A+ graded proposal done in sem 1.2

2. Gender

3. Income Level

4. Occupation

5. Education

6. Family

7. Life-cycle

8. Geographic

9. Location

10. Market Size

11. Transportation

12. Competition

13. Climate of area

15. Personality

16. Motivation.

17. Innovator.

18. Values.

19. Life style.

22. The name of our café is Espéranto. It has the meaning “one who hopes” in French.

23. Functionality and services

24. We cater to the needs of customers by providing food and beverages, entertainment and lodging services at an affordable price.

25. Quality

26. Exceptional quality service can be expected to be provided in Espéranto.

27. Safety

28. Espéranto holds the responsibility to deliver excellent hygiene standards.Price<br />Pricing strategy <br />Our selling price is low but profits would be generated from large sales volume.<br />Discounts may be given such as:<br />Early payment discounts<br />Membership discounts<br />Seasonal discounts- Christmas Menu Special etc.<br />Weekends Special<br />Price discrimination<br />Students would all be granted special discounts for food and services.<br />Promotion<br />Sales promotions ( Should be carefully crafted and compared with the next best alternative)<br />Promotions such as:<br />buy one get one free promotion<br />coupons and vouchers distributions<br />free gifts upon total spending of $30 per visit<br />Publicity<br />Advertising creates awareness. <br />Newspapers<br />Television<br /> Radio<br />Website<br />Flyers distribution<br />Through words of mouth<br />Place (Distribution)<br />Distribution channels :<br /> 1 outlet, located at Bugis <br />Brief write-up on top 2 level of management:<br />The Chief Executive Officer (CEO) is a formal leader who is the overall in charge of the management of the café. He will focus on the productivity and efficiency of the café. The CEO has legitimate, reward and coercive power. He is able to use his position to command his subordinates to do work. He could also provide rewards such as bonuses and promotions which will entice the subordinates to listen to him. <br />At the second level of management, managers are responsible in many roles. He has to make sure that his subordinates do their jobs well. He is also responsible to pass down the instructions from the higher management. Second level managers would set short term goals for their various departments in order so that the subordinates can work towards them and the departments can improve. Second level managers have legitimate and coercive power. They have the authority and power to command subordinates to do their work well.<br />The Management Of The Organisation<br />Centralised vs Decentralised Organisation<br />For centralised organisation, major responsibilities and powers are given to the higher end of management. On the other hand, decentralised organisations distribute responsibility down the hierarchy and towards lower end managers. <br />Esperanto operates in both a centralised and decentralised manner which aimed to increase efficiency in production while producing high quality products at the same time.<br />Vertical decentralisation means that the authority to make certain decisions (often, minor), are pass down the hierarchy system. It thus enables staffs at the lower end of the hierarchy to be involved in decision making which encourages them to learn more in-depth of the company. Often, the experiences these workers had with them might aid in effective decision, comparable to those of senior managers. Moreover, the empowerment given increases the motivation within them and enabling them to adapt, respond faster to changes and new challenges faced.<br />Esperanto aims to groom staffs who value social responsibility and loyalty to the company.<br />Furthermore, with decentralisation, upper heads of the hierarchy system could concentrate better towards making vital decisions.<br />Horizontal decentralisation spreads responsibility across the company. One example would be the implementation of free WIFI access in Esperanto.<br />In a centralised manner, top managers would be reviewing the structure of the café once in a while to improve situations in the café. Also, company policies would be reviewed and change accordingly under circumstances.<br />Delegation <br />As Esperanto is a decentralised company, delegation is implanted in Esperanto. Lower rank employees like supervisors are given authority and responsibility to carry out specific activities. <br />However, the person who delegated the work (high rank managers) remains accountable for the outcome of the delegated work. This promotes trust in the company. Furthermore, employees will feel more important and be more loyal to the company.<br />Motivation <br />Chosen group of employees: Student part-timers<br />a. Background: Student part-timers are mainly full time students, aged between 16 to 21 years old. They have to manage their time and balance between work and their studies. Duty Roster consisting of shifts would be drawn up to suit their inflexibility of time. Student part-timers normally work to earn extra income. They are up to date and have many useful skills like IT or giving creative ideas. They are also more willing and able to learn at a faster pace. Furthermore, they tend to be more adaptive to changes in the environment.<br />b. Expectation: Since they are working part time for extra income, their expectations are generally lower as compared to full time employees. Other than money income, they might also be working to gain more experience. <br />c. Behaviour: They are more active and diligent as they are young people. They are also very expressive and would voice out should they disagreed to anything- feedback is essential towards growth of company. They are creative and innovative, they are able to give suggestions and ideas to improve the café. Moreover, as our target market are around their age too, they are the most suitable candidates to give suggestions to improve our café.<br />How to motivate this group of employee?<br />Maslow's hierarchy of needs<br />Using the Maslow’s hierarchy of needs, for the lower rank employees, mainly student part timers, we only need to fulfil the basic needs, safety and physiological aspects.<br />To motivate this group of employees, we can have bonus pay, for example, extra pay during festive seasons like Christmas. Give them staff bonus or staff discount when they dine in the café. Other than providing them with a better working environment, we can give them breaks in between the working hours, or free paid meals. This made it easier to motivate this group of employees as they are only working part time with lower expectations. <br />LEADING<br />Participative (Democratic) leadership would be implemented in our café, although the leader has the final says in making decisions, he/she will still invite other employee’s for discussion. For example, the leader could ask the employees for discussion whether to introduce a new promotion or new dish. This will increase employee’s involvement and they will feel valued, thus more motivated to work. They can also know the latest updates regarding the café; this also promotes café’s harmony and brings the leaders and workers closer. <br />Supervisors have legitimate power over workers, as they are authorized by the management. With the legitimate power, workers are expected to listen to them. Also, supervisors’ responsibility would be heavier as they need to guide and lead people under their hands. <br />Experienced workers would have expert power over green horns like part-timers. For example, when a green horn doesn’t know how to deal with a difficult situation with customers and seek help from the experienced worker. The experiences of the worker give him expert power over the green horn. <br />Hersey and Blanchard’s Situational Leadership Model<br />http://www.enviedentreprendre.com/images/motivation1.jpg<br />We have to apply different leadership styles to lead different type of employees as they are all different in all aspects (for example, personality and expectations). Using the leadership style that suits them best will then be the most efficient and effective way towards production and generating sales revenue. <br />Using the Hersey and Blanchard’s Situational Leadership Model, for the student part timers, as they are green horns in the Food and Beverages industry, they are less experienced and have a lot of things to learn still. However, they are teenagers who are willing and confident to learn new things, this will put them under R2. People in R2 are unable but willing or motivated. <br />To lead this group of employees, we will use leadership style S2(selling) which involves high task focus and high relationship focus. The leader (supervisors/managers) will still lead and provide directions (i.e. give orders) but in a two-way communication method with the student part-timers. Through teaching and influencing them (selling), they will understand and do the right things. <br />To choose a leader, we will use the traits theory, which is evaluating & selecting leaders based on their mental & psychological characteristics. To be a leader, they must possess some of these traits: Intelligence, Self-confidence, Determination, Honesty / Integrity, Sociability, Problem-solving skills, Extraversion (outward looking), Conscientiousness. This would be an important part in promoting a person to supervisors or managers as they would be responsible to lead the rest of the employees in the café. <br />If an employee refuses to listen to supervisor’s orders, they will be warned and if there are still no sign of changes in attitude, the employee would then be fired. Harmony and cooperation in a management is very important. <br />Controlling <br />Performance Standard<br />Overall, the café ought to set a targeted sales amount at end of the month. This gives everyone a goal and also, the motivation to work towards the target. <br />Furthermore, employees’ performance must be up to standard as it would affects directly the sales of Esperanto. If the employees’ performance and services rendered are good, customers would be more than willing to visit our café again, they might also recommend our café to their friends or family which thus, increases sales revenue. Similarly, if the performance by employees is bad, customers would not want to visit us again and might let others know about the bad service in our café through words of mouth, resulting in a bad reputation of Esperanto. <br />Therefore there are some rules and standard for employees to obey and achieve. Employees should try their best to attend and cater to all customers’ needs. They should be polite and do not show personal emotions nor attitudes like angry or bored. Service with a smile is essential and they ought to be alert at all times. They also should be fast and efficient in serving food and taking orders, reducing the waiting time the customers have to wait. <br />Café’s environment Conditions <br />The café environment should be nice and comfortable for customers to dine or chill. Hygiene is the most important condition; the café should be cleaned up every day once café is closed. All kitchen staffs must wear gloves, masks and chief hats while handling food. All utensils and plates will be washed with warm water thoroughly to ensure that they are clean and safe to use. The lightings should not be too glaring or too dark for dining; music played should be suitable for everyone to listen (i.e no rock music or vulgarities) and pleasing to the ears. No unnecessary or extra things (i.e stocks) should be placed at any walking areas and serve as obstruction. Stocks should be organized and positioned neatly in the store.<br />Employees’ Appearance<br /> As employees are at the front line, their outlook appearance and behavior would determine our café reputation. If our employees are dressed up in a sloppy manner and look unhygienic, no one would want to visit the café. <br />To avoid such a situation to happen, there will be a set of rules for employees to abide. All employees would not wear any hand accessories like rings or bracelets and should keep their fingernails short. Hair must be tidy at all times and not covering their faces. Also, no body or face piercing is allowed. No brightly coloured/dyed or punky hairstyles. Employees should always look fresh and energetic. <br />Uniforms should be worn properly with covered shoes. <br />Regular checks on employees’ appearance is needed.<br />Comparison on the number of complaints between week 1 and 2.<br />In Esperanto, our targeted limit numbers of complaints are 2 per week. In week 1, the number of complaints reached 7 which are undesirable, in week 2 it even reached 20. We have to find out the root cause of it and take actions to lower the number of complaints. <br />Comparison on the number of complaints between week 2 and 3.<br />In week 3, the number of complaints shot up to 30, as compared to week 2. We must implement harsher actions to curb this trend from continuing as it will damage our cafe’s image. <br />Feedback Control<br />After collecting feedback from the customers, we had numerous complaints from customers regarding the taste of the coffee. Many pointed out that the quality of the coffee beans was not good enough and that it was not fresh.<br />Feedforward Control<br />3Ms<br />1) Manpower –Suppliers and Employees<br />2) Materials- Coffee Beans<br />3) Machinery- Coffee Grinder, Espresso Machine<br />Causes of Complaints<br />1) The supplier who we are ordering from did not sell us fresh coffee beans.<br />2) Employees may not have stored the beans at the right place and temperature.<br />3) Employees may have accidently used the expired beans to serve customers, due to negligent.<br />4) The manufacturer may not have packed the coffee beans well which may cause the taste to change.<br />5) The coffee machine may be faulty.<br />Take corrective action<br />1) Ensure that employees are well trained to avoid incidents such as wrong storage of coffee beans <br />2) Change to a better supplier<br />3) Ensure that coffee beans delivered are fresh and not expired.<br />4) Ensure storage of stocks is well organized and that expired stock of coffee beans must be disposed off immediately. <br />5) Conduct daily inspections before operating hours to make sure facilities such as machines, grinder are in good working condition and that coffee beans are kept fresh.<br />How to implement 3 levels of control:<br />Type of ControlHow to implement?Strategic control(monitoring performance to ensure that strategic plans are being implemented and taking corrective action as needed)At the beginning of the business, Esperanto can actually review the performance on a monthly basis to see the performance of the café. This is to make sure that the business is working out well and the sales are stable. Once the business is on track, the business can be reviewed every quarterly to keep track on the performance of the café. If there is a drop in sales, the café management will look into the problem and find the root of the decrease so that sales can be improved. If the café is earning profits, it shows that the management style is correct and will continue to maintain the standards. Tactical control(monitoring performance to ensure that tactical plans – those at the divisional and departmental level – are being implemented and taking corrective action as needed)The various departments of the organization would actually review their performances by the sales and feedbacks to see if they actually worked towards their goals. Managers will meet up with their subordinates monthly and discussed what they had done well and the things that they could improved on. Once goals are met, they would need to maintain that and may set newer goals which they hope to achieve in the next month. However, if the goals set aren’t achieved, they would need to review on what went wrong and how things can be changed in order to meet the goals. Operational control(monitoring performance to ensure that operational plans – day-to-day goals – are being implemented and taking corrective action as needed)Each day the first-line manager will have to report on the daily activities of the organization. If there are any problems, it can be dealt with immediately to avoid further complications. After the business each day, the supervisor can actually sit down with the employees and discussed about the day’s business and what the supervisor observed. The employees can give feedbacks on what they felt about the day and what they feel to improve the café’s business. By doing so, the employees will be able to feel a sense of belonging as their opinions are being heard and they can be involved partially. <br />Future plans for Esperanto in the next 3 years.<br />Esperanto serves to be at the top of the cream of the food and beverages industry. Service and food qualities remained at a competitive edge above the rest of the other competitors.<br />For the second year of business, Esperanto would continue to strive to be at least at the top 3 café choices among its consumers, especially among teenagers and young adults.<br />Along the way, Esperanto might suffer from unforeseen economic changes (ie. Recession), therefore, having a strong finance foundation is important and essential to the development of Esperanto. Extra flow of cash or capital would be useful during difficult times. <br />For the third year of business, Esperanto would venture out into the franchise line where the brand name of it will be well recognised. Esperanto aims to have at least 8 chains of outlets at all high district areas, such as Orchard Road, Serangoon Gardens. This is to broaden the market size from teenagers and young adults to higher income earners.<br />Lastly, for the fourth year in business, Esperanto would participate in charity organisations and help out with the needy all over the world. Esperanto’s slogan: EAT.LIVE.HOPE would be spread across the world with love. This thus enables the needy people to enjoy food and beverages produced by Esperanto, giving them a new lease of hope at the same time. <br />While being a profit-making company, Esperanto, aims to spread the love and bringing in hopes to people. <br /> <br />