Principles of Food and Beverage Management Food and Beverage
Management: Analysis and Decision Making Chapter 10
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Learning Objectives After completing this chapter, you should
be able to: Explain how enhanced quality should be the focus of an
operations improvement philosophy. Explain a three-step process for
analyzing a restaurant or foodservice operation and establishing
financial priorities. Describe procedures for corrective action
plans. Describe basic procedures for implementing change.
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making QUALITY AS AN IMPROVEMENT PHILOSOPHY Management
Decision Making
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making Evaluating Quality
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making A CLOSE LOOK AT FINANCIAL ANALYSIS Set Expectations
Annual Operating Budget The Budget Team Budgeting Revenues
Budgeting Expenses
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making Assess the Actual Situation Analyze the
Variance
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making Revenue Analysis Expense Analysis Profit
Analysis
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making Budget Revisions
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making CORRECTIVE ACTION PROCESS Identify Problems
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making Managers Math Answer the Questions:
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making Make Decisions
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making PROCEDURES FOR IMPLEMENTING CHANGE Overcoming
Resistance to Change Managing Change
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making Quality Improvement in Action: Implement
Rollouts
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making Managers Are Decision Makers
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making - Summary Chapter 10 Food and Beverage Management: Analysis
and Decision Making - Summary 1. Explain how enhanced quality
should be the focus of an operations improvement philosophy. A
quality system involves several steps: establish standards,
identify defects, track defects, and implement a problem-solving
strategy to correct defects that occur. Spot checking strategies by
the manager and chef are useful for evaluating quality. They might,
for example, order the same meal during two different shifts and
see whether the meal is the same. They should evaluate the plating,
speed of delivery, and quality, and confirm that a standardized
recipe was followed. Managers may take daily or weekly notes to
record their findings and communicate issues to the appropriate
staff members.
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making - Summary Chapter 10 Food and Beverage Management: Analysis
and Decision Making - Summary 2. Explain a three-step process for
analyzing a restaurant or foodservice operation and establishing
financial priorities. A three-step analysis process for
establishing corrective action priorities includes developing a
budget, assessing the situation using the income statement, and
analyzing for variances. Budgets are prepared with input from the
management team. The basic process includes estimating revenues and
then forecasting expenses (including fixed, variable, and mixed
costs) to determine profits. Experienced managers use historical
information and their knowledge about internal and external changes
to develop budget benchmarks. Income statements reflect the
operations efficiency and profitability.
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making - Summary Chapter 10 Food and Beverage Management: Analysis
and Decision Making - Summary 2. Explain a three-step process for
analyzing a restaurant or foodservice operation and establishing
financial priorities continued Significant variances between budget
expectations and actual performance reflected by the income
statement require analysis. Analysis should include both dollar
figures and profit percentages. If basic assumptions have changed,
the budget should be revised.
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making - Summary Chapter 10 Food and Beverage Management: Analysis
and Decision Making - Summary 3. Describe procedures for corrective
action plans. Sometimes corrective action is necessary to reduce
variances. First, problems must be identified to determine those
that most affect profitability. Managers must then make decisions
about how to address unacceptable variances most effectively. One
decision-making process involves defining the problem, determining
and evaluating solution alternatives, selecting and implementing
the best alternative, and evaluating its effectiveness.
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making - Summary Chapter 10 Food and Beverage Management: Analysis
and Decision Making - Summary 4. Describe basic procedures for
implementing change. Employees may resist the changes required.
Managers can use several strategies to overcome resistance to
change. First, the process will be easier if the manager has
involved employees and explained why changes are necessary. Also,
change is easier if situations have historically been better after
changes than before. A continuous quality improvement (CQI)
initiative can drive the culture in which change is implemented.
Employees will know that regardless of how small a change might be,
the operation can better meet its mission and goals. Several basic
procedures can be used to implement rollouts of new or revised
policies, procedures, and menu items.
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making - Summary Chapter 10 Food and Beverage Management: Analysis
and Decision Making - Summary 4. Describe basic procedures for
implementing change continued This process involves identifying
rollout changes, planning rollout details, considering staff
training if necessary, and implementing the rollout. Then, rollout
data must be collected and evaluated, and the rollout may need
adjustments depending on how well its objectives were attained. A
final step is recording the rollout results.
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making Key Terms: Bottom line A planned profit or another
financial goal such as to break even. Calendar year A year that
begins on January 1 and ends on December 31. Continuous quality
improvement (CQI) A system of ongoing efforts to better meet or
exceed customers expectations, and to define ways to perform work
with better, less costly, and faster methods. Fiscal year Any
365-day accounting period that does not begin on January 1. Fixed
cost A cost, such as rent, that does not change as revenue changes.
Food cost percentage The percentage of all food revenue that was
spent to purchase the food products required to generate that
revenue.
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making Key Terms continued: Mixed cost A cost that
contains both fixed and variable components, such as labor. Net
income The profit made in a business. Profit percentage The profit
or loss expressed as a percentage of total revenue. Quality system
A system that outlines how quality processes and procedures should
be implemented, controlled, and maintained. Revenue, incremental
Income statement The percentage of all food revenue that was spent
to purchase the food products required to generate that
revenue.
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making Key Terms continued: Spot checking A regular review
of standardized recipes and food products as a way to maintain
product quality. Supply and demand, law of Economic beliefs about
the supply of an item and its price relative to its demand.
Generally, as the price of an item increases, the demand for the
item decreases (although the reverse can also occur). Variable cost
A cost that changes in proportion to revenues. Rollout The process
of introducing something new in an operation.
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Chapter 10 Food and Beverage Management: Analysis and Decision
Making Chapter 10 Food and Beverage Management: Analysis and
Decision Making Chapter Images