session 2 - benihana - students
DESCRIPTION
benehana of tokyoTRANSCRIPT
2. Operations Strategy and Processes – René Caldentey
Benihana of Tokyo
2. Operations Strategy and Processes – René Caldentey
Recently reopened Benihana in Atlanta, GA
Benihana in Utah
How it Looks
2. Operations Strategy and Processes – René Caldentey
Benihana of Tokyo: The Concept
Business Operations
2. Operations Strategy and Processes – René Caldentey
Flow Process
Process architecture
– Inputs & outputs
– Flow units
– Activities and buffers
– Resources
– Information
Input
Buffer 1
Activity 1 Activity 2Output
Buffer 2
Process
Resources
Information
Process: Transformatio
n of inputs into
outputs
2. Operations Strategy and Processes – René Caldentey
Transformation Process
• Food & Beverages• Employees:
• Chefs• Managers• Carpenters• Waitress
• Building Materials• Market Information
Operations:• Layout Distribution
• Bar/Dinning Area• “Back Office/Room”
• Hibachi Cooking / Show• Bar Service• Food Purchase & Storage• Food Preprocessing• Quality Control• Employee TrainingMarketing:• Advertising / Public Relations• Benihana Concept• Site Selection / DecorationFinance:
• Skilled Chefs • Low Food Inv.• Utilization rate of Bar/Dinning Area• Customer Service - Entertainment - Food & Drinks - Social Environ.
Feedback
Inputs
Processes
Outputs
2. Operations Strategy and Processes – René Caldentey
Process Flow Diagram
Reception
Bar
Group of 8?
yes
Customers
Diners seated
Orders taken
Soup served
Chefshow
Main meal
Checkout
Food
Preprocessing
Storage
Drinks
Other Flows:• Information Flow• Cash Flow• Chef Training Flow
WIP
2. Operations Strategy and Processes – René Caldentey
Comparison of Operating StatisticsTypical Restaurant
SalesFood 70.0% 80.0%Beverage 20.0% 30.0%
Cost of SalesFood cost (% of food sales) 38.0% 48.0%Beverage (% of beverage sales) 25.0% 30.0%
Cost of total Sales 35.0% 45.0%
Gross Profit 55.0% 65.0%
Operating ExpensesLabor Cost 34.0% 42.0%Advertising 0.8% 2.0%Rent 4.5% 9.0%Others 16.0% 33.0% 16.0% 33.0%
Total Operating Expenses 55.3% 65.0%
Net Profit Before Income Tax 0.5% 9.0%
RangesRangesBenihana
2. Operations Strategy and Processes – René Caldentey
Process Management Definitions
Activity: Is a value-adding stage on the business process.
Buffer: Is a stage in which units are stored waiting for the next activity on the process
Throughput: Is the rate (unit/unit time) at which a process (system, work area, machine) produces goods or services.– Benihana: # of (satisfied) customers per unit of time (hour, day, month, year)
Capacity: Maximum throughput of a system
Buffer ProcessPreviousstage
Nextstage
2. Operations Strategy and Processes – René Caldentey
Process Management Definitions
Flow time: Time spent by a typical order, job or customer in a buffer, activity, or the entire system.
Capacity utilization: Throughput divided by total capacity available.
Example: A GM plant has a capacity of 3600 cars/week, and actually produces at a rate 2700 cars/week. Its utilization is:
= 2700/3600 = 75%
2. Operations Strategy and Processes – René Caldentey
For Benihana….
Parameters that influence throughput:
Layout
Training Process
Reduced Menu
Food Pre-processing
Food Quality Control
Capacity Management
Advertisement
2. Operations Strategy and Processes – René Caldentey
An Example of Flow Analysis
Find the relationship between # of tables in the dinning room and # of seats in the bar if we want an average customer to stay 24 min.in the bar (assume full capacity).
CustomersDinning Area
hour). (1 area dinning at the time(Run) Processing
tables).(14 tablesof #
pers). (8 per table customers of #
S
N
n
T
p
RBar
2. Operations Strategy and Processes – René Caldentey
An Example of Flow Analysis (cont..)
Little’s Law:System
R R…
I units
Flow Time (Waiting Time) = T
I = R T
Let I = # of seat in the bar (Inventory) T = Waiting time in the bar (24 min).Then from Little’s Law:
Consider a Benihana operation with 45 seats in the bar area and 14 Hibachi tables (with 8 seats each). Assume also that processing time at the dinning area is 1 hour. Suppose the restaurant starts it operations at 6pm and closes the door for new customers at 10pm. During these five hours, customers arrive at a rate of 150 customers per hour. Assume that if a new customer arrives and the bar is full then the customer walks away.
a) Use an Inventory Build-Up chart to represent the number of customers at the bar and at the dinning area over time. At what time the bar will be empty? At what time there will be no more customers in the restaurant?
b) What is the flow time (for the entire process bar+dinning) of a customer that enters the system at 8pm? What is the utilization of the bar and the dinning area?
Inventory Build-Up Chart
1. Introduction and Operations Strategy – René Caldentey
2. Operations Strategy and Processes – René Caldentey
Inventory Build-Up Chart
6 7 8 9 10 11 12time
BarInventory
15
30
45
6 7 8 9 10 11 12time
DinningInventory
28
56
112
84
2. Operations Strategy and Processes – René Caldentey
Business Flows
Relating Flow Time, Throughput and Inventory
Inventory = Throughput Flow Time I = R T (The IRT Rule)
The Turnover Relationship
Turnover = Throughput / Inventory TO = R / I = 1 / T
2. Operations Strategy and Processes – René Caldentey
Business Flow Examples
Customer Flow: Taco Bell processes on average 1,500 customers per day (15 hours). On average there are 75 customers in the restaurant (waiting to place the order, waiting for the order to arrive, eating, etc.). How long does an average customer spend at Taco Bell and what is the average customer turnover?
Job Flow: The Travelers Insurance Company processes 10,000 claims per year. The average processing time is 3 weeks. Assuming 50 weeks in a year, what is the average number of claims “in process”.
Material Flow: Wendy’s processes an average of 5,000lb. Of hamburgers per week. The typical inventory of raw meat is 2,500lb. What is the average hamburger’s flow time and Wendy’s turnover?
2. Operations Strategy and Processes – René Caldentey
Wal-Mart vs. Kmart (1999)
KM WMSales $33,674.00 $137,634.00COS $26,319.00 $108,725.00Cash $710.00 $1,879.00Inventories $6,536.00 $17,076.00AR $584.00 $1,118.00
Margins 28% 27%
Flow time (weeks)Cash 1.35 0.86Inventories 12.42 7.85AR 0.87 0.41
2. Operations Strategy and Processes – René Caldentey
The Benihana Case Illustrates Well-designed service operating system
Cost advantages and operations choices
Process analysis concepts Process flow diagram Batching Inventory Flow time / Cycle Time Capacity / Throughput / Utilization
Little’s Law : I = R T Inventory Turns Weeks of Inventory