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Introduction Pizza Hut started out as a pizza parlor opened up by two brothers, Dan and Frank Carney in Topeka, Kansas. Today, Pizza Hut serves over a million pizzas a day in more than 12,689 restaurants in 88 countries and makes it the number one pizza brand in the world. Pizza Hut is now being enjoyed in school cafeterias, sports arenas, major airports, shopping malls, and office settings. From the first day that it opened its doors, Pizza Hut Company has been the pizza market leader in the dine-in, delivery and take-away business.
Its delicious pizza and attentive services have consistently been recognized by customers as the very best in the market. The most common food sold at the restaurants is the Pan Pizza, which usually comes in four different sizes included Personal Pan, Small, Medium and Large. They also come in a variety of toppings which consists of Meat Lovers, Pepperoni Lovers, Cheese Lovers, Veggie Lovers, Double Cheeseburger, Supreme, and Super Supreme, which is Pizza Hut’s most expensive pizza.
Pan Pizza has a thicker crust than most other commercially available pizzas.
Moreover, Pizza Hut also has a number of side dishes including bread sticks, cheese sticks, cinnamon sticks, mozzarella sticks, onion rings, hot and mild chicken wings, and garlic bread. The company’s annual sales are in the billions. The growth of the company was due to a good product being delivered at a good price, offering perceived value and the most important is good organizing. Organizational Structure and design of Pizza Hut Company Organizational Structure is the formal arrangement of jobs within an organization.
When managers develop or change the structure, they’re engaged in organizational design, a process that involves decisions about six key elements: Work Specialization, Departmentalization, Chain of Command, Span of Control, Centralization and Decentralization, and Formalization. Pizza Hut Company also uses these six key elements as the basic of organizing its whole organization. Work Specialization is referred to dividing work activities in an organization into separate job tasks.
Pizza Hut Company focuses on increasing its productivity by using work specialization because the company believes that each individual employee specialize in doing part of an activity rather than the entire activity. Therefore, Pizza Hut Company has divided its management structure into six different kinds of teams that specialize in different tasks; 1. The Product Manufacturing Team This team has a responsibility in making and developing the best quality of product to serve a group of target customers. It involved in turning inputs into outputs and sells them into the market 2.
The HR Operations Team This team is referred as the face of the company. It responses in working as a receptionist, sale representative at the counter service and deliverer in three kinds of the restaurants: Full Service Restaurants, Home Service Restaurants and Restaurant Based Delivery. 3. The Organizational Development and Communications Team This team focuses on business communication, organizational development and change. It also aims to support and develop team members to their fullest potential within the Restaurant Support Centre. 4.
The Recruitment Team The Recruitment Team is split into two separate teams, one recruiting for management positions within the restaurants and the other recruiting for positions within the Restaurant Support Centre. Both teams work to recruit the right people into the right positions. 5. The Training and Development Team This team aims to support and develop team members to their fullest potential, using various programmes such as the Expert training programme, as well as the Developing Champions training programme or all levels of restaurant management.
6. The Compensation and Benefits Team This team aims to provide all Pizza Hut employees with a comprehensive and competitive benefits package, including; fair pay, bonus, health care and pension. Departmentalization is the basis by which jobs are grouped together. Pizza Hut Company’s departmentalization is divided into five common forms which are Functional Departmentalization, Geographical Departmentalization, Product Departmentalization, Process Departmentalization and Customer Departmentalization.
Pizza Hut Company use five different kinds of departmentalization to group job tasks back together after work activities have been divided up through work specialization, so the work can be done in a coordinated and integrated way. 1. Functional Departmentalization: Grouping jobs by functions performed. [pic] 2. Geographic Departmentalization: Grouping jobs on the basis of geographic region [pic] 3. Product Departmentalization: Grouping jobs by product line. [pic] 4. Process Departmentalization: Grouping jobs on the basis of product or customer flow. [pic] 5.
Customer Departmentalization: Grouping jobs on the basis of specific and unique customers who have common needs. Pizza Hut Company has divided its Customer Departmentalization by Demographic factor. [pic] Moreover, Pizza Hut Company also uses Cross-functional teams which are work teams composed of individuals from various functional specialties such as employees from Sale and Marketing, Manufacturing, Finance and so on. Chain of Command is the line of authority extending from upper organizational levels to the lowest levels which clarify who report to whom.
The main three concepts of the Chain of Command are Authority, Responsibility and Unity of Command. Pizza Hut Company’s managers use concept of Authority to do their job of coordinating and overseeing the work of other employees and also tell them what to do their jobs. Concept of Responsibility of Pizza Hut Company is used by all employees who have an obligation to perform any assigned duties form managers. Finally, the company will practice concept of Unity of Command to preserve a continuous line of authority by believing that a person should report to only one manager.
However, the Chain of Command of the company may seem not to be clear because managers sometimes allow employees to do their jobs in their own styles and decisions. Span of Control is the number of employees a manager can efficiently and effectively manage. Pizza Hut Company has used wider span of control to focus on having more efficient in term of cost such as to reduce management salaries. However, having more training and experience for employees are needed because in this way, the less direct supervision they’ll need so employees can function quite well with wider span.
[pic] Centralization and Decentralization are two basis ways of making decisions of all organization. Centralization is the degree of which decision making is concentrated at upper levels of the organization. On the other hand, Decentralization is the degree to which lower-level employees provide input or actually make decisions. For Pizza Hut Company, although it is actually between both Centralization and Decentralization, the company tends to more decentralized.
Pizza Hut Company tries to encourage all level of their employees since high levels to low levels of employees to think, make decision unconventionally and take careful risks to achieve results. Formalization refers to how standardized an organization’s jobs are and the extent to which employee behavior is guided by rules and procedures. In highly formalized organizations, the person doing that job has little discretion over what to be done with numerous organization rules and clearly defined procedures covering work processes.
In contrast, where formalization is low, job behaviors are relatively unstructured and employees have a great deal of freedom in how they do their work. Pizza Hut Company is likely to have low formalization because it always provides an informal environment with open communication to give employees the freedom to make contributions on their own idea. This is a part of company’s culture called “ownership” which is the feeling that comes from knowing you can affect the company’s direction through your expertise, innovative ideas and hard work.
Organizational design decision is involved with two generic models. Mechanistic and Organic Organizations are two different organizational forms. Mechanistic Organization is a rigid and tightly controlled structure while Organic Organization is organizational design that’s highly adaptive and flexible. From the information above of Organizational Structure part, Pizza Hut Company has performed that it has all qualifications which support the concept of Organic Organization; Cross-functional teams, Free flow of information, Wide spans of control, Decentralization and Low formalization.
Communication and Information Technology Communication is the transfer and understanding of meaning. There are two kinds of communication. First, Interpersonal communication is communication between two or more people. Another one, Organizational Communication is all patterns, networks and systems of communication within an organization. For Pizza Hut Company, it uses the concept of organizational communication because the company is formed as an organization.
The pizza hut must have communication which can be used to control, encourage and provide information for all level of employees. Function of Communication Because Pizza hut Company has divided into several branches, it needs to function its communication method between all employees. First, the company uses communication to control employees to follow the company policies and the way they do their jobs. Second, the company motivates its employees by using communication to encourage them to set up the goals, work toward those goals and give them the feedback on progress toward goal.
Moreover, the company also provides a release for emotional expressional of feeling for all employees through working in group so, they can share both frustration and feelings of satisfaction. Finally, information is needed to get things done in organization. Communication also provides that information. The interpersonal Communication Process involves with the seven elements which transfer meaning from one person to another. 1. Intentions, ideas, feelings of sender 2. Encoding of the message by the sender 3. Sending the message.
4. Channel through which message is translated 5. Decoding the message by the receiver 6. Internal response by receiver to interpretation of message 7. Amount of “noise” in above steps For Pizza Hut Company, before it sends messages to employees, it will encode words from customers to be in their own language, and then employee will decode those messages again. The company can transfers the information in many ways. Sometimes, managers will transfer messages face to face with employees, or by e-mails, telephones and so on.
While managers are transferring the messages, it always has something affect them called noise which referred as an interference of communication and may lead to failure in sending and receiving the messages. For example, sometimes noise can caused by employees themselves don’t pay enough attention to the messages. Sender: attitudes, prejudices, frame of reference, appropriateness of language Receiver: attitudes, background, experiences that affect the decoding process Channel: environmental noise (traffic, static on telephone), speech problems, annoying or distracting mannerisms.
Interpersonal Communication From the above process, Pizza hut Company has performed that it has its own method to communicate with employees. Since the company is formed as a fast food company, so everything has to be quite in higher level of speed than normal. Therefore, it must have good senders and good receivers. The main concept of Interpersonal Communication is Nonverbal communication which is a communication transmitted without words and can be divided into Body Language and Verbal Intonation.
Body Language is the gestures facial configurations, and other movements of body that convey meaning. Sometimes Pizza Hut Company’s employees can communicate with another one through body language such as in the situation that one another is in the far distance so, communication through speaking is unusable. However, the sender must ensure that the receiver will understand the meaning of he or she’s body language. Verbal Intonation is an emphasis given to word or phrases that conveys meaning. For example, if managers order employees to do something with the horrible sound.
The employee will do work seriously. Barriers to Effective Interpersonal Communication In communication of Pizza Hut Company, everyone will make the information more favorable by using good emotion to show their intention to have interpersonal communication. At the same time, they won’t take overload information. However, the company sometimes has its own jargon which is specialized terminology or technical language that members of a group use to communicate among themselves such as food’s names, so they can operate their jobs more quickly.
Formal versus Informal Communication Formal Communication refers to communication that follows the official chain of command or is required to do one’s job. For instance, managers in top level will convey the instruction to employees in lower level to do their jobs. Informal Communication refers to communication that is not defined by an organization’ structural hierarchy. For example, communication between employees in the Pizza Hut Company can transfers information to another employee without following the concept of Chain of Command.
Direction of Communication Flow Pizza Hut Company wants to make its managers and employees to work more efficiently and effectively so, the company train its people on how to communicate in all positions by practicing all concepts of communication flow; Downward Communication which will flows downward from a manager to employees, Upward Communication which flows upward from employees to managers and last one is Lateral Communication that takes place among any employees on the same organizational levels.
Human Resource Management Human Resource Management Process consists of eight activities necessary for staffing the organization and sustaining high employee performance. The entire of HRM process is influenced by the external environment. However, the main factors that most directly influence the HRM process are Employee Labor Unions, Government Laws and Regulations, and Demographic Trends. Employee Labor Unions is an organization that represents workers and seeks to protect their interests through collective bargaining.
Not only Pizza Hut Company pays attention on how it treats its customers, the company also pays attention on how it treats its employees. Pizza Hut Company uses the terms of collective agreements to regulate its HRM decisions which usually define such things as recruitment sources; criteria for hiring, promotion, and layoffs. Government Laws and Regulation HRM practices are governed by a country’s laws, which vary from country to country. Within countries, there are state or provincial and local regulations that also impact specific practice.
For instance, Pizza Hut Company is influenced by Government Laws and Regulations in choosing employees for a training programme that must be made without regard to race, sex religion, age, color, national origin, or disability. The company must give equal opportunity for all employees. Demographic Trends Due to a large number of baby bloomers which aged over 40 and the fast-growing of Gen Y, most of Pizza Hut Company’s employees are made up by these two groups. This performs that Demographic Trends also have the impact on HRM practices and will continue to be important in the future.
Human Resource Planning refers to ensuring that the organization has the right number and kinds of capable people in the right places at the right times. HR planning consists of two steps: Current Assessment and Meeting Future HR Needs. Pizza Hut Company provides various programmes such as Advanced tracking programme and Hawk programme for tracking and watching employees to assess its current human resources and evaluate those employees for further development.
Furthermore, due to the company plans to expand its market into other segments and locations, it must also plan to continue hiring more employees in the future in order to meet the demand of organization’s workforce for making products or services. Recruitment and Decruitment Recruitment is locating, identifying and attracting capable applicants. Pizza Hut Company establishes the Recruitment Team which is split into two separate teams, one recruiting for management positions within the restaurants and the other recruiting for positions within the Restaurant Support Centre.
Both teams work to provide many sources such as Internet, Employee referrals and Company Web site to encourage applicants to apply with the company. Decruitment is reducing an organization’s workforce. This situation doesn’t seem to happen so often in Pizza Hut Company because the number of demand for employees continues to increase without stopping as the company expands its markets. Except some special situations that force the company to decruit its employees such as if some employees try to violate the company’s policies.
Types of Selection Devices can be used to reduce accept and reject errors. The best-known devices included Application Forms, Written Tests, Performance-Simulation Test, Interviews, Background Investigation and Physical Examinations. Application Forms are used widely in almost all organizations. This application might be included name, address and telephone number. For Pizza Hut Company, it also included with a comprehensive personal profile, detailing the person’s activities, skills and accomplishments.
[pic] Written Test included test of intelligence, aptitude, ability and interest. Pizza Hut Company also has Written Test which can be both short answers and essays to evaluate applicant’s attitudes and behaviors. Performance-Simulation Tests are made up of actual job behaviors. The best-known of these are Work Sampling and Assessment Centers. Work Sampling is a type of job tryout in which applicants perform a task or set of tasks that are central to it by actually doing the tasks. This type of test is appropriate for jobs where work is routine or standardized.
Assessment Centers are used to evaluate managerial potential through job simulation activities. Such activities might include mock interviews, in-basket problem-solving exercises, group discussions and business decision games. For Pizza Hut Company, it doesn’t tend to use both two concepts of Performance-Simulation Tests because they might require more investment. Interviews is an almost universal selection device, like the application form. Because there are so many variables that can impact interviewer judgment, the interview may not be the most useful selection device.
However, managers can make interviews more valid and reliable by structuring a fixed set of questions for all employees, having detailed information about the job, minimizing any prior knowledge of applicant and so on. Pizza Hut Company uses Interviews as the second step of choosing employees after the first step of Application Forms. During having an interview, the interviewers of the company will provide the questions carefully to ensure that they must be extremely cautious in the types of questions they ask candidates.
Background Investigations are of two types: verification of application data and reference checks. Pizza Hut Company prefers using verification of application data to reference checks because applicants’ references tend to be almost universally positive. Physical Examination is a device that would be useful only for a small number of jobs that have certain physical requirements. Therefore, Pizza Hut Company won’t use this test in choosing new employees. Orientation will happen when a person starting a new job needs the introduction to his or her job and the organization.
Pizza Hut Company uses two types of orientation to introduce all useful information to new employees. First, the company uses Work Unit Orientation to introduce employees about the goal of the work unit, clarifies how his or her job contributes to the unit’s goals and also introduces new co-workers. Then, the company will use Organization Orientation to inform the new employee about the company’s goal, history, philosophy and rules. For example, Pizza Hut Company will take its new employees to have a tour of the company and it also let the employees watch videos about company’s history.
Employee Training is an important HRM activity. Pizza Hut Company has established the Training and Development Team to support and develop team members to their fullest potential by using various specific technical training programmes such as the Expert training programme and Champions training programme for all levels of employees. Managing Organizational Change Organizational Change refers to any alteration of people, structure, or technology in an organization. Type of Change has three types: Structure, Technology and People.
Changing Structure includes any change in structural variables such as reporting relationships, coordination mechanisms, employee empowerment, or job redesign. Pizza Hut Company’s structure has been changed from Bureaucratic into Democracy. The relationship between top managers and lower level of employees are more closely like family instead of boss and worker. Changing of Technology encompasses modifications in the way work is performed or the methods and equipment that are used. As the world is changing, the growth of technology is also increasing which can be used to perform more effective tasks within the company.
Pizza Hut Company has got many advantages from changing of technology such as using technology in promoting the products, minimize the cost of production and reducing time consuming. Moreover, technology also helps the company to distribute its products to group of target customers more convenient. Changing of People refers to changes in attitudes, expectation, perceptions, and behavior of individuals or groups. Pizza Hut Company nowadays has encouraged it employees to take a risk and give them a freedom to make decisions and create their own style to perform their works by themselves.
Conclusion Pizza Hut is one of the successful companies which have an excellent organizing within its organization. Not only the company shares a good value among all level of employees, it also allows them to have a freedom in order to make their own decision on how to do their jobs through using the concepts of wide span of control, decentralization and low formalization. Pizza Hut Company also provides the system to evaluate its employees in every month and rewards those who do their jobs very well, so this can be the way to increase the effectiveness among all employees.
Furthermore, Pizza Hut Company attempts to achieve customer satisfaction and loyalty by focusing its employees on the way they treat with customers. As a result, the company has been able to retain market share and make profit despite the efforts of introducing new products and services from other competitors. Recommendation First, we recommend that not only Pizza Hut Company should focus on how to create loyalty of customers by providing its good image, but the company should also focus on creating its good image and attitude toward its employees such as provide the concept of “treat your customers and colleagues as your family ”.
We can’t forget that the way to impress those customers is not just come from our excellent product, but it also comes form our excellent services through employees’ performance. Second, we suggest that although Pizza Hut Company practices the concept of Decentralization which gives a freedom to employees to make their own decisions on how to their jobs, the company should emphasizes employees to respect and pay attention to the command of managers also. Therefore, the company better positions itself between the concept of Centralization and Decentralization to organize its organization more effective.
Third, in order to increase job satisfaction among employees and reduce turnover, the company should consider a realistic job preview (RJP), which include both positive and negative information about the job and company that provided for new applicants. Therefore, they will better handle with frustrating elements of the job. Fourth, Pizza Hut Company should develop its R&D Department and keep doing research to develop new product all the time to follow customer’s trend.
Although some groups of customers may favor its original products, do not forget that sometimes they also need for a new version of products. Finally, we think that the company needs to be ahead of the competitors by accepting orders via the internet called E-commerce. The company should be the first to revolutionize the way customer order pizzas, so they can continue being the top of pizza maker in the industry.
References 1. www. pizzahut. co. th 2. www. pizzahut. com 3. www. 123helpme. com 4. www. oppapers. com/topics/pizza-hut 5. http://en. wikipedia.org/wiki/Pizza_Hut 6. http://top-1000. org/pizzahut. jpg 7. www. cartoonstock. com/directory/p/pizza_hut. asp 8. www. managementparadise. com/forums/retail-project-pizza-hut. html 9. www. barking-dagenham. gov. uk/6-living/hcs/licensing/public-register/cafe/pdf/pizza-hut-dagenham. pdf.
Present to: A. Pimchai Nilrattanakhun Created by: Group: 19 Section: 406 Mei Z. ID: 5015328 Nattanit Y. ID: 5016194 Pimsiri T. ID: 5016281 Term Project semester 1/2008 NGT2900 Principles of Management School of Management, Assumption University [pic] [pic].
Managing Director Sale and Marketing Director Manufacturing Director Customer Service Director Restaurant General Director Finance Director Mozzarella sticks Boneless wings Garlic bread Chicken Munchers Onion rings Chicken wings Sales Director, Middle East Sales Director, Americas Sales Director, Asia Sales Director, Europe Sales Director Cinnamon sticks Cheese sticks Super Supreme Supreme Veggie Lovers Cheese Lovers Pepperoni Lovers Senior Customer Finance Director Kids and Teenagers Customer Middle Age and Working class Customer Meat Lovers Mineral Water.
Pepsi Beverage Dessert Customer Restaurant General Director Customer Service Director Manufacturing Director Sale and Marketing Director Managing Director Factory Manger R&D Manager Quality Control Manager Packaging Manager Deputy Director Deputy Director Shipping Control Manager Management Accountant Financial Accountant Risk&Investment Manager Property Manager Treasury and Tax manager Insurance and Estates manager Pizza Pizza Hut Company Packaging Manager Quality Control Manager R&D Manager Factory Manger Manufacturing Director Shipping Control Manager.
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