Improving customer service at Red Lobster CUTTING THE FAT FROM THE SEAFOOD
General presentation Problem statement Customer experience(Gap analysis) Managing Capacity and demand (bottleneck) Managing queues Further recommendations Marie Rob Steven Renji Kevin Rob Agenda
World's largest seafood casual dining operation: • Over 650 seafood restaurants in the United States and Canada • Founder Bill Darden introduced RL in 1968 • Over 60,000 employees • Record sales 2001: $2.2 billion • 137 million guests in 2001(estimated) • Subsidiary of Darden Restaurants Inc. (Olive Garden, Bahama Breeze, and Smokey Bones BBQ & Sports Bar restaurants.) visit the website: http://www.redlobster.com/
A typical RL restaurant: • $3 million in annual sales, 3-4 managers and about 75 employees. • Capacity: about 250 persons. • Price Range: $25-$50 per check. • Hours open: Sun-Thurs 11am-10pm, Fri-Sat 11am-11pm
Map of the Williamsburg restaurant Ovens Restrooms Prep area Dishwashing area Entrance LINE Kitchen entrance Waiting area BAR 5 Hostess 2 1 3 4 Legend: Table Bench
Problems statement Robert Miller
Main Problems • Waiting time excessive: as the input rises, the system becomes over-saturated: • Unhappy customers • Servers and kitchen staff become frazzled • Pressure does not increase efficiency, it acts against it • Table turnover low (too many campers) : • Capacity can’t meet demand at peak times (kitchen bottlenecks) • Customers report problems with immature servers
Main Problems • Cost Structure Unbalanced: • Too large portions for certain items • Main entrée’s too small at times • Customer disappointment • Pay Scale Unbalanced: • Kitchen paid hourly while servers are tip-oriented • No impetus for chef efficiency
Customer experience Steven Koskinen
Gap Analysis Reasonable prices Casual atmosphere Quality seafood Expected dining experience Gap 4 Kitchen preparation of prepackaged foods. Delivery of food items to restaurants Perceived dining experience Hostess and wait staff provide customers their first experience Gap 3 Gap 1 Gap 2 Proper presentation of various menu items. National advertisement campaigns, which sets the mood for new customers Corporate offices decide what to offer on the menu, what price to charge, and how much to pay employees.
Managing capacity and demand Roger Huang
Managing capacity and demand • Capacity: 140 entrees/hour • Cycle time for fried entrée: 10 min • Cycle time for any other entrée: 16 min • Bottleneck : C 2 min B) Fried 2 min 2 min 1 min 3 min D)Assembly E)Garnish F)Delivery 8 min A) order C) Broiled
Recommendations to increase the capacity • Add another tier or conveyer belt to the existing oven • 70 more entrees produced/hour • Increase capacity to 210 entrees/hour • Decrease broil belt time from 8 to 6 min • Increase capacity to 186 entrees/hour • If you decrease broil belt to 5 minutes! • Increase capacity to 224 entrees/hour
Managing queues Kevin Chang
Further recommendations… Robert Miller
Recommendations • Increase capacity in the kitchen so the food can go out more quickly. Tradeoff analysis must be performed to decide on capital expenditure magnitude (payback analysis). Add third tier to oven. • Increase service efficiency by training employees more frequently. • Implement kiosks that allow customers to make their drink/appetizer orders by themselves while waiting to be seated.
Recommendations • Give customers opportunity to socialize while waiting: • Rearrange space, add tables, no hard benches • Newspapers, surveys • Food pricing not optimum • Incentive system must include chefs. Link them with turnover so they have motivation to be efficient same as servers. Allow servers and chefs to take “ownership” of their profit
Recommendations • Bartenders drink list must be increased (tradeoff vs. simplicity) • Servers must learn to up sell • Merchandise counter – sweatshirts, knick-knacks, cute stuffy lobsters, etc. • Institute three strikes and you are out policy for employees • Mints!!!!! Mints!!!!! Mints!!!!!