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Introduction to Management Case Study Semester 1 2020: The Taco Company This case study is fictional and has been partly built using facts from several real companies The Taco Company is a Mexican food restaurant chain based in Vietnam with a network of franchises and 25 retail stores nationally. It has been hailed as a success story since its launch in 2009. In just over a decade. The Taco Company shares have Surged more than 2500 per cent, making it one of the best performers on the market and making a lot of people wealthy. In 2019 the company generated a total revenue of VND 50,747,000,000 Background of The Taco Company The Taco Company has the world's largest taco and burrito menu with more than 500 options, helping boost The Taco Company sales. The Taco Company business model is based on franchisees growing sales, not profit, with the head office taking a royalty from every sale Stores are bought and sold on a multiple of these sales, not on profit. The more stores in the network, means more sales are generated which results in more profits for head office The Taco Company selects its franchisees carefully, those who genuinely believe The Taco Company is a highly profitable business. However, when the store is not profitable franchisees are held to blame for bad business management. The stress of making ends meet took its toll on many franchisees who realised the business they had bought into was not viable, due to the company policies, especially on labour costs and a perception that the head office was only concerned about the welfare of people at the headquarters. Whilst The Taco Company profits is growing, the selling price of tacos and other menu items is getting lower due to high competition in the fast-food sector. However, the cost of making tacos is borne by the franchisees who are struggling to make a decent profit due to them not being able to pass on the increasing high costs of running the stores. Understanding the CEO The Taco Company CEO Mrs Nguyen believes the only way a business can deal with challenges is to work out ways of turning a negative into a positive. For example, legislation on employee conditions has forced up The Taco Company labour costs SOX over the last four or five years. But that means people are getting better paid, which means the company is holding on to its employees for longer she says. The result: our teams make fewer mistakes in store and are more committed to the organisation Mr. Nguyen uses encouragement and training programs to engage and motivate stalwe incentive people through a range of systems to become better Mexican food makers. There are training classes and we time you, and you go through tests, and you get different badges on your shirt and so on. The Taco Company staff respond to her nurturing leadership with loyalty. As a reward every year Mrs. Nguyen takes her top team to Singapore to view new technologies that could be introduced into the The Taco Company outlets Worker happiness The reality of life inside The Taco Company is not what is portrayed to the general public. Many workers are unhappy due to widespread underpayment of wages, and not always paying staff their entitlements was found to be standard practice across many stores. Hardworking staff made few tips and often suffered abuse from the managers Affected workers were reluctant to speak out for fear of retribution It took The Tace Company store manager Mr Long three years to get the courage to form head office that his boss Mr Thao, who was also one of the most powerful franchises and a member of The Tace Company influential Franchisee Advisory Committee, wap ing workers, Mr Thapwed stores in the Minh City area Mr Long remembers working long hours without a br o cating that with conditioning wong deseto a 200-degree oven had to bring info becouse was hor as se stressed all the time," he says Mr Long said he worked between so hours and 60 hours week but that his pay slip o n showed he worked 4 hours as anything above 3 hours would attract penalties. This had the effect of denying him overtime payments for extra hours he worked was told the money would be made w e nt good day, but that didn't happen we were and afraid working in the stores the sales weren't good I would be shouted or he says. Once I was told would be put in the over he was somo he said Franchisees After claims of unlawful conduct by franchisees were made to head office, The Tace Company audited its stores and terminated four franchisees for wage fraud. The audit uncovered a strong hood of unlawful and fraudulent behaviour, driven by greed, including manipulation of workers hours by the franchisee, breach of payrol conditions and practices, not paying overtime, not paying the correct hourly rate. The Taco Company said it has here tolerance for worker exploitation and will take action against anyone caught deliberately underpaying workers Why were some franchisees acting like this? As competition intensified with other rival food chains a number of franchises describe the head office system as dictatorial with its ongoing demands to make record profits Franchises reported being very stressed losing hundreds of ions of Vietnam Dong. They weren't making money unless they were cutting costs Franchises were being asked to pay more and more ongoing fees, while retail prices remained the changed of which put pressure on staff and franchisees Mr Long reported Mr Thap to head office shortly after he uit job in April 2019. The long hours, pay. and heat exhaustion finally got tom e never heard back from The Tace Company and never received back pay ITM concepts this case relates to Stakeholder theory/Power/Ethics/Organizational culture/Human resource Management from Module 1 to 6 You must follow the marking rubrics structure when writing your case study analysis Instructions Analyse the case study using the following structure: 1. Case Analysis: Analyses the case identifying the key issues and/or problems. Identifies problems using evidence from the case plus theories and concepts 2. Linking theory and practice to the solution: Develops a solution to the issues or problems. Justifies the solution with evidence, management theory, approaches, concepts and/or models. 3. Recommends specific strategies to accomplish the proposed solution. Case Study Marking rubrics Case A ang proches Recommended Introduction to Management Case Study Semester 1 2020: The Taco Company This case study is fictional and has been partly built using facts from several real companies The Taco Company is a Mexican food restaurant chain based in Vietnam with a network of franchises and 25 retail stores nationally. It has been hailed as a success story since its launch in 2009. In just over a decade. The Taco Company shares have Surged more than 2500 per cent, making it one of the best performers on the market and making a lot of people wealthy. In 2019 the company generated a total revenue of VND 50,747,000,000 Background of The Taco Company The Taco Company has the world's largest taco and burrito menu with more than 500 options, helping boost The Taco Company sales. The Taco Company business model is based on franchisees growing sales, not profit, with the head office taking a royalty from every sale Stores are bought and sold on a multiple of these sales, not on profit. The more stores in the network, means more sales are generated which results in more profits for head office The Taco Company selects its franchisees carefully, those who genuinely believe The Taco Company is a highly profitable business. However, when the store is not profitable franchisees are held to blame for bad business management. The stress of making ends meet took its toll on many franchisees who realised the business they had bought into was not viable, due to the company policies, especially on labour costs and a perception that the head office was only concerned about the welfare of people at the headquarters. Whilst The Taco Company profits is growing, the selling price of tacos and other menu items is getting lower due to high competition in the fast-food sector. However, the cost of making tacos is borne by the franchisees who are struggling to make a decent profit due to them not being able to pass on the increasing high costs of running the stores. Understanding the CEO The Taco Company CEO Mrs Nguyen believes the only way a business can deal with challenges is to work out ways of turning a negative into a positive. For example, legislation on employee conditions has forced up The Taco Company labour costs SOX over the last four or five years. But that means people are getting better paid, which means the company is holding on to its employees for longer she says. The result: our teams make fewer mistakes in store and are more committed to the organisation Mr. Nguyen uses encouragement and training programs to engage and motivate stalwe incentive people through a range of systems to become better Mexican food makers. There are training classes and we time you, and you go through tests, and you get different badges on your shirt and so on. The Taco Company staff respond to her nurturing leadership with loyalty. As a reward every year Mrs. Nguyen takes her top team to Singapore to view new technologies that could be introduced into the The Taco Company outlets Worker happiness The reality of life inside The Taco Company is not what is portrayed to the general public. Many workers are unhappy due to widespread underpayment of wages, and not always paying staff their entitlements was found to be standard practice across many stores. Hardworking staff made few tips and often suffered abuse from the managers Affected workers were reluctant to speak out for fear of retribution It took The Tace Company store manager Mr Long three years to get the courage to form head office that his boss Mr Thao, who was also one of the most powerful franchises and a member of The Tace Company influential Franchisee Advisory Committee, wap ing workers, Mr Thapwed stores in the Minh City area Mr Long remembers working long hours without a br o cating that with conditioning wong deseto a 200-degree oven had to bring info becouse was hor as se stressed all the time," he says Mr Long said he worked between so hours and 60 hours week but that his pay slip o n showed he worked 4 hours as anything above 3 hours would attract penalties. This had the effect of denying him overtime payments for extra hours he worked was told the money would be made w e nt good day, but that didn't happen we were and afraid working in the stores the sales weren't good I would be shouted or he says. Once I was told would be put in the over he was somo he said Franchisees After claims of unlawful conduct by franchisees were made to head office, The Tace Company audited its stores and terminated four franchisees for wage fraud. The audit uncovered a strong hood of unlawful and fraudulent behaviour, driven by greed, including manipulation of workers hours by the franchisee, breach of payrol conditions and practices, not paying overtime, not paying the correct hourly rate. The Taco Company said it has here tolerance for worker exploitation and will take action against anyone caught deliberately underpaying workers Why were some franchisees acting like this? As competition intensified with other rival food chains a number of franchises describe the head office system as dictatorial with its ongoing demands to make record profits Franchises reported being very stressed losing hundreds of ions of Vietnam Dong. They weren't making money unless they were cutting costs Franchises were being asked to pay more and more ongoing fees, while retail prices remained the changed of which put pressure on staff and franchisees Mr Long reported Mr Thap to head office shortly after he uit job in April 2019. The long hours, pay. and heat exhaustion finally got tom e never heard back from The Tace Company and never received back pay ITM concepts this case relates to Stakeholder theory/Power/Ethics/Organizational culture/Human resource Management from Module 1 to 6 You must follow the marking rubrics structure when writing your case study analysis Instructions Analyse the case study using the following structure: 1. Case Analysis: Analyses the case identifying the key issues and/or problems. Identifies problems using evidence from the case plus theories and concepts 2. Linking theory and practice to the solution: Develops a solution to the issues or problems. Justifies the solution with evidence, management theory, approaches, concepts and/or models. 3. Recommends specific strategies to accomplish the proposed solution. Case Study Marking rubrics Case A ang proches Recommended