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Operations Management Strategy Of Hard Rock Cafe Marketing Essay

Paper Type: Free Essay Subject: Marketing
Wordcount: 1844 words Published: 1st Jan 2015

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Answer One:

Hard Rock Café is one of famous brand name of café restaurant in the world. In this essay , we will try to find to understand what is the operation management strategy that make it successful.

At first, what is Operation Management (OM)? OM is the set of activities that creates value in the form of goods and services by transforming inputs into outputs . The new challenges in OM includes:

high ethical and social responsibility , increased legal and professional standards.

Global focus, international collaboration

Rapid product development, design collaboration

Environmentally sensitive production, green manufacturing, sustainability

Mass customization

Empowered employees, enriched jobs

Supply- chain partnering, joint ventures, alliances

Just in time performance, lean, continous improvement.

Then managers apply planning, organizing, staffing, leading and controlling to achieve objectives. Ten major OM decision are required :

Design of good and services

Managing quality

Process and capacity design

Location strategy

Layout strategy

Human resources, job design and work measurement

Supply chain management

Inventory, material requirements planning, and just in time

Intermediate and short term scheduling


(From Jay Heizer, Principles of Operation Management, Page 56).

From above basis knowledge , we will identify how each of the 10 decisions of OM is applied at HRC as the current result HRC can develop quickly with 149 locations in 53 countries and put it in top 10 of all restaurants.

Design of goods and services: The first impression of HRC is logo is simple and clear with round cycle, guitars are hung on the wall ,… unique design but HRC choose the design waythat “accommodate changing tastes”. It means that design in HRC is franchisee, HRC utilize local tradition and culture combine with unique design . It make you feel full rock environment at the first time you see HRC. Next is menu at HRC also are modified to satisfy local customer besides famous menu. “Hard Rock chefs are modifying the menu from classic American burgers and chicken wings to include higher-end items such as stuffed veal chops and lobster tails” . For example fish and lobster are focused more in Britain, or Thai Snack Combo is added into Hard Rock Cafe Bangkok. In case you can’t eat American food, you want to eat the local food so you can find the sentence in HRC menu: “Local Daily Specials: Please ask your server for details about today’s available specials”. Moreover, HRC pay attention to kid , you will see menu for kid, this is difficult to find kid’s menu compared with other rock café shops. It implys that HRC respect to all customers, no discrimination in ages or nationalities… All of this create flexible and unique in design of goods and service at HRC. All above create “experience difference” in HRC. Customer can find in here classic rock n roll, big-screen rock videos, memorabillia and staff who can tell stories, understand the displays, can buy tangible part of experience by buying T-shirt for souvernirs . It mean customers can feel they receive more perception than full of their stomach, it is called ” dinning experience”. There is a saying “differentiate or die”. This create competitive advantage compare with HRC’s competitors. Customers at HRC will feel that great food, great service, great atmosphere, great music …

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Managing quality: The customer’s quality expectations must be determined and policies and procedures established to identify and achieve that quality. HRC control their quality of food and services are very strict by surveying regularly. Scores are done on a 1 to 7 scale, and if the score is not a 7, the food or service is a failure. Moreover staff working schedule is re-arranged to meet customer demand based on seasonal. To ensure the quality of product and service, HRC control quality from suppliers to quality control in process in HRC to achieve quality output , bring positive experience for customers. Thus HRC’s reputation for high quality of food, friendly staffs

Process and capacity design. It means process and capacity are designed for availability products and services by specific technology, quality, human resource use and maintenance in order to minimize cost and maximize effiency. Hard Rock uses long-range forecasting in setting a capacity plan and intermediate-term forecasting for locking in contracts for leather goods (used in jackets) and for such food items as beef, chicken, and pork. Its short-term sales forecasts are conducted each month, by cafe, and then aggregated for a headquarters view.

Location. This is one of important factor to make business successful. Where to place HRC? On what criteria should we base for location decision. There many factors that affect to location decision (key success factors) to get competitive advantage. HRC choose the country based on political risk, currency and social norm- how does their brand fit into the country …then HRC use checklist such as Hard Rock’s Standard Market Report to identify factors in that region such as demographic, visitor marke, transportation, restaurants and nightclub, political risk, real estate market, HRC comparable market analysis….

Current HRC focus on “city centers” where nightlife tends to concentrate. They also use tools such as break even analysis to decide whether to purchase land and build or to remodel an existing facility.

Layout. How to arrange layout flow from kitchen , restaurant to bar. How to use light, sound, screen, music…to create visual control and make customer impressive. How large a facility is required. At HRC layout is utilized of space , equipment , flow of information from kitchen, restaurant area for American food, bar, memorabilla displays along wall, place for big group to giftshop .

Human resource and job design. Human factors is the most factor in service business. How to provide a reasonable work enrivonment to stimulate employee output positively to satisfy customer. In that working environment both management and employment work together to achieve company objective. Everybody is treated honestly and equally to deserve with their performance. We can see recruiment advertising focus on criteria passionate about music, love to serve… “Hard Rock employees are not only competent in their job skills; they are also passionate about music and have engaging personalities” or “Applicants also are screened on their interest in music and their ability to tell a story” . After recruited, they are trained before start their job.” The company’s training is very specific, with job-oriented interactive CDs covering kitchen, retail, and front-of-the-house service.” HRC have good human resource policy in evaluate their employee .” To evaluate managers and set bonuses, a 3-year weighted moving average is applied to cafe sales. If cafe general managers exceed their targets, a bonus is computed”. They also pay attention to working time “This includes benefits that start for part-timers who work at least 19 hours per week (while others in the industry start at 35 hours per week)”. The promotion chance in HRC is good for lower level due to ” 60% of the managers are promoted from hourly employee ranks” . Outside volunteer work is especially encouraged to foster a bond between the workers, their community and issues of importance to them.”. HRC created a dream working environment “Hard Rock builds on a hiring criterion of bright, positive-attitude, self-motivated individuals with an employee bill of rights and substantial employee empowerment”.

Supply chain. The objective is to build a supplier chain to maximize value to end customer. Company need to decide should they make or buy this item. Who are their good supplier. How many suppliers should they have. How to produce and deliver products on time. HRC choose suppliers qualified to ensure quality of food. HRC also apply outsorcing to cut cost such as signature sourvenirs.

Inventory. Inventory is one of the most expensive assets of many companies. If we can control inventory well we can meet customer demand and cut cost. If not , inventory becomes one of 7 wastes. HRC apply Just in time method and supply chain management to control their inventory. The collection of memobillia includes 1,000 of pieces, valued at $40 million. Around 5 years they bring them back to Orlando to refurbish. They have system to control inventory to know how many pcs do they have and where.

Scheduling.Aggregate scheduling determine the quantity and timing of production for the intermediate future around 3 to 18 months ahead by making detail plan and master plan. We need to know how many employee do we need to schedule daily basis. What is the best way to complete a job or project. What is the shortest time and lowest cost to accomplish job. HRC use 3 type of forecasting “long-range forecasting in setting a capacity plan and intermediate-term forecasting for locking in contracts for leather goods (used in jackets) and for such food items as beef, chicken, and pork. Its short-term sales forecasts are conducted each month, by cafe, and then aggregated for a headquarters view”. HRC use POS to control csutomer database by count head then analysis by manangers to have daily sale forecast to know hourly sale and arrange manpower and inventory. Besides they also consider other factors such as “as a major convention, sporting event, or concert in the city where the cafe is located” to predict sale. Then they will compare between actual and forecast to find the variances if have and solve it. Moreover, Microsoft project and tools are applied in HRC to plan, monitors and control festival.

Maintenance. We need to know who is responsible for maintenance. How to organize , schedule and control maintenance to maintain the capability of the system. If not, our system can be disruptive, wasteful in cost and even human life through improving individual components and spareparts. HRC apply maintenance “In keeping with the times, Hard Rock also maintains a Web site, www.hardrock.com, which receives over 100,000 hits per week, and a weekly cable television program on VH-1. Hard Rock’s brand recognition, at 92%, is one of the highest in the world”.

HRC have succeeded in apply OM in their business. HRC built successful “experience economy” to develop and expand HRC by ” multidomestic strategy”. I believe with correct strategies changed with the time HRC will continue their globalization.


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