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COMPANY PROFILE

Jen-Dres Catering Services originated from the names of the owners


children: Jen from Jeni Rose and Jenelle Rose, and Dre from Andre Ross. The
owner, Arlyn Lusanea Melanio, a Hotel and Restaurant Management graduate from
St. Paul College, had her first-hand cooking and canteen management experiences
from her mother, Rosalinda Martinez Lusanea, who was a cooking expert herself. Her
knowledge in the food service operations was enriched through actual culinary
seminars and managerial training programs.
Jen-Dres has been in the Food Service Industry since 1990. Through word of
mouth, orders started to pour in and the owner decided to put up a small canteen that
served as outlet for food orders as well. Jen-Dres then ventured into the catering
business segment with extended services for all kinds of parties and group gatherings
such as seminars, birthdays, and weddings. The company decided to branch out by
attending bidding invitations from government and private establishments, through
which it had been the canteen concessionaire to the following institutions:
Philippine High School for the Arts at the National Arts Center, Mt Makiling, Los
Baos, Laguna, from January 2000 to December 2001, where they provided food
services to 150 persons for three meals daily.
Department of Interior and Local Government, Local Government Academy
Training Center in UP College, Laguna, from January 2001 to March 2002, where
they rendered services for DILG-sponsored seminars/conferences for five meals a
day.
Forest Products Research and Development Institute, under the Department of
Science and Technology in UP College, Laguna, from August 2003 to June 2006,
providing meals to its employees and guests on work days and during conferences.
Morning Star Montessori School, Inc. Putho, Tuntungin, Los Baos, Laguna from
2006-2010, servicing canteen needs of the students, teachers, and staff.
Department of Interior and Local Government, Local Government Academy
Training Center, UP College, Laguna from December, 2010 to present, extending food
services to government, government-sponsored, and private in-house seminars,
conferences, and workshops.
Westbrook Residences, University of the Philippines Los Baos from 2013 to
present, providing meals to dormers and outsiders from breakfast to dinner.
Suzuki Philippines, Inc., Canlubang, Laguna from July 2015 to present, serving five
meals a day to all production workers and office employees.
Aside from being concessionaire to the above institutions, Jen-Dres also
accepts outside catering functions. It develops programs on management based on
customer-oriented information to meet the demands or needs of each group of
clientele.

INTRODUCTION

Problem Background
Jen-Dres Catering Services has just started working as canteen concessionaire
for Suzuki Philippines, Inc. last July 6, 2015. Meals are prepared for breakfast, lunch,
overtime (early dinner), and morning and afternoon snacks.
The motorcycle plant (Suzuki) has a total of 400 employees, of which an
average of 320 are served daily. Figure 1-1 shows the breakdown of consumers in a
day.

30%
Production

HR, Executive Offices

47%
MC Sales and Mktg, Fin and Admin

23%

Figure 1-1. Division of consumers.


Three batches of employees are served per meal. For instance, for lunch, the
first batch queues up at 11:20, followed by the second batch at 12:00, and by the last
at 12:20. A 47% majority of customers are part of the first batch the production
workers. They are followed by employees from the Motorcycle (MS) Sales and
Marketing and Finance and Administration departments. The third batch consists of
employees from Human Resources and the top management from the executive
offices.
Because Jen-Dres has only been serving for Suzuki for 7 weeks, it is still
having problems with planning how much stock to cook. Most of the time, the food
served for the first batch are already depleted in time for the next batches.
Moreover, marketing continually poses problems in orders and scheduling.
Budget and employee constraints (i.e. only the marketing-inexperienced cook
prepares the market list) have led to regular stock-outs, erratic order quantities, and
time- and money- consuming sporadic trips to the market.

Problem Statement
From preliminary data gathered from August 24 to September 18, 2015, a
36.96% shortage of food dishes is observed in Jen-Dres, Suzuki, Philippines, Inc.
This leads to dissatisfaction of customers and eventual loss of sales through
opportunity cost.

Scope and Limitations


Of the five meals served in a day, lunch will be focused on because it has the
most regular schedule and the most stable magnitude of consumers. An irregular
number of employees eat breakfast and work overtime at the plant; and office
employees (non-production) have a flexible snack schedule.
Furthermore, proposed solutions will focus on the specific dish type according
to employee preferences and most shortages occurring. Consumed rice will be
excluded in the study because from historical data, rice stock-out or surplus/overproduction has never occurred during any of the meals.

Objectives of the Study


Generally, the study should be able to reduce shortages of the food dishes
served at Suzuki. It specifically aims to:
determine the number of servings to produce to meet clientele demand; and
devise new production schedule per food type over the two-hour lunch
preparation period.

Materials and Methods


The study follows the DMAIC methodology to problem solving and project
implementation. Before conducting the data collection, the researchers identified the
problem through interviews and preliminary data collection. After defining the
problem, the researchers proceeded to the data gathering which is conducted at the
site itself.
Preliminary data involved that of the preference of the clientele, gathered
through reservation sheets where they chose what viand they will consume for the
day. This was observed over a period of four weeks (August 24 to September 18,
2015).
For the actual materials used, the researchers gathered data via Jen-Dres staff
through pen and sheet only. The sheet used consists of the type of viand, the number
of served dishes of each viand type, and the shortages incurred. This was done
simultaneously with the preference data gathering, for a period of twelve weeks
(August 24 to November 13, 2015).
With the data collected, the researchers were able to redefine the problem and
analyze its possible causes. The concepts of inventory management were applied to
the problem on stock shortages and irregular levels. Proper models were applied to the
continually fluctuating demand against the level capacity, in order to establish the
actual number of servings that should be available.
Aggregate planning was applied to be able to balance the aggregate demand
and aggregate production capacity. Moreover, capacity planning was used to measure
the capacity available and required to identify the action plan and the proposed
production schedule.
Generally, chase strategy was implemented to produce the average demand of
the customers. A production schedule of the distribution of the available two hours for
lunch preparation was also constructed.

Project Timeline
Table 1-2. Gantt chart of the project at Jen-Dres.
08
24

0831

0907

0914

0921

0928

1005

10
12

10
19

1026

1102

1109

1116

Define
Define problem
Measure (Gather data)
on preferences
on dish shortage
Analyze
Marketing
Utilization of resources
Demand forecasting
Improve
System devising
Control
Evaluation
The weekly schedule follows the DMAIC methodology to problem solving
and project implementation. It will be further improved as more data is gathered and
more areas for improvement are recognized.

RESULTS AND DISCUSSION


As per the methods of the study, the results were divided into four parts:
preliminary data on preferences, opportunity costs on the current level strategy
system, capacity planning for a new production schedule, and opportunity costs on the
new chase strategy.

Preferences
Through interviews with the manager, it was found out that a general pre-set
number of meals is being followed for lunch, i.e., 2 fish/seafood dishes, 2 pork dishes,
2 chicken dishes, 2 vegetable dishes, and 1 beef dish. In line with the shortages of
food served for lunch, data on the preference of the employees at Suzuki was gathered
from August 24 to September 18, 2015, and tabulated in Appendix Table 1.
From the majority of the consumers production workers twenty random
samples were observed for three consecutive lunch periods. The total numbers of
orders of each meal type for three days were then computed, as shown in Figure 1-2.

Fish/Seafood
Pork
Chicken
Vegetable
Beef

Figure 2-1. Breakdown of orders per meal type.

As shown in both Table 1-1 and Figure 1-2, production workers prefer pork
over fish/seafood, chicken, vegetable, and beef. Statistically, it can be deduced that
pork meals have the greatest demand among the meal types. The rank of preferences

is as follows: pork, chicken, fish, vegetable, and beef. Through interview, it was also
deduced that vegetables are often ordered as side dish with other viands.

Opportunity Costs Current System


The actual data on shortages and servings are tabulated in Appendix Table 3.
Aside from the unsatisfied customers gained every time there is a shortage in a
specific viand, Jen-Dres Catering Services at Suzuki, Philippines also incurs
opportunity costs. It is assumed that every time a customer experience shortage in
their preferred dish, they would buy the next most preferred viand according to the
data gathered from the earlier part of this study. Vegetables, on the other hand, are
considered side dish since most of the customers buy vegetable dishes along with
their preferred viand.
Table 2-1. List of viands and their corresponding opportunity cost due to weekly
shortage, according to the current system
VIAND
PORK
CHICKEN
FISH
VEGGIES

AGGREGATE PLANNING PARAMETERS


Shortage
Opportunity Cost
14.45
72.25
6.3
31.5
3.6
36
4.45
66.75

Pork, having the most number of shortages, incurs the largest opportunity cost,
followed by vegetables, then fish and lastly, chicken. The opportunity costs of pork,
chicken and fish were obtained by multiplying the number of shortage for each viand
to the difference in prices of that viand to the next most preferred viand. For
vegetables, its opportunity cost was obtained by multiplying its average number of
shortage to its price.
Those opportunity costs or loss of sales could have become Jen-Dres profit or
could have been used for its other expenses like labor and ingredients to cater more
number of customer orders, if only shortage of a particular viand were prevented.

Capacity Planning
One of Jen Dres important resources is time. The time required to prepare
every viand of food at Suzuki Philippines have an impact on the average number of
meals being served. At present, the company is still on their first year of operation;
hence, there are problems in matching demand with their production.
It is of the researchers goal to develop an aggregate plan that determines
whether a particular viand of food is over- or under-utilized. The data gathered was
used to determine the average demand for each viand (Pork, Chicken, Fish, Veggies
and Beef). The standard time (in minutes) in preparing each viand is used to
determine the capacity available. The capacity required is the number of minutes
required in order to satisfy the demand. It is computed using the formula:

Capacity Required=

Average demand of Viand


x 2 hours
Total Average Demand of all Viands

The 2 hours is the total preparation time of Jen Dres in preparing the meals
for lunch at Jen Dres. The data is summarized in Table 2-3.
Table 2-3. Determining the new production schedule to be implemented

CAPACITY PLANNING PARAMETERS


TYPE OF
FOOD
DISH

PORK

CHICKE
N
FISH
VEGGIES

Capacity
Require
d

Capacity
Availabl
e

97.2833
3

28.043

26.25

88.05

25.38

26.25

78.87
107.033

22.735
30.85

26.25
26.25

Demand

Over/Unde
r
Utilization

Action
Plan

New
Productio
n Schedule

Average
Serving
s

1.793 Use
1.793
from
Beef
-0.87

28.043

100

25.38

90

-3.515
4.6 Use
0.221
from
Beef,
3.515

22.735
30.85

80
110

from
Fish,
and 0.87
from
Chicken
BEEF
45.05 12.986
15
-2.014
12.986
45
To predict the new production schedule, the researchers opted to use Chase
Strategy wherein the production is matched with the demand. It was observed that the
Pork and Veggie are over-utilized with values 1.793 and 4.6 respectively; while the
Chicken, Fish and Beef are under-utilized with corresponding values of -0.87, -3.515,
and -2.014. The action plan for both Pork and Veggie is to use the excess time from
Chicken, Fish and Beef to meet the capacity required. A new production schedule was
devised and the average servings per viand is computed.
With the new production schedule, Jen Dres can now meet the demand of
their customers at Suzuki Philippines.

Opportunity Costs Forecasts After Implementation


Opportunity costs were computed given that the demand for the next periods
of time will be the same as that of the data gathered in the current system, as shown
on Table 2-3. (See Appendix Table 4 for actual values).
Table 2-3. List of viands and their corresponding opportunity cost due to weekly
shortage, according to the system to be implemented
VIAND
PORK
CHICKEN
FISH
VEGGIES

AGGREGATE PLANNING PARAMETERS


Shortage
Opportunity Cost
-32.6
-163
-23.4
-117
-19
-190
-35.6
-534

It can be observed that there would be no more shortages and thus no more
opportunity costs to be incurred after implementation of the production schedule.

SUMMARY AND CONCLUSION


Jen-Dres is on its first year of operation in Suzuki Philippines and for the
couple of months that they have been serving the company, they have encountered
problems regarding shortages of dishes generally on pork, chicken, vegetables, beef
and fish. The researchers collected preliminary data on Jen-Dres operations during
lunch hours and found out that
there is a 36.96% shortage of food dishes which
leads to dissatisfaction of customers and loss of sales through opportunity cost.
Using the DMAIC methodology in problem solving, the researchers conducted
a study on Jen-Dres and took advantage of different concepts in production systems
such as aggregate planning and capacity planning to meet their objectives.
In a span of twelve weeks, the researchers were able to collect data on the
shortages per day of Jen-Dres operations and were able to compute for the
opportunity cost per type of viand. With the problem at hand, the researchers devised
a production schedule to match the demand with Jen-Dres production;
correspondingly, the average serving per viand was computed.
From the capacity planning results on the previous subsection, a chase strategy
is to be followed according to the demands of the customers. The new number of
servings that must be produced on average daily is shown on Table 2-4.
Table 2-4. List of viands and their corresponding opportunity cost due to weekly
shortage, according to the system to be implemented
VIAND
PORK
CHICKEN
FISH
VEGGIES
BEEF

Average Servings
100
90
80
110
45

The preparation for these servings are distributed over two hours as shown on
Figure 2-2.
PORK
28.04 min

CHICKEN
25.38 min

VEGGIES
30.85 min

FISH
22.74 min

BEEF
12.99 min

Figure 2-2. New production schedule


After deviating from the level strategy in the current system, the new
production schedule now follows the chase strategy largely dependent upon the
demand of the consumers.
Through aggregate planning and capacity planning, the researchers were able
to determine how many dishes for each type of viand should be served therefore
meeting the demand of the consumers. They were also able to identify the time to be
allotted for each food type to be cooked. With the proposed new production schedule,
opportunity costs were computed and the researchers were able to meet their
objectives of meeting the demand and reducing food shortages.