Case Study OB - Domino's Pizza (Job Satisfaction)
Transcript of Case Study OB - Domino's Pizza (Job Satisfaction)
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Meishkafadiah AlkaffMohammad Fardani Dzulhikam
Sandy RenaldyPermada Wirapranata
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• Type :Public (NYSE: DPZ) • Founded :1960 • Headquarters Ann Arbor, Michigan • Key people : Tom Monaghan,
FounderDavid Brandon, Chairman & CEO Industry Restaurants
• Products Pizza · sandwiches · pasta · chicken wings · desserts
• Revenue ▲ $1.462 billion USD (2007)
• Employees 145,000 • Website www.dominos.com
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• Low Pay• Part Time• Closely Supervised• “High Turnover”• In the case of Domino’s Pizza
– Multitasking
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• Main Problems– Domino’s is Facing employee high employee turn over
rate• Store Manager leave every 3 – 6 months• Lower level employee turnover rate 300 %
– Company Policies avoid increasing basic wage• How they Handle the Problems
– Recruit better store manager by implementing new test– Improving employee skills by training the weak points
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• How they Handle the Problems (Cont.)– Providing facilities for store to see
their records– Better financial incentive – Better improvement training
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• Why is Domino’s Facing High Turnover Rate ?
• What is the Impact of high turnover rate to Domino’s
• Is it really effective not to increase the basic wage oppositely like starbucks does?
• What is really needed to reduce employee turnover rate?
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• Compatibility with they work reviewed from their basic education, interest, experience, compensation and any others.
• The Amount of salary and fringe benefits with any others benefit (career, training & management development)
• Relationship between human either vertical and horizontal (superior treatment and relationship with subordinate and colleagues).
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• Low Pay (obvious)• Lack of relationship between boss
and worker.• Mean colleague + boring days• Lack of leadership element (note
that store manager leave ever 3-6 months)
• Main Problems is : “Store Manager”
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• Opportunitis to get employee who’s have better experience and ability
• Company can employ new employee who’s got new idea’s yang memiliki ide-ide baru which can create inovation in exist governace work
• Can decrease the average of employee work period which can reduce the cost of salary that must be paid.
• Can give a chance to talented and high performance.
• If the employee who’s quit the job has a poor performance or employee of a gadfly for the same team working in the organization
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• Employee Repo cost• Learning cost• What they out for worker are more less than
they get from new worker.• Level accident new employees, usually tend
to be higher• There is a production that has lost during
turnover• Production equipment that cannot full operate • A lot of waste because of the new employees
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Impact On Domino’s
• It’s cost money to recruit, hire, and train people, and undercuts service when inexperienced employees don’t work as efficiently
• The Financial Cost is estimated as :
– $20.000 for each store manager leave– $2.500 for each hourly worker leave
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•Distinct characteristic of fast food business were, high dependable on low-paid workers. Small problem could trigger worker to seek another job in another company.
•Some company using approach of giving high initial salary.
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• Domino using different approach, where they didn’t raise salary
• They believe working environment and quality of store manager play important role in turnover rate
• They believe when store manager position turnover is high, it will has ripple effect to the layer below
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• So they try to focus on recruit high quality store managers
• Domino’s is selectively hiring store managers, train them, and motivating them with rewards
• They coach and demand store managers to create better working environment
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– Recruit Better Store Manager– Give Store Manager Better Tools– More Meaningfully Incentify Store
manager
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•The Role of a Store Manager :• better working environment• To motivate other workers or
subordinate• Increase job involvement among
workers
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•The Role of a Store Manager :• To create better working environment• To motivate other workers or
subordinate• To Increase job involvement among
workers
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• Dimension• 1. Extraversion : Outgoing, talkative,
sociable, assertive• 2. Agreeableness : Trusting, good‐
natured, cooperative, softhearted• 3. Emotional Stability : Dependable,
responsible, achievement oriented, persistent
• 4. Emotional : Stability Relaxed, secure, unworried
• 5. Openness to Experience : Intellectual, imaginative, curious, broad‐minded
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• Recruitment – Managerial and Financial Skill is needed– People Management
• Development– To enhance managers weakness which
assessed during recruiting process– Continuous Development guided by
franchise owner or headquarters
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Supporting Tools for Manager
• Managers need to be equipped and weaponized with better tools to provide easier managerial handling on their subordinate
• The weapon include : – Better IT system– Better FAQ system– Better managerial control system– Better business process/operational
efficiency
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Supporting Tools for Manager
• Computerized Tracking System• FAQ Management• Domino’s Pulse System• Domino’s Next Generation Store
System• New Domino Next Generation Store
System developed by Microsoft
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Key Benefit of The system
• Total cost of ownership. The solution is designed to lower the total cost of ownership by delivering superior price performance and reducing administration cost
• Lower Risks. The solution is designed to help address industry mandates and avoid unnecessary risk and related costs
• Security. The solution is designed to minimize risks, Microsoft is optimizing and better securing solutions that reduce complexity while supporting rigorous service levels. The solution also monitors fraudulent activity
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Sustainable Incentive Programs
• formal scheme used to promote or encourage specific actions or behavior by worker.
• The scientific literature also refers to this concept as Pay for Performance.
• Domino’s is using the concept of sustainable incentive to improve worker’s job involvement
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Incentive program
Type of Incentive :– Employee Incentive– Consumer Incentive– Dealer / Channel Incentive– Sales Incentive
Type of Reward :– Cash Reward– Non Cash Reward– Non Monetary Reward
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Rewards for Managers & Employee
• Employee Stock Option Plans Company introduced program that grants
stock options to about 15% of store managers based on criteria such as sales growth and customer services
• Suggestion Rewards :– A simple ‘Thank You’ appreciation of good work– Treat your employee with respects– Start birthday program– Have employee field trips– Casual lunch with staff
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•The result is significant: employee turnover rate declined to 107%.
• Far below previous, and average industry
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• In case you haven’t figure it out : IT IS GROWING