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Assignment of Strategic Operational Issues

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Executive Summary Abu Dhabi is the largest of seven emirates, and also it’s the capital of United Arab Emirates, and this is what makes Abu Dhabi the first in an expansion of the market, tourism, construction & other important issues. In this rich area, the catering company can find good opportunities to introduce their different services, products. Catering operations, as either a stand-alone facility or as part of a larger hospitality related business, exist in a wide variety of formats, or styles. Most common are those that are readily identifiable as private rooms in restaurant operations, hotel facilities, and independent catering facilities. The increased demand by the international public for private function space outside of their own homes and businesses has led the catering segment of the foodservice sector of the hospitality industry to be a leader in the continued growth of both facilities and revenue. 1
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Page 1: Assignment of Strategic Operational Issues

Executive Summary

Abu Dhabi is the largest of seven emirates, and also it’s the capital of United Arab

Emirates, and this is what makes Abu Dhabi the first in an expansion of the market,

tourism, construction & other important issues.

In this rich area, the catering company can find good opportunities to introduce their

different services, products.

Catering operations, as either a stand-alone facility or as part of a larger hospitality

related business, exist in a wide variety of formats, or styles. Most common are those that

are readily identifiable as private rooms in restaurant operations, hotel facilities, and

independent catering facilities. The increased demand by the international public for

private function space outside of their own homes and businesses has led the catering

segment of the foodservice sector of the hospitality industry to be a leader in the

continued growth of both facilities and revenue.

This assignment will show as a Catering Manager how to run the day-to-day catering

operations and services in a variety of locations and projects as well as leading a team of

chefs and catering assistants. You will be tasked with optimizing the quality of the food,

service and performance of their outlets and achieving good quality at low cost and

maintaining high standards of hygiene and customer satisfaction. The Catering Manager

responsible for planning menus in consultation with chefs, hiring, training, supervising

and motivating staff and setting and monitoring budgets and maintaining financial and

administrative records.

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Also, this report will show how “National Catering Company” NCC, operate their

organization, what is their services & products, analyzing the method to control the

quality of their product & services.

STRATEGIC OPERATION ISSUES NATIONAL CATERING COMPANY & FOODSTUFF

Contents

Introduction…………………………………………………………………..……6

Company background………………………………………………………..…….6

Vision/Mission ...……………………………………………………………..……6

Company Operation Strategy………………………………………………………7

Catering Operational Issues……………………………………….………………..7

Company Existing & Potential Client’s Projects Are……………………………...10

Analysis of NCC operational issue……………………………………………………10

Summary of this analysis…………………………………………………………...16

Appendix of Company organization chart …………………………………………17

Appendix of Operation steps involved in NCC (Sample) ………………………….18

Recommendation to operation management in catering company………………....22

Conclusion………………………………………………………………………….23

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References………………………………………………………………………….24

Introduction

Today’s food industry relies upon a web of intercompany relationships.

Successful interactions among ingredient vendors, food contact packaging providers,

re-packers, co-manufactures, brokers & other suppliers are the precursors to effective

food safety management. This report identifies a range of operational issues that make

“National Catering Services & Foodstuff” one of the first successful catering company in

UAE & other gulf countries.

Company Background

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National Catering is one of the leading catering and related support services companies in

the Arabian Gulf region. In just a short period, National Catering has become one of the

Middle East leading independent contract catering companies, serving daily over 31000

meals per day in the different business, industry and education sectors, to whom they

offer various catering packages.

The company at the line of process of management & quality control.

[Data Dubai 2010]

Vision / Mission Statement

National Catering's focus on core business of providing world class Catering and related

services, allows Clients to concentrate on their core businesses.[NCC 2010]

'can-do' attitude

have a passion for quality

provide services beyond expectations

Objectives

Objective it’s always to deliver customer satisfaction whilst participating in client’s

commercial target achievement. [NCC 2010]

Company’s Operations Strategy

Operations Management a lot of disciplines, to be effective, operation interface with

many different disciplines with is an organization.

Production & service operations have a central role in most firms (services &

manufacturing) they typically account for 70 – 80% of an organization’s assets,

expenditure & people.

The function of operation management briefly defined:

Selecting : involves the determination of what product (S) or service (S)

will be produced, and by what process

Designing : involves the creation of method of production

Operating: involves the actual production – process meeting of schedule,

satisfying of production quotas and standards.

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Controlling involves testing for adequate performance – with respect to

quantity, quality, and timeliness

Catering Operational Issues

Catering operation & process management is generally one of the more complex

components of a venue’s activities. A successful catering department requires the

effective management of everything from price and portion size to marketing and

HR. The benefit of a successful catering operation is that it not only brings in

profits from the catering department, it also serves to enhance other areas of the

business. [Diskson Wohlsen Strategies 2010]

Catering Operational Issues will define the nature of the customer relationship and co-

operation between NCC Group catering management and the shipping company.

management. [Kokkaka_Tommi, ME Group2010]

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The figure. Shows the catering management as in theory is not complicated

“Note this Diagram shows the catering operational issues for ME Group which we can consider it

also for NCC” [Kokkaka Tommi, ME Group2010]

The list mentioned below some of company’s key strengths for the successful

execution of project:

a) Capabilities

NCC serves clients on a wide array of issues, regardless of industry sector,

and providing support solutions for the most difficult, fundamental catering

and related problems facing company’s clients.

b) Local knowledge

Company’s staff members proposed to engage in a given project are

carefully selected based on ability to effectively communicate and interact

with company’s customers.

c) Technical Abilities

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A resource of highly qualified professionals unsurpassed in its depth of

experience and knowledge. Such experience substantially sensitizes

company’s team to the vigorous service demands of the institutional and

environmental demands.

d) Team Approval

NCC approach to various projects focuses on working closely with the

client and the staff using the facility to ensure the delivery effectiveness of

the proposed services.

e) Management Follow up

Regular schedule and surprise visits of National Catering management to

sites and to the client’s management premises for the purpose of control and

staff motivation. Consistency of standard levels is assed and feedback

reviews are undertaken.

f) Quality and Choices

Quality is carefully monitored by high - standards, by company specialized

people in the various catering and related services requirements.

[NCC, Company Profile, PDF 2010]

“National Catering Company” NCC offer diversification services & products, these

different operational issues that introduced earned the company reputation for developing

& and using leading-edge concepts to solve challenging situations. [NCC 2010]

Company Existing & Potential Client’s Projects Are:

Hotels & Restaurant

Hospitals & Healthcare

Staff Facilities & Cafeterias

Educational & Training

Sports & Recreation Venues

Central Production Kitchens & Flight Catering

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National Catering has the ability to apply foodservices production techniques and establish

volumes production requirements, logistics planning, logical workflow and smooth delivery for

arrange of major public and private hospitals, commercial operators and airlines companies .

[NCC 2010]

Analysis of NCC operational issues

Certain types of food such as catering foods decay very rapidly. In this part investigates

how the quality of such foods can be improved by shortening the time interval between

production and delivery. To this end, the company should develop an approach or method

to solve this problem, which integrates short-term production and distribution planning in

a novel iterative scheme. The production scheduling problem is solved through an MILP

mixed integer linear programming modeling approach, which is based on a block

planning formulation complemented by a heuristic simplification procedure.

I) OBJECTIVE OF THIS METHOD

The quality of the products is not only determined by the production process. It is also

strongly influenced by the coordination between the production and the distribution

environments. To ease this coordination, the food preparation sites are usually directly

connected to the customers with a fleet of vehicles operated by the caterer.

However, the analysis of this practices shows that the production and distribution stages

are planned independently, causing large operational and quality problems

Therefore, in this part, the investigating is how an integrated planning approach can be

used to harmonize the decisions made on production and distribution aiming at an

improved quality of the delivered products at the customer location.

II) ITERATIVE SOLUTION FRAMEWORK

The quality of the produced products continuously degrades with time, until the order is

delivered. Therefore, there is a tight connection between transportation and production

scheduling decisions on the quality of the delivered order. However, due to the

complexity of the production scheduling and transportation problems, modeling the entire

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problem as a single mathematical model does not lead to a tractable formulation.

Therefore, the company designs a novel iterative framework to handle these problems.

Production decisions include the completion time for individual orders. Transportation

decisions involve vehicle routes determining when each order is picked up from the

production site (departure time) and its delivery time. Clearly, an order cannot be picked

up by a vehicle unless its production is complete

Delivery time

Fig. 1 describes the iterative solution framework used to solve the integrated problem

MILP: mixed integer linear programming

In principle, it is possible to start production at a very early time to have all products

ready by the time the vehicles are scheduled to depart from the production site. In this

first iteration, every order’s delivery time and the departure time of the vehicle carrying

that order are determined. This information is used to generate constraints for the

production scheduling problem. Also successive iterations during which delivery and

departure times are updated, will not lead to an infeasible production scheduling problem.

But any update of the delivery and departure times creates a potential for improving the

quality of the delivered orders by rescheduling them. Similarly, in a solution to the

production scheduling problem the completion time of the orders provides a potential for

rerouting the vehicles to improve the quality of the delivered orders without increasing

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total transportation costs. The two main constituents of this approach are the solution

algorithm for the production scheduling problem and the solution algorithm for the

distribution problem (cf. Fig.1). The latter is a typical vehicle routing problem with time

windows (VRPTW), the quality improvement of the delivered foods is included into the

objective function (cf. the model formulation in section IV of this Method). For the

solution to this problem, the company used a large neighborhood search (LNS) algorithm,

which has proven to work very efficiently.

III. CATERING PRODUCTION SCHEDULING

The production environment and the heuristic batching method, which works as a

preprocessing procedure to the solution of the model formulation, are explained. The

general configuration of the production environment is as follows:

All products are produced at a single production site with several identical

ovens. These ovens form the bottleneck of the production system.

A set of known customer orders arrives daily and has to be processed and

delivered within time-windows specified by the customers.

Every order encompasses only one type of food menu.

The quality decay of food orders starts right after the completion time.

Food quality is calculated at the time of delivery.

Orders can be combined to be produced together in a batch. However, only those

orders are allowed to be put in the oven together, which have a similar

temperature requirement and a similar processing time. In combining orders, the

oven capacity must be respected.

There can be idle time between two successive batches in an oven. This is

accepted to avoid premature production which may result in unacceptable quality

decay.

The aim in production scheduling is twofold: (1) minimization of the quality decay,

expressed as the time interval between order completion and delivery times, and (2)

minimization of total setup costs. The setup costs result from heating up (and cooling

down) of the ovens

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In consumer goods industries manufacturers often consider a fixed sequence of

production setups based on human expertise or technological conditions. For instance, in

food processing industries, production managers often sequence from the less intensive

taste of a food product to the stronger or from the brighter color of a product to the

darker. Such production policy is known in practice as block planning

One important aspect in this approach is to define a pre-set sequence of setups based on

human expertise, and then to construct a hierarchical structure for planning the

production operations based on such a fixed setup sequence

The purpose to use a block planning approach to formulate the production scheduling

problem since it not only reflects the practical settings of our application but also

significantly reduces the complexity of the problem

Since heating up the ovens is much quicker than cooling them down, orders are

scheduled on the ovens based on their temperature level requirements in an ascending

order. In our case, a block is hence defined as the sequence of all required temperature

levels in ascending order. These blocks are applied to all lines

Considering such a temperature pattern, total setup costs of an oven can be seen as the

costs for heating up the oven to its highest temperature level realized for processing the

assigned orders. Obviously, such an objective will result in the most economical

schedules. If a temperature level is used for an order A on a line, then the processing of

another order B at a lower temperature level on the same line will not have any impact on

the setup costs. However, order B must be produced before order A and this might lead to

preparing it far before its delivery time. Therefore, the quality decay is also included in

the objective function which keeps finishing times of orders close to their delivery times

The second step of block planning is to construct a hierarchical plan based on the defined

blocks. The following heuristic batching procedure was designed based on the definition

of temperature patterns which significantly simplifies the problem without impairing the

quality of the final solution. The procedure described in Table I determines the orders

to be included in a batch. The resulting batches cannot be scheduled on the same oven

unless their sequence is respected. This significantly reduces the solution space. The

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production scheduling problem is thus reduced to scheduling a considerably smaller

number of entities (batches vs. orders)

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Fig.2. Batching heuristic

Fig. 2 illustrates how this approach works for a simple example of 11 orders, 3 temperature levels

and 3 ovens. Transportation between every two locations is assumed to take 3 units of time and

the threshold parameter for batching is considered to be 5. Distribution decisions including

vehicle routes and visiting time of each customer are obtained by solving the transportation

problem formulated in the next section using LNS. Afterwards, orders are combined into batches

through the heuristic algorithm of Table I and then the formed batches are scheduled on different

lines by solving the model presented in the next section.

[A Heuristic Approach for Short-Term Operations Planning in a Catering Company

2010]

IV) Large neighborhood search framework (LNS)

A large neighborhood search algorithm is an iterative process that destroys at each

iteration a part of the current solution using a chosen neighborhood definition procedure

and, reoptimize it in hope of finding a better solution Algorithms can be created that

identify and invalidate price movements that differ significantly from the norm for a price

transaction. For some seasonal price transactions for which price movements are erratic,

it may be more appropriate to construct an algorithm to look at price level rather

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than price change. Although algorithms can be an efficient way to highlight problematic

data, a word of caution should be expressed about using them. [large neighborhood

search algorithm 2010]

Fig.3 shows that the algorithm works more efficiently when decay rates ate increased from 3 to 9.

It is worth nothing that such large quality improvement comes at the cost of any marginal

increase in setups and transportation costs.[ .[A Heuristic Approach for Short-Term

Operations Planning in a Catering Company 2010]

Summary of this analysis

In short-term catering operation, production scheduling and transportation planning need

to harmonize to obtain good product quality, however both problems are already makes

their integration difficult.

This paper provides an iterative solution framework for an integration of both problems

further, a modeling approach to simplify the production scheduling problem based on the

block planning concept is developed The result of the quality focus and the integration of

the decisions show significant improvement in the quality of delivered foods in catering

business. The purpose of this study is to find an appropriate lower bound for production

scheduling against which the influence of applying the block planning approach and the

batching heuristic can be measured.

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COMPANY ORGANIZATION CHART

[NCC, Profile, PDF 2010]

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Operation Steps involved in National Catering Company

(Samples)

[NCC, Profile, PDF 2010]

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[NCC, Profile, PDF 2010]

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[NCC, Profile, PDF 2010]

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[NCC, Profile, PDF 2010]

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[NCC, Profile, PDF 2010]

Recommendation to operation management in catering company

If the company wants to reach customer satisfaction, they should believe that the role of

customer is the important way to know how to operate their business.

Customer satisfaction can be reached through offering him effective & good product &

services with lowering costs, improving high quality and ensuring that the right quantities

of products are produced and made available to the consumer at the right time and place

, to be successful operation management as a catering company they should know how to

manage their process management and how to operate it, and these processes should define as

follow:

An output requirement statement between process owners and customers

An input requirement statement between process owners and suppliers

A process that’s capable of transforming the suppliers’ input into output that meets the

customers’ performance and quality requirements

Feedback measurement systems between process and customers, and between process

and suppliers.

A measurement system within the process.

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Conclusion

As briefly, it’s possible to say, the successful companies must first learn to manage their process

it’s the basis of most improvement methodologies. A process is a series of interconnected

activities that take input, add value to it and produce output. It’s how organizations do their day-

to-day routines.

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References

Data Dubai, UAE Dubai Directory, the website viewed on 15 of August 2010[http://www.datadubai.com/United_Arab_Emirates/Ajman_Region/

Business_and_Economy/Services/Caterers/256003-14139.html]

National Catering Company, corporate website viewed on 15 of August 2010[http://www.nationalcatering.net/];

http://nationalcatering.net/~natihmu5/nationalcateringprofile.pdf

Disckon Wohlsen Strategies, viewed on 17 of August 2010

[http://www.dws.net.au/tools/catering-operations.html]

Kokakala Tomi, ME group, the website viewed on 17 of August 2010

[https://publications.theseus.fi/bitstream/handle/10024/1389/Kokkala_Tommi.pdf?

sequence=1]

A Heuristic Approach for Short-Term Operations Planning in a Catering Company,

the website viewed on 19 of August 2010

[http://orbit.dtu.dk/getResource?recordId=251848&objectId=1&versionId=1]

Large neighborhood search algorithm for vehicle routing problem,

the website viewed on 20 of August 2010

[http://transp-or2.epfl.ch/tristan/FullPapers/046Desaulniers.pdf]

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