BUSINESS STRATEGY – KEBAB-JI CASE STUDY
Introduction
Kebab-Ji is the concept of healthy Lebanese cuisine quick casual restaurant. Different from fast-food due to more refined meal options and restaurant layout, this concept became very popularly among many consumers. Timely service and fresh ingredients are the key elements of the marketing strategy, chosen by the management. The purpose of this study is to analyses the operations of the restaurants, its mission and vision and other aspects, which affect the effectiveness of the operations from the Supply Chain (SCM) standpoint.
A variety of dishes and ingredients underpin the authenticity of the Lebanese cuisine. Moreover, the company places fresh ingredients and quality on top of its generic strategy agenda and marketing proposition. As a fast and casual restaurant, the complexity of the operations of such establishments is significantly higher than the one of a traditional fast-food. Such elements, as the use of the charcoal grill and no additives in the process of preparation, places further pressure on operational efficiency.
The purpose of the supply chain management is to optimize the operations in a way that allows effective cost reduction while maintaining superior quality on upstream and downstream of the operations. With that in mind, the effectiveness and efficiency of all the milestones within the preparation, cooking, serving and other stages are essential to the success of Kebab-Ji. Kebab-Ji focuses on a wide public, including middle and upper middle-class segments. The fact that the organization serves healthy food in a niche market, it can charge the premium price. Pricing strategy, however, builds on the high fixed costs as the company works with on average 55 employees per establishment, demanding cost-centered strategy to generate healthy profit margins. Kebab-Ji, therefore, highly depends on the throughput capacity and potential flow of the clients. All the above factors determine the choice for high-traffic location in the cities, underpinning the high fixed costs of the company, related to the rent, utility bills and other location specific cost lines. More importantly, the company aims at the rapid growth in all its major markets, which means that Kebab-Ji will further depend on the effectiveness of its international SCM. The ability to standardize and make its SCM transparent will determine the level of quality and profitability of a company. It is not a secret that internationalization of SCM results in a reduction of control over the quality and processes in the operations. With that, Total Quality Management (TQM) is essential to the operations to ensure the elimination and minimization of human errors and operational waste.
Additionally, Kebab-Ji offers fast waiter service to its clients. Taking into consideration that the establishments work from early morning to late evenings, shift management and headcount costs make the significant contribution to the bottom line of the company. Optimization of operations can benefit the company by reducing the headcount and increasing collective performance through higher individual efficiency. The presentation of the service, product and the overall customer experience on the downstream of the business build customer loyalty and return (Gummesson, 1998, pp. 5-7). It is evident from the case that the long-term strategy of Kebab-Ji is centered around creating a base of loyal customers, which can become ambassadors of the brand (Davies, 2016, pp. 106-110). That said operations are central to achieve this goal.
Finally, operational management should be considered in the context of relationships between the organizational internal and external environments. Kebab-Ji implements Hazard Analysis and Critical Control Point (HACCP) system, building on food safety and hazard prevention techniques. These processes are, to a large degree, a demand of legislator and formal regulatory environments. Considering the standards of operations in different locations, where company is present, operations management is critical to the ability to run continues operations, compliant with the governmental regulations in the food retail sector (Christopher, 2016, pp. 45-47)
QII: Kebab-Ji’s Mission Statement
Kebab-Ji's mission statement is "Serve Healthy Food to Today's and future simply Because of We Care". This means that quality I central to building the trust of the clients and delivering the unique value proposition. Kebab-Ji aims at differencing themselves from traditional fast-food, building on the concept that comprises, rather than contrasts, the idea of “fast” and “healthy”. The company places such values, as (1) care, (2) health, (3) commitment to future generations to the center of their growth. Organizational goals include rapid growth and profitability and the mission statement outlines the manner and values that stand behind this commitment. It is evident that the organizational strategy relies heavily on the Corporate Social Responsibility (CSR)., starting from food production process, using charcoal and no additives policy, to the work with local community as all the ingredients are sourced locally, contributing to the microeconomic climate of the region (Keller and Horn, 2003, pp.66-70).
Moreover, the mission statement should be related to the organizational motto, which states that “Kebab-Ji goes an extra mile to bring you fresh quality food that tastes great every time”. That said the company builds its brand equity on consistency and continuity of the service, also evident in the statement about the future generation in the organizational mission.
The overall message of the mission statement is to outline the participation of the company in a community and its concern with bringing the best to the urban environment. It is interesting to note that the company's strategy is to combine fast food and healthy and fresh proposition. This offer is the core differential on the market. Mission statements provide strong support for this message and serve as a unique point of "contact" with the client.
QIII: Importance of Forecasting at Kebab-Ji
When it comes to the choice of appropriate forecasting method for this establishment, it is possible to argue that flexibility and enhanced capabilities in predicting the future demand are essential for success. The core advantage of quality forecasting is that it allows predicting changes in sales patterns and consumer market trends. Unlike wise quantitative forecasting method, qualitative methodology relies heavily on consumer psychology. One of the downsides of qualitative forecasting, relevant to Kebab-Ji is the influence of current events on the prediction of future demand. As such, the company can ignore or overlook the competition from substitute products, such as grocery stores and their in-house restaurants and, thus, under or overestimate the demand for the coming period. With that, structural and numerical data is essential to ensure accurate inventory strategy for Kebab-Ji and its internal control mechanism. Quantitate method can contribute essentially with historical and transactional data of the restaurant itself as well as the competition. This data is relevant to occupancy and layout planning, purchasing demand planning and customer throughput forecasting. Considering the above observations, it is possible to conclude that Kebab-Ji should use mixed forecasting approach and qualitative forecasting alone is not the most optimal solution (Christopher, 2016, 49-55).
QIV: Where is Kebab-Ji on the Good-Service Continuum?
The purpose of the goods-service continuum is to provide marketers with an effective tool to evaluate the total good and service composition of a total product. The ability to do so, allows the company to spot opportunities and better position itself on the market for sustainable development and growth spurt. Good service continuum is the relative concept, which has a subjective element of judgment, generally, depending on the perceived value and vision of the management. Kebab-Ji is a restaurant that serves food to the clients in a niche market, offering healthy Lebanese food. With that, it is a product-focused business. As any other dining-out business, however, the experience is essential to the client and, thus, restaurants can be placed in the center of the Good-Service Continuum model. To be more accurate, however, it is critical to have the more specific analysis of the Kebab-Ji proposition. The overall proposition of the company is centered around the total customer experience, which involves (1) ethnical food, (2) food and service quality, (3) ambience, (4) freshness of the recipes, (5) participative experience through applying such layout elements, as glass-fronted kitchen and make-to-order process design (Christopher, 2016, pp. 49-52). These observations allow arguing that the company is focused on building a unique customer proposition through exclusive in-house experience. Considering the importance of the experience to creating trust and loyalty of a customer, an intangible element is the key to the company. With that, Kebab-Ji can be classified as a service linked to tangible goods, where fresh and healthy ethnical Lebanese food makes part of the total fast and casual restaurant experience concept.
References
Davies A. 2016. Best Practice in Corporate Governance: Building Reputation and Sustainable Success. 2nd Edition. London: Gower Publishing.
Keller, M. & Horn P., 2003. Strategic Management. 2nd Edition. Journal of Literature, 12(5), pp.66-89.
Gummesson, E. (1998). Productivity, quality and relationship marketing in service operations. International Journal of Contemporary Hospitality Management. Vol 10(1), pp.4-15.
Christopher, M. 2016. Logistics and Supply Chain Management. New York: Financial Times Publishing.
