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Establishing performance standards
 

Establishing performance standards

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    Establishing performance standards Establishing performance standards Presentation Transcript

    • Establishing Performance StandardsMonday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 1 / 47
    • Recap of the Previous session• What is meant by Compensation?• How does direct compensation differ from differed compensation. compensation• Explain labor turnover.• Discuss the difference between Part time staff and Contractual staff in an organization.• How does the menu affect the labor cost. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 2 / 47
    • KCM of the Session• Explain the meaning and significance of quality and quantity standards in labor control.• Explain how records of business volume are used in scheduling.• Describe how to prepare an hourly schedule for variable - cost personnel using records of business volume. volume• Describe how to develop performance standards based on a test period period. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 3 / 47
    • Scope• Establishing Standards Standards.• Features of the Organization Chart.• Writing Job Descriptions. W iti J b D i ti• Keeping Records of Business volume.• Daily and Hourly Tallies.• Developing Schedules for Employees Employees.• Developing a Standard Cost for Labor. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 4 / 47
    • Establishing Standards1.1 Quality Standard Standard.2. Quantity Standard.3. Cost Standard.3 C t St d dQuality Standard:1. Depends on the menu.2.2 Competence of the Employee Employee.3. Type of Restaurant. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 5 / 47
    • Quantity Standards1.1 Quantity standards must be established after the quality standards are set.2.2 Break down of tasks and compare it against time.3. Establish3 E t bli h quantity of performance on an tit f f individual in 1 hour.4. In higher industries the time and motion concept is used to analyze each job. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 6 / 47
    • Quantity Standards5.5 The Production is normally linked to the demand from the market and hence quantity standards are also linked to scheduling which depends on demand.6.6 Fast food restaurant chains define jobs and designate individuals to improve efficiency. efficiency Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 7 / 47
    • Quantity Standards7. Fried Chicken restaurant have standards that a product will remain on a particular stand only for a certain time after which it y will be discarded.8. The standards is established by manually y y calculating a task and quantified in time.9. In restaurant business the perishability p y and fluctuations in customer demand greatly affect quantity standards.
    • Steps required in Establishing Standards d Procedures S d d and P d1.1 Organizing the enterprise by making an enterprise, organizational structure with jobs and designation. designation2. Preparing job descriptions by listing them down sequentially later handing them over as you go on appointing people.3. Scheduling3 S h d li employees as per b i l business hours, efficiency and job description. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 9 / 47
    • Establishing an Organizational Plan1.1 Type of clientele. clientele2. Nature of the products offered.3.3 Type of service rendered. T f i d d4. Estimation of customer count and no of meals to be served.5. The smaller the establishment in the service and product range the easier it is to establish an organizational p g plan. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 10 / 47
    • Features of the Organization Chart1.1 The lines leading down show the chain of authority.2.2 The one below reports to the one above above.3. The Boxes next to each other work in the same place b t on diff l but different equipment, t i t co-ordinate and co-operate. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 12 / 47
    • Features of the Organization Chart4.4 The dotted lines vertically indicated co- co working communication and co-operation between two positions positions.5. The lateral lines co-ordination in accomplishing respective tasks neither of whom are taking directions from each other. other Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 13 / 47
    • Steps in Job Descriptions1.1 Using Job analysis analysis.2. Job descriptions.2 J bd i ti3. Job Specifications. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 14 / 47
    • Preparing Job DescriptionsUsing Job analysis:1. Use skills are featured in resume and on job skills test test.2. Level of Education.3. Other specific qualifications.4. Interviewing workers and supervisors to g p tabulate information.5.5 Observe workers perform their jobs jobs. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 15 / 47
    • Job Analysis query structure1.1 Job Objectives Objectives.2. Specific tasks required to achieve objectives. objectives3. Performance standards.4. Knowledge and skills necessary.5. Education and experience required. p q Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 16 / 47
    • Writing Job Descriptions• The process can be very detailed in some may be specific but 3 questions are of importance. importance1. What is to be done.2. When i2 Wh is it d done.3. Where is it done.• The above are also known as Performance Criteria. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 17 / 47
    • Writing Job Descriptions• Most Job descriptions are the main heads of SOP’s.• At the heading that states job title and grade and division name.• V ti l reporting i stated normally i Vertical ti is t t d ll in appointment letters.• A summary of the duties of the job in paragraph form. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 18 / 47
    • Writing Job Descriptions• Specific duties are also mentioned which are assigned to the job.• This increases and accountability with the management.• It imperative that employees are Its i ti th t l expected to sign the job description after they th are read and explained t th d d l i d to them iin detail. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 19 / 47
    • Job Specifications• An outlining of qualifications needed to perform the job.• Its an outcome of Job analysis analysis.• It judges the incumbent’s qualifications and skills whether are i li with th j b d kill h th in line ith the job.• It becomes a standard till such time there is a major change in menu or theme in the restaurant. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 20 / 47
    • Variable Labor cost Personnel• Variable Labor Cost Personnel:• The personnel linked to business volume.• Usually th shop fl U ll the h floor staff. t ff• The hours of work correspond to the variable cost employees.• By careful scheduling the p y g peak hours of a restaurant operation can be supported by Variable labor cost Personnel. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 21 / 47
    • Variable Labor cost Personnel• Personnel falling into these category are affected by seasons in business. They may have a higher hourly rate rate.• Personnel falling into this category:• Di h washers, Kit h cleaners. Dish h Kitchen l• Cleaning staff and garbage disposers.• Back up waiters. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 22 / 47
    • Fixed Labor Cost Personnel• The fixed cost personnel are whose numbers are unrelated to the business volume.• Managers, Book keepers, Chefs, Stewards and maintenance personnel personnel.• In many establishments the fixed labor costs are derived in a later stage once the organizations has operated for over a year. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 23 / 47
    • Keeping Records of Business volume l• Actually is done by using automated systems.• All electronic cash registers and the Micros systems has this provision in report generation. generation• Daily Tallies• Hourly tallies. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 24 / 47
    • Daily and Hourly Tallies• The first technique is to draw information from Sales history.• Guest checks is also a source where the systems are still manually operated.• Th d t collected assists i f The data ll t d i t in forecasting ti business with a reasonable degree of accuracy. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 25 / 47
    • Daily and Hourly Tallies• The current happenings should be taken into consideration while using the daily Tally system, Road construction Political system construction, rallies are examples.• The Hourly tallies are a major help in keeping the labor cost at a bare minimum.• A manual method of W kl and d il t ll l th d f Weekly d daily tally is illustrated on pages 27 and 28. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 26 / 47
    • Number of Covers Served per day Daily Tally method yMonday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 27 / 47
    • Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 28 / 47
    • Number of Covers100 90 80 70 60 50 40 Number of Covers 30 20 10 0 Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 29 / 47
    • The Features and results of Charts• Improve control over cost of labor labor.• Make scheduling effective.• I the next case we take 5 successive In th t t k i Friday’s and place their performances on a line h t li chart.• The objective behind the exercise is to draw a median or an average. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 30 / 47
    • Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 31 / 47
    • Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 32 / 47
    • Difference in Arithmetic mean and Median M di• The Arithmetic mean will be a numeric average.• Which is 90+85+105+100+105= 487 487.• 487/5 = 97.4• While in case of a median it is 100.• We arrive at this by eliminating the two y g lowest and the two highest counts on all 5 Fridays and retaining the middle figure. y g g
    • Developing Schedules for Employees E l• To develop schedules for employees from:• Using the appropriate records from daily and hourly business volume volume.• The scheduling of fixed labor cost employees i di l is discussed l t i thi d later in this chapter.• The scheduling of variable labor cost employees is exhibited in the next slide: Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 34 / 47
    • Sample Schedule based on median sales f VLCE di l forMonday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 35 / 47
    • 120 X axis is Hours of Operation . p100 Y axis is # of Covers and Staff Required 80 60 Satff required Anticipated Sales Volume in Covers 40 20 0 10 am  11 am  Noon  1 Pm  2 Pm  3 Pm  4 Pm  5 PM  6 PM  7 PM  8 PM  9 PM  10 PM 11 PM  to 11  to  to 1  to 2  to 3  to 4  to 5  to 6  to 7  to 8  to 9  to 10  to 11  to 12  am Noon Pm Pm Pm Pm Pm PM Pm PM Pm Pm Pm Pm
    • Scheduling Variable Cost employees l• By applying the schedule if for 40 guests the outlet manager requires 2 employees then to cater to the peak period of 100 guests 5 servers will deployed.• The total staffing is never 5 it may be 7 or 8, now this can be brought up by adding 3 part-time part time employees and the rest would be permanent. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 37 / 47
    • Sample ScheduleMonday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 38 / 47
    • Sample Schedule for Fixed Cost Personnel P lMonday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 39 / 47
    • Scheduling for FC employees• The scheduling of Fixed cost employees is unlike Variable cost labor.• It can be done at the discretion of the Manager and as per job requirement.• H Hours of operation. f ti• Hours of delivery of receipts.• Fixed cost personnel schedule usually remain constant. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 40 / 47
    • Standard Staffing Requirements• Also known as manpower requirements requirements.• Estimating efficiency of labor by segregating covers and comparing against time on a daily basis.• Th t The two fi figures give a di t estimate of i direct ti t f evaluating employee efficiency.• Finally summarizing them in a matrix that becomes a labor standard. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 41 / 47
    • Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 43 / 47
    • Standard Work Hours VCPMonday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 44 / 47
    • Developing a Standard Cost for Labor L b• As seen in on slide 43 for a maximum business of covers ranges from 500-599.• If the servers for the max period is 8 8.• Then 8 servers x 3 hours = 24 work hours.• The same applies to the Ware washing personnel and Preparation personnel. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 45 / 47
    • Developing a Standard Cost for Labor L b• If the hourly wage of a server is $ 4 00 4.00 then 24 hours x $ 4.00 per hour = $ 96.00 as standard cost. cost• The above is for a 3 hour period which is $ 96.00 96 00• The same calculation applies for ware washing personnel and di h washing hi l d dish hi personnel. Monday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 46 / 47
    • Questions CommentsMonday, July 11, 2011 BAC-5132 Food and Beverage Management-II-Establishing Performance Standards Slide 47 / 47