Proposed Management of New Enterprise – Belly Happi Café

This report aims to provide an overview of the proposed planning, organizing, leading, controlling, ethics and social responsibility for the start-up of a new food and beverage business entity called Belly Happi Café.

Belly Happi Café is envisage to be a new small start-up offering fusion, healthy, halal food for the Muslim diners and the masses. The intended location is Bali Lane, in Arab Street area where the vibrancy of young hipster cafes has emerged over the last 5 years. The restaurant would be able to cater to 50 dinners in one single sitting. The concept of healthy halal food will be its competitive edge as the population of health-conscious young adults is on the rise.

Mission Statement

Mission statement is essential for any businesses, whether it is a new start-up, small enterprise or big chains. It articulates the business objective internally as well as to the public and serves to guide stakeholders throughout the business in accomplishing its intended purpose.

Belly Happi Café’s mission statement is proposed to be “Make amazing healthy halal food, offer welcoming service, and make every guest who chooses Belly Happi Café leave belly happy.” The mission statement reflects the business make up, customer focus, and present capabilities.

Singapore is a country with a high proportion of Professional, Managers, Executives and Technicians (PMETs) earning more than $2,500 a month. With current low unemployment rate and a good economic health, consumer’s purchasing power is strong as evident by the International Monetary Fund’s ranking of Singapore’s GDP as 4th highest in the world in 2017. In addition, according to a news article by The New Paper published on 21 Aug 2017, it was estimated that Singaporeans eat out for 78% of their meals and noted that younger people are getting busier with work. The fact that people have strong purchasing power and are eating out more shows demand and presents a good business opportunity for Belly Happi Café to capitalize on offering fusion healthy and halal food.

Sociocultural Dimension

In relation to preceding paragraph on the high proportion of PMETs, Singapore is also facing an increasing ageing workforce. According to an article by HRD Magazine dated 30 June 2017 titled “Singapore’s workforce “ageing quickly””, it was said that the proportion of residents aged 60 and above in the labor force has increased from 5.5% in 2006 to 13% in 2016. In lieu of the demographic characteristics of the workforce, it represents an opportunity for Belly Happi Café to adopt fair employment practices and support the government’s push for re-employment of older workers as part of its Corporate and Social Responsibility (CSR) effort.

As in all businesses, goals must be set. Broadly, most organizations have 3 levels of goals at the top management, middle management and lower management i.e. strategic (corporate level), tactical (divisional level) and operational (department level), correspondingly. These 3 levels form a hierarchy and form a means-end chain which means the achievement of goals at the lower levels are required in order to attain the higher-level goals.

Importance of Goal Setting

Goals setting would be beneficial to Belly Happi Café as with all businesses. However, it is critical to set good goals in order to facilitate employees’ identification and motivation and provide a sense of direction in achievement of desired outcomes as well as provide a standard for performance assessment. Good goals must be S.M.A.R.T.

• Specific i.e. clearly and precisely defined e.g. who needs to be involved, what are you trying to accomplish and when (timeline), where, why and how.
• Measurable i.e. expressed in quantitative terms would make a goal more tangible and progress measurable.
• Attainable i.e. challenging but realistic goals that are meant to inspire motivation and achievements.
• Relevant i.e. key result areas/activities that contribute most to the company’s performance and competitiveness.
• Time-limited i.e. clear and realistic specification of time period for which goal attainment will be measured. Providing time constraints would also create a sense of urgency.

To break even within 6 months of operation and earn a profit of at least $120,000 by the first anniversary date of 31 July 2019.

An assessment and evaluation of the competitive strength and position of Belly Happi Café using the Porter’s Five Forces model was carried out.

The Threat of Substitute Products or Services is high as Singapore is a food haven and there are certainly many substitutes for good healthy halal food e.g. fast food, hawker food, other halal eateries and cafes. Where close substitute products exist in a market, it would increase the likelihood of customers switching to alternatives in response to price increases and thus reduces the power of suppliers and attractiveness of the market.

The Threats of New Entrants is high as profitable markets typically attract new entrants and the barriers to entry for the food and beverage sector is very low, which means it would be easy for new ‘copycat’ cafes to enter the market and offer similar if not the same menu items and challenge Belly Happi Café’s existence.

Therefore, Belly Happi Café must develop its competitive strength and position in the food and beverage industry within the first year of business, and regularly conduct environmental scan as well as assessment of opportunities and threats, internal strengths and weaknesses to understand the factors affecting profitability and make informed strategic decisions.

Growth Strategy – Product Development Strategy

Belly Happi Café would adopt the Product Development Strategy under Porter’s Competitive Strategies model to achieve its strategic goals in the next three years. Belly Happi Café will develop and offer new unique products and quality services i.e. fusion, healthy, halal food and welcoming service for the current market which would differentiate itself from other F&B outlets. Belly Happi Café will adopt and implement these two approaches at the onset i.e. having an aesthetically appealing café experience at the onset and serve food and beverage of quality. We will constantly review and improve on features and new menu items along the way.

To support the planning and achievement of strategic goals, it is important to establish Belly Happi Café’s organization structure that maximizes the deployment of resources with clear formal lines of authority and coordination across the various functions.

Departmentalization Approach

Belly Happi Café would departmentalize using the traditional functional approach in which activities are grouped together by common function based on similar skills, work activities, expertise and resource use. The functional approach would result in efficient use of resources, allow in-depth skills deepening, specialization and progression, and provides the top manager with direction and good control within their respective functions.

To lead is to promote vision and change and to have the ability to influence, build the commitment, inspire and direct people towards the attainment of the personal and corporate goals and objectives. As Belly Happi Café is a new start-up, it is important for the managers to possess these two leading skills at this juncture to develop and move the organization into the future – Visioning Skills and Managing Power and Influence Skills.

Visioning Skills

Visioning skills involves having an idea, a vision, and a clear sense of the future and directions needed to get there successfully. A leader with visioning skills is an essential ingredient of effective leadership. It is of utmost importance that Belly Happi Café start on the right footing. The Chief Experience Officer (CEO) as well as the respective department Directors must first have a clear and brief statement of the organizational vision.

It is proposed for Belly Happi Café’s corporate vision statement to be “To create the best dining experience and become people’s most loved place for amazing and healthy halal food.”

To support this corporate vision, Belly Happi Café would formulate and initiate policies and programmes in areas such as Customer Experience Management (e.g. desired level of professional attitude of staff, promptness of service, making suggestions to diners on menu items, turning dissatisfied patrons into repeat customers) which would be applicable to the Operations and F&B departments;

Food Innovation (e.g. spur creativity for fusion food, and innovation to keep up with consumer landscape and food trends) which would be applicable to the Business Development and F&B departments. The CEO and the respective Department Directors must then effectively communicate the vision and engage all staff in carrying out the vision.

Power is the potential capability to influence the behavior of others, while influence is the consequence that a person’s actions have on attitudes, values, beliefs and/or behavior of others. An effective leader is someone who leverages on the use of appropriate type of power for the achievement of goals and objectives. There are five types of power which could be applied within Belly Happi Café at different junctures to achieve the goals and objectives, namely:

1. Legitimate power which is associated with a formal management position in an organization and the authority accorded e.g. the CEO and its Department Directors has the powers to lead and make decisions;
2. Reward power which stems from the authority to bestow rewards on other people e.g. the F&B Director can use rewards such as recognition, promotion or pay increase to influence F&B Associates’ behavior in promptness of service or displaying desired level of professional attitude;
3. Coercive power which refers to the authority to punish or recommend punishment e.g. the respective Department Directors have the power to fire persistently underperforming staff or withhold promotion of undeserving staff;
4. Referent power, which could also be referred to as leading by example, is not dependent on a formal title or position but is one that stems from an individual’s personal characteristics that command others’ respect and admiration and emulation e.g. a leader demonstrating exemplary behavior, conduct and ethics at the workplace;
5. Expert power which refers to a person’s superior or specialized knowledge and skills pertaining to the tasks being performed and for which others follow e.g. the HR & Finance Director would likely accept the recommendations of the Business Development Director with regard to innovation for market competitiveness, for lack of deep knowledge in industry landscape.

Controlling

Organizational control is the systematic process of assigning, evaluating and regulating resources/activities on an ongoing basis to make them consistent with expectations established to accomplish an organization’s goals. For effective control, managers must plan and set performance standards, implement an information system that provides knowledge of actual performance, and take corrective actions where there are deviations from the standard.

Many restaurants and F&B outlets are fixated on costs, competitors, new menu offerings and pricing that they may overlook the fact that human resources issues can make or break the business. Hence, it is proposed for Belly Happi Café to focus on Human Resources Control. This includes processes for regulating employee performance and behavior, with the aim of improving the capabilities of employees and implementing rewards, financial incentives, or training and capability programs to encourage employees to focus on necessary activities for the achievement of organizational goals.

There are inescapable truths: The most successful restaurant is one with the best people, and you only have one time to make a good impression on a customer! It is therefore important to ensure that suitable candidates (has aptitude, good attitude and good fit to the organization) are employed. There must be clear policies for screening and recruitment, clear job descriptions, employee relations, remuneration, rewards, welfare, better training and development opportunities in placed to uplift the skills of the staff across all levels i.e. Chef, kitchen staff, F&B Manager, F&B Associates. And there must also be clear and established service standards and guidelines. A restaurant with competent and highly engaged staff would be able to create the best dining experience for any patrons.

Control Methods (Timing Control)

There are three types of control that managers can use, which are determined by the time period in which control is emphasized in relation to the work being performed. The following illustrates the three type of control methods (timing controls):

1. Pre-control i.e. controls that take place before work is performed. In relation to the Human Resources Control scope narrated above, this pre-control method should be applied at the onset of drafting the job descriptions, determining actual headcounts required for each department/job functions, designing the various human resources policies and processes for recruitment and screening, employee relations, people management, remuneration, rewards, welfare and career development and training roadmap. The establishment of policies and procedures at the onset before they become part of the system (i.e. before actual recruitment activities commence) attempts to control the quality and/or quantity of financial and human resources and mitigates undesirable behavior that may derail organizational achievements/results.
2. Concurrent Control i.e. controls that take place as work in being performed. In relation to the Human Resources Control scope narrated above, this concurrent control method should be applied as staff deployed to their respective job areas are performing the work, as part of monitoring ongoing employee activities to ensure that they are consistent with established standards. For example, F&B Associates hired to service diners in the restaurant would need to be monitored while they are serving the diners or taking orders to ensure they display the desired level of professionalism and promptness of service according to established service standards.
3. Feedback Control i.e. controls that take place after work is completed. This form of control attempts to take corrective actions to bring performance back to planned levels. In relation to the Human Resources Control scope narrated above, this feedback control should be applied after the staff deployed to their respective job areas have completed the work. For example, once the F&B Associate has completed the task of serving the diners or taking orders, managers can take immediate corrective actions to provide feedback (discreetly) to the staff on areas for improvement or areas done well. This would help reinforce the desired standards.

Business ethics are standards of conduct or moral judgment, differentiating right from wrong and which forms the core of social responsibility, used by managers in carrying out their business in socially responsible actions. Corporate and Social Responsibility (CSR) is the obligation of an organization to take actions that protect and improve the welfare of society along with its own interests. However, views on social responsibility, beliefs and values differ from one individual to another, and from one business to another. An organization’s approach to social responsibility is usually determined by its top management.

Equal Opportunity in Employment

It is important to note that Singapore is a multi-racial society with a diverse workforce in terms of ethnicity, religion, age and gender. In support of the Tripartite Alliance for Fair & Progressive Employment Practices (TAFEP) and the government’s push for fair employment practices, Belly Happi Café would consider establishing progressive human resource management systems and policies affirming equal employment opportunities for all and provide equal training and promotion opportunities for all employees. Belly Happi Café would recruit and select on basis of merits such as skills, experience or ability to perform the job and reward employees fairly based on their performance and contribution, as part of our CSR contribution.