Professor Elam

Thursday August 30 2012

MCD, SBUX, and CMG   are all working to speed up the service during peak hours. This is an excellent example of what we study in managerial accounting. 

There are several concepts in volved here. The British refer to a waiting line as a que. Queing theory is all about how long someone will wait in line. Another concept is the idea of a constraint. The lunch hour so to speak only lasts so long. And the key to restaurant is traditionally the number of times one turns over the tables, how many tables of people does one serve during the lunch hour. Clearly this idea is expanded with take out and drive thru windows. MCD for example has a standard of 90 seconds as the time between the drive in order and when you get your sack of burgers at the window. Indeed some locations are adding a second drive in window. 

So the idea is to maximize the number of sales in a given time. This is done by eliminating non value added activities, the idea of just in time inventory supply chain delivery  and activity based costing. The next time you are in a fast food joint, pay attention to what they are doing and how they do it, if one of the servers disappears into the back of the store, something went wrong.