Food And Beverage

Alternative beverages competed on the basis of differentiation from traditional drinks such as carbonated soft drinks or fruit juices. The market started out with low competition, however that is rapidly changing as many new product lines enter and profit margins will inevitably suffer from the price reduction. The rest of the beverage industry is faced with low profit margins because of high competition and little ability to differentiate products. The alternative beverage segment help companies to sustain volume growth in mature markets where consumers were reducing their consumption of carbonated soft drinks.

Also the alternative beverage industry offered products that catered to different demographics. For example energy drinks were purchased more by teens and young adults while energy shots were bought by adults to get extra boosts of energy during the work day. In addition the vitamin-enhanced drinks and sports drinks went more toward athletes and people who exercised often. This differs from just the usual carbonated soft drinks that people were used to drinking. Now they had products that they could consume for different activities.

Demand is expected to grow worldwide as consumer purchasing power is increased and alternative beverages offered profit margins much higher than those of other beverages. One key characteristic in the beverage market was introduction of the energy shots and they were an important growth factor in the industry; the shot was introduced in 2004 and took the market by storm with its high containments of B6, B12 and caffeine. Competitor’s course introduced energy shots to the market but none have come close to the 5 hour energy shot, with it holding 85% of the market share in 2009.

1 Resistance to Change: A Case Study in the Food and Beverage Department 2 Change is common in an organization and is initiated due to the need to survive and adapt to the changing market. As change is a disruption of routines and what people are used to, resistance to change is a common reaction of the change recipients. People resist changes because changes are uncomfortable and require them to adapt to a new way of thinking and doing things. Also, people have trouble envisioning how life will be like after changed; hence, they tend to stick to the unknown rather than embracing the unknown.

This essay is going to demonstrate why employees resist change in the hospitality and gaming organization with around 6000 employees and how the change agent can turn their resistance to advantages. The Food and Beverage department (F&B) is undergoing a change in the management initiated by the new F&B director. The director attempts to introduce a new food safety audit scheme with the objective to raise the food safety standard of the dining outlets. The change recipients, the F&B Kitchen, Service and Stewarding eams, are resisting the change by ignoring the director’s requests and refusing to cooperate with him. The change of food safety management creates disruption in the daily operations of the change recipients. As a result, rather than providing improved services, the number of guests’ complaints and the turnover rate of F&B staff increase drastically one month after the change has started. The process of change is now stuck at its beginning because of the conflicts between the director and the F&B teams. The employees’ reactions and resistance are so great that the change The proposed change, which is ow appears to be impossible to implement. originally of a good intention to upgrade the F&B outlets, is doomed to failure because the change agent – the F&B director – is so engrossed in his plan that he never tries to understand the reasons of resistance to his proposed change. 3 When the change was initiated, the change agent employed a consultant to assist in the process of change. The consultant works out a plan of the new food safety practices on what has to be changed and to what extent these things have to be changed.

The use of outsider to teach and give comments to the F&B teams on how things should be done gives them an impression that their experience is not valued and their ways of work are not respected. The assumption in the change recipients’ minds is that their new boss thinks they have not been delivering a satisfactory performance in food safety so the director has employed an outsider to look for their wrongdoings. Other than the daily operation of the outlets, the change affects the social relationship among the three F&B teams and the food safety audit team.

The use of a stricter audit system means that they have to work harder to comply with the standards. Moreover, failing the food safety audit will result in disciplinary actions, such as issue of warning letters or temporary suspension of work. Therefore, the social relationship among the three teams changes from cooperating with one another into shuffling the blame of food safety standard non-conformance off to one another. In addition, in the past, the F&B teams worked closely with the food safety audit team in upholding the agreed standard.

However, because of the fear for failing the higher food safety standard, the F&B teams have become hostile to the audit team and are always trying to argue with the audit team on the result of audit. Another reason of resistance to change is that the director has put too much pressure on his teams in upholding the high standards and meeting the targets of continuous increase in restaurants’ income and reduction in operating cost. These unrealistic objectives lead to a huge workload and pressure and cause the teams overload. 4 Conflicts among the teams emerge, leading to frustrations and anger of the employees and finally, high turnover rate.

The shortage of manpower in the restaurants contributes to the unsatisfying customer service and increase in guests’ complaints. Besides, the pressure of the restaurant managers and chefs to fulfill the objectives creates panic and confusion in the operating level. In order to save cost, chefs tend not to maintain the food safety standards that request them to throw away unused food items. On the contrary, the food audit team and the outlet managers demand the This confusion in employees to comply strictly with the food safety standards. peration and food safety practices leads to employees’ frustration, high turnover rate, and, consequently, shortage of labor in the restaurants, especially when the unemployment rate of the economy is so low that it is very easy for the employees to get another job. In addition, the change agent fails to listen to the employees when he is implementing the changes. The outlet managers and chefs have already told him that the high food safety standard is unrealistic and impossible to attain. The neglect of the employees’ frustrations has led to the employees’ chronic resistance and persistent hostility towards the change agent.

As a result, that particular change and other beneficial changes introduced by the director do not work as planned and are totally rejected by the change recipients. Without the cooperation of the change recipients, the project is in slow progress because they try to fool around with the consultant and the director and refuse to cooperate. As the resistance of change persists, the change appears to fail sooner or later. The main reason of failure is that the change agent perceives the resistance as the “enemy 5 of change” because of the belief that a change process with only minimal resistance is a good change (Waddell and Amrik, 1998).

In fact, resistance, like pain, reflects that What something is wrong in the process, but not that the change itself is wrong. causes the resistance is how the change is implemented instead of what has to be changed. change. Resistance, when managed carefully, can be used as an advantage to assist In fact, resistance is an important form of feedback, giving the change agent some valuable inputs on what have gone wrong in the implementation of change. Therefore, the director should look into the resistance, try to understand it and use it to refine the change effort.

In order to reduce resistance, it is essential to build a guiding coalition with the restaurant managers and chefs. In order to build the coalition, the director should abandon the idea that he is doing the right and proper thing while the change recipients are throwing up unreasonable obstacles or barriers intent on “doing in” or “screwing up” the change (Dent and Goldberg, 1999). Furthermore, the change agent should always communicate with the change recipients and try to understand the uncertainties and potential problems, caused by the change, faced by change recipients.

He should also present his vision and the company goals clearly so that the change recipients can align their objectives with that of the change agent and the company. Moreover, Spreitzer and Quinn state that change agents contribute to the occurrence of what they call “resistant behaviors and communications” through their own actions and inactions, owing to their own ignorance, incompetence, or mismanagement (1996). The director, instead of trying to understand the difficulties his employees are facing in their operation, uses fear management and exerts pressure on the outlet 6 anagers and chefs to change because he believes that this particular change is good and necessary for the company. However, as Hultman (1979) comments that it is a fallacy to consider the change itself to be inherently good because change can only be evaluated by its consequences. This belief cannot be proved with any certainty until the change effort has been completed and sufficient time has passed. The change agent should, rather than getting an outsider – the consultant – to initiate the change, elicit participation from the teams and respected their opinions regarding the routines of the restaurants.

Besides, the change agent should create a great sense of urgency in that particular change, for example, whether it is government requirement or market driven (Ford et al. 2008). Without explaining the need and urgency of change, the change recipients In fact, the change are unable to relate the change with the objective reality. proposed by the director is driven by the government food safety policy which will be put into practice next year, the highly competitive market and the increase in customers’ demand of high quality food and services.

Therefore, there is an urgent need for the company to continuously improve and meet the demand of the customers in order to maintain profits and market share. It is fairly easy for the change agent to scapegoat the change recipients for the failure of change because of the uncooperative and hostile attitude of the change recipients. However, the change agent should understand that change is a situation that interrupts the normal patterns of organization and calls for participants to enact new patterns. This process involves the interplay of deliberate and emergent processes that can be highly ambiguous (Mintzberg and Waters, 1985).

Change is an interruption of normal operation and implies an increase in workload, at least during the period of 7 change implementation. It is not difficult to imagine that the change recipients are reluctant to accept change right at the beginning, especially when they cannot foresee any immediate or long-term benefits. Therefore, the process of change should be carefully planned and well-communicated in order to get the participation and support of the change recipients. On the other hand, participations of the change recipients should be valued respectfully.

Participation is a feeling on the part of people to be involved in a process but not just being called in to take part in discussions. People are more likely to respond to the way they are customarily treated and whose opinions are respected rather than being asked some carefully calculated questions about their opinions (Lawrence, 1969). The wrong way to elicit participation by overselling the positive and underselling the negative that the change will bring about will be perceived by the change recipients as intentional misrepresentation, injustice and violation of trust between the recipients and the agent (Mintzberg and Waters, 1985).

Consequently, the change recipients will be more defensive to change and may even intentionally deliver bad performance in order to prove that the change is a failure. In fact, resistance is a resource that can be fully utilized when it is acknowledged and understood. Change agents have to be aware of the problems caused by change because these problems are constructed from novel, discrepant, or problematic situations that are puzzling, troubling, or uncertain to the participants of change (Weick, 1995).

The emergence of problems demonstrates the potential obstacles that These problems, when will be encountered on the way to a successful change. managed carefully, can become advantages that greatly assist the process of change. Resistance is a form of conflict that strengthens and improves not only the quality of 8 decisions, but also the participants’ commitment to the implementation of those decisions (Amason, 1996). Hence, the F&B director should realize that he has to e-introduce the change as the benefits to the department and the company as a whole, and try to regain the trust of the F&B teams by inducing their participation with respect, taking more responsibilities in the occurrence of resistance and empowering the teams in the process of change. As a result, the process of change will be smoother and will ultimately succeed with the emergence of resistance. 9 Bibliography AMASON, A. C. (1996) Distinguishing the effects of functional and dysfunctional conflict on strategic decision making: resolving a paradox for top management teams. Academy of Management Journal, 39, pp. 23-148. BUCHANAN, D. A. and HUCZYNSKI, A. A. (2010) Organizational Behaviour. 7th ed. England: Pearson Education Limited. DENT, E. B. and GOLDBERG, S. G. (1999) Challenging “resistance to change”. Journal of Applied Behavioral Science, 35, pp. 25-41. FORD, J. D. et al. (2008) Resistance to change: the rest of the story. Academy of Management Review, 33 (2), pp. 362-377. HULTMAN, K. (1979) The Path of Least Resistance. TX, Denton: Learning Concepts. LAWRENCE, P. R. (1969) How to deal with resistance to change. Harvard Business Review, 1, pp. 49-57. MALTZ, M and BASLER, F. (1997) Portable Conference on Change Management.

Hiam: HRD Press. MINTZBERG, H. and WATERS, J. (1985) Of strategies, deliberate and emergent. Strategic Management Journal, 6, pp. 257-272. PARDO DEL VAL, M. et al. (2003) Resistance to change: a literature review and empirical study. Management Decision, 41 (2), pp. 148-170. SHAPIRO, D. L. , and KIRKMAN, B. L. (1999) Employees’ reaction to the change to work teams: the influence of “anticipatory” injustice. Journal of Organizational Change Management, 12(1), pp. 51-66. SPREITZER, G. M. and QUINN, R. E. (1996) Empowering middle managers to be transformational leaders. Journal of Applied Behavioral Science, 32, pp. 37-261. 10 TORMALA, Z. L. , and PETTY, R. E. (2004) Resisting persuasion and attitude certainty: a meta-cognitive analysis. In KNOWLES, E. S. and LINN, J. A. , (eds. ) Resistance and Persuasion. Mahwah , NJ: Lawrence Erlbaum Associates, pp. 65-82. TRADER-LEIGH, K. E. (2002) Case study: identifying resistance in managing change. Journal of Organization Change Management, 15(2), pp. 138-155. WADDELL, D. and AMRIK, S. S. (1998) Resistance: a constructive tool for change management. Management Decision, 36 (8), pp. 543-548. WEICK, K. (1995) Sensemaking in Organizations. Beverly Hills, CA: Sage.

Answer: Food and Beverage Service is the service of Food made in the Kitchen and Drinks prepared in the Bar to the Customers (Guest) at the Food & Beverage premises, which can be: Restaurants, Bars, Hotels, Airlines, Cruise Ships, Trains, Companies, Schools, Colleges, Hospitals, Prisons, Takeaway etc Food & Beverage Outlets are divided in to the following categories: Restaurants: Restaurants are places where Food & Drink is served. There are various types of Restaurants: All Day Dining Restaurants: They are sometimes called as Coffee Shops or Cafe in Hotels.

They are usually big in size with many Covers (seats), compared to other Restaurants in the same Hotel. The main reason why they are called All Day Dining Restaurant is because of their hours of operation, as they are open for Breakfast in the Morning to Lunch in the afternoon to Dinner in the Evening. Fine Dining Restaurants: Fine Dining Restaurants are characterized by their elaborate and exclusive menu with special emphasis on the very high quality food they serve. The emphasis being on fresh ingredients and natural flavors or on the type of Cuisine served, or both.

Usually the operation of this restaurant revolves around the Head Chef or Chef De Cuisine of this Outlet. Specialty Restaurants: These are Restaurants which usually have a type of National or Regional Character or Cuisine attached to them, for example: Italian Specialty Restaurant, Chinese Specialty Restaurant etc. In some Hotels they do also sometimes have Multi Cuisine Specialty Restaurant, which literally means that Restaurant serves cuisine from more than one country, or the dishes on the Menu at that Restaurant has Food Specialties from many different countries. . Lounge: Lounges can be found in different hotels. Their main purpose is to offer Food & Drinks in relaxed surroundings with comfortable and cozy seating in relaxed surroundings. There are many kinds of Lounges ranging from a Lounge in a Lobby, Cocktail Lounge and Cigar Lounge to Executive and Club Lounge in special Floors. 3. Bar: Bar is a place where drinks are served. There is usually a small Snacks Menu too. The service is fast and quick.

There are various kinds of Bars ranging from Formal bars to Club Bars, Pubs, Pool Bars, Wine Bars, Cocktail Bars, Beach Bar to Juice Bars and many more. 4. Discotheque/Nightclub: They are outlets where Music and Entertainment takes priority with the Food & Drink. The operation is very fast and the guest numbers are large. Security is an important aspect in these operations. Music and entertainment can range from DJ to live bands playing. 5. Room Service/In Room Dining: Room Service, also known as In Room Dining .

It is the service of Food & Drink in Guest Rooms in a Hotel or a Resort. Depending on the size and type of Hotel or Resort its functions vary. 6. Meeting and Conference Rooms: Meeting and Conference rooms together with Ball Rooms come under the Banquets & Conference section. They are a great source of Revenue in Food & Beverage Department usually in Corporate and City Hotels. MICE (Meetings, Incentives, and Conferences & Exhibitions) can alone bring much revenue in some hotels in comparison to other outlets in Hotel. 7.

Ball Rooms: These are large Function Rooms which are primarily used for Functions and Weddings. The Staffing ration of Full Time Staff in this section is very less as the Function and Wedding Business can sometimes be seasonal and extra staff is usually filled in by the use of Casual Staff. This Section is the most Dynamic section in Food & Beverage with the Conference Section, which is more physically demanding and creatively oriented. 8. Delicatessen: Delicatessen or Deli traditionally had been a place where fresh meat and other produce were available.

Hotels nowadays use this concept of having a Deli on their premises, where guests can buy fresh produce ranging from Freshly Baked Bread, Cold Meat, Fresh Salads, Cakes, Home Made Ice creams and light and healthy drinks. 9. Others: There are many other Food & Beverage outlets ranging from Fast Food Outlets to Food Courts to Snack Bars which are usually stand alone or in a shopping centre. This is just a brief introduction to Food and Beverage. Detailed information on Food and Beverage can be found at Food and Beverage Bible E Book By Santosh Koripella at: www. foodnbeveragebible. com

Despite all the conventional methods of analyzing the customers with all the physical and social and other factors, the actual statistics seem to differ tremendously from the estimated outcomes. This is because we as humans seem to bank heavily on emotions. Once the customer has some sort of emotional attachment with the outlet for whatsoever reasons, he is not going to opt for other places. The customer might now be considered loyal to the outlet. The customer wouldn’t prefer going to any of the competitors because he feels he has some sort of bond with the outlet.

This emotional umbilical cord is very powerful as it is one of the easiest and the most effective ways to maintain customer loyalties. As they say, it is easier to retain the existing customers than it is to create new ones. The existing customers would always walk in with that feeling of homeliness and once this feeling of theirs is respected and catered, all the outlet has do is cash in. Existing customers don’t mind paying a little extra also because they’ve already grown used to the ambience and the way the outlet is run.

Therefore, it should be profoundly important for the hotels and restaurants, to see to it that they lock in the customers as their regular guests. The hotels have to work hard to make sure that the customers don’t take away the business elsewhere. The loss of a regular customer is colossal. The hotel is just not losing that one customer but a lot more than that. All those people whom he had recommended the hotel in course of years would also develop negative thoughts and opinions about the outlet. This might be a very serious issue and often devastating for the hotel chains.

Loyalty as such is the key factor in most businesses, but its impact is more clearly visible in the business of hospitality and hotel management. When compared to several other businesses, the one fact that stands out here is that the hospitality industry has a lot to do with how the customer actually feels about being at the place. This might include the food, the ambience, the customer satisfaction and several other factors. Hospitality has more to do with experience as against those of other industries who just sell products.

There can be many ways in which this can be done, some hotels prefer giving free gifts, some give special privileges to their regular customers, some others give huge discounts. All these methods are simply aimed at encouraging customer loyalty. The hotels and restaurants should never miss a chance on maintaining and pleasing loyal customers given the fact that this emotional attachment is so very delicate yet powerful enough change the very course of several businesses. Research Problem:

It is because of these above stated reasons that it becomes immensely important for the managers to study the science of loyalty management and learn how to implement it thoroughly. Discussion: Important concepts and theories, the background of the study: In simple terms, it can be said that in spite of all what the company the customer has an inherent tendency to keep looking for better alternatives, the analogy here is given by Leahy where the characteristic customer behavior is compared to that of a cat. A dog considered being man’s best friend because come what may it does not swerve its loyalties.

However the customer behaves more like the cat and is always on the lookout for softer and more comfortable lap. The need of the hour is that the hotels should see to it that they provide this soft lap to the customers and always keep increasing the standard of their services. Leahy here compares the restaurants to the airlines; the airlines have been far more successful in maintaining loyal customers than the hospitality industry. Airlines have several clubs where the members are classified as gold, silver or other such members. The members of such clubs are offered free up gradation from economy to business class if the seats are free.

However no such practice is noticed among the hotel managements. The article takes evidence from US consultancy Colloquy, noting that restaurants are lagging far behind other businesses in developing loyalty schemes. The article notes that in the United States, only 27. 2 million customers are part of restaurant loyalty schemes, while airlines have over 254. 4 million members for their loyalty schemes. Leahy further emphasizes that loyalty issues are to be taken very seriously in the restaurant business and it is very important to retain regular customers.

The General Approach: There are many ways to retain regular customers, one such prominent way is the loyalty card, a technique which has now caught on even in big showrooms and jewel stores. The simple technique here is that every time the customer buys something, he is given certain points and once these points reach a certain value, the points can be exchanged for discounts or special offers. This not only keeps the customer coming back to your store but also helps in maintaining good relations.

Once again this idea was an innovation of the aviation industry and it still needs to be implemented to a greater extent in the hospitality industry. According to CEFF (2007), loyalty cards schemes are a key factor in determining choice of hotel, airlines and restaurant chains by leisure travelers. Surveys have revealed that even though there are some customers who don’t quite bother about these loyalty cards, a good percentage about seventy percent of them admit that the loyalty cards played prominent roles in them determining their hotel or airlines.

Literary Reviews and Opinions: Gomez, Arranz and Cillan (2006) argue that these loyalty programs yield two important results of interest, which may be applied to the hotel and restaurant hospitality sectors. Such a program creates to genres of customers. The first class of customers includes those who display more behavior loyalty than the others simply because they are emotionally aware that the hotel considers them more important than their counterparts which are not enrolled in any of the loyalty schemes.

As in all businesses, emotion plays a very prominent role even in the hotel and management industry. Yet another thing that needs to be borne in mind is that the customer will not simply walk in to your outlet just because you have all these cards and offers. For example, however captivating and encouraging might be the scheme; the customer will come to your restaurant only when he feels like eating. You can never force the customer to increase the number of his visits, directly or indirectly.

Research that compares consumer behavior before and after the introduction of a loyalty program show that there is no real difference in the number of visitors, or the amount of purchasing done (Gomez, Arranz, & Cillan, 2006). Here it is once again argued that loyalty program don’t quite generate new loyal customers but just help in retaining the existing loyal customers. As in any other business, the sole objective and the motive behind your business should be very clear, for example, if the customer doesn’t like your product, then all the management tactics in the world will not help him come to you.

The bottom line is that what you offer the customer must stand up to his expectations. Trust and satisfaction are won by genuine effort and determination, there are no shortcuts, and the customer is smart enough to figure out what the actual standard of your restaurant is. According to Gomez, Arranz and Cillan (2006), effective loyalty can only come from customer attitudes such as satisfaction, trust and commitment. Loyalty based on simple repeated behavior is not very effective. Ethical Considerations: Unwanted effects of biased management:

Some researchers argue that even though loyalty is a very important issue, it is very difficult to impress the customer through these roundabout techniques; the management needs to focus more on other basic issues like the maintenance and the quality of service. All these schemes and offers can only assist the growth, they can never be the sole reason for the growth and a sensible manager should never depend upon any of these. Lacey and Sneath (2006) argue that customer loyalty programs are not always fair to all consumers.

The argument is assisted by the fact that such loyalty schemes only focus on a certain class of customers and not all customers. This creates negative hype and ill feeling among. The firm spends all the resources on pleasing the existing customers whom they assume to be loyal where as the new customers who might prove to be loyal customers in the future are just left to themselves. If this methodology is practiced in the long run, the organization might stand to lose many customers, the organization was so very considered about pleasing the existing customers that they forgot that they even have to generate new customers.

“One of the basic principles of the company is remembering what it is that guests prefer when they are in your hotel,” explained (Ritz Carlton) spokeswoman Vivian Deuschl. Such an approach can even be dreadful at times. It is argued that the same quality service should be given to all the customers. Never should the restaurant make the mistake of pleasing one class of customers at the expense of others. Such a treatment might be very pleasing to the regular customer but even he will hesitate to recommend the restaurant to others because he knows that new customers are not treated well over there.

Apart from all the above-mentioned ill effects, this practice is strongly condemned even on ethical grounds. The safest and the best alternative are to provide uniform treatment throughout to all the customers. This generates a positive attitude and helps a lot in business. There is no substitute to genuine hard work, determination and honest implementation of policies. As Jack Welch in his book Winning quotes “sorry, there are no shortcuts”. Hypothesis and Questions: The prime objectives:

Rather than concentrating on these hypothetical concerns, the restaurant should be bothered more about improving service delivery, bakery products, and cooking. Lacey and Sneath further argue that customers who are not a part of such loyalty schemes are often discriminated against and this is very unpleasant for the customer as well as a loss in revenue for the management. Langenderfer & Cook (2004), Petty (2000) throw light on a very important aspect here. The customer databases are rich with information and are excellent resources and if by chance this data ends up in wrong hands, t can be very taxing for the customers.

If such a thing happens, then it would be a clear exploitation of customer rights and a breach of moral and ethical values. The customer would then obviously hesitate to become a member of any such loyalty schemes in future. Wendlandt & Schrader (2007) come up with yet another intriguing question, they argue that all these schemes at times might even backfire and in fact cause more loss to the organization. As an able manager, the first that needs to be firmly affixed in mind is that we as humans are more effected by emotional happenings than anything else.

Once the person is emotionally troubled or if he even perceives that he is being manipulated, even the most loyal of the customers will give up. The customer might get frustrated by all these and begin to think that all these tricks only serve as gimmicks and in fact react exactly in a way opposite to what is expected of him. Smartly designed loyalty schemes however can actually avoid reactance of this type. For example, a loyalty scheme that offers long-term financial rewards that have to be gathered over repeat visits will probably avoid reactance (Wendlandt & Schrader, 2007).

However, long-term loyalty schemes can also be less effective at retaining regular customers. Kirby (2007) has yet another way of seeing the same scenario, the argument here is that it is more beneficial to serve customers as people rather than targeting on their customer profiles. The argument here is that rather than treating loyalty as just another part of the charm game, the hotels should earn repeat business by offering excellent services based on remembered and recorded client preferences (Kirby, 2007).

If hotels invest in tracking guest preferences and provide a superior service through the use of Customer Relationship Management (CRM), the customer will automatically be retained. Weinstein (2004) further argues that the ambience and the feel of the place are also very important. Always remember that the customer might forget what he came for, why he came, when he came etc but he is never going to forget how it felt to be there with you.

In the book the “Ice Cream Maker”, a book on the concept of six sigma, the author argues that in a departmental store or a shopping mall, it takes an average of seven to eight seconds for the customer to pass by your restaurant, it is in this minute fragment of time that we have to impress the customer that our outlet is actually worth a visit. To make the customer ‘feel’ something is an enormous challenge in its own right. Therefore, it is well worth going the extra mile to provide extra amenities to impress guests into engaging in repeat business (Weinstein, 2004).

Some of the 5 star chains in Dubai follow this strategy, hoping to get repeat business by pampering even walk-in customers. Research Questions: To summarize we can say that all the literature on loyalty is divided into two categories both conflicting each other. The first category, is those who advocate the loyalty schemes to lock in customers and make sure that they patronize and prefer certain restaurants in place of the other. Some researchers even argue that such a type of management might even be unethical.

The second category of advisors are those who emphasize on the importance of personalized service, remembering customer preferences, and offering amenities to keep customers coming back. They note that rather than discriminating customers, their stand is that hotels, restaurants and other businesses should keep service standards high across the board. As a manager we are faced with the question that when and to what extent which of these methodologies or logics are to implemented? What is to be given more importance and how are customers, both old and new to be dealt with? Should the approach to both these parties be same or different?

What is it that needs to be done so that all the parties are happy and content? How are we going to satisfy the emotional requirements of our customers? Jang and Mattila (2005) throw light on yet another trend. Their basic argument is that the manager must learn to understand the customer needs and requirements and react accordingly, for example, if the customer is expecting monetary benefits, then he must simply be given so, instead if the hotel argues that the customer be given only the free spa session or a free buffet lunch against his will, then it is only obvious that none of the parties is happy.

The customer is displeased because he is given something free of cost something he actually has no desire for. The hotel has used up its employees and other resources for the same purpose, which was not at all fruitful. Thus, such a decision has a negative impact on all parties. Jang and Matilla further note that at times immediate cash discounts are also not the solutions to the problem. Also, while customers may want immediate rewards, it usually suits managers to delay gratification in order to ensure repeat business.

Also, there is less guilt associated with luxury rewards if they’ve worked up to them over a period of time. It is also noted that there is a very strong potential for developing such programs in the hospitality industry. The transactions involved and the formalities taken up during the process of loyalty offers should be made very convenient and comfortable. The customers should not be penalized to show their loyalty cards every time; the hotels should remember the customers and work towards serving them better.

Data Management and Analysis and Budget considerations and timelines: Statistics will provide all sorts of data from all sorts of places. This data might vary over decades of research or even more, the right management comes from the fact that the manager should be able to pick up the right data and study it accordingly, wrongly directed research or haywire policy implementation is sure to spell doom for the company.

Therefore, it is of profound importance that the right data be chosen from all perspectives, the implementation schemes should not be so costly that the management suffers because of these, after all management is all about producing the best possible results in the minimum possible expenditure. Also, the time limits should also be adhered to very strictly. What might be a huge success in summer might be a complete failure in winter. If the set goals are not achieved within the given time limits, then the entire purpose of research is flawed. Conclusion:

There is no dearth of literature as far as the loyalty issue is concerned. Managers realize very well that there is more to management than just analyzing theories, real problems need real and innovative approaches, and not everything can be solved from the books. Able managers know for a certainty that all what is in research papers is just conjectures and even if a particular scheme or technique worked very well in a particular hotel or restaurant, there is no guarantee that it will produce the same or similar results elsewhere or even the same hotel the next year.

Trends change, people change, their needs and expectations change, every year researchers come up with new theories. The key to being a successful manager is to have the right instincts and realize where to draw the line. It might be noted that the manager should not go to extremes, as an example he might be so puffed up with confidence that he turns a deaf year to the researchers or for that matter is so engrossed in the research that he forgets that he has to deal with real life situations.

Coming to the issue of hotel management and the hospitality industry, the first and the foremost thing that should be firmly affirmed in the mind is that unless and until the product and services are up to the mark and stand valid in front of the customers’ expectations, no amount of management hoopla can help the cause. The hotel management should be more concerned about the quality of service and other basic but very important factors. Only when these issues are properly and sensibly addressed to and resolved can the management think of anything else.

The loyalty considerations are also to be dealt with great care and delicacy. It is but natural that the older customer will expect better services and the new customers would want their privileges to be on par with those of everyone else. This is where the elegance of the manager comes handy. The manager should be able to glide between such scenarios always keeping in mind the benefit of the employees and should also be successful enough to generate the maximum possible revenue.

Objectives of F&B control * Analysis of income and expenditure performance can be expressed in gross profit, net margin (gross – wages) and net profit (net margin – rent, rates, insurance…) * Establishment and maintenance of standards. SOP (standard operational procedures) * Pricing * Prevention of waste * Prevention of fraud * Management information Problems of F&B control * Perishability of food * Business volume unpredictability/sales instability Menu mix unpredictability * F&B operation short cycle -> little time for many control tasks * Departmentalization – several production and service departments -> separate trading results Fundamentals of control Planning phase Policies: pre-determined guidelines * Financial policy – level of profitability, subsidy and cost limits from each department * Marketing policy: target group * National identity * Customer profile Market share – same or more percentage of ‘our’ market * Turnover – sales volume increased by x% on previous year * Profitability – profit increased by each unit by x% on previous year * ASP (average spending power) increased by x% or to achieve a new ASP of no less than €x * Product – same high standard * Customer satisfaction – net result must be the satisfaction of every customer * Catering policy – main objectives of F&B facilities and describe the methods of how this is achieved * Type of customer * Type of menu * Beverage provision necessary for operation Food quality standards * Method of buying (contract, cash…) * Type and quality of service * Degree of comfort and decor * Hours of operation Operational phase * Purchasing * Product testing (tasting) * Yield testing * Purchase specifications – concise description of quality, size, weight etc. * Method of buying * Clerical procedures (who places orders, what documentation necessary for control) * Receiving * Quantity inspection * Quality inspection * Clerical procedures (acknowledgement of the receipt, delivery signature) * Storing and issuing * Stock records Pricing of items * Stocktaking (how much stock to be held, rate of stock turnover etc. ) * Clerical procedures (what documentation in necessary) * Selling * Checking system (number of items sold) * Control of cash * Clerical procedures Post operation phase * F&B cost reporting (daily or weekly) * Assessment – compare reports with budgets and with previous performance * Correction if necessary Reality of control: never 100% efficient Setting the budget and break-even analysis * Budget – plan which reflects policies and determines the business perations for a particular trading period * Budgetary control – control with particular responsibility for budget results is assigned to managers and continuous comparison between the actual results and the budgeted figures is made * Objectives of budgetary control * To provide a plan of action, to keep business with its policies and to maximize the full use of resources * To set standards of performance * To set out levels of cost responsibility and to encourage cost awareness * Capital budgets – assets, equipment etc. * Operating budgets – day-to-day income and includes sales, cost of sales, labour, maintenance etc.

Stages of budgeting 1. Determination of net profit, capital invested and risks involved 2. Preparation of sales budget – volume of sales necessary to achieve desired net profit. Also influences budgeted cost for food, labour etc. 3. Preparation of administration and general budgets (office expenses, advertising etc. ) 4. Preparation of capital expenditure budget (new equipment, furniture) 5. Preparation of cash budget (cash inflows/outflows, cash balance) 6. Preparation of master budgets (trading account, profit loss account and balance sheet) Costs, profits and sales Material costs = opening stock + cost of purchases – closing stock – cost of staff meals * Labour costs = wages and salaries * Overhead costs = all other costs Four kinds of costs * Fixed – always the same * Semi-fixed – depends on volume of sales but not in same proportion (fuel, telephone costs) * Variable – in proportion to volume of sales * Total – sum of above Profit * Gross profit – total sales – cost of materials * After-wage profit/net margin – total sales – material – labour * Net profit – total sales – total costs (material, labour, overhead cost) Break-even analysis * Based on: Selling price, product mix and unit costs remain the same * Only one product is made/sold * Break-even = C/(S-V) * C = total fixed costs * S = sales price * V = variable cost Software systems * Menu planning (popularity and profitability) * Production control (quantities) * Stock management (maintain stock levels) * Purchase ordering (order automatically when minimum stock) * Menu analysis (individual customer menu choices recorded) * All of these systems together: EPOS system Basic concepts * Planning, standard yields, recipes, portion sizes -> PYRS * Production planning (or volume forecasting) Goal: cost control, purchasing, reduce waste, production on demand, comparison between actual and potential volume of sales * Standard yields * Is the usable part of that product after initial preparation, or the edible part of the product after preparation and cooking * Goal: know how much to buy, safeguard against wastage – measurement of efficiency of production, accurate food costing * Standard recipe * Goal: accurate costing, important to know nutritional value, useful in kitchen * Standard portion size * Aid to food costing Methods of food control Control cycle * Purchase order * Delivery note Invoice (usually send directly to accounts department) * Requisition Weekly/monthly food cost report * For small business * Simple and quick to make * No intermediate information (only after 7 or 28 days) Daily food cost report * For small to medium-sized business * Simple and easy to follow * Detailed * Corrective action can be taken early in the month * Accuracy is important * Ignores staff meals, food that goes to/from bar -> not accurate Calculation of potential food costs 1. Multiply number of each menu item during a sample week by potential food cost per portion -> total potential food cost of a week 2.

Same with sold portions and menu prices -> potential total sales 3. Divide total potential food cost by total potential sales -> potential food cost percentage * Necessary information for above calculation: * Number of items sold and their selling prices * Standard recipe cards of all menu items * Summary of potential food cost obtained from recipe cards * Average market price for main ingredients Methods of beverage control * Six basic types: control of purchasing, receiving, storing and issuing, planning, establishment of standard yields, recipes, portion sizes and inventory * Par stock or bottle control system Beginning stock * Number of empty bottles to be counted and requisitioned for the day * Potential sales based on quantities issues and compared to actual revenue received * Adjustments made to selling price if necessary * Potential sales value system * Revenue value of each bottle based on standard size of drink, contents of bottle and selling price for each drink * Full bottles of spirits: potential sales value is the same as selling price * Spirits sold by glass: number of drinks x price per drink = potential sales value * Millimeter system * Most accurate EPOS reporting Menu item preference – to identify potential menu items that aren’t doing well and eliminate them from the menu * Menu item profitability * Sales by meal period – to know when to hire more staff or for marketing * Sales by server – to identify members of staff who need further training * Category report * Table waiting times Profit sensitivity analysis (PSA) * Identifying the ‘critical’ or ‘key factors’ of a business and how they influence the net profit * Method of PSA: 1. Identify key factors (number of covers, F&B costs, labour costs…) 2. Assume a change in one key factor at a time 3.

Calculate resulting change in net profit 4. Calculate ‘profit multipliers’ PM = % of change in net profit / % of change in key factor 5. List the PM’s in order of size 6. Analyze results Menu engineering * Evaluation of menu with regard to its present and future content, design and pricing * Highlight the good and poor performers on a menu * Customer demand – number of customers served * Menu mix – customer preference for menu item * Contribution margin (GP% – gross profit %) of each menu item (how much earned from item) * Stars – popular menu items and high GP% * Plowhorses – popular but low GP% Puzzles – low popularity but high GP% * Dogs – low popularity and low GP% Systems of revenue control * Manual or automated * Sales checks: each item ordered and the selling price to be recorded in check pads * Cashiers role: check and record the check pads in a ‘check number issue sheet’ and check pricing of all checks and add taxes Computerized items * Pre-checking systems: waiter has own machine key * Pre-set pre-checking system: each item on menu has its own key on machine * Electronic cash registers (ECR): EPOS is better so now only for small operations * MPOS: handheld/mobile EPOS system

Forecasting * How many customers and what will they eat at what time * We need: * Sales and turndown history * Cancellations and no show trends * Competitor data * Market trends * Weather forecast * Methods of forecasting software * Non-linear regression: used when time is the independent variable * Multiple regression analysis * Trend analysis * Adaptive filtering Operating ratios * Total F&B sales * Recorded and checked against budgeted sales figure * Done daily for large businesses * Departmental profit * Expenses = costs of F&B labour * Profit = % of departmental sales Ratio of separate F&B sales to total sales * ASP – number of items recorded on till roll and total sales * Sales mix – food-beverages, appetizers-coffees-mains * Payroll costs – % of sales – higher if more service * Index of productivity – sales/payroll * Stock turnover * Rate of stock turnover = cost of F&B consumed / average stock value at cost * Number of items that average level of stock has turned over in a given period * Sales per seat available – sales value that can be earned by each seat * Rate of seat turnover – number of times that each seat is used * Sales per waiter * Sales per m?

This integrated REA diagram combines 4 individual cycles together, Revenue cycle indicated in blue shape, Expenditure cycle indicated in green shape, Production cycle indicated in red shape and Human Resource cycle indicated in orange shape.

There are 4 integrated resources divided into 2 types which are tangible and intangible. Tangible resources include ‘Inventory (Raw material)’ , ‘Inventory (Finished goods)’, ‘machine&equipment’ and ‘Cash’. Only intangible resource shown in this REA diagram is ‘Employee time and skill’.There is also one integrated event, ‘Disburse cash’ , which is linked to 3 events, ‘receive raw material’ (Expenditure cycle) , ‘Acquire PPE’(Expenditure cycle) and ‘record time worked’( in Human Resource cycle). According to economic duality , Inventory (Raw material) is increased by ordering and receiving raw material (Expenditure cycle) and decreased by being used in issuing raw material(Production cycle). At the same time, Inventory(finished goods) is increased by producing finished goods(Production Cycle) and decreased by taking day-to-day order and shipping goods to customer.Cash resource is increased by collecting payment and is decreased by disbursing to employee as salary and to supplier as payment to ordered goods or PPE.

Revenue cycle The cardinality between two events Take estimated weekly order Confirm&take day-to-day order At this present, F&B has only two customers, its branch retail store and Starbuck. Every week both of them have to send ‘estimated order’ of demanded finished goods for the next coming week in advance so as to let F&B arrange sufficient inventory. Every afternoon F&B confirms and takes day-to-day order from both of the two customers.The ordered goods are going to be shipped tomorrow morning. Collect payment Ship goods to customer Therefore, each ‘take estimated weekly order’ may involve zero ‘confirm&take day-to-day order’ due to cancelling estimated order. And maximum cardinality is many because there can be up to 7 confirmations for each ‘take estimated weekly order’. On the contrary each ‘confirm&take day-to-day order’ may involve zero ‘take estimated weekly order’ due to sudden change in demanded goods, and can maximum involve only one take estimated weekly order’.

confirm&take day-to-day order’ and ‘ship goods to customer’ occur in sequence,therefore there is a p of time which makes minimum cardinality between them be zero. Note that F&B take order and ship goods day by day, so each ‘confirm&take day-to-day order’ cannot relate to more than one ‘ship goods to customer’ . As previously stated, F&B confirms and takes day-to-day order from customers every afternoon, and the ordered goods are going to be shipped tomorrow morning.Therefore, each ‘ship goods to customer’ involves one and not more than one ‘confirm&take day-to-day order’. F&B usually bills customer on 15th of every month and grants its customer 60 days credit term. Moreover F&B has no policy to let its customers install their payment. Consequently, each ‘ship goods to customer’ may involve no ‘collect payment’and can be maximum involve only one ‘collect payment’.

Besides for batch billing, zero cardinality is also allowed for the case that F&B has delivered defected goods or that customer ignores payment.Because ‘collect payment is a sequential event of ‘ship goods to customer’, each ‘collect payment’ has to involve at least one ‘ship goods to customer’ and can be maximum to many ‘ship goods to customer’ for batch billing . The cardinality between event and agent For each event that occurs, there is at least one and only one agent involving for accountability reason. For example, each ‘ship goods to customer’ can be involve one and only one customer, and only one employee has to account for this event.For each employee (agent), ‘employee’ is linked to event with zero minimum cardinality which is allowed for new employees or those who do not directly account for these events, and many maximum cardinality is allowed for those employees who usually take responsibility for these events consistently. For each customer who involves in Revenue cycle, ‘customer’ is linked to event with zero minimum cardinality which is allowed for potential customer ,and maximum cardinality is allowed for close-relationship customer. The cardinality between event and resource take estimated weekly order’ is a commitment event.

It does not directly increase or decrease ‘Inventory(raw material). However, receiving estimated weekly order can trigger warehouse people to set aside at least one raw material or may up to many kinds of material. On the contrary, ‘Inventory(Raw material)’ may relate zero ‘take estimated weekly order’ because there can be some raw material which is never used for producing ordered goods. And the many maximum cardinality is allowed for regularly used raw material.Each ‘take day-to-day order’ and ‘ship goods to customer’ has to involve at least one ‘Inventory(finished goods)’ or can also be multiple inventories. At the same time, each ‘Inventory(finished goods)’ is linked to both ‘take order’ and ‘ship goods to customer’ with the zero minimum and many maximum cardinality. Zero cardinality is allowed for those out-of-demand or new inventories whereas most finished goods may be ordered and shipped several times.

The fact that F&B maintains only one cash account makes actual REA diagram should be presented as following picture cashCollect payment The diagram show that if the company maintain only one cash account, this one cash account has to relate at least one collection of payment. However, we have suggested that F&B should separate cash account for one purpose, so this REA diagram is created on the assumption that there are more than one cash accounts. Collect payment cash According to relationship shown between ‘cash’ and ‘collect payment,’ It shows that each time the company collect payment from supplier, the payment has to be deposited into at least one and only one account.And each ‘cash’ may not relate to ‘collect payment’ if it is an account for salary disbursement. However, if the cash account is opened for collecting payment from customer particularly, it can relate several collections of payment. Moreover, ‘cash’ is a merged resource, zero minimum cardinality should be indicated here. Expenditure Cycle The cardinality between two events Acquire machine &equipment Receive raw material Order raw material Disburse cash Same as other companies, ‘receive raw material is a result of ‘order raw material’ therefore the minimum cardinality between them is one and zero.

Moreover each ‘order raw material’ may not lead to any ‘receive raw material’ if suppliers have no ordered goods available for sale. If supplier approves company’s order, there can be only one ‘receive raw material’ at most. On the contrary, ‘receive raw material’ is a result of at least one occurrence of ‘order raw material’. Since some suppliers usually deliver ordered goods in batch ,each ‘receive raw material’ can be a result of multiple orderings. Each time company receive ordered raw material, company may not disburse any cash if supplier delivers free sample goods.And ‘disburse cash’ can happen at most only one time because suppliers do not allowed company to install payment. Since some supplier usually bill F&B monthly, each ‘disburse cash’ can be up to multiple occurrences of ‘receive raw material’.

Note that ‘disburse cash’ is integrated event therefore minimum cardinality indicated in red is zero which means that each occurrence of ‘disburse cash’ can relate to either ‘receive raw material’ or ‘acquire machine & equipment’. Besides from acquire raw material, the company has to disburse cash so as to invest new machine and equipment such as a new oven which has larger capacity.As shown in the picture, each time the company acquires new fix asset, it may relate to zero ‘disburse cash’ due to a p of time and for the case that company exchanges an old machine with a new one, and can be up to multiple of ‘disburse cash’ for installment case. The cardinality between event and resource Receive raw material Order raw material Inventory (Raw material) Each ‘order raw material’ and ‘receive raw material’ has to increase at least one ‘Inventory(raw material)’ and up to multiple inventories.However some raw material may not use to be ordered or delivered because it is under consideration process of company whether to order those new ingredients or not. While basic raw material like flour and sugar are ordered and delivered several times. Disburse cash cash As previously mentioned, we have suggested that F&B should separate cash account base on business purpose.

Therefore each ‘cash’ may not relate to any ‘disburse cash’ , while some cash accounts are opened particularly for disbursement which can relate to multiple of ‘disburse cash’.On the other hands, each ‘disburse cash’ has to relate to one and only one cash account for easy error tracing. Acquire machine &equipment Machine & Equipment For machine and equipment, like raw material, some machines are under consideration process of company whether to buy or not while some consistently used equipment like knives are purchased several times. On the other side, each occurrence of ‘acquire PPE’ has to relate at least one ‘machine&equipment’ and can be up to many. The cardinality between event and agent Employee Supplier Receive raw materialOrder raw material Supplier Each occurrence of ‘order raw material’ and ‘receive raw material’ has to relate to one and only one supplier and employee for accountability reason. On the other hands, each agent is linked to each event with zero minimum and many maximum cardinality. Because some new suppliers may never receive any orders from F&B and therefore never deliver company any goods.

While some close-relationship suppliers always get several orders from company and deliver goods multiple times. Employee (cashier) Disburse cash Supplier Employee (payee)For cash disbursement, F&B has an authorized cashier who directly take responsibility for this event consequently each ‘disburse cash’ has to relate to one and only one and only one ‘cashier’ for accountability reason. Only minimum cardinality of cashier remains one because ‘disburse cash’ is an integrated event among three event, ‘record time worked’ , ‘receive raw material’ and ‘acquire machine&equipment, ’ therefore zero minimum indicated in red is used to describe the relationship which means that each ‘disburse cash’ can relate either to ‘supplier’ or ‘payee’, not both of them at the same time.While each maximum cardinality remains one owing to accountability reason. On the contrary, each agent may never involve zero ‘disburse cash’ especially for new agent ,and most of them relate to multiple of ‘disburse cash’. Acquire machine &equipment Supplier Employee (Production mng. ) Each time of acquiring fix asset, there has to be one and only one production manager involved in order to approve the event and take responsibility.

Same situation happens to supplier.For both of agents, they are linked to ‘acquir machine & equipment’ with minimum of zero and maximum of many. Zero minimums shown from employee and supplier to the event are allowed for new or indirect-related employee and supplier respectively. Two maximum cardinalities are shown the relationship that some direct-related employee and close-relationshiped supplier may account for ‘acquire machine&equipment’ several times. Production Cycle Every early morning production manager gets the ‘production order’ which indicates type and quantity of bakeries to be manufactured in that day.Every ‘production order’ relate to one occurrence of ‘produce finished goods’. For F&B,each ‘ Issue raw material’ can be used for one and only one ‘produce finish goods’.

At the end of the process, if there is some remaining issued raw material, production people has to return it to storeroom immediately. The remaining issued raw material is not used for tomorrow’s production due to quality control. In other words, a new issuing raw material is required for every new start of production.Thanks to the professional production manager, after production people have issued requested raw material, the production manager checks quality and quantity of those issued raw material before starting manufacturing process which makes the issued raw material fit to day-to-day production, only little raw material left. The cardinality between two events Issue Raw material Produce Finished Goods As mentioned, each time production people issue raw material, it can relate to not more than one time of producing finished goods. The zero minimum cardinality is allowed for a p of time due to being sequential event.On the contrary, each ‘produce finished goods’ required at least one ‘issued raw material’ and can be up to many for the case that issued raw material is used to defected finished goods or that issued raw material is not enough to produce demanded finished goods.

Record time worked Produce Finished Goods There is also one across cycle-related event, ‘produce finished goods’ in production cycle and ‘record time worked’ in payroll cycle. F&B has a policy that production people has to record their worked time by scanning their finger print everyday.As the ‘record time worked’ is a sequential event of ‘produce finished goods’, minimum cardinality between them has to be one and zero respectively. For maximum cardinality,note that there is always only one occurrence of ‘produce finished goods’ per day because it is a production of bakeries. All bakeries have to be done daily. Therefore, each ‘produce finished goods’ relates to not more than one ‘record time worked’. The fact that employee of F&B has to record their time worked daily makes each ‘record time worked’ be a result from at least one occurrence of ‘produce finished goods’ and not more than one.

The cardinality between event and resource Inventory (Raw material) Issue Raw material The relationship between ‘Inventory(raw material)’ and ‘issue raw material’ is M:N. Some raw material is never used in production especially for new ingredient, but most raw material is issued for multiple times. On the other side, each time production people issue raw material, they have to issue at least one raw material and can be maximum to several raw material. Produce Finished Goods Inventory (Finished Goods) The relationship between ‘Inventory(finished goods)’ and ‘produce finished goods’ is M:N.For F&B, the case that finished goods are increased by returned inventories from customers cannot happen because bakery product cannot be kept to resale nor remake. Whenever customers reject delivered goods for any reason, F&B has to dispose those rejected bakeries immediately. Therefore, each type of finished goods has to increased from at least one occurrence of ‘produce finished goods, and can be maximum of many occurrences for those best selling bakeries.

On the other side, each ‘produce finished goods’ may create zero finished goods since unsatisfied bakeries have been made especially for new first-try menu.However, each ‘Produce finished goods’ can create up to load of finished goods at the same time. Produce Finished Goods Machine & Equipment Some machine and equipment of F&B are not used to produce finished goods, but some of them are used in production cycle everyday. On the other side, every occurrence of ‘produce finished goods’ required at least one baking machine and can be up to a lot. The cardinality between event and agent Employee (Production mng. ) Issue Raw material Employee (Warehouse) Produce Finished GoodsEmployee (Production people) Typically after production manager has noticed the demanded quantity of raw material to be issued which is indicated in ‘production order’ , production manager is going to approve the withdrawal and gets production people to issue demanded raw material from warehouse ,where warehouse people take responsibility. Consequently, as shown in the picture above, ‘issue raw material’ is linked to two agents, warehouse people and production manager.

Both of them has minimum of one agent and maximum of one agent for accountability.On the other side, the ‘warehouse people’ and ‘production manager’ entity may relate to at least zero ‘issue raw material’ and can be maximum of many ‘issue raw material’. Zero cardinality is allowed for new warehouse people and production manager or those who do not directly account for this event while maximum cardinality is allowed for those employees who involve in this event consistently. The same situation occurs when ‘production manager’ and ‘production people’ are linked to ‘produce finished goods’. Every morning production manager approves day-to-day finished goods production and let production people bake ordered bakeries.Therefore each ‘produce finished goods’ relates to one and only one ‘production manager’ for accountability reason, but relates to at least one production people and can be up to many ‘production people’ who work together for large order. Payroll cycle The cardinality between two events Disburse cash Record time worked For payroll cycle, employees especially for production people have to record their time worked everyday before they start working in the kitchen.

However F&B usually records their time worked and pays them monthly.Therefore, each time ‘record time worked’ may not lead to any ‘disburse cash’ and can result in maximum of one ‘disburse cash. Note that ‘disburse cash’ is an integrated event which is also linked to ‘receive raw material’ and ‘acquire machine&equipment’ in expenditure cycle. Consequently, each occurrence of ‘disburse cash’ may not relate to any ‘record time worked’ and can relate up to multiple of ‘record time worked’ when the company disburse monthly salary, zero minimum and many maximum cardinality shown respectively. The cardinality between event and agent Employee (Production people) Record time workedEmployee (Production mng. ) At F&B, each occurrence of ‘record time worked’ has to get approval from production manager, so it is linked to production manager and production people with minimum and maximum of one agent involved for accountability reason. On the contrary, both ‘employee (production people) and ‘employee (production manager)’ are linked to ‘record time worked’ with zero minimum and many maximum cardinality.

Two of zero minimum cardinalities are allowed for those employees who do not need to record their time worked such as accounting and sale people and those who do not involve in any approval of