Haidilao

Case Study: Strategy Execution

Mostafa Kamal
Fakhre Alam Taj
Md. Abdul Alim
Taskheer
Strategy Organization
Core competencies &
Staffing Management Structure
Competitive Advantages

Staffing based on honesty, personality & Previously maintained Pyramid style

Exceptional quality service;
rational thinking; structure….BOD>GM>GO>RM2>DM>RM1;

Nursing the employees to retain with Now it maintain Inamori Kazuo’s

PET, CT, TT & RM (mostly in house Fresh ingredients; Amoeba principle:
training for lower level & HU for Middle BOD>GM>CT>>PET>TT>RM;
to top level;
Pleasing customer experiences e.g. kids
zone, shoe shining etc.
Satisfying the employees-competitive
compensation, incentives;
Skilled employees retention ratio is
high;
Treating the employees respectfully;

Performance based rewards;

 Resource Allocation
Fixed costs:
 Space rent;
 Decorations -kids
park;
Food related Cost:
 Ingredient cost;
Allocation of  Overhead Cost-transportation
Sources of cost, utility cost;
the Financial
Funding  Other expenses-free food
Resources
distribution to awaited
customers;
Internally Accumulated
funds Employee compensation:
Because:  Competitive salary;
 Public financing needs  Bonuses;
rapid expansion;  Rewards-occasionally;
 Bond markets not so  Educational allowances;
developed;  Housing Facilities;
 Banks need mortgages  Training cost;
and fixed assets;  Insurance coverage;
 Emergency crises facilities;
POLICY

 The policy of Haidilao is employee-centric.

 High salary welfare
 Promote internal employees to management positions to form a happy
management team
 Providing further study opportunities to employees at public expense in different
universities.

These series of policies make Haidilao

 Lowest staff turnover
 Highest satisfaction in the catering industry
POLICY……………..(Con..)

 The second one is to give the pleasant and wonderful experience for the
customers and to make them feel like home.

 Financial Management Policy

 Haidilao restaurants employ the official company policy for reserve funds.
 Each restaurants keeps certain amount of cash reserves in addition to reserve fund
stored by finance department.
 They usually keep 10000 RMB in reserve funds to be used for daily expenses.
Continuous Improvement

Creativity
 Haidilao continuously insists on service creativity, keeping pace with era, making
staffs and customers grow up together.
Employee moral
 Workers take ownership and accountability
Management
 Manage people differently, following the maslow’s hierarchal theory of need
Business in future
 It creates its own suppliers by offering want to be entrepreneurs contracts that
promise lots of business in the future.
Management of People

Empowering employees
 Haidilao offers financial rights to managers at all levels, even Haidilao attendants
are authorized to give customers special discount or free of charge.
 Motivates staff innovation service by material and spiritual double reward.
 Promote internal employees to management positions
 Form a happy management team
 Haidilao University in order to more systematic training and skilled employees they
train employees with management responsibilities
Customer satisfaction
 Give them small presents and gifts
 IPad equipped with the entire menu
Corporate Culture
 Trustiness, kindness and gratitude to the employee and customers
 Customer and employee satisfaction
 Horizontal culture where employee feel ownership of the company
 Authority to take decision
 Focuses on person-organization-fit values
 Making balance of strong and weak employees
 Creating opportunity for the rural people to empower them
 Reward and Incentives

 High compensation packages than other companies

 Well facilized housing condition, free cleaning service, nannies, and
sometimes parental subsidies, educational expenses for their children.
 RMB 100000-200000 reserved for emergencies and family crisis in name of
Family Care
 Well organized motivated tools for execution
 Fair performance management system
Leadership

 The leadership style of Haidilao is subordinate centered style.

 They fully empower them to make decision on the spot without manager’s
permission which can bring an environment of trust and ownership.