Case Study
The Patterson Brasserie and Bistro ChainUse of the case study in an HRM Examination paper
Maria Patterson's first café sold light snacks, exotic salads, cooked pies, ice cream desserts, beverages and sandwiches and had the decor of an old fashioned Parisian Brasserie and Bistro.
Following Maria's death, her husband William expanded the business using his wife's café as a model. Patterson Brasserie and Bistro grew to be a chain of restaurant outlets across London and the south of England. William believed that the key to success was to replicate the original café in every detail.
William used standard layouts and equipment. He laid down detailed instructions for food preparation and for services, specific standards for cleanliness and maintenance and strict methods of record keeping. It was the responsibility of each café manager to train workers and supervisors to follow standard procedures and methods.
At least once a month, at irregular intervals, someone from head office would make out a quality audit of each café-restaurant. This included an eight page check list covering; how work was being done, the condition of food inventories and of equipment, the accuracy with which , the friendliness of the café’s atmosphere, even the attractiveness of employees’ physical appearance. On many occasions, William would carry out the audit himself. Indeed, all seventeen cafes in the brasserie and bistro chain could expect to see William at least twice a year. His policy was to visit his outlets without any advanced notice. In truth, he quite liked to see that his managers and employees were "on their toes".
In addition to quality audit reports, a monthly financial report for each café showed ratios of food items and supplies used per sales unit, labour hours and wages in relation to sales, and the unit's operating profit.
William Patterson was convinced that his management system would work and he urged all café managers and employees to follow it faithfully. Managers who kept to the system and made it work were applauded as "top dog achievers". These managers regularly received bonuses in the form of holiday bonuses, free cinema tickets, cheap car hire deals, and the like. At the same time, William ensured that managers who failed to make the top dog grade either changed their ways quickly or were fired.
When William Patterson retired, his daughter Helen gave up her job as a financial management consultant to become the chief executive officer of the Patterson café chain. She was committed to expansion of the business and a strong advocate of management by objectives (MbO). She applied this management technique to delegate responsibility and coordinate the activities of all the company's cafés.
She gave more autonomy to the café managers in the way they managed their brasseries/bistros. However, where a vacancy occurs, managers must obtain her authorisation to recruit new staff. Helen is concerned about inconsistencies in the approach that different managers take. This applies also to staff training at the level of café operates. She is currently thinking about how consistency of management approach can be achieved without overcentralising and undermining her policy of ‘empowering the managers to manage’.
Helen Patterson computerised the monthly financial reporting system. The on-line reporting of café sales and expenditure reduced the managers’ burden of administration. At the beginning of each financial year she met with the managers and agreed targets and results for the forthcoming financial year expressed in terms of quality as well as total sales and operating costs. Head office control now centred on how well a manager is meeting these agreed targets. The quality audits were still made but now seemed to be more acceptable.
The MbO programme supported by on-line financial reporting proved to be very popular with the café managers and generated good results from older managers who were brought up under William Patterson's stricter regime.
Problems however arose with newer managers who had a strong sense of autonomy and independence. They tended to argue that they were "adapting and rising to the challenge of new and changing market demands". As an example, the young manager of one of the cafés in a central urban location offers a range of less expensive snacks to cater for diners who are unemployed or on low incomes. However, longer serving managers complain that the newer managers are undisciplined and are allowing quality standards to fall in order to satisfy their personal agenda.
Helen is now worried about standards falling. She has started to, use "mystery diners" to check what is happening in various outlets. Reports from the "mystery diners" go both to the brasserie/bistro managers and to head office management. In general they confirm that sometimes the food and service quality are below the standards set by the company - for instance - some managers are allowing their café to fill up with young people who take over an hour to drink a single cup of coffee.
Helen Patterson is concerned about the poor performance of the manager of the Twickenham Brasserie and Bistro. He has a particularly high staff turnover, his outlet's financial results are in the bottom 10% for the financial results of all outlets. The Twickenham Brasserie's quality audits over the past year indicate that key standards are regularly not being achieved.
At his last two staff appraisal sessions, the Twickenham manager agreed new targets but was adamant that poor performance arose from the branch's fixtures and fittings and poor location (away from the main shopping area and had poor parking). He tended to blame his staff for the problems.
Helen is coming to the conclusion that she must take action under the company's disciplinary procedure in relation to this manager. She sees that eventual dismissal is a possibility.
High turnover amongst waiting staff is a problem. The constant flow of new, inexperienced staff puts pressure on existing staff and managers complain that they all too frequently see new staff handing in their notice and leaving just at the point where they have been trained for the job and are starting to work well.
Helen Patterson is becoming worried about the effects of lower quality on the company's prestige, market position and profits.
Written © by Chris Jarvis for the BOLA Project.