Executive Summary
forecasting. Because of this, there are days when they have surplus of wraps.
We concluded that it would be better if they use the moving average method to
forecast demand because it is the most effective way to predict the demand
based on their daily sales.
SaWRAPs current process design is repetitive focus because it has
medium volume and medium variety. Our group recommends that they stick to
this method but make it more systematic. We arrived on this recommendation
by considering a lot of factors which can be seen as you browse through this
research. We also concluded that SaWrap can best meet their capacity
requirements by keeping a schedule of production and making sure that they
strictly follow this schedule every time.
II.
Business Profile
Internal Affairs
Overlooks everything related to the
inner workings of the stall, such as
employee relations, making sure that
all is well within the confines of the
stall. He will also ensure that all the
members of the group work in
harmony and will work as the mediator
in case of disputes.
Marketing Head
Geb will handle the stalls promotions
making sure that the stall innovates
when called upon, and is also
responsible for the stalls public
identity and reputation.
Additionally, he is in charge of the
documentations of the stall, which
comes hand-in-hand with its marketing
promotions.
Operations Head
Previously owning a JSEC stall, JJ will
serve as overall head, overseeing the
operations of the stall while providing
support for every other role.
Finance Officer
Seeing to it that the stall is financially
sound, Michael is in charge of the
monetary division of the stall. All the
funds and revenue will pass through
him, as he is in charge of the
accounting and allocation of the
money.
External Affairs
In charge of SaWRAPs public image,
Mela will play a vital role in making
sure the stall has the right
documentation from the right
agencies, be it governmental or within
the academe.
Size
The owners shelled out 150,000 pesos as the initial investment for the JSEC
stall, each member pitching in 25,000 pesos from their personal savings,
depending on the need.
They have three employees namely Medy Mercado, Ramon Vero and
Eduardo Paguio. Ate Medy has so far continued her consistency in her duties as
the stalls frontman. She has been reliable overall and has not shown signs of
weariness. Overall, she has been a vital cog in our stalls operations, as she also
contributes to our marketing by attracting customers using her friendly
Operational Overview
The stalls operations strategies are low cost (cheaper) and rapid response
(faster). However, at the same time, they also make use of the Differentiation
(Better/Different) because they are the only stall that offers Filipino flavors,
therefore, gaining competitive advantage over the other stalls. SaWrap primarily
offers and sells wraps with fillings that appeal to the Filipino palate. Everything
from the filling to their wraps are homemade and these wraps are served in
banana-leaf sleeves as to-go meals or snacks with a choice of classic Filipino
drinks, like Buko Pandan and Black Gulaman.
Product/Service Design and Forecasting
Majority of the variety of fillings offered are based on popular Filipino
cuisine with a little twist. They first conceptualize these flavors through
observation and through the demand of their customers. An example of this is the
stalls Sisig Gyro as a result of the popular demand of the distinct taste of sisig that
was missing from JSEC. The owners were aware of the volatile tastes of their
consumers that is why they strive to come up with a different flavor every month.
However most of these flavors are scrapped off if the new product does not seem
to click with the crowd. Moreover, they also remove items from their menu when
they observe that the particular product is doing poorly in sales.
The owners of the stall share responsibilities and are arranged in such a way
that they all have equal control over the stalls operations. Store duties involve
Finance, Operations, Logistics, Human Relations, and others - each member
occupies one position but is flexible enough to interchange their duties given the
situation, making sure that everyone is involved in the processes.
The products are designed in a way that it will be healthy, filling, and at the
same time environmentally sustainable with the use of banana leaves as the
sleeves of the wrap. They strive to incorporate products that jive with their brand
concept and identity. Furthermore, they conduct research through acquiring
accounts of the peoples opinions by personally talking to their market - as shown
exemplified by the development of their Sisig Wraps. To keep up with their
customers demands when it comes to having a few adjustments in the wraps
product, such as requesting for more filling, they give a little room to add a bit of
the vegetables but strictly discourage adding any more filling more than their
standard of 100g.
From what could be determined from the interview with the owners, it is
safe to assume that they do not use an approach similar to the House of Quality to
design their products and opts to play things by ear and bring out what their
customers want simply by observing the trends and listening to their markets
feedback. Similarly, the owners do not have a fixed method to
forecast their demand.
Process Selection
SaWraps production process uses Repetitive Focus. In this type of
production process, an assembly line is used, which means that it focuses on the
manual or hands-on assembly. Key processes that are undertaken by the stall
include buying the ingredients once a week to ensure freshness of the ingredients.
On a typical day of operations, it begins with the workers preparing the filling for
wraps very early in the morning, prepping the banana leaves and trimming them if
needed, and then making the dough for the wraps.
There are two, out of the three, employees present in the stall at a time, the
third member could be out buying extra ingredients if they are running low on
some instances or doing preparations in case the filling or the wraps are also
getting low. When a customer orders a wrap, the cashier first takes account of the
order and asks for payment, while telling the other person in the stall who takes a
wrap to grill the uncooked wrap and lines it with vegetables, before handing it over
to the cashier who puts the filling of choice, assembles it into a wrap, and hands it
to the customer. A flowchart is available in the reference section, number 3.
From our observations, the process used to make the wraps are appropriate
but could be improved to ensure the quality of the product and also we have
observed that none of the processes are automated and the appliances in the stall
used is a hand-mixer for the garlic sauce, a griller, a refrigerator, and a warmer.
Capacity Planning
As of now, the group does not have enough data about the stall in order to
know the exact capacity of the stall and even the owners are not sure of their
capacity. However, the stall owners say that they make around one hundred to two
hundred wraps a day but expect to sell around 100-150 wraps. The fillings they
make at the start of each day would last for around one hundred wraps. Actual
sales are only a little over a hundred, however, there are some days that some
ingredients are leftover and are not used. Currently, there is no system
implemented to determine their capacity requirements.
IV.
Product Design
In improving the processes involved in designing a product, SaWrap could
start with creating a systematic way to conduct their research instead of
depending on pure observation and feedback alone. This will serve as a basis to
which they could draw their concepts for a new product and also to improve their
existing products. These measures will prevent them from constantly wasting their
efforts and resources on product designs that may not be what their customers are
willing to purchase.
Furthermore, they do not give much consideration for documenting their
previous product designs. They could change this by not just scrapping an item
because it had a poor sales performance, but also to observe why it did not sell as
well as they expected it to, and to adjust their future concept products accordingly.
Granted, SaWrap do make product prototypes and probably taste-tests in
order to verify the quality and way the filling tastes with the wrap before selling
these new items. However, taste-tests alone may not be enough to verify the
marketability of the product.
Drawing from an online survey which the group disseminated beginning
December 2013, with forty-one respondents, a recurring problem encountered
when eating the product was that it was too messy to eat and that patrons have
noticed how difficult it is to eat with the banana leaf sleeves. Also, it was observed
from the operations of the stall that the cashier is also the person who folds the
wraps in the banana leaves then hands it to the customer, of course, wearing
plastic gloves but draws concern to the quality control over the product. These
points for concern regarding the product design and operations could be remedied
by changing specific steps and measurements used by the stall.
First, it was verified that most of the sauce in the wrap does collect at the
bottom where also most of the flavor is found. A good 37% of our respondents
claim to have experienced difficulty in eating majority of the items in the menu. A
few reasons why this problem occurs are because the sauce is added along with
the vegetables and the filling. This step might be done in this particular manner to
give aesthetic appeal to the wrap, however it does seem to also be counterproductive as the customer cannot taste the sauce in the first few bites of the
wrap. Possible solutions to these problems are to halve the amount of sauce spread
inside the wrap and place the other half at the top. This would hypothetically even
out the flavor-distribution and also lessen the dripping at the end of the wrap.
Another alternative is to pat-dry the vegetables used and to thicken the sauce.
Second, the groups recommendations about the difficulty in the way the
product could be eaten is to make people aware that the banana leaves have little
grooves that could be individually removed like perforated paper.
And lastly, to ensure the quality of the product, the steps taken could be
adjusted so that everything that involves handling the food could be handed over to
the other person in the stall.
Demand Forecasting
They have no fixed system in determining demand. What can be observed is
that currently, theyre using the naive approach in forecasting. Because of this,
there are days when they have surplus of wraps. Their method may not be the most
effective in the sense that their products demands vary each day. And since naive
approach assumes demand in the next period is the same as demand in the most
recent period, their demand forecast would most of the time be inaccurate.
The store could improve on their forecasting methodology by using the
moving average method. Since there are no trends for their products, this is the
best way to forecast their demand. Considering that this is a JSEC stall which lasts
only for a year, the seasonal index approach is not applicable since this requires at
least 3 years of sales data.
According to the stall owners, they are able to sell a little over a hundred
wraps per day. This number would be greatly affected only when there are events
that occur in campus such as the mass. In order to demonstrate how we plan to
forecast the demand, the values used would be rough estimates.
Estimated Daily Sales*
Monday
Tuesday
Wednesday
Thursday
Friday
110
107
112
105
103
5375
5
wrap with the filling once the customer orders. They make everything from
scratch; there are no automated processes. They make their own wraps and sauce
because they say it is cheaper. The only technologies they use are hand mixer,
griller, warmer, refrigerator, and freezer.
We recommend that they stick to repetitive focus process design because of
the on-the-go nature of their stall. However, we recommend that they make the
process more systematic. Currently, they only create new products and forecast
demand based on their personal observations. Because of this, they have trouble
controlling the stores shortage and surplus. Doing more research and fixing their
demand forecast can tremendously improve this. They can also try to be more
competitive by increasing their sales through marketing as well as price and
product adjustment.
The 7 steps for Process Evaluation:
1. Have we kept it simple?
SaWraps current system is that they prepare the product upon the customers
order. Because of this, each customer can request if they want certain contents to
be removed. Each wrap is composed of 100 grams of meat. This is the base of the
product and they do not allow for the customers to ask for more meat. However,
they allow the customers to ask for more sauce.
2. Is value added in each step?
Yes. When the ordered ingredients are delivered, they are cooked in the stall
and stored. When someone orders, one employee gets the wrap from the container
and heats it. Afterwards, the cashier assembles the wrap with the banana leaf then
gives it to the customer. Each step is valuable and necessary for the customers
good. They also mentioned that they experience shortage almost as much as they
experience surplus, which is why their storage process is satisfactory also.
3. Have we minimized the handoffs?
In the event of shortage, they ask their employees to buy ingredients from
Katipunan, which is time consuming and more expensive. Therefore, the handoffs
are not minimized. Improving the way they forecast the demand can solve this.
4. Is each individual step and responsibility clearly defined?
All the members know the process and how each step is done. They have six
departments, namely Finance, Operations, Logistics, Marketing, Internal affairs
(HR), and documentation. However, they have interchangeable roles, making their
individual responsibilities vague.
5. Have we included visual controls and /or fail-safe measures for quality
assurance?
There is no visual control available in the stall. This is probably because the
employees are already trained and they have already memorized the steps. This is
also a small-scale business so the room for error is smaller compared to large-scale
businesses. Also, we assume that they did not deem it necessary to provide visual
controls since there are only 3 employees. However, it is still recommended that
they use visual controls for the safety of both the customers and employees.
6. Have we leveraged technology?
They have no automated processes and they have no intention of buying more
machines because according to them, the school year is about to end. The only
appliances they use are hand mixer, griller, warmer, refrigerator, and freezer.
7. How do we monitor throughput and variability?
They have precise measurement for each product that they sell. The meat has
to be 100 grams. They also make their own wraps so they are able to control the
quality of each one. The wrap-making process already serves as early warning
systems for quality problems. They check the quality of the meat before they
purchase it. They also check for the products quality when they prepare it upon
the customers order. Moreover, mid-day checks are conducted to see if everything
in the stall is in order. According to one of the managers, when an issue arises, we
identify the cause of the issue then determine what we can do to prevent it from
happening again.
Capacity Planning
SaWrap can best meet their capacity requirements by keeping a schedule of
production and making sure that they strictly follow this schedule every time.
Currently, the stall has no problems in meeting their demand. This can be the
result of scheduling their daily operations. By cooking the wrap fillings in the
morning (around 8AM), and making the wraps simultaneously, they are being very
efficient in the sense that they would not panic and be disoriented when orders
start to come in. The cooked fillings are placed in food warmers to keep them fresh
and hot throughout the day. Also, in this way, it would be easier for them to
prepare the wrap whenever a customer decides to order. When the fillings are
going low, the staff would make another batch in the middle of the day to avoid
shortage. Also, the banana leaves used are cut throughout the day by one of the
staff. Since the leaves do not easily wilt, unused leaves can still be used for the
following day.
In terms of efficiency, using the formula we derived how efficient the stall is
in terms of its current operations.
Efficiency =
Actual Output
Effective Capacity
Derived
107(demand forecast )
150 (Given by stall owners)
= 0.71333 or 71%
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References
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Tell partner
order
Grill wrap
dough
Hand to
cashier to
wrap
Do they want
drinks?
YES
What drink do
they want?
Get drink
from fridge
N
O
Give wrap to
customer
Hand drink to
customer
Fold wrap in
Banana leaf
sleeve
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