MANAORG Written Report

De La Salle University – Manila Ramon V. del Rosario College of Business

Management Practices Of Tropical Hut Hamburger: Application of Mainstream and Multi-Stream Approaches

A Paper Submitted to

Mr. Real C. So

In Partial Fulfillment Of the requirements in

BUSORGA/MANAORG Management of Organizations

Submitted by: Cupiado, Janille Yna De Guzman, Joseph Noel Delos Santos, Karl Angelo Donesa, Regine Francesca Escarcha, Stefanie Kristine Ferrer, Tiffany Kristianne Floresca, Justine Gem

I.

Introduction

Objectives of the Study The following are the aims of conducting this study: a. Conduct an extensive observation and research on Tropical Hut and its management functions b. Enumerate management practices under two management functions utilized by Tropical Hut c. Provide a detailed description of the aforementioned management practices d. Identify the management approach of Tropical Hut with the corresponding management functions e. Relate discussions in Professor Bruno Dyck’s book with respect to the assessment of management approaches

Background Information

Tropical Hut Hamburger

In the late 50’s, Mariano Que was operating a small one store drugstore called Mercury Drug. Their family had a small sari-sari store business. Pretty soon, the small sari-sari store became a small grocery store. And because of his business acumen, the small grocery store became a supermarket. Then, there came an opportunity to buy a business from the father in law of one of his daughters- Vivian Que Azcona, the original owners of Tropical Hut.

In 1962, with the acquisition of a food business and with the supermarket in place, Mariano Que introduced the concept of a coffee shop within the supermarket. Thus Tropical Hut Hamburgers (Tropical Hut Food Market) was born. In the late 60’s, Tropical Hut opened its branch at the corner of EDSA and Ortigas Avenue and it soon became the favourite hangout of the Lasallians from La Salle Green Hills. Their hamburgers, iced tea, halo-halo were an instant hit to the student population of that school. Today, Tropical Hut has nearly fifty-five (55) Hamburger outlets. Tropical Hut is one, if not the oldest, fast food joint in the Philippines. It serves a variety of dishes from Crispee Chicken Nuggets, Fried Chicken, Hamburgers, Spaghetti, etc…

Organizational Structure Among the many companies owned by the flag-ship company Mercury Drug, Tropical Hut is probably the “smallest” in terms of the number of outlets and revenue, yet one of the oldest. Among the other companies include Medical Center Trading Company (a medical equipment and suppies trading company) and 10-Q (a convenience store). For some reason, the management of Tropical Hut wanted to keep the business as simple as possible. This could be because of the personality of the son of Mariano, who is now running the business. As such, the table of organization of the company is simple, flat and straight forward, as illustrated below.

The current President and General Manager is Louie Que, one of the sons of Mariano Que and one of the 10-Q’s. He is a La Salle Green Hills alumnus with all of his kids going to De La Salle University. Two of his daughters played for the basketball and volleyball varsity teams of La Salle, one of which is Louie who was once a track and field athlete of LSGH, with Br. Roly Dizon FSC as his mentor. The table of organization of Tropical Hut is flat. If you look at it, there are not much level between the head of each department and the president. Sales and Marketing task is mainly advertising and promotions. This group is incharge of product development (i.e. new dishes and value meals), preparations of print ads and promotions. The Human Resource and Administration is responsible for hiring, training, developing and termination of employees. They are also in-charge of the physical maintenance of the head office. This includes the janitorial services, security guards and other assets of the company. Finance and Accounting is probably the key to the business. This is one of the strengths of this organization. Aside from handling the cash and investments of the company, they provide management with the information to make informed decisions. Operations or Store Operations has the hardest role in this organization in a sense that they are on the frontline of providing the clients with the best food and restaurant experience the client could have at “value for money” prices. It should be noted that like most “sari-sari” store business, much of the decision emanates from the president.

Methodology for Data Gathering The research was conducted in Tropical Hut Hamburger located at Ground Level D’Students Place Bldg., Estrada cor. Taft Avenue, Manila last July 10, 2012. The instruments used for gathering data were camera and paper. A telephone interview with the president of Tropical Hut was also conducted by one of the members of this group. This was further validated with interviews with the store employees. In order to gather diverse ideas from the place, the researchers placed their orders on two types: individually and by group. How the employees interacted and served the customers was monitored. The setting of the place, its appearance and facilities were also observed. Using a camera, photographs of the problems seen by the researchers in the restaurant were captured. The comments made were also listed down on paper for documentation. Furthermore, the researchers reviewed each of their remarks while inside the site using the two points of view, the mainstream and the multistream approaches. All these observations were considered and validated with the interviews both on site and on the telephone interview.

II.

RESULTS AND ANALYSIS

1. Planning a. On the front line – the store/selling area Standards in : a. The way the store looks like, b. The way the employees behave and perform their tasks

c. the food prices and portions are allocated. b. Sales Targets per branch – each store is given a sales target per branch based on many factors including the cost of operating that store, potential market and profit targets of management. c. Promos at the branch level are decided on at the head office. The individual branches are not allowed to experiment on localized promotions to improve sales.

2. Controlling a. branch performance is based on sales output or profitability. b. reports are generated from the cash registers that monitors sales as well as inventory. c. attendance is monitored by the security guards to ensure that the employees come and leave on time.

Assessment Tropical Huts management style is essentially mainstream. All decisions emanate from the president and is carried out by the department heads. At the Store level, procedures are standardized to ensure that each store will do exactly what the other stores are doing. Similarly, the functions of each employee at the store are identified and become the basis for his evaluation.

The store level personnel and its managers are not involved in the profit and loss planning for the branch. Their sales targets are assigned to them and they are expected to meet their sales and profit objectives. These sales targets form the biggest part of the evaluation of the employee.

III.

Conclusion

Tropical Hut Hamburgers is the oldest fast food chain in the country today. In keeping with the wishes of the families’ patriarch, Mariano Que, Tropical Hut is known for the quality and freshness of its products and its affordability. However, like most companies that started in the traditional style of management, Tropical Hut has not evolved from the mainstream management style where the self-interest of the company is the premier goal utilizing its (material and human) resources, in order to maximize productivity. Goals and strategies almost always emanate from the president and are carried down the organization without much discussion. Procedures are all standardized and centralized from the president for everybody to follow. Each person is given a set of specific task to do and is expected to do just that. The performance of everybody is based on a standard that the president dictates.

Fortunately for everyone, Mr. Louie Que, the president of Tropical Hut is a true Christian Gentlemen from La Salle. The standards he sets for everyone is very reasonable and achievable. He makes sure that the given standard of performance is easy to achieve. This can be validated by looking at the regular employees of Tropical Hut. Most of them are old and have been with the company for many years. While the employees are happy because no one gets fired, it is however a delicate situation for the company as some employees might get complacent and perform just to the level of acceptable. Exceeding sales targets or customer expectations might not be a goal for the store level employees. However, one cannot argue with the owner with his business management policy, if he is happy and the employees and customers are happy as well.

DOCUMENTATION Facilities

Sevice

Promos

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