Sustainable Operation - Management

A Wendy’s hamburger fast food restaurant in Tocoa,

Honduras. Wendy’s strategic decisions emphasize operations

management for stability and productivity in all areas in its

current markets, mostly in North America. (Photo: Public

Domain)

Wendy’s applies the 10 strategic

decisions of operations management

(OM) to address needs in various

business areas. These 10 strategic

decisions are aimed at streamlining

Wendy’s activities. As the third biggest

hamburger restaurant chain in the world,

Wendy’s must streamline its operations

to effectively compete against aggressive

rms like McDonald’s and Burger King.

Wendy’s operations management efforts

are indicative of the company’s

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BUSINESS, MANAGEMENT

Wendy’s Operations Management, 10 Decisions, Productivity UPDATED FEB 7, 2017 | LAWRENCE GREGORY

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prioritization of business stability rather than international expansion. Nonetheless, the

10 strategic decisions of operations management are applied in a way that supports

Wendy’s potential expansion in more market areas.

Wendy’s operations management (OM) covers all of the 10 strategic decision areas for its

business. Wendy’s strategies are directed toward productivity and business stability, and less at

expansion in the global hamburger restaurant market.

Wendy’s Operations Management, 10 Decision Areas 1. Design of Goods and Services. Wendy’s emphasizes high output quality. This decision

area of operations management pertains to the design of the company’s products and

how it addresses business and market needs. In this regard, Wendy’s strategy is based

on product innovation to maintain product competitiveness.

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2. Quality Management. In this strategic decision area, Wendy’s objective is to maintain

high quality standards to match outputs and consumer expectations. The company

ensures that its operations managers are prepared to apply these standards at larger

scales when expansion starts. Wendy’s mission and vision statements emphasize high

quality.

3. Process and Capacity Design. Wendy’s operations management strategy involves

production lines. Many of the ingredients are prepared in the company’s production line

facilities. Also, even at Wendy’s hamburger restaurants, this system is used to maximize

process ef ciency and capacity utilization in all areas.

4. Location Strategy. Wendy’s strategy for this decision area of operations management

is typical in the fast food restaurant industry. For instance, the company maintains

strategically located Restaurant Support Centers as support hubs for its franchisees. On

the other hand, Wendy’s restaurant locations are based on proximity to town and city

centers.

5. Layout Design and Strategy. In this strategic decision area of operations

management, the goal is to ensure that layouts facilitate ef cient movement of people,

materials and information. Wendy’s does so through standard layouts for its restaurants

and their kitchens. Total Quality Management is also used as basis for the layout design

and strategy of Wendy’s operations management in Restaurant Support Centers and

supply chain facilities.

6. Job Design and Human Resources. Wendy’s Restaurant Support Centers provide HR

training support for franchisees. In this way, the company satis es its operations

management objective of standardization in this strategic decision area. Wendy’s

corporate control is applied through these centers, ensuring optimal human resource

performance.

7. Supply Chain Management. This decision area of operations management involves

the adequacy of the supply chain. In this regard, Wendy’s strategic objective is to

diversify its supply chain. Even though most of its operations are in North America,

Wendy’s operations management approach maintains suppliers outside North America

for a stable supply chain.

8. Inventory Management. Wendy’s uses a combination of centralized and

decentralized approaches for this strategic decision area of operations management.

The company applies centralized inventory management to minimize stockouts

throughout the inventory. On the other hand, decentralization ensures that Wendy’s

operations management is capable of responding to uctuations in markets. For

example, Wendy’s restaurant managers are given considerable autonomy for managing

the inventory for day-to-day operations.

9. Scheduling. This strategic decision area of operations management focuses on

implementing schedules that address customers’ needs. Wendy’s uses automation for

scheduling many of its activities in the supply chain. However, majority of operations in

Wendy’s hamburger restaurants involve manual and semi-automated scheduling.

10. Maintenance. Wendy’s operations management strategy for this decision area is to

use localized maintenance teams. Franchisees access local maintenance teams and

services from the Wendy’s Restaurant Support Centers. The company’s operations

management also includes in-house maintenance teams for some areas, such as supply

chain facilities.

Wendy’s Productivity Measures Wendy’s productivity is measured through a wide variety of criteria. Variations among

franchisees’ operations management also lead to differences in the productivity

measures used. The following are some of the most notable productivity criteria

considered at Wendy’s:

1. Stockout rate (inventory management productivity)

2. Orders ful lled per hour (Wendy’s restaurants’ productivity)

3. Rate of problems solved (Wendy’s Restaurant Support Centers’ productivity)

References

Lawrence, K. D., & Weindling, J. I. (1980). Multiple goal operations management

planning and decision making in a quality control department. In Multiple Criteria

Decision Making Theory and Application (pp. 203-217). Springer.

Liu, S., & Jiang, M. (2011). Providing Ef cient Decision Support for Green Operations

Management: An Integrated Perspective. INTECH.

Najdawi, M. K., Chung, Q. B., & Salaheldin, S. I. (2008). Expert systems for strategic

planning in operations management: a framework for executive

decisions. International Journal of Management and Decision Making, 9(3), 310-327.

Schrunder, C. P., Galletly, J. E., & Bicheno, J. R. (1994). A fuzzy, knowledge‐based decision support tool for production operations management. Expert Systems, 11(1),

3-11.

The Wendy’s Company, Form 10-K, 2013-2014.

Verdaasdonk, P. (1999). De ning an information structure to analyse resource

spending changes of operations management decisions. Production Planning &

Control, 10(2), 162-174.

Verdaasdonk, P., & Wouters, M. (2001). A generic accounting model to support

operations management decisions. Production Planning & Control, 12(6), 605-620.

Wendy’s International, LLC, Form 424B3, 2001.

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10 DECISION AREAS OF OPERATIONS MANAGEMENT CASE STUDY & CASE ANALYSIS OPERATIONS MANAGEMENT RESTAURANT INDUSTRY WENDY'S