Week 3

Delivering Quality in Food and Beverage Operations

Managing Profitable Food and Beverage

Operations

Session Content What is quality and why is it important?

Defining quality

What determines quality

Managing service quality and the quality chain

The benefits of maintaining quality

Quality characteristics

Service failure and recovery

What is Quality? (1)

Ask yourself the following questions:

How would you best describe ‘quality’?

What are your own expectations of ‘quality’?

How do restaurant and bar customers assess quality?

Does quality necessarily mean or indicate the most expensive and is price an indicator of quality?

What is Quality? (2) Quality is one of the 5 performance objectives (introduced last week) - high quality goods and services can give food and beverage businesses a distinct competitive edge

Slack et al (2010) suggest that quality is “consistent conformance to customer’s expectations” and that “all operations regard quality as a particularly important objective” being something that customers find relatively easy to judge (although this is usually a subjective assessment). They also write that quality:

reduces costs – making fewer mistakes in an operation means less time is spent correcting them

Increases dependability – having both an external impact which influences customer satisfaction and an internal impact which leads to stable and efficient processes (and happier employees)

Definitions of Quality (1)Common definitions usually include reference to the following:

Fitness for purpose

Customer satisfaction

Value for money

Zero defects

Get it right first time

The right thing, at the right price, at the right time

Definitions of Quality (2)Greasley (2013) cites Garvin (1988) who categorised a number of available definitions into 5 approaches to quality:

1. The Transcendent Approach - views quality as synonymous with excellence. Quality is defined as the absolute, the best possible, in terms of the product’s or service’s specification. How would you define a ‘quality’ meal a ‘quality’ watch or a ‘quality’ car?

2. The Manufacturing Based Approach - is concerned with making products or providing services that are free of errors and that conform precisely to their design specification. Can food and beverage operations ever be error free?

3. The User Based Approach - is concerned with making sure that the product or service is fit for its purpose. This means that not only does it adhere to specification, but also that the specification is appropriate for the customer

4. The Product Based Approach - views quality as a precise and measurable set of characteristics that is required to satisfy the customer

5. The Value Based Approach - defines quality in terms of cost and price. This approach contends that quality

should be perceived in relation to price. A customer may be willing to accept something of a lower specification quality, if the price is low enough. What examples can you think of?

Variablesthings you can measure

Attributesthings you can assess

accept/reject

Qualityfitness for purpose

Reliabilityability to continue

working at acceptedquality level

Quality

Quality of Designdegree to which

design achieves purpose

Quality of Conformancefaithfulness with which the

operation agrees with design

Aspects of quality

Slack et al (2010)

Why is Quality Important?Quality is a key element of all management activities with food and beverage businesses operating in a sector where customers expect a high level of service. Two main objectives should, therefore, be to (i) achieve customer satisfaction & to (ii) maximise the efficient use of resources while taking into account quality considerations

Customers are demanding more of the products and services that they buy and the way that these are delivered

Despite technological developments, however, personal contact is still highly valued

Businesses operate in a highly competitive environment – consider food & beverage operations in Birmingham city centre, for example. Consistently delivering quality is now seen as a key way of achieving competitive advantage

What Determines Quality?

In most cases, the level of quality offered by an organisation is determined by what the competition is offering:

In order to hold their share of the market a business must provide at least the same level of quality as their competitors

To improve their position in the market it needs to demonstrate an increased and sustained level of improved quality above that of the competition

Quality can, therefore , provide competitive advantage

Customers expect, and take for granted, the basic requirements such as food being prepared and delivered on time, for example.

Product and Service QualityIt is necessary to split the concept of quality to reflect the complex nature of the food and beverage product:

Product quality – this is tangible where conformance to a ‘standard’ can be checked prior to customer consumption.

Service quality - is a sequence of activities (processes) of variable duration and content. It is influenced and supported by the quality of tangibles but is an experience co-created with the customer and is subjectively assessed during and after delivery.

It involves technical elements and social interaction - service ranges from being mainly transactional (table reservation and Meet & Greet) to mainly experiential (tasting the food and drink product)

What is Service Quality?Fitzsimmons and Fitzsimmons (2014) write that service quality is a complex topic and suggest that:

“the assessment of quality is made during the service delivery process. Each customer contact is referred to as a moment of truth, an opportunity to satisfy or dissatisfy the customer.

Customer satisfaction can be defined by comparing perceptions of the service received with expectations of the service desired. When expectations are exceeded, service is perceived to be of exceptional quality – and also to be a pleasant surprise. When expectations are not met, however, service quality is deemed unacceptable.”

Service QualityParasuraman (1988) suggests that service quality is “an abstract and elusive construct because of the three features unique to services: intangibility, heterogeneity, and inseparability of production and consumption. … An appropriate approach … is to measure consumers’ perceptions of quality.”

There is a difference between objective and perceived quality.

Parasuraman (1988) goes on to write that “perceived service quality is a global judgement, or attitude, relating to the superiority of the service, whereas satisfaction is related to a specific transaction.” and that “Perceived quality is therefore viewed as the degree and direction of discrepancy between consumers’ perceptions and expectations.”

Moments of Truth

Fitzsimmons & Fitzsimmons (2014) suggest that each customer contact can be called a ‘moment of truth’.

A business and its employees have the ability to either satisfy or dissatisfy its customers with each contact.

Service recovery is satisfying a previouslydissatisfied customer and making them aloyal customer.

Service Failures (1)Service failures are inevitable and are usually due to someone not doing their job correctly which can then result in a problem being created for another person.

If a bartender dispenses an incorrect drink for service in a restaurant, for example, it is the waiter who has to deal with the customer who complains. Similarly, if a runner does not fully equip a station prior to service, the waiter will then have problems during the trading session, resulting in poor service to the customer.

In food and beverage operations, these problems are common and are due to the failure of individuals not doing it right the first time and every time - consistency is compromised

Service Failure (2)When service failures occur:

There is a need for speedy action and empowered frontline staff.

Attempt to see the situation from the customers’ view, empathise

Have guidelines and procedures in place to manage recovery.

Keep records of reported failures and use for future improvement

Check back with the customer to ensure that the problem has been resolved to their satisfaction.

Monitor social media and online review sites regularly, responding professionally and with empathy to comments posted – do not underestimate the power of online reviews and comments

http://www.tripadvisor.co.uk/Hotel_Review-g190920-d1849116-Reviews-or110-Premier_Inn_Paignton_Goodrington_Sands-Paignton_English_Riviera_Devon_England.html#REVIEWS

Self-directed readingIt is highly recommended that you read through the remaining slides contained within this lecture and supplement this with additional reading from the recommended texts.

At the same time, you are strongly advised to read the additional supporting articles attached to the module reading list/delivery scheme in relation to the quality measurement tools that may be considered in deciding how you will measure your ‘live’ dining experience.

Please bear in mind, however, that these notes should only form the basis of your reading

Seminar ActivityDuring the second part of this lecture session you are to:

If you have not already done so, decide who you wish to work with to form your team that will undertake the ‘mystery diner’ report & presentation assessment. Team member names must be given to the lecturer today

Using smartphones/tablets, undertake initial online research to select a suitable restaurant operation

Working as a team, begin to develop a set of criteria that you may be able to use when undertaking your restaurant visit.

Evaluate how your visit criteria may be linked to the quality measurement tools used by food and beverage operations

The seminar hour will be used to launch the second assessment and review criteria progress

Quality CostsTo instil a quality culture into a business takes time, commitment and money. However, what are the ‘costs’ of not achieving quality?

1. Prevention costs - these are the expenses associated with creating quality performance standards, such as staff training, preparing purchase specifications, recipe development etc.

2. Detection Costs – are the expenses of inspection, measurement and data collection analysis

3. Internal Failure Costs – expense due to waste or loss before the item reaches the customer involving the need for corrective actions or returns to suppliers, for example

4. External Failure Costs – expenses related to defective items reaching the customer resulting in customer dissatisfaction - - giving a free drink, for example as ‘compensation’

Quality Measurement Tools - the Servqual ModelOne of the most popular methods for assessing service quality is the SERVQUAL model developed by Parasuraman et al in the 1980s.

Using a 22 question questionnaire derived from a larger survey, they proposed measuring the gap between what customers expected and their perceptions of the service experience. The size and number of gaps would indicate areas for improvement.

These questions were grouped into 5 categories called the dimensions of service quality, which had been consistently ranked by customers to be important for service quality. The dimensions of service quality are as follows:

Dimensions of Service Quality

Reliability - ability to perform the promised service dependably and accurately

Responsiveness - willingness to help customers and provide prompt service

Assurance - knowledge and courtesy of employees and their ability to convey trust and confidence

Empathy - the caring, individualised attention to customers

Tangibles - appearance of physical facilities, equipment, personnel and communication materials.

The operation’s domain

Management’s concept of the

product or service

The customer’s

domain

PreviousExperience

Word of mouth communications

Image of product or service

Customers’ own specification of

quality

Organization’s specification of

quality

The actual product or serviceGap 1

Gap 2Gap 3

Gap 4

Customers’ expectations concerning a

product or service

Customers’ perceptions

concerning the product or service

Gap 5

Slack 2010

The Gap Model of Quality (Parasuraman et al, 1985)

Quality Planning & ControlThis process can be divided into 4 sequential steps:

Step 1 - Define the quality characteristics of the product or service

Step 2 - Decide how to measure each quality characteristic

Step 3 - Set quality standards for each quality characteristic

Step 4 - Control quality against those standards

Quality Characteristics of Goods & Services Functionality - how well the product or service does the job for which it was intended

Appearance - aesthetic appeal, look, feel, sound and smell of the product or service

Reliability - consistency of product or services performance over time

Durability - the total useful life of the product or service

Recovery - the ease with which problems with the product or service can be rectified or resolved

Contact - the nature of the person-to-person contacts that take place

Measuring Each CharacteristicCharacteristics must be defined in such a way as to enable them to be measured and then controlled. What problems can you see with this ?

Two types of measures are used by businesses to describe quality characteristics:

Variables - are those that can be measured on a continuously variable scale (length, weight or time, for example)

Attributes - are those which are assessed by judgement and are dichotomous (such as right or wrong, works or does not work, looks OK or not OK)

Variable Attribute

Functionality Number of meals served during a trading period

Is the food acceptable?

Appearance The number of tables that had not been cleaned to an acceptable standard

Are the bar and restaurant staff dressed smartly?

Reliability Proportion of meals that arrive at the tables in the required manner

Are there any complaints?

Durability Number of times when food and beverage innovation was not evident in comparison to competitors

Does a restaurant generally updating its products in a satisfactory manner?

Recovery Proportion of service failures resolved satisfactorily

Do customers feel that staff deal satisfactorily with complaints?

Contact The extent to which customers feel well treated by staff (1 to 5 scale)

Do customers feel that the staff were helpful (yes or no)?

Setting Quality StandardsOnce a business has identified how quality characteristics can be measured it needs a quality standard against which it can be checked in order that they can establish whether it indicates good or bad practice.

The quality standard is that level of quality which defines the boundary between acceptable and unacceptable. Such standards might be constrained by operational factors and the cost limitations. At the same time, however, they need to be appropriate to the expectations of customers.

No organisation is 100% efficient in all areas of its operations, but in crucial areas it has to be – consider the implications of poor hygiene standards in a restaurant operation, for example

Control Quality Against those Standards

After setting up appropriate standards, the operation will need to check that the products or services conform to those standards. This will involve 3 main decisions:

1. Where in the operation should the checks take place?

2. Should they check every product or service or take a sample?

3. How should the checks be performed?

Where Should the Checks Take Place?A key task for food and beverage managers is to identify the critical control points at which service, products or processes need to be checked to ensure that they conform to specification. These can be:

At the start of the process

During the process itself

After the process has ended

Should there, however, be 100% checking for all products and services and does 100% checking guarantee that all defects or problems will be identified?

How Should Checks be Performed?A variety of methods can be used by food & beverage businesses to check quality. Fitzsimmons & Fitzsimmons (2014) suggest that the Walk-Through Audit is suitable to determine where:

A service delivery system should conform to customer expectations.The customer impression of service is influenced by use of all senses.Service managers may have lost sensitivity due to familiarity.A detailed service audit is needed from the customer’s perspective.

A number of operations also use Mystery Guest visits where:

An external Walk-Through Audit may be usedA check for conformance to operational standards is undertakenSubjective feedback as a (professional) customer is given

A company only lives because it has customers. A quality company lives for its customers

ORDINARY Co. versus QUALITY Co.

Customer satisfaction profits come fromcomes after profits customer satisfaction

focus on detecting focus on preventing problemsproblems

Low spending on high spending on trainingtraining

treat complaints as complaints are treated asa nuisance an opportunity to learn

Cost containment cost containment throughthrough cuts disciplined approach to ops.

Supply chain

People do not manages the quality chain know where theyfit in the quality chain

Prime References Associated with this Lecture

Fitzsimmons, J.A., & Fitzsimmons, M.J., (2014) Service Management: operations, strategy, information technology 8th Edition, McGraw-Hill International, USA

Greasley, A., (2013) Operations Management 3rd Edition, John Wiley & Sons, Chichester, UK

Parasuraman, Berry & Zeithaml (1988) ‘SERVQUAL: a multiple-item scale for measuring customer perceptions of service quality’ Journal of Retailing, Spring 1988

Slack, N., Chambers, S., & Johnston, R., (2010) Operations Management 6th Edition, Pearson Prentice Hall, England, UK