Australia’s Filthiest Restaurant- Dumpling Hut Pty Ltd- Case Study Report Assignment Solution

June 14, 2017
Author : Kristy

Solution Code: 1JJGI

Question: Management Case Study

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Management Case Study Assignment

Case Scenario

Is this Australia’s filthiest restaurant?

A POPULAR dumpling restaurant in Melbourne’s east has been exposed as a filthy cesspit, and its owner fined $19,000 after live and dead cockroaches, drain flies, rodent faeces and filthy buildups of food waste, grease, oil and grime were found in the kitchen.

A Monash Council inspector made the discovery at the Raramen eatery in Glen Waverley, along with used drink bottles used to store sauces, meat sitting on a bench “for a couple of hours” and rice stored on the floor, plus wires and boxes that had been nibbled by rodents.

Astonishingly, the restaurant — which is still open for business — continued to be riddled with to insects and rodent poo on up to eight further council visits between March and July this year. On July 10, Dumpling Hut Pty Ltd, the company which owns Raramen, and company director Siu Hin Yip pleaded guilty to 17 charges under the Food Act 1984 and the Food Standards Code. The charges related to inadequate pest control, unsuitable food handling, poor food storage and inadequate skills, among other issues.

Louisa Dicker, for Monash Council, told Melbourne Magistrates’ Court on July 10 that council officer Troy Schonknecht first visited the restaurant on March 3 for a routine inspection. According to documents prepared for the court, Mr Schonknecht saw as many as 50 live cockroaches running through the noodle-making and front cooking area, grease, grime, oil and food waste behind cooking equipment and in the cool room and freezer, grease dripping from the stove canopies, encrusted dirt on the stove top, food waste in the microwave and dirty mops and cleaning equipment. Mr Schonknecht also noted glue traps with peanuts as rodent bait and cockroach faeces in the cool

room.

He met with the owner soon after to discuss the state of the restaurant, then returned for several further inspections until early July. Cockroaches, drain flies, dirty benches and cooking equipment were noted at many of the visits.

Magistrate Duncan Reynolds convicted and fined the company $12,000 and ordered it to pay $7000 in costs. He fined the company director, Siu Hin Yip, $5000 without conviction.

In a media release Monash Mayor Paul Klisaris said the severity of the fines sent a message to Monash businesses that they must maintain the highest standards.

“Monash has a well-deserved reputation as a destination for great food and we expect our businesses to respect that reputation by maintaining high standards when it comes to safety and cleanliness,” Cr Klisaris said.

He said the business has reviewed its processes and subsequent inspections have found it was complying with the regulations.

The owner Siu Hin Yip did not respond to Leader’s requests for comment.

Task Details

As the unit progresses and subsequent to the Creative Syntheses on thecase study, your individual management problem report will be the written document. This report is in the context of presenting a management problem report to the business owner/manager as a management problem consultant tasked to complete (and potentially being paid a handsome sum of money) present a succinct, credible and practical pathway forward. From this case study you follow on from the CS assessment with the management problem solving process in one of four key areas that you have been taking:

  • Strategy
  • Processes
  • Organisational Behaviour
  • Corporate Social Responsibility/Ethics

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Solution:

Executive Summary

The key purpose of the essay is to explain the case study about Raramen Eatery. The eatery is considered as one of the filthiest eateries in Australia. The report explains the challenges and the problems that the management, staffs and customers of the Raramen Eatery experience. Public health standards require that the management of the eatery ensure high hygiene levels. The reports thus explain possible solutions and strategies that are required to

maintain high levels of hygiene at the restaurant. The corporate social responsibility and the business ethics pathway were identified to determine the most effective strategy for the realization of high hygiene standards at the Raramen eatery. Strategy pathway has four areas. These areas are an illustration of the problem, analysis of the pathway, explaining the opportunities that the strategy provides, and determination of the most appropriate direction for achieving the desired results. SWOT analysis approach is utilized in explaining the factors influencing the business environment of Raramen eatery. A problem-solving plan was developed to achieve the desired goal. The report findings explain that the staffs of the eatery have insufficient qualifications and skills, the storage and handling of the food are poor, the eatery currently has a bad reputation, and there is poor ventilation to provide clean and fresh air.

Introduction

The purpose of the report is to determine the challenges that Raramery Eatery experiences and provide a recommendation on the effective approach to addressing the problems that Raramen Eatery experiences. The strategies and possible solutions to the problems and challenges of Raramen Eatery are determined in accordance to the Corporate Social Responsibility (SCR) and business ethics (Lantos 2013). The eatery has low health and safety levels, and the staff morale is very low. CSR ensures that the needs of all the stakeholders are taken into consideration. The Management of Raramen Eatery should properly use CSR to improve its business processes. Business ethics shows that acceptable behavior in the business environment. Acceptable behavior is that which is lawful and morally correct in the society. Eateries should; for instance, ensure high hygiene standards by giving customers healthy food that has been prepared in a healthy environment. It is also the responsibility of the eateries to give staffs appropriate training that ensures they prepare food in a clean kitchen environment. Raramen Eatery is located in Monash region of Australia, and it focuses on providing Asian food. The Monash Council is responsible for ensuring that all restaurants provide customers with food products in a healthy and clean environment. The Monash Council has shown that Raramen Eatery prepares food in unhygienic condition. The eatery has thus been requested to improve the cleanliness and safety to ensure high health standards. The report studies the problems that the eatery experiences based on useful management theories and models. Data generated by the analysis is important in recommending solutions that will improve the health, safety and productivity of the eatery, such as effective training of staffs, building an open kitchen and providing finances for pest and rodent elimination.

Organization Strategy

The organizational strategy entails the ideas and actions that various members of the business organization use to achieve goals and desired outcomes (2013). Ramanen eatery must thus adopt effective strategies that enable it realize important goals of customer satisfaction and increase sales revenue. The business strategy of the restaurant should aim at achieving the interests and expectations of all stakeholders. These stakeholders are regulators, customers, management, shareholders, staff, and community. CSR is achieved when the needs of all

stakeholders are properly realized. Business ethics is realized when the Asian food products are prepared in safe and hygienic conditions, by staff who are properly trained (Fredric 2012).

The needs of customers are ensured by high levels of customer satisfaction. Customers will be satisfied if the food products of the eatery are of the correct quality standards. Quality standards are realized by making food in clean kitchen environment using ingredients that are fresh and safe for human consumption. Customer satisfaction is also realized by good custome service. The staffs of the restaurant should be given enough skills on how to prepare and serve various food items for the customers. Customer satisfaction is realized by offering food products at affordable prices. Affordability is a critical factor that many customers take into consideration when looking for a restaurant. Raramen Eatery can use affordability as a competitive advantage against other restaurants.

The management of the eatery must adopt approaches of effective human resource management to enhance its competitiveness in the restaurant industry. The customers should be given continuous food preparation and handling training that improves the hygiene and safety of food products. Training on customer service should also be done to ensure that employees handle the customers in an appropriate manner. Employees in the eatery should be motivated by good remuneration or financial compensation. The salaries or wages of the staff must be the same or more that the market rates. Good motivation enables the staff to serve the customers with more enthusiasm and care. Employees who achieve the goals of the restaurant in the correct manner must benefit from rewards opportunities like promotion, recognition or financial bonuses (Hofstede 2012).

The jobs of the business regulator should be made easy by the management of the company. The regulators ensure that the business operations are by the law and also ensure the interests of the customers. The Monash Council inspector ensures that business standards are properly achieved. If the organization does not achieve the standards, then the inspector has the responsibility of giving fine in addition to recommendations for adhering to the standards. The owner of the Raramen Eatery was fined by the Monash Council because of the unclean and unhygienic condition of the restaurant. He paid a fine of $19,000. The company management is supposed to adopt the recommendations of the council inspector with the aim of avoiding more fines and also satisfy the needs and expectations of the restaurant customers.

The shareholders of business owner will benefit greatly if the restaurant operates based on ethical standards and in line with the CSR principles. The company management should ensure that customer service is good. Good customer service attracts more customers and hence the level of revenues and profits increase. Shareholders receive more dividends when the profits of the organization increase. Hygienic conditions of the restaurant should be maintained by the staffs and management. Good hygiene attracts and retains more customers. The high rate of customer attraction improves the revenue and profitability of the company. Shareholders expect to earn huge returns from their capital investments in the restaurant. The return increases when the performance of the eatery increases in revenues and profitability.

Community interest should be considered by the management of Raramen Eatery as part of CSR. The community comprises the people who reside in the area where the eatery is located. Raramen Eatery can improve its community image by engaging in environmental conservation efforts like recycling wastes from the company. The restaurant can also send its representative to important community events or activities such as fundraising activities. Most of the customers come from the surrounding community. Therefore, their concerns should effectively be taken into consideration by the Managers and staff of the restaurant. Community members should also be given sufficient consideration when employment opportunities are advertised by the restaurant. The community has people who can provide skilled or unskilled labor. Job adverts should first be communicated to people in the community (Schermerhorn 2014).

Differentiation of products is an important competitive advantage strategy. The eatery should continue to provide only Asian food items because this restaurant business strategy differentiates it from competitors. Very few restaurants provide Asian food products within the Monash area. There is a significant population of people with Asian descent in the city. The eatery has effectively attracted the Asian or Asian affiliated customer demography. Cost differentiation is also an important consideration in attracting and retaining customers. The price for food products at the eatery should be affordable and stable. Stability of prices implies that the cost of food will be the same regardless of whether the demand rises or reduces. The differentiation of the customer service can be effectively realized by providing soft entertainment at the eatery. Customers can be allowed to listen to soft music as they eat the food that they have ordered.

Issues and Causes

The issues concerning the Ramera Eatery illustrate several management challenges and problems. It is important to identify the factors resulting in these problems and then formulate appropriate solutions to the problems.

The first problem is the low skills of the employees in the area of food preparation and customer service. It is a legal need that all eateries must employ qualified staffs so as to provide good services to the staffs. Low skilled labor force results from the employment of unskilled laborers that are paid lower wages and salaries. The competencies of these employees can be enhanced through providing enough training. The most appropriate training for the restaurant staff are catering, customer service and hotel management.

The employees have low motivation. The likely causes of low staff motivation or morale are poor remuneration, less career advancement opportunities, poor teamwork, less recognition of performance and poor involvement in restaurant decision-making processes. The management can improve the work motivation of employees through various approaches. Teamwork improves the morale of staff because it enables them to share ideas on how to satisfactorily

prepare high-quality foods and effectively serve the customers (Hill & Jones 2013). Morale of employees is improved when the management of the restaurant recognizes the efforts or productivity of the staffs. Recognition is achieved by providing rewards like cash bonuses to the staff who achieve the set work targets. Motivation is improved when the organization has enough career advancement changes like enough promotion opportunities. High performing employees are thus given the chance to serve in high positions of the restaurant.

Leadership approach in the eatery is ineffective, and this is the reason the food quality and restaurant hygiene are very poor. The management should adopt the participatory leadership style that enables all organizational stakeholders to engage in the decision-making process.Employees are allowed to participate in making important organization decisions like setting goals and strategies for achieving the goals so as to enhance customer satisfaction. The staff deals with the customers on a daily basis; therefore, they understand how to satisfy most of their needs regarding food and service quality. Participatory leadership improves the communication between the employees and the eatery managers. The managers thus get the chance to understand the needs of the employees and how best to achieve those needs (Fredric 2012).

Raramen eatery has unhygienic kitchen condition. The unhygienic condition is as a result of insufficient finances to the purchase of appropriate pest control devices. Leaving foodstuffs like meat and rice on the store has worsened the situation because of the rise in the number of rodents and insects in the kitchen. Poor hygiene can result in diseases, infections, illness and irritation by staff and customers. Good hygiene standards in the restaurant can be improved if the management allocates enough finances to acquire pest control services that will greatly limit the number or pests, rodents, and insects in the kitchen. Staff should be trained on good food storage processes in appropriate facilities. Storage facilities like fridge and cupboards should be renovated to improve the storage of food items. The renovations should also develop an open kitchen model that allows the customers to observe the processes involved in food preparation and service delivery.

Conclusion and Recommendation

Poor management has resulted in the low performance of the Raramen Eatery. The low performance is characterized by noncompliance with the Food Act of 1984 and also the Food Standards Code. The eatery was fined $19,000 because of non-adherence to the restaurant legislations. The low performance also arose because of poor hygiene and safety conditions of the eatery. Unsafe and unhygienic environments are health hazards that can cause disease and infections. Staff morale reduced because of the poor working environment. The problems that are experienced by the eatery can be solved if the managed strictly adheres to the instructions of the council inspector. The instructions, in summary, involves training of staffs, providing finances for controlling pests and rodents, ensuring proper storage and building an open kitchen. Training of staffs improves customer service. Finances are used to purchase pesticides and traps that prevent entry of pests and rodents in food preparation area. The open kitchen enables the staff to monitor how food is being prepared and served.

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