Dunkin’ Donuts, Business Plan Example

Dunkin’ Donuts[1] District Manager Business Policy Statement

I have devised a policy to implement the new responsibilities of DD District Manager, which I have recently accepted. I have been working with DD for two years. I have learned a lot about how to manage a franchise store. I will now be managing five midwest-area franchises as they open sequentially in the next two years. Expectations are high for both myself and the company. I want my employees to share in that success. I will begin with them.

Job Design

Job design has been defined as the “specification of the contents, methods, and relationships of jobs in order to satisfy technological and organizational requirements as well as the social and personal requirements of the job holder”(Buchanan, 1979). Basically that means specifying the details of a given job in order to maximize productivity while keeping the employee happy, if happiness is the goal. This is not always the case, as some companies prefer to embrace the high turnover they are going to have anyway. DD realizes that many of its employees consider their jobs to be temporary, not career-length, and that no matter how much effort we put into it, turnover will tend to match that of the fast-food industry in general. DD also realizes that job satisfaction will partially depend on the store’s customers, which in turn depends on a given store’s location. Fortunately for us, midwest customers tend to skew friendly.

To be  brief, the technical requirements for being a DD employee are low and almost anyone of high-school age can be trained to quickly master them. The most important qualification is to be a multitasker. Like at other fast-food restaurants, at DD the big divisions  are drive-through and counter; and store-to-store — the latter because, this being all one franchise district under my control, some of my employees may be available to work different stores if it suits them. Thus owning a car will facilitate this kind of multitasking, as well as shift switching as required. Employees must be able to work all store positions, and keep the dispensing machines supplied with their product. At peak hours, multitasking skills become more and more valuable. I will instruct my local managers to stress this skill during hiring interviews. Employees must be free to make quick adjustments and not be hampered by on-and-off-again rules. It has been said that Cuban citizens can only survive by actively breaking the law to the point of facing arrest — and if they don’t they will starve (Corbett, 2004). I will make sure no one has to break a manager’s “rule” in order to do their jobs at the risk of being fired.

Before I can determine what rules to avoid in making new job designs for my new stores, I must get my present set of employees to talk. Toward that end I will submit a Work Design Questionnaire for them, one that has shown promise in the past (Morgeson & Humphrey, 2006). The trick will be to get them to take it seriously. I plan to do this by making it a part of the annual performance review and instituting immediate consideration of the feedback I get. Employees may also fill out the questionnaire at any time on their own initiative. In other words, if someone comes up with a good idea, I’ll try it. Potential supervisors will have to assimilate the questionnaire to merit consideration. The questionnaire will become an ongoing process, integral to the job itself and thus a part of Training and Performance Appraisals (to be discussed below).
The questionnaire will be a sorting mechanism: short-time employees will self-identify by not taking the process seriously. I will not terminate them, but I need not promote them either.

Another integral part of the job design is to foster shift-stability, which is to say that overtime will only be a last-resort requirement. This is a fundamental point. Overtime, when granted only by chance and never for long, is not usually valued by employees. They tend to put a premium on stability. So to them, overtime is a kind of tax. Only where overtime can be counted on in large amounts will it be accepted as part of the job. In this business, large amounts of overtime is a red flag — it means staffing is inadequate for daily business. Since turnover is already high, we want to lessen burnout by reducing unscheduled but persistent overtime.

Organizational Design

If job design is design at the granular level, organizational design is the next level up. Organizational design is really just my own job-design: since I will have my own organization of five stores, I will need my own organizational job-design. In any case, it has been described as “enabling a group of people to combine, coordinate, and control resources and activities in order to produce value, all in a way appropriate to the environment in which the business competes” (Myers, 1996). Compete is the key word and an interesting concept in the franchise field. Does a particular DD store compete with the closest DD store in the same franchise district, or does it compete with McDonald’s across the street? The answer is that each each shift manager in each store must simply maximize the productivity of the employees. A local manager need not come up with a new advertising campaign — not even I will do that. I must know my district and the competitive landscape and set the broad-based rules, requirements, and goals in order to maximize profitability for the franchise owners, who themselves are largely on their own too. My “organization” is largely composed of one person — me. Even though I have been given complete autonomy, authority, and responsibility to structure, staff, and operate these five new locations I will have no staff of assistants beyond those I pay for out of my own pocket. I don’t even have an office outside of my own kitchen table. My five-store district is my office and I must be available for them every working day when they need me, and when they don’t need me I need to be somewhere else before the non-managerial employees begin to think of me as the de facto shift manager. In sum, maximizing cash income, profits, growth, asset utilization and people productivity are what organizational design is all about.

Recruiting and Selection

In theory, I recruit and train shift managers. They in turn hire and fire the store personnel. I do not select store locations or oversee the construction — that is handled by the franchisees. But like for any multitasking employee, organizational-chart classifications don’t always play out in real life. In training the shift managers I will have to be on site showing them how to hire and fire by first doing it myself. The people I hire will have varying levels of experience and skill and will need varying amounts of hand-holding. Some might have less experience but be skilled in quickly learning how to make their store work. I must select and train those who can either turn around a long-standing store or get a new one up and running. As District Manager I will have responsibilities in both areas and each will have unique challenges. I must sometimes manage ambitious employees by making them somewhat less ambitious. And vice versa.

The late urbanologist Jane Jacobs once pointed out that, contrary to popular belief, families don’t shape societies. It is societies that shape families. In the same way, employees do not shape the store. The store shapes the employees. That’s because the store is part of its neighborhood. A donut shop that caters to hundreds of walk-ins and drive-throughs per day will be a good temporary job for some people and a possible career for others. But they cannot change the nature of the business itself, no matter how hard they might try. They must adapt to it — it will not adapt to them at all. Chances are that a store that has shown itself unable to thrive over a period of years and a steady turnover of different employees drawn from the surrounding area will never thrive and should be closed. Even the best star employees placed in such a store will not be able to help it if its business is not fully appropriate for the neighborhood society.

Training and Appraisals

As a practical matter, it is mostly non-managers who do the training. Shift-managers will usually delegate that responsibility whenever they can. And the training is pretty basic. It is largely a matter of just watching somebody do the job, asking a few questions, and then getting started. The shift-manager will then monitor the result. It is important that such managers should not necessarily negatively judge a more experienced employee if the person they trained is not performing well, because that would make that experienced person a kind of manager. This must be avoided. If the new person is not performing well, it might have been poor training, but it might just be that the person the shift-manager recommended for hire is just not working out. It should be pointed out that I will not always be making hiring decisions. I will probably do that at first for each new store, but gradually will restrict myself to authorizing the promotion of a given employee to the position of shift-manager. I will have less and less time for routine hires and my own goal is to make each store as independent as possible. This better allows for micro solutions to micro problems, and it also trains managers. When one of my shift-managers shows promise for promotion, it reflects well on me and provides me with a talent pool for me to take advantage of if and when I am in turn promoted with a larger franchise district.

Conclusion

 As a new DD District Manager who will soon have five new stores to oversee, I am the person whom the franchise holder will hold responsible for success. That franchisee has twenty other stores, and my goal is to eventually be the District Manager for all of them. In order to do that I will need to keep my head on a swivel and my feet on the ground and running. How well I succeed at cash, profits, growth, asset utilization, and people will depend on how well I manage job design, organizational design, recruiting, selection, training, and performance appraisals.

References

Buchanan, D. (1979). The Development of Job Design Theories and Techniques. New York: Praeger Publishers.

Corbett, B. (2004). This Is Cuba: An Outlaw Culture Survives. New York: Basic Books.

Jacobs, J. (1992). Systems of Survival: A Dialogue on the Moral Foundations of Commerce and Politics. New York: Vintage Books.

Morgeson, F. P., & Humphrey, S. E. (2006). The Work Design Questionnaire (WDQ): Developing and validating a comprehensive measure for assessing job design and the nature of work. Journal of Applied Psychology, 1321-1339.

Myers, P. S. (1996). Knowledge Management and Organizational Design. Oxford: Butterworth-Heinemann.

[1] To be abbreviated as “DD” throughout.