Data Analysis
Businesses are developing in accordance to the needs of their consumers. It is very vital for firms to identify these needs because it determines their success. With this regard, a survey was conducted to determine the perception of consumers about the critical success factors of Tao Heung Holdings Limited. Basically, the survey questionnaire was comprises of questions about CSFs of Tao Heung Holdings Limited and Maxims Group. The goal is to compare if Tao Heung Holdings Limited exceeds Maxims Group in terms of CSFs and determine the particular CSFs that people consider most.
Company Overview[1]
Tao Heung Holdings Limited is one of the leading Chinese Restaurant Group in Hong Kong. The group operated 42 Chinese restaurants in Hong Kong under different brands serving a selection of Chinese cuisine developed for various consumers as of 8 June 2007. As for their brands, Tao Heung Holdings Limited includes Tao Heung, Tao Heung Seafood Hotpot Restaurant, Cheers Restaurant, Hak Ka Hut, Tao Heung Super 88, Chao Inn, Shanghai Inn, Harbour Seafood Restaurant and Chung’s Cuisine.
The group is actually one of the long-lived restaurant business group operating in Hong Kong. Thus their directors believed that they are a pioneer in the Chinese restaurant industry in implementing the “5-S” management system throughout the entire operational process, starting from sourcing and processing of food ingredients, maintaining hygiene standards, staff training and daily management of each of their restaurants. From the history of their operation, the group also received numerous awards and accreditations.
Analysis
Key industry Success Factors also known as Critical Success Factors (CSF) is used as a basis for identifying the information needed by the management of a certain organisation. The notion of CSF is very straightforward, it says that in any organisation may it be profit or non-profit, there are essential factors which are critical to the success of such organisation, in a way that, if the objectives, goals and missions associated with the determined factors are not attained, the organisation may face its downturn (Huotari & Wilson 2001).
In line with this study, the CSF analysis will be conducted in order to determine the essential factor that leads to the success of the company with its designed and implemented alternative solutions. CSF that can be attached to the company includes its strategic management and the ability of the company provides quality products and services through the use of knowledge management and other enhancing approach. To determine the status of CSFs within the organisation, the company conducted surveys among consumers.
With regards to the given survey questionnaire, 120 people answered the questions. 54.17% of 120 respondents are female. Actually, majority of these 120 respondents are in 20-30 years old which is 29.17% of the total subjects. Aside from this, the subjects are mostly enterprise employed and government employed i.e. 47.50% and 32.50%, respectively. Basically, their average monthly incomes are in the range of HK,001-HK,000.
Table 1
Statements
5
4
3
2
1
Weighted Mean
Interpretation
1. Tao Heung restaurant food quality is high.
69
49
2
0
0
4.56
Agree
2. Tao Heung restaurants provide high quality service.
58
51
11
0
0
4.39
Agree
3. Tao Heung restaurant provides high quality environment.
70
37
13
0
0
4.48
Agree
4. Tao Heung restaurant considers value of money.
60
44
13
3
0
4.34
Agree
5. Tao Heung Group provides different choices to customers.
63
56
1
0
0
4.52
Agree
6. Tao Heung can provide different choices for all-day dining needs of you.
63
53
1
3
0
4.47
Agree
7. Tao Heung restaurant location is convenient.
58
58
1
3
0
4.43
Agree
8. Tao Heung Group gives you impression is fashionable.
46
49
24
1
0
4.17
Agree
9. Tao Heung Group is a forefront of innovation in Chinese restaurant.
53
49
16
2
0
4.28
Agree
10.Tao Heung Group embraces innovation at many levels, from marketing through to food preparation. /Tao Heung Group has innovation at sales marketing.
78
35
7
0
0
4.59
Agree
As presented in Table 1, the perception of the respondents regarding their view towards the performance of Tao Heoung Group was indicated. Basically, the column 5, 4, 3, 2, and 1 signifies the number of respondents who answered to the different degree of responses. For example, in statement number 1, there were only 69 respondents who answered 5, 49 for 4, 2 for 3, 0 for 2, and another 0 for 1. The weighted mean column shows the mean answer of that particular statement that is 4.56 and interpreted it as agree. The table above shows that most of the respondents agreed on the given survey statements. All the statements from the survey are clear to the respondents. From these responses, it indicates that the average number of respondents agreed regarding the quality of services provided by Tao Heoung Groups. Moreover, it also indicates that value of money, multi-branding and innovation was considered by the group.
Table 2
Statements
5
4
3
2
1
Weighted Mean
Interpretation
1. Maxim’s restaurant food quality is high.
39
30
51
0
0
3.90
Agree
2. Maxim’s restaurants have high quality service.
31
39
44
6
0
3.79
Agree
3. Maxim’s restaurant have high quality environment.
19
23
49
29
0
3.27
Neutral
4. Maxim’s restaurant is value of money.
37
39
44
0
0
3.94
Agree
5. Maxim’s Group provides different multi- choice to customers.
55
49
37
0
0
4.13
Agree
6. Maxim’s can provide different choices for all-day dining needs of you.
33
42
45
0
0
3.90
Agree
7. Maxim’s restaurant location is convenient.
39
44
47
0
0
3.94
Agree
8. Maxim’s Group gives you impression is fashionable.
22
31
65
2
0
3.61
Agree
9. Maxim’s Group is a pioneer Chinese restaurant.
27
33
45
15
0
3.60
Agree
10. Maxim’s Group embraces innovation at many levels, from marketing through to food preparation. / Maxim’s has innovation at sales marketing.
12
15
45
34
14
2.81
Neutral
As seen in table 2, the perception of the respondents regarding the performance of Maxims Group shows great results. Similar to the results in Tao Heoung Groups, Maxims was also identified as good restaurant that provides excellent food products and services. However, most of the surveyed participants are neutral if Maxims restaurant provide excellent environment and gives consideration to innovation opportunities. In line with this, the next section will show the paired sample t-test that will determine the significant differences/similarities between the performances of Maxims Group and Tao Heung Group as perceived by the surveyed respondents.
To verify and validate the previous results, the use of t-test must perform. To evaluate the differences between performances of Maxims Group and Tao Heung Group as perceived by the surveyed respondents, the use of paired-sample t-test in the computed mean was employed. The t-test is the most commonly used method to evaluate the differences in means between two groups (Creswell, 2001). Theoretically, the t-test can be used even if the sample sizes are very small (e.g., as small as 10; some researchers claim that even smaller n’s are possible), as long as the variables are normally distributed within each group and the variation of scores in the two groups is not reliably different (Creswell, 2001). As mentioned before, the normality assumption can be evaluated by looking at the distribution of the data (via histograms) or by performing a normality test (Creswell, 2001). The equality of variances assumption can be verified with the F test, or you can use the more robust Levene’s test. If these conditions are not met, then you can evaluate the differences in means between two groups using one of the nonparametric alternatives to the t- test (Creswell, 2001).
According to Creswell (2001), the p-level reported with a t-test represents the probability of error involved in accepting our research hypothesis about the existence of a difference. Technically speaking, this is the probability of error associated with rejecting the hypothesis of no difference between the two categories of observations (corresponding to the groups) in the population when, in fact, the hypothesis is true.
Some researcher (e.g. Creswell, 2001) suggests that if the difference is in the predicted direction, you can consider only one half (one “tail”) of the probability distribution and thus divide the standard p-level reported with a t-test (a “two-tailed” probability) by two. Others, however, suggest that you should always report the standard, two-tailed t-test probability. When testing for a relationship between two variables, sometimes there is a 3rd variable, which we are not interested in at the moment, which influences our results.
So, the null hypothesis (Ho: x and y are independent), can also be written as:
Ho: mD= 0, where mD = population mean of difference scores
df = N – 1, where N = the number of pairs of participants
Then, using the standard “template” for our inference test, we have:
With regards to the previous illustration, paired sample t-test analysis was also performed in this study using SPSS. This was used to test the significant difference between the Maxims Group and Tao Heung Group as perceived by the surveyed respondents. Upon using SPSS, three tables were produced in the output and these are the paired samples statistics (table 3), paired samples correlations (table 4) and independent sample test (table 5).
Table 3
Table 3 displays the mean value, standard deviation, and standard error for the pair(s) of variables compared in the Paired Samples T Test procedure. Since the Paired Samples T Test compares the means for the two variables, it is useful to know what the mean values are. The two variables in the study are the perceived performance of Tao Heung group and Maxims Group with their mean computed to 4.4230 and 3.6890 respectively.
Table 4
Table 4 however, displays the value of the correlation coefficient and the significance value for each pair of variables used in the Paired Samples T Test procedure. Since the two variables should represent the same group at different times or two related groups, the correlation should be fairly high and the significance value low (typically less than 0.05). As an offshoot of these, it was revealed that the significance value is greater than the 0.05 level of significance i.e. 0.637, therefore it is considered that the significance value greater than the level of significance implies that there is no significant correlation between the perception of the respondents between significant difference between the Maxims Group and Tao Heung Group.
Table 5
The independent sample test procedure, as shown in table 5, compares means for two groups of cases, specifically in identification of the significant difference between the Maxims Group and Tao Heung Group as perceived by the surveyed respondents. The mean values for the two groups are displayed in the table 3 which is then compared to the mean difference in the independent sample test table.
In analysing the table, The Paired-Samples T Test procedure compares the means of two variables that represent the same subjects at different times (e.g. Tao Heung Group and Maxims Group). The mean values for the two variables are displayed in the Paired Samples Statistics table. A low significance value for the t test (typically less than 0.05) indicates that there is a significant difference between the two variables (Creswell, 2001). And since the computed sig value is 0.00 and the confidence interval for the mean difference does not contain zero, this also indicates that the difference is significant. Consequently, this implies that there is a significant difference between the Maxims Group and Tao Heung Group as perceived by the surveyed respondents.
The Critical Success Factors
Since the business environments are fast becoming more and more complex added to the fact that it changes rapidly and dynamically, businesses need to concentrate on a few key elements that are most important to their organisations survival. Thus, it is not surprising the critical success factors keep the organisations from straying too far with external issues not relevant to their company’s success. Critical success factors (CSFs) in business, are the limited number of areas in which results, if they are satisfactory can ensure that successful competitive advantage for the company (Thierauf, 2001). Determining these factors is an old concept in business because there were great leaders throughout history who have identified and addressed key factors to achieve their successes. There is no one definition of CSF but it is considered that these are the areas which the company needs to concentrate on to flourish. Therefore, the activities should be carefully monitored and guided by the management.
Chung (1987) defined critical success factors as managerial factors that create a competitive edge for a company in its respective industry. There is no specific process in identifying and executing critical success factors in strategic management planning. This is the reason why Thierauf (2001) asserts that different companies which have similar structure can conduct its market entry forming different strategies which lead to the development of various critical factors. As the primary means for an organisation to achieve its strategy, critical success factors must take into account the differences in the environment and organisation that exists. Using the data gathered from the selected customers, it was found out that 42.50% of them patronise Tao Heung Group, 39.17% choose Maxims Group and 18.33% for other restaurants. With this regard, the following figure will illustrate the views of respondents about the importance of the identified CSFs.
Figure 1. Critical Success Factors
Basically, Tao Heung Group identified 7 factors that are critical and essential to their success and these are location, cleanliness, service, taste, innovation, value of money and brand name. Figure 1 actually illustrates the weighted mean of these CSFs with respect to the degree of importance as perceived by the respondents. Small values signifies low or small importance (e.g. 1 or less than 1) while high values (e.g. 3.0 or more than) on the other hand signifies great importance. And from this presentation we identified that CSF “value of money” receives a high degree of importance i.e. 2.98. This means that the subjects prefer to buy products that are valuable. In addition, subjects believed that the value of their money should correspond to the quality of services or products that they are needed. If we look on the previous table (i.e. table 1), Tao Heung actually gives priority to the quality of their products as perceived by their customers and therefore this indicates that the “value of money” was the priority of the group. Aside from this importance, cleanliness is also crucial to Tao Heung Group. Most customers prefer to have a clean environment and excellent service aside from receiving quality products.
With this regard, the previous Tables, Table 1 and Table 2 describe the 3 CSFs of Tao Heung and Maxims. From the tables, statements 1 to 4 describes the perception of the respondents about Value of Money, statements 5 to 7 illustrates the belief of respondents concerning branding efforts of these restaurants and statements 8 to 10 also describes their perceptions towards Innovation effort of the groups. Here is the summary of computed means.
Table 3
CSFs
Tao Heung
Maxims
Value of Money
4.46
3.73
Multi-Branding
4.47
3.99
Innovation
4.35
3.34
As seen in this table, Tao Heung outperformed Maxims in these three CSFs. This result indicates that To Heung is better than Maxims as perceived by the survey participants. Moreover, the excellent perception of consumers concerning CSFs indicates high profits. Actually, Tao Heung was performing much better than Maxim on these factors. Thus, this indicates that Tao Heung is more successful and the result is reflected in the next section, profitability.
Profitability
With regards to profitability as viewed by the surveyed participants, the use of coefficient of variation with respect to the given data was considered. Actually, when the standard deviation is expressed as a percentage of the mean the resulting type of relative dispersion is called coefficient variation (C.V.) the coefficient of variation is always expressed as percent.
Formula:
where: CV= coefficient of variation
S=sample standard deviation
=sample mean
In other words, coefficient of variation indicates the relative magnitude of the standard deviation as compared with the mean of the distribution of measurement. It allows us to compare variability of data with different measurement units. Since the data in Table 3 provides us the standard deviations and sample means, then we may compare the variability of the data that tests which restaurant is more effective that will leads to a conclusion of profitability. Actually, the details of information reflect to the stance of the restaurant based on the perception of the respondents. Small values indicate degree of differences to the responses of subjects. Thus we may say, small differences indicate valid response among subjects.
Using the formula above, the following results was gathered:
For Tao Heung Group:
= (0.13081/4.4230)(100%)
=2.96%
For Maxims Group:
= (0.39187/3.6890) (100%)
=10.62%
Based on the computation above, the results show that Tao Heung Group is more variable than Maxims Group. Basically, the computed coefficient of variation for Tao Heung Group and Maxims Group are 2.96% and 10.62%, respectively. In effect, the profitability and effectiveness of business approach and results of the gathered data indicates that Tao Heung Group is better than Maxims Group. Tao Heung Group is more variable than Maxims Group by approximately 7.66% as perceived by the respondents.
Implications and Recommendations
By and large, the operations functions and critical success factors (CSFs) of a company are important because it directly influence how well the organisation satisfies its customers (Slack et al., 1995). By guaranteeing that the firm’s strategy is properly executed, it then serves both as a supporter and implementer of the organisation’s strategy. Similarly and oftentimes, operations function also provides companies with all elements of performance needed to achieve its long-term competitive aims, and thus, playing its role as a leader of the firm’s strategy.
With the continuously tighter market competition, business organisations are progressively focusing on their business operation to gain market leadership and thus increase profitability. In most business organisations the boundaries between operations and other functional areas is severe and nearly dense. Yet as business competition increases, corporations are demanding that all functional areas in the organisation work together to bring products and services to market quickly and effectively. As business increases their focus on productivity and cost control, the future is still belongs to organisations that can amalgamate management theories and practice throughout their enterprise. Recent experience shows that even huge companies are feeling the need to be able to move quickly in the competitive arena. Decentralised organisation structures can enhance the quality of such decisions, while also providing higher managers a greater opportunity to pursue strategic planning. Technological improvements in product design, resource planning software, and manufacturing itself also reduce the time it takes to institute strategic changes.
As discussed, the knowledge of the underlying sources of competitive pressure highlights the critical areas where strategic changes may yield the greatest payoff, and highlights the areas where business industry trends promise to hold the greatest significance as either opportunities or threats. Understanding these sources will also prove to be useful in considering areas for diversification, though the primary focus is on strategy in the industry. With respect to the previous discussions, innovation alone is the essential thing to competitive advantage or success of Tao Heung Group. Other factors such as location, cleanliness, service, taste, value of money and brand name also need enough consideration.
And from the data and analysis provided, it shows that Tao Heung Group was responding to the needs of their customers. And since all the statements in table 1 receive an average agree response and not strongly agree, then it means that it is still not enough to suffice the needs of customers. This also means that the company still needs more improvement. Improvement actually reflects to change management practices. Basically, change management is a process in which all companies undergo. This is an important procedure because it enables the organisation to make decisions that will be advantageous and beneficial to the company. In addition, organisations that are open to change are generally more successful compare to companies that resist it.
References
Chung, KH (1987). Management: Critical success factors, Allyn & Bacon, Boston, MA.
Creswell, JW (2001). Educational research: Planning, conducting and Evaluating quantitative and qualitative research. OH: Merrill/Prentice-Hall.
Huotari, ML & Wilson, TD (2001). Determining organisational information needs: the Critical Success Factors approach. Information Research, 6(3).
Slack, N, Chambers, S, Harland, C, Harrison, A, & Johnson, R (1995). Operations Management. London: Pitman Publishing.
Thierauf, RJ (2001). Effective business intelligence systems, Quorum Books, Westport, CT.
[1] The information are from http://www.taoheung.com.hk/eng/main/index.jsp
Credit:ivythesis.typepad.com
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