TUGAS KELOMPOK

TUGAS 1
Anaysing the requirements of PMS (Taco Bell Case)

Dosen: Ir. Adi Joko Guritno, MSIE, Ph.D.

Kelompok 5 1. Shindu A. Wicaksono 2. Susilo Pramono - 11D0609 - 11D0610

Kelas Khusus Pertamina Angkatan 6 Jakarta

PROGRAM STUDI MAGISTER MANAJEMEN FAKULTAS EKONOMIKA DAN BISNIS UNIVERSITAS GADJAH MADA JAKARTA 2012

Insight From Practice : Analysing the Requirements of performance measurement systems 1. This article proposes making a contribution to this field by discussing how to deal systematically with all the requirements a performance measurement system (PMS) should fulfil. 2. The article explains how to separate requirements that can be linked to a PMS and to an individual performance measure. It also suggests three system classes depending on what requirements a PMS fulfils. Finally a three-step procedure is proposed that describes how to evaluate and improve an existing PMS in a company. 3. A successful performance measurement system (PMS) is a set of performance measures (i.e. a metric used to quantify the efficiency and effectiveness of action) that provides a company with useful information that helps to manage, control, plan and perform the activities undertaken in the company. 4. The information retrieved from the PMS must in turn be accurate, relevant, provided at the right time and easily accessible for the persons who need it. Furthermore, the performance measures must also be designed to reflect the most important factors influencing the productivity of the different processes that can be found in the company. To design such a PMS is, of course, a difficult task and what that can be considered to be the optimal PMS will also differ from case to case (Tangen, 2004a). 5. Various authors have discussed the design of performance measures and identified numerous important requirements that performance measures should fulfil. a. Crawford and Cox (1990), for example, believe that performance must be measured in ways that are easily understood by those whose performance is being evaluated. They also propose that measures should evaluate a group, not individual work. Moreover, graphs should be the primary method of reporting performance data. b. Performance measures should be derived from strategic objectives to ensure that employees behaviour is consistent with corporate goals (Cross and Lynch, 1992; Kaplan and Norton, 1992; Dixon et al., 1990; Bourne et al., 2003). 6. There are numerous requirements to fulfil when designing a PMS. Several compilations of what a PMS should fulfil can also be found in literature (Neely et al., 1997; Franco and Bourne, 2003; Bauer et al., 2004; Najme et al., 2005), requirements fall into two categories: a. System requirements. These represent criteria important from an overall system point of view, such as: support strategy and selection of both financial and non-financial performance (i.e. what to measure). b. Measure requirements. These represent criteria important when designing an individual performance measure, such as: have an appropriate formula and include necessary specifications (i.e. how to measure). 7. The idea of system classes is that a company should begin by designing a simple yet useful PMS fulfilling the companys basic needs instead of going directly to an

advanced PMS. In other words, it is suggested that a company should start with designing the lowest class of a PMS (i.e. third class). Later when the company is completely prepared it should progress to the next class (i.e. second class) and then consequently to the highest class (i.e. first class). 8. Three different classes of PMS are suggested: a. Third class can briefly be described as PMS where mostly traditional performance measures are used. The requirements of such a system are rather low, but it is important to have control over the basic principles in performance measurement before moving up to the next level. b. Second class means that the PMS have a much more balanced view on performance than the previous class. Non-financial measures are used, different time horizons are considered and most levels within the company are overviewed by the PMS. c. First class is the most advanced PMS, which means that very high standards are met, ranging from the existence of an advanced information handling architecture to measures that explain causal relationships across the organisation. These systems must also include processes that enable them to evolve when necessary. 9. some basic requirements should always be fulfilled by a good PMS and, in this case, regardless of system class: provide accurate information; support strategic, tactical and operational objectives; guard against sub-optimisation; and include a limited number of performance measures. 10. Bourne et al. (2003) describe five different aspects in performance measurement that have changed significantly during the last 20 years: focus, dimensions, drivers, targets and desired benefits. A similar classification will be used here when discussing what requirements increase both in importance and in complexity depending on each system class: requirements regarding used performance criteria; requirements regarding stakeholders; requirements regarding hierarchical levels; requirements regarding time-horizon; and requirements regarding information architecture. 11. A third class PMS requires that: Traditional performance criteria are used. The performance measures within this class will to a majority be influenced by the traditional way of measuring performance (e.g. return on investment (ROI), cash flow, efficiency). The performance measures control that different costs are kept at a reasonable level. Internal needs are fulfilled. The performance measures are mainly focused on fulfilling the internal needs of the organisation. Top hierarchical levels are included in the PMS. The performance measures should cover at least the most important hierarchical levels of the organisation. The short-term time-horizon is considered. Important measures within the PMS should include updated targets, which at least cover the short-term time- horizon.

12. A second class PMS requires that: Both financial and non-financial performance criteria are used. Performance should not solely be seen from a traditional point of view. A second class PMS consist of various types of performance measures (i.e. multi-dimensional) covering all the important aspects that represent the performance of a company (e.g. cost, quality, delivery, flexibility and dependability). There must in turn be a balance between the various performance measures in the PMS. Internal and external needs are fulfilled. The performance measures are focused on fulfilling both the intern needs of the organisation and external needs (such as from suppliers and customers). Most hierarchical levels are included in the PMS. Performance measures exist on most hierarchical levels in the organisation and are linked to each other. There should be a balance between global and local performance. Short- and long-term time-horizons are considered. Important measures within the PMS should include updated targets, which cover both the short- and the long-term time-horizon. A practical information architecture is achieved. Vital information goes to the right persons with little delay. 13. A first class PMS requires that: The used performance criteria explain important causal relationships across the organisation. The performance measures within this class must support sustainable performance improvement and must therefore stand up to the highest standards. The measures must not only have a multi-dimensional view on performance, they should also be able to explain what factors that have an influence on the performance of the company and indicate what to do in order to improve. The needs from all stakeholders are fulfilled. The PMS includes performance measures considering the needs from all possible stakeholders needs (e.g. customers, shareholders, competitors, suppliers, employees, the society). All hierarchical levels are included in the PMS. Performance measures exist on all hierarchical levels in the organisation and clear links have been established between the measures on the different levels. Processes have been created for natural evolution of the PMS. Secures that the PMS is constantly updated when needed. An advanced information architecture is achieved. Performance measurement databases and other reporting systems should be fully integrated to each other. The information in the PMS is updated continuously and directly presented to the persons who need it. 14. In order to deal with the above-presented requirements in practice when improving a current PMS, the following simple three-step procedure is proposed. This is a similar approach to identify weaknesses of PMS as the Performance Measurement Questionnaire proposed by Dixon et al. (1990). However, that Performance Measurement Questionnaire does not support the idea of system classes and does not consider all of the requirements presented here (such as stakeholders):

Some form of information architecture is achieved. The PMS should be designed in a way so that information is easily retrieved as well as easily understood by those whose performance is being evaluated.

Requirement evaluation. The first thing to do is a subjective evaluation of to what degree the PMS fulfils different requirements. This is done with the system evaluation form described in Table II. The idea with the form is to subjectively consider to what degree each specified requirement is fulfilled by the PMS, on a scale between (1) to (7), where (1) means that the requirement is not fulfilled at all and (7) that it is fulfilled to the highest degree possible. It should be noted that there is no particular reason for choosing a seven-graded scale here other than that this scale is easy to use and gives proper details. System class determination. After the requirements have been analysed it is time to determine the system class of the PMS (third class, second class or first class). This is done by comparing the system evaluation form to the descriptions of the system classes in Table I. Revision of the PMS. Depending on the result of the previous steps, there are two different strategies to follow when revising the PMS: - Class completion strategy. This strategy is used if some defined requirements within the system class have not yet been fulfilled to a satisfactory degree. The class completion strategy simply means that the requirements within the class that can be improved, receive considerable attention until the PMS has completed all class requirements. - Class progress strategy. This strategy is used when all requirements within the system class have been achieved to a satisfactory degree and the organisation is ready to move up to a higher class. The class progress strategy will require more efforts for a shorter period of time than the previous described strategy, since many new requirements must be focused simultaneously and the PMS will be affected by major modifications.

Case : Taco Bell

Introduction

1. Taco Bell adalah rumah makan berantai siap saji dengan konsep restoran keluarga yang menyediakan tacos, pizza, dan lain-lain. 2. Taco Bell didirikan pada tahun 1962 di Downey, California oleh Glen Bell. Rumah makan ini mulai menjadi rumah makan waralaba sejak tahun 1978, dan selanjutnya membuka cabang di seluruh dunia. Hingga saat ini, Taco Bell memiliki rumah makan di Kanada, Amerika Serikat, Kosta Rika, Meksiko, Australia, RRC, Inggris, Jerman, Islandia, Jepang, Meksiko, Filipina, Singapura, dan Korea Selatan. 3. Taco Bell mendominasi pasar di tahun 1999, dimana dari tiga dari empat jenis makanan meksiko siap saji dibuat oleh Taco Bell, namun seiring dengan perkembangan pasar dimana dominasi Taco Bell semakin terdesak dengan produsen lain menuntut perusahaan ini untuk bisa melakukan langkah strategis dalam mentransformasi bisnisnya untuk dapat mempertahankan pangsa pasar.
4. Dengan Tipikal Job Shop Operation yang dianut oleh Taco Bell dimana seluruh aktivitas berkaitan dengan kegiatan operasi dan produksi yang dilakukan oleh sendiri mulai dari persiapan memasak sampai penyediaan bahan dan bumbu yang dikelola sendiri sehingga kegiatan ini berdampak pada keterlambatan dalam penyajian dan proses delivery kepada konsumen. Problem Identification Dengan pengelolaan kegiatan operasi dan produksi yang dilakukan sendiri oleh Taco Bell berdampak pada efisiensi yang tingginya biaya operasional yang harus dibebankan kepada Taco Bell. Hal tersebut dapat terlihat dari : 1. Waktu tunggu di customer cash register rata-rata adalah 105 detik dan bertambah disaat peak hour karena butuh waktu yang lama untuk memasak dan menyiapkan makanan 2. 70% dari ruangan menjadi area dapur dan hanya 30% menjadi area pelanggan. 3. 50% total penjualan dari competitor datang dari konsep drive-through sedangkan Taco Bell tidak memilikinya sama sekali. Semula perusahaan beranggapan bahwa yang dikehendaki para pelanggan adalah dekorasi yang bagus, dapur yang luas, pelayan yang banyak, peralatan yang canggih, pilihan menu yang banyak dan tempat main anak-anak di halaman. Namun sebetulnya yang dikehendaki pelanggan sederhana saja, yaitu makanan yang baik, dihidangkan panas, disajikan secara cepat, dilingkungan yang bersih, dan dengan harga yang layak dan terjangkau. Kedua tema dari indentifikasi permasalahan inilah yang harus menjadi perhatian dari John E. Martin selaku CEO Taco Bell untuk dapat memperbaiki kendala operasional yang harus dihadapi oleh Taco Bell. Case Analysis Dalam mengidentifikasi permasalahan di Taco Bell harus juga kita perhatikan mengenai tipikal dari operasi perusahaan tersebut yaitu Job Shop Operationdimana kegiatan ini cenderung lebih fleksibel dimana beberapa

aktivitas yang dapat dilaksanakan secara langsung dan bersama-sama dengan produk yang berbeda. (http://www.netmba.com/operations/process/structure/). Adapun job shop sendiri memiliki beberapa ciri yaitu : Flow Jumbled flow Flexibility high Product Many Capital investment low Variabel Cost High Labor Content and Skill High Volume - Low Kondisi tersebut yang cenderung mengakibatkan bercampurnya beberapa kegiatan dalam satu proses yang terkadang mengakibatkan tidak efisiennya dalam pengelolaan waktu sehingga berdampak pada penambahan biaya operasional yang tidak memberikan dampak positif bagi kinerja perusahaan.

Transformasi yang dilakukan oleh John E. Martin dengan melakukan perubahan- perubahan secara total dan radikal dengan mengambil langkah-langkah strategis sebagai berikut : Melakukan Sistem K-Minus K-Minus adalah sebuah proyek yang mengubah dapur menjadi hanya unit pemanasan dan unit perakitan. Sistem ini menghapus hampir seluruh proses penyiapan makanan termasuk didalamnya memasak. Dengan sistem ini lay out ruangan menjadi terbalik yaitu 30% luas area untuk dapur sehingga masih tersisa 70% luas area untuk pelanggan. Dengan kata lain, dengan luas yang sama, kapasitas area untuk pelanggan telah berhasil digandakan. Terkait dengan K-Minus, praktis Taco Bell hanya menyediakan bumbu- bumbu dan air panas untuk menyajikan dan memanaskannya. Efeknya, hampir seluruh kegiatan operasi dapur dikerjakan diluar restoran (outsourcing). Itu semua telah menggeser 15 jam kerja sehari dan hampir sama dengan 11 juta jam per tahun untuk seluruh restoran. Tentu saja hal ini meningkatan kecepatan penyajian (speed of service) menjadi 30 detik lebih cepat dan juga meningkatkan kapasitas pelayanan pada saat peak hour sebesar 50%. Mendesain TACO (Total Automation of Company Operation) Adalah sebuah IT project yang didesain untuk mengkomputerisasi semua unit dengan kantor pusat. Penggunaan teknologi informasi ini masih jarang digunakan oleh industri restoran pada saat itu. TACO menyediakan daily report untuk setiap manajer dengan 46 pengukuran performansi. Dengan sistem ini, hubungan dengan para pemasok dapat dilakukan dengan lebih cepat dan tepat disamping dapat menghilangkan atau setidak-tidaknya sangat mengurangi pekerjaan administrasi yang tadinya sangat banyak menyita waktu. Dengan langkah-langkah strategis tersebut diatas, Taco Bell memperoleh keuntungan sebagai berikut : Memperoleh penghematan sebesar US$ 7 juta pertahun sejak permulaan tahun 1990 an. Pengawasan mutu dapat lebih baik. Kecelakaan kerja menjadi sangat berkurang.

Conclusion Dari studi kasus yang dialami oleh Taco Bell ada beberapa pelajaran yang dapat kita tarik dari kegiatan operasi dan produksi yang dihadapi oleh perusahaan tersebut adalah : 1. Perlunya melakukan redefinisi kembali proses bisnis yang telah berjalan mengingat tidak adanya proses bisnis yang dapat bertahan dalam setiap kondisi bisnis. Pekanya para pengelola perusahan dalam menjaga dan mempertahankan pangsa pasar menjadi satu kekuatan perusahaan dalam menjadi yang terdapat dalam bisnisnya. 2. Kecepatan dan kecakapan dalam mengambil langkah perubahan yang radikal dalam mempertahankan pangsa pasar menjadi kekuatan bagi perusahaan untuk bertahan dalam bisnisnya. 3. Penggunaan teknologi menjadi media dalam mengoptimalkan proses bisnis perusahaan sehingga dapat menjadi perhatian yang serius dalam pengelolaannya.

Pelanggan mendapatkan perhatian lebih besar dari manajer sejak makin berkurangnya pekerjaan administrasi.