organization is totally mechanistic, almost all large ones have some of

these mechanistic characteristics.

Dunkin Donuts has organic structure, which is a structure thats highly

adaptive and flexible. Organic organization may have specialized jobs, but

those jobs are not standardized and can change as need require. Work is

frequently organized around employee teams. Employees are highly trained to

handle diverse activities and problems, and they require minimal formal rules

and little direct supervision.

Managers are finding that traditional designs are often arent appropriate for

todays increasingly dynamic and complex environment. Instead,

organizations need to be lean, flexible, and innovative, that is, they need to be

more organic. So managers are finding creative ways to structure and

organize work.

There are contemporary organizational designs, but Dunkin Donuts follow

Team structure. A team structure is one in which the entire organization is

made up of work teams that do the organizations work. In this structure shop

managers do the work in the way they think is best, but they are also

responsible for all work performance results in their respective areas.

In large organizations, the team structure complements what is typically a

functional or divisional structure. This allows the organization to have the

efficiency of a bureaucracy while providing the flexibility that team provide.

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Dunkin Donuts is learning organization; the learning organization is a concept

that is becoming an increasingly widespread philosophy in modern companies,

from the largest multinationals to the smallest ventures. The concept of

Learning Organization is increasingly relevant given the increasing complexity

and uncertainty of the organizational environment

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The Controlling Process


CONTROLLING:

After goals and plans are set, Tasks and structural arrangements are put in

place, and people are hired, trained and motivated, there has to be some

evaluation of whether the things are going as implemented. To ensure that

goals are being met, managers must monitor and evaluate performance. This

is called Controlling.

DUNKIN DONUTSPERFORMANCE EVALUATIONAND

CONTROLLING:

Dunkin Donuts Performance management focuses on what techniques and

methodology is involved in controlling the Organization. It is the natural

process of Organization and basically called the one of the Six Sigma. It points

out any shortcomings of either companys staff or Business plans and helps to

take appropriate corrective actions. Evaluation Management allows Dunkin

Donuts to recognize the full potentials of its staff. This method can be

described as a Comprehensive process starting from Monitoring and

establishing desired characteristics to value Companys progress and

rewarding employees for their achievements. Additionally, this evaluationmethod also helps mangers to provide certain guidelines of what they expect

and what the employees need to accomplish.

QUALITYCONTROL:

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Quality Control is one of the most important parts in Organization Controlling

Process. During this Quality Control Process, the Organization divides the

whole production processes in to smaller and simpler processes to identify the

points where inspection review is necessary. Dunkin Donuts mainly

focuses on the Satisfaction of the Customers and therefore, Quality control is

efficient service is necessary. The Process that involves in quality Control is by

sending a person of company to different outlets for the inspection of products

and levels of services provided. The main Strategy of controlling the work

tasks of Dunkin Donuts is using the Cause and Effect Method, through this

process company Identifies the issue and then divide it in to different

Departments and tries to resolve that issue, in this way the Controlling process

is also done and efficiently and Discipline is also maintained.

The main goal of Dunkin Donuts is Customer Satisfaction and providing good

Quality of services and to check it, managers at the company are continuously

evaluating employees performance. In Dunkin Donuts the stock mangers are

use the Periodic System to manage the weekly inventory. The outlets have

goods for 4-5 days and that is how the Periodic System works in most of the

Dunkin Donuts Outlets.

CONTROLLINGENVIRONMENTALINFLUENCES:

Today, there are different cultures present in Dunkin Donuts Market Strategy,

which are continuously adapting new Technologies to satisfy the Demands of

consumer needs. Dunkin Donuts is keeping the factors such as Age, Income

and most importantly the lifestyle of the customers to succeed in such a

competitive market. To control this situation Dunkin Donuts have

implemented several changes to attract customers like their many

Restaurants are looking for Centralized kitchens to increase the cost and

reduce the cost. This process will help to save customers money as well. The

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Restaurants of Dunkin Donuts are also adapting to the lifestyles of many of its

customers.

Dunkin Donuts Empowers by controlling its Departmental Teams to satisfy

their guests and fulfill their all needs in a friendly manner. It also monitors the

speed of its employees' service in providing quality products to their

Customers.

Dunkin Donuts are also involved in Designing Effective Control Systems which

have got Following Characteristics.

1. Controls at all levels of Business

2. Acceptability to those who will Enforce Decisions

3. Flexibility

4. Accuracy

5. Cost Effectiveness

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The Leading Process

The Leading Process

Leadership is processes in which mangers motivate their subordinates in order

get the most out of them. Leading is focused on influencing people, while the

other functions are focused on "resources". The factor that is considered to be

the most important one throughout the world is the presence of interpersonal

skills in the leaders. The human interaction plays an essential part in

influencing the human behavior. In Pakistan the corporate leadership is a very

limited concept. Most of the leaders in our organizations first think aboutthemselves and then look for the things that benefit others and the

organization. Every organization in Pakistan has their own way of leading,

some stick to the highly professional approach where they are highly goal

oriented and in some organizations the leaders have the fatherly concern

where along with supervising the people on work, they also take care of

subordinates off-the-work life.

LEADERSHIPAT DUNKIN DONUTS:

Usually the leadership in the organizations is all about being the first one, the

most powerful and the biggest one but the trend that has been fallowed in our

organization revolves around the effort in setting the direction and influencing

people to fallow that direction. The qualities that a good manager have to

develop trust between manager and the subordinates, the open and face toface communication, best at handling interpersonal conflict among the

employees, he must also value the diversity in the workforce, work on

motivating the staff and constantly look for the feedback as it identifies the

room for improvement.

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The Leading Process

A leader is not a magician he cant change the nature and the attitude of the

people in a second or so, he is the one who manage and change their attitudes

gradually with the techniques like team building and system thinking which

brings out the capabilities of every single individual. The most common skills

that a manager in Dunkin Donuts have the ability to think creatively,

systematically, and conceptually i.e. he have the broad view while handling

different situations. The ability to analyze information and make decision and

he also possess the ability to judge his own performance through the

knowledge of the organization and its environment he will lead and for this

purpose we at DUNKIN DONUTS use the method of self evaluation forms for

the self appraisal and also take feedback from the subordinates through these

appraisal forms.

The employees who fulfill their monthly, quarterly and yearly targets get

different kind of incentives and sometimes even a promotion for showing high

efforts performances this help them to motivate their employees. The mode of

communication used at Dunkin Donuts is the world call telephones at every

shop and office that makes the communication between the workers and the

manager at the head office easier and effective. The leadership style that is

used at Dunkin Donuts is autocratic where the leader makes the decision and

everyone has to fallow it. They are using the same policy since so many years

so it is considered to be the most effective one.

Dunkin Donuts highly appreciates the cross functional team approach as it

enhances the capabilities of every single individual which in turn affect the

organization progress. The integration of the all the departments within the

organization lead to the continuous improvement in the quality of work.

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Human Resource Management

Human Resource Management:

Human Resource Management provides support and advice to line

Managements. The resource Management (HRM) includes a variety of

activities. The function of Human Resource Management is generally

administrative. Organizations generally use Selection Evaluation and Payroll as

a part of their Human Resource Management process. The use of Human

Capital has become extremely important to organizations for their success.

Human resource functions consist of tracing employee data which may include

skills, personal history, accomplishments, capabilities and salary records.

Human Resource management includes:

1. Recruiting: Recruitment is process that must be carried in order to have

right person for right job at right time

2. Training: Training is process in which organizations increase their

employees competence level. Employee training may be done throughtraining courses, books, CDs, web based learning etc.

3. Performance management: Organization carries out performance

management process in order to evaluate employee current

performance and to figure out employees who will be beneficial to

organization in long run.

HUMAN RESOURCE MANAGEMENT AT DUNKIN

DONUTS:

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Long Term Goal:

The long term vision of Dunkin Donuts is to become a diversified company

which is operating Pakistan. The Management is planning to open 100

branches in Karachi alone. To acquire this target they need the people who are

competent enough to achieve this target. Therefore they aim to recruit highly

productive people. Dunkin Donuts look for long-term commitment on the part

of both Company and employee and have designed their systems to fulfill the

Company's part of this promise.

Recruitment and selection process:

The recruitment process is taken very seriously and attentively. This is the

most important part. It is vital that they select people with productive and

unique qualities essential for their continued success and rise.

Identification of need

The first step is to ensure that whether there is a need for new selection or

not. If there is a new position to be made then, then the department notifies

the Human Resource Department to place advertisement in the newspapers.

Application Form

Application forms enable the candidates to present a complete picture of their

personality and talent. It is the first stage of evaluation and the most basic

criteria for initial selection.

Evaluation of Resume

HR department checks all the resumes of the people who have applied. In its

evaluation the HR department ensures that abilities and experience matches

with their requirement of job.

Short Listing

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After the evaluation of the resumes the HR shortlists the candidates who have

fulfilled the minimum requirement of the job description and specification.

Test

The test is conducted by the HR department to ensure that best applicants are

selected.

Interview

The candidates who have cleared the tests are then called for interview. Aim

of the interviews is to check the persons subjective skills which are difficult to

measure such as attitude, communication skills, abilities and personality.

Hiring

After the medical test, the candidate is consulted and referred back to the

relevant department for which it is hired. If the department satisfies and

agrees upon it, then the candidate is hired.

Training

Company arranges a long range of training program; both technical

management and core management and they are on a regular basis to

develop ethics, knowledge and basic working skills.

PERFORMANCEMANAGEMENT

Compensation and Benefits

Dunkin Donuts provides compensation and benefits to high performing

employees in the form of bonuses and promotions.

Career Development

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The main aim of career development process is to satisfy the employees with

their personal needs, desires and skills with the requirements of the Company

for the right person in the right job at the right time.

mp report (97-2003)

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