Evaluation Of CSR Metrics And Product Sources For Domino’s Organization

Organization background

In order to evaluate the CSR metric and the sources of product categories in successful manner, Domino’s (Castlemaine) organization is selected. The organization is offering pizza services in all over the world.     

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Goal and strategies

  • The main goal of the organization is being the number one in pizza delivery services in worldwide and also accomplished higher quality of customer’s services.  
  • The main strategies of an organization to implement better technologies in supply chain management system that helps them to best pizza delivery organization in the world.
  • Vertically integrated value delivery system and strategically located domino’s stores had helped them to serve consumes in best manner.   

The organization Domino’s mainly known for its quality as well as fresh pizza. The box for products foods is mainly designed to keep pizza fresh and hot. Apart from pizza, the organization domino’s offers some other products items including garlic Bread Sticks, calzone pockets, pasta italiano, stuffed Garlic bread sticks, chicken wings, spicy Baked Chicken, Choco Lava Cake.         

Segmentation

Explanation

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Demand profile

Youngster mainly age above than 15 years   

Competitive profiles  

KFC, Pizza Hut, McDonald’s, Burger King

Products profile

Bread Sticks, calzone pockets, pasta italiano, stuffed Garlic bread sticks, chicken wings, spicy Baked Chicken, Choco Lava Cake

Technology related:  To accomplish strategy and goals in successful manner, organization Domino’s needs to incorporate effective technology strategies such as ERP system, that helps them to increase faster exchange of information between stakeholders. A faster exchange information can helps the business to delivery services in fast and short time period and also helps them to react quickly to changes within external environment (Hong, & Kim, 2002). Social media in present ear plays the significant role into peer to peer communication channel. Therefore instead of using traditional marketing strategies, Domino’s need to implement social media marketing strategies which helps them to offers two way of communication process.

Manufacturing related: – Unique test of Pizza should attract more customers towards stores. In addition to this organization needs to offers wide range of consumers preferences products in their stores, which also helps them to retain huge customers.

Distribution related: – Since the organization’s business model is mainly based on home delivery services, therefore speed of delivering and preparing pizza, are critical success factors for business.

A raw material is used by the organization to obtain end products. For domino’s, a pizza is the end of the products ready for customers consisting for several raw materials. A pizza mainly implements three main raw materials which include tomatoes, wheat and milk. These materials are transferred from the firms to stores via manufacturing plans.

  • Supplier one is responsible for supplying the raw materials to manufacturing organization and it can produce co2 emission (because to deliver materials from one place to other place supplier uses van) that has a negative impact on society and environment(Tai, & Chuang, 2014).
  • The ingredient as well as raw materials used by the organization to manufacture pizzas can produce approximately 300g of Co2 that is equal to much as driving a car above than 2 km.
  • Organization uses cooling appliances that involves many toxic and hazardous in addition to metal and plastic. The equipments mainly involve CFCs chlorofluorocarbon or HCFCs hydro chlorofluorocarbon, ODSs ozone depleting substances and portent greenhouse gases(Suliman, Al-Khatib, & Thomas, 2016).         

Figure 1: SCOR process of Domino’s pizza in restaurant

Figure 2:   SCOR process of domino’s materials demands from supplier and pizza delivery

Implementation of the CSR i.e. corporate social responsibities program helps the organization to provide wide range of metric and includes the employee engagements, data on sustainability, workplace diversity, corporate giving as well as ethical compliance. CSR metric helps the organization to provide better profitability and firm’s value creation which aids them to accomplish organization objective in successful manner. Moreover, it helps in transparency about information and an operation which helps the organization Domino’s to achieve higher customers satisfaction in successful manner (Bhattacharya, Korschun, Sen, & Routledge, 2017). In addition to this, it offers sustainability which helps them to secure the organization performance for long time and also aids them to run their business operations for long terms. Implementing effective CSR activities helps the business to promote economic goals and have a better priority in both evaluating and reporting business.         

GS1s are mainly used to determine the products or services at any point in supply chain management system. They are determined worldwide and mainly referred as to bar code. In order to determine the unique products in categories organization needs to implement barcode techniques that help them to determine products categories in successful manner.                     

Products and services

Figure 3: record real?time added in SCOR process of dominoes

Figure 4CRS metric calculation

The specific environmental impact in terms of pollution has been addressed by using this metrics. Strategic alliances with the suppliers of the organisation in the tier 1 and tier 2 of the company are going to be used in this case. The metric is going to measure the unique product type that is fuel both in terms of motor fuel and refrigeration fuel used by the organisation (Cheng et al. 2014). This metric has to be used on monthly basis to keep a check on the amount of reduction in terms of emission that has been done after the implementation of CSR measures. The CSR metrics impacting the Revenue is going to be used in this case. The reduction in the expenses done in fuel for vehicles and refrigeration is going to be targeted. The goal of this metrics is to reduce cost in some cases. The key driver of this metric involves strategic alliances. The potential metric that is going to be used in this case involve cost saving by taking sustainable initiatives. This is the metric that has been selected for application in this particular context that is in the Dominos outlet in Castlemaine

The corporate social activity that is conducted by an organisation should also be profitable for a business. That is the reason that there are several metrics that are used by the organisations for the development of the CSR metrics. The metrics that are often used by organisations involve data regarding the sustainability of the CSR activity, the amount of engagement on the part of the employees of the organisation, diversity in the workplace etc. These are some of the metrics on which the successes of the CSR activities are measured. It is important for an organisation to be able to calculate effectively the return on the investment done on corporate social responsibility (Blanchard 2011). The external impact of the CSR activities which can be measured by the direct clauses like the area which is cleaned or number of children that has been fed as par the CSR activity but for internal reporting it is of importance to make sure the aspect of the company strategies that has been met by the implementation of the CSR activities like the impact on the revenue, reputation, recruitment retention and relationship. The 5 R frameworks is the method which is one of the key metrics that is used by the organisation for measuring the return on investment of the CSR activities.

There are positive and negative aspects of the usage of CSR metrics within an organisation. there are certain requirements for executing the CSR metrics within an organisation thus whether it is feasible for a small organisation to use the CSR metrics within the organisation is going to be discussed in the following section (Moratis and van Egmond 2018). But first of all it is important to know the process that helps in the collection of information regarding the CSR metrics.

Buyer’s behavior segmentation

Revenue: the process regarding the generation of revenue due to CSR activities can be measured in different methods depending on the nature of CSR activities. To illustrate with example it can be said that if fuel efficient motors are used as a part of CSR activities then the reduction in the expenses in the fuel can be used to measure the success of the technique.

Reputation: the reputation factor can also be measured in different ways depending on the nature of CSR activities. For example in case of a CSR activity that is promoted in online platform the concrete measurement of its success can be done by shares, likes or comments.

Recruitment: the CSR program and its impact in the recruitment of the employees of the organisation can be done by asking the candidate a question during the time of their selection regarding the impact of the CSR activities in selecting the organisation (Collier and Esteban 2007).

Retention: the employee retention rate also increases because of the CSR activities this can be observed in previous health ventures that are taken by the organisation. Dominos has used CSR activities for encouraging the healthy behaviour of the employees of the organisation. They have also undertaken CSR activities for the development of healthy work life balance of the employees of the organisation. This has resulted in the increased health review of the employees by 12.9 per cent which has been measured by taking review from the employees of the organisation (Weber 2008).

Relationship: the relationship aspect is also impacted by the CSR activities. There is no direct method that can be used for the measurement of relationship and its impact by the use of CSR activities. One method that can be used in this regard involves taking reviews from the supply chain partners of the organisation by the use of an online questionnaire which can be stored by the employees of the organisation in the system.

The feasibility of the owner for the measurement of the return on investment of CSR activities is possible but there are several constraints that have to be dealt by the owner in the execution of this process. There is likely to be a certain amount of expense that has to be incurred in the collection of the information regardless to mention there is likely to be a certain amount of technicality added to the regular activities of the employees as well as the suppliers of the organisation (Salah et al. 2010). This is likely to cause increased effort in terms of time both on the part of the employees, suppliers and the owner of the organisation.

As mentioned before in the 5 R framework that there are certain aspects of the CSR activities that can be measured by the organisation at the same time there are certain types of CSR activities that cannot be measured by the organisation that is they are not quantifiable in nature. But the key problem arises from the fact that there is a certain amount of time that has to be invested by the employees of the organisation in ensuring the measurement of the CSR activities. At the same time there is likely to be more technological intervention that has to be used for the measurement of the CSR metrics. This is likely to create resistance among the employees of the organisation. This is because there are certain time like the weekends when the outlets have to deal with heavy traffic in terms of orders thus additional activities in such situation is likely to result in discontent among the employees of the organisation.

Decision factors

The implementation of new technology within the organisation for the measurement of CSR metrics may involve pop up questionnaires that blocks the regular online tasks. This may result in problem for the staffs of the organisation. There can also be other technological aspects like apps that can be used for providing information regarding the CSR metric information of the organisation. These apps may become difficult for a delivery person or a store sales staff to use which can result in higher amount of discontent among the employees of the organisation. Machines that are used for the measurement of emission can also be used which can require a certain amount of training to use on regular basis.

There is likely to be more accounting work that is going to be added in the regular activities of the organisation. This may result in higher level of discontent among the managing staffs of the organisation who deals with the calculation of POS for the store or the technical staff of the organisation. The calculation regarding the extra investment and resultant reduction in expense is likely to cause higher level of discomfort among the accountant of the store. The identification of the places of expense and reduction in cost has to be done by the employees of the organisation and the calculation is going to be done by the employees of the organisation on daily basis and the accountant of the organisation at the time of development of reporting.

There is likely to be a need of training for the staffs of the organisation regarding the proper reporting of the expenses of the staff in the CSR activities. As mentioned before apps can be used for regular updating by the employees of the organisation, so there is likely to be a certain amount of comfort that has to be developed by the employees of the organisation with the use of the app (Lougee and Wallace 2008). So it is going to be important to ensure that the employees as well as the owner of the organisation are trained in the activity.

So the financial feasibility of the implementation of the CSR metric within the organisation is subjected to a cost benefit analysis of all the aspects that are mentioned above. The key expenses in this regard is likely to involve the introduction of apps for the proper measurement of the CSR metrics, training of the employees of the organisation and the owner of the organisation and dealing with the resistance from the staffs which might involve certain rewards or bonuses for the use of the techniques apart from that the expense regarding the implementation of CSR techniques. The benefits may involve the 5 R’s.

ROI OF CSR activity in Domino’s stores in ANZ(Australia, Newzealand)

percentage rise

Average Rise in store revenue[The charity aspect of the store for supporting the  different social causes is pulling more customers to store apart from product and service]

8%

Rise in store  recruitment[Rise in product demand , that has arise due to delivery of good food products and good staff training] (“ENVIRONMENTAL IMPACTS DELIVERING SOCIAL COMMITMENT”, 2014)

50%

Fuel conservation & reduction in fuel cost[ arise due to extremely efficient double load supply
chain delivery trucks, replacement of  existing gasoline-powered scooters with more environmentally friendly electric
scooters] (Dominos-Australia, 2017)

30%

Reduction in environmental pollution (Rise in use of recycling material in store building)

20%

Conclusion    

As per the above findings and evaluation it can be observed that CSR has a significant impact on organization performance and productivity. The findings also show that, in order to improve the performance and accomplished objective in successful manner, organization needs to implement an effective technology tools and techniques at workplace. The above findings shows that in order to enhance revenues and capture competitive market position organization needs to use real time management system which offers  real time information in accurate manner.

References

Bhattacharya, C. B., Korschun, D., Sen, S., & Routledge, H. (2017). Corporate Social Responsibility. Journal of International Law, 26(2).

Blanchard, O., 2011. Social media ROI: Managing and measuring social media efforts in your organization. Pearson Education.

Cheng, B., Ioannou, I. and Serafeim, G., 2014. Corporate social responsibility and access to finance. Strategic management journal, 35(1), pp.1-23.

Clapp, J., & Rowlands, I. H. (2014). Corporate social responsibility. Essential concepts of global environmental governance, 42.

Collier, J. and Esteban, R., 2007. Corporate social responsibility and employee commitment. Business ethics: A European review, 16(1), pp.19-33.

Dominos-Australia. (2017). Retrieved from https://www.dominos.com.au/media/91337/annual-report-2017.pdf
ENVIRONMENTAL IMPACTS DELIVERING SOCIAL COMMITMENT. (2014). Retrieved from https://webcache.googleusercontent.com/search?q=cache:tMsLmKR5dfEJ:phx.corporate-ir.net/External.File%3Fitem%3DUGFyZW50SUQ9MjE4MzgzfENoaWxkSUQ9LTF8VHlwZT0z%26t%3D1+&cd=3&hl=en&ct=clnk&gl=in

Hong, K. K., & Kim, Y. G. (2002). The critical success factors for ERP implementation: an organizational fit perspective. Information & management, 40(1), 25-40 

Lougee, B. and Wallace, J., 2008. The corporate social responsibility (CSR) trend. Journal of Applied Corporate Finance, 20(1), pp.96-108.

Moratis, L. and van Egmond, M., 2018. Concealing social responsibility? Investigating the relationship between CSR, earnings management and the effect of industry through quantitative analysis. International Journal of Corporate Social Responsibility, 3(1), p.8.

Salah, S., Rahim, A. and Carretero, J.A., 2010. The integration of Six Sigma and lean management. International Journal of Lean Six Sigma, 1(3), pp.249-274.

Suliman, A. M., Al-Khatib, H. T., & Thomas, S. E. (2016). Corporate social responsibility. Corporate Social Performance: Reflecting on the Past and Investing in the Future, 15.

Tai, F. M., & Chuang, S. H. (2014). Corporate social responsibility. Ibusiness, 6(03), 117.

Weber, M., 2008. The business case for corporate social responsibility: A company-level measurement approach for CSR. European Management Journal, 26(4), pp.247-261.