KFC DSR

Custom ERP system: digital business transformation and process automation

Client

KFC has over 21,000 restaurants all over the world. Many of them keep their records in hard copy. The company addressed us with an idea to build an ERP system. The result turned out to be a great success and is now considered to be implemented in restaurants all over the world.

Project idea

To build an ERP system to manage business processes

Previously, the company lacked a consolidated system. As a result, the business processes were isolated and no centralized statistics were available. Senior management could not analyze metrics in real time and make swift adjustments, if necessary.

Here are some issues that KFC employees were facing when they worked without a custom ERP system:

  • KFC’s shift managers, RGMs, and area coaches filled out their reports and checklists on paper.
  • RGMs used to plan their schedules in Excel and manually transfer everything into Google Calendar or Outlook, where an area coach could see the information.
  • All schedules were generated in ESP, proprietary desktop software that could not be integrated with other systems or customized.
  • The restaurant managers used to keep track of each employee’s clock-in and clock-out in a paper log and manually transfer the data into a time-clock system. Some restaurants had a time-clock system equipped with fingerprint scanners. However, it was quite expensive and easy to come around using scotch tape.
  • Managers at any level could not see in real time a restaurant’s revenue and KPI statistics and monitor if any targets were met. As a result, they had no way of quickly addressing the issues: adjusting schedules, creating tasks, or informing restaurant employees that some of their performance metrics were too low.

The tasks were to help KFC digitize their business processes and provide managers with a simple tool to track the status of their restaurants. With this in mind, we suggested creating an ERP system that would automate many of the manual business processes in the kitchen and bring together partners from different cities and countries into a single ecosystem.

Challenges and solutions

To digitize business processes using a custom ERP system

Developing the ERP system, we needed to digitize all business processes — reporting, scheduling, planning, and control — and integrate them into a single IT system.

We’ve created KFC Digital Successful Routine (DSR) — a custom ERP system that automates both financial analytics and business process management. All the information is now digitized and stored on the server, which means the company can now compile statistics, generate reports, and track metrics in real time. Managers of all levels found DSR, the ERP system built by the Surf team, to be extremely useful. For example, shift managers can fill out their checklists, track clock-ins and clock-outs, and assign tasks online. Now that these routine processes are automated, they save 10 hours per week. 

To provide managers with an online tool to monitor KPIs 

We had a task to provide top and middle management with graphic dashboards that they could use to monitor KPIs in real time even when they were not in the office — all through a mobile app.

Having created an ERP system, we also developed a mobile app for managers. RGMs and area coaches can install the DSR app on their personal smartphones, track the metrics remotely, and make real-time adjustments to the restaurant’s activities.

To automate scheduling, taking into account every constraint 

Schedules have to be based on a restaurant’s financial performance in previous periods as well as its current sales targets.

The DSR system generates an optimal schedule automatically, taking into account all constraints, sales targets, and financial performance history. If necessary, RGMs can open it and make adjustments.

To implement an automated time clock system

The idea was to create a usable face recognition system and integrate it with the time clock program.

We developed a face recognition app for restaurant employees. This type of automated time clock system is 100% tamper-proof.

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More about project

Dashboards

One of the key modules in DSR is a system of dashboards and reports on restaurant performance. Managers need it to analyze the current situation and make on-the-spot decisions. This platform aggregates all receipts available in KFC restaurants in real time. Based on that, it plots charts and generates reports for executive management. 

Here are the key restaurant performance metrics displayed on dashboards of our custom ERP system:

  • Turnover, average bill, number of transactions.
  • Rated meal categories: both standard and extra ones. Relative values — a ratio of the number of specific meals sold to the total number of receipts received over a given time period. This helps track how successful the cashiers are at selling extra ingredients, new menu items, desserts, drinks, etc. The system can show this data on each cashier separately. This way managers can evaluate an employee’s performance and make adjustments to the process.
  • Speed of service — how long does it take the restaurant team to process each stage of the order (accept, cook, assemble, hand in). This helps identify any weak links in the team and increase the speed of service.
  • Performance: SPMH (Sales per member hour) and TCPH (Transactions per member hour) — are the number of receipts or total sales in a specified hour. This helps understand whether the work schedule is efficient in terms of hourly traffic. For example, if performance is above normal, the restaurant is losing money because there aren’t enough employees and they don’t have time to serve all the clients. 
  • Employee ratings, KPIs (both relative and detailed). 

For each parameter, the ERP system built by Surf shows actual and planned values over a specific period: quarter, month, week, day or hour.

There is a summary dashboard in the ‘Stats’ section, showing key metrics with planned and actual values compared. From this dashboard we added, users can then go to detailed reports on each of the metrics.

All values are updated online so that shift managers can ‘keep their fingers on the pulse’ and adjust the workflow at any moment.

Area coaches and market managers have their own dashboard — restaurant rating. This one is a summary report on key metrics from several restaurants: here they can see which one is leading or lagging behind, compare the current values to the previous period and predict turnover.

Another report worth mentioning is a rating of meal categories. Here the planned and actual sales values are compared for each meal category. In addition to that, statistics can be grouped according to respective area coaches and restaurants to show the most successful ones and the outsiders.

The ‘Stats’ section is available in both the web and mobile app. Since all values are updated online, managers of all levels are always up to speed wherever they are. Therefore, they can immediately react to changes in target parameters, which significantly improves performance in restaurants.

Automated work schedules for restaurants

Creating a work schedule is one of the most difficult and important tasks an RGM can have. The efficiency of a schedule affects financial performance. Is there enough people on the shift to handle a large number of lunchtime customers? Or are there too many employees getting in the way of an effective workflow?

It’s pretty hard to create a well-structured schedule without using the system. This task requires finding a balance between performance and a number of constraints:

  • The schedule has to factor in the target revenue and target sales for specific meals.
  • Business hours of a restaurant should also be taken into account.
  • Daily traffic fluctuations in the restaurant should also be considered. To do so, RGMs need to check hourly stats in detailed sales targets.
  • RGMs have to check the schedule against the table where the number of employees at each station is set depending on the traffic (sales targets).
  • Each employee’s strengths and weaknesses matter as well — someone may be great at cashiering but not so good at deep-frying, while someone else may be quick at serving but not familiar with the cash register.
  • Some employees agree to work on weekends while others don’t. Some ask for a day off on a specific date. This must be considered as well.
  • Shifts have to last no less than 4 hours and no more than 12, the total weekly workload of an employee should not exceed 40 hours.
  • Each employee must have breaks during the shift.

Our custom ERP system generates optimal schedules automatically taking into account all constraints, target sales, and financial performance history. The schedule can then be adjusted by an RGM, if necessary.

The tool has made life much easier for RGMs and reduced the error rate. Now the restaurants have optimal shift schedules, and team performance has improved — every hour, there are just enough employees to do the job. In addition, with the ERP system built by Surf, performance can now be tracked in real time.

Digital task management

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Detailed process standardization is what makes a successful franchise stand out. Thanks to that, a bucket of hot wings fried in London will taste the same as it does in San Francisco. Compliance to standards requires routine comprehensive checks. At KFC, shift managers, RGMs, and area coaches fill out a range of reports and checklists to keep track of the workflows and maintain corporate standards. 

Checklists cover all aspects affecting performance: from clean floors and disinfection to tap water temperature, frying oil temperature and fresh food. Checklists are filled out at the start and end of each shift and every hour of the shift.

Before the custom ERP system we built was introduced, all the checklists were filled out on paper. We needed to create a tool helping KFC digitize all of these processes. In KFC DSR, all checklists are digital. Employees can now fill them out in a mobile app.

Transferring checklists into the mobile app helps do the following:

  • Make sure the requirements are met. Employees must stick to the timing and tap YES/NO on time — at the start of the shift, hourly and at the end of the shift. Checklist printouts, on the other hand, can all be filled out in one go at the end of the shift without anyone noticing.
  • Gather statistics and draw conclusions on performance of a restaurant and its employees.
  • Improve checklist contents: decide which checklists to introduce and which to remove as well as what information to add and change.
  • Make swift adjustments to the restaurants’ business processes.

Apart from the standard daily checklists generated automatically, managers can create tasks and assign them to employees on their shift. 

Here’s how it works:

Checklists contain various types of UI components: YES/NO questions, data input fields, drop-down lists, date/time pickers, groups of checkboxes and radio buttons. The system is extremely flexible and is managed via the admin panel. Checklists are created in a checklist wizard on the DSR admin panel.

Shift managers use the mobile app on corporate Android-smartphones, while RGMs and area coaches can safely install it on their personal devices.

Down the road the app may become a full-fledged interactive portal. Instead of a whiteboard with paper notes, each restaurant will have a digital dashboard displaying key metrics, corporate news and other useful information.

Time management made effective with a calendar

Checklists, though very important, are not the only key aspect of standard business processes. RGMs and area coaches have many other tasks regarding workflow planning, inspections, training, and weekly meetings. These tasks are also standardized down to the amount of time they may take (from 15-20 minutes to 4 hours). There are daily, weekly, and monthly tasks.

Before the ERP system built by Surf was implemented, RGMs used to plan their work schedules in Excel and then transfer those to the Outlook calendar. Area coaches could then view the schedules of their subordinate RGMs and create their own schedules based on that. That was a pain given that managers wasted time on repetitive actions, creating and transferring their tasks.

In the DSR, our custom ERP system, we’ve automated this manual process in the ‘Calendar’ section. It shows a list of pending tasks created automatically and grouped according to their frequency (weekly, monthly, etc.). Users can create and set tasks manually, view the list of planned tasks on the calendar and mark them as complete. Area coaches can open the calendar and check their RGM’s progress. Thanks to the calendar, RGMs and area coaches can now organize their workflow more efficiently.

The calendar has two modes: month view and week view. Users can plan their tasks by dragging and dropping them from the common list onto a specific day. They can also create tasks that recur according to a specified pattern, for instance, on the 29th day of each month or on the last Monday of each month.

Handy team management tool

The ‘Personnel’ section is a digital catalog of all employee personal files accessible to RGMs. Apart from contact details, it shows information on vacations, sick leaves and work schedules of each employee as well as their on-the-job evaluations and employee ratings according to several jobs available at the restaurant (deep fat fryer, cash register, etc.).

The data is used to create an optimal work schedule.

Facial recognition time clock

​​Another crucial function of DSR, our custom ERP system, is the automated time clock system created for restaurant employees and powered by a facial recognition system. 

Previously, KFC restaurant managers kept a paper log of each employee’s clock-in and clock-out times and entered the data into a time clock system manually. This resulted in human errors: managers could miscalculate the amount of time worked or forget to put down the clock-in/clock-out time of an employee.

There have been a few cases of restaurant partners hiring ‘phantoms’ who only existed on paper or people working under someone else’s ID.

Now the restaurants have a facial recognition system being installed. The system consists of an Android tablet with a DSR-integrated app and a tamper-proof 3D ToF camera. This camera can tell the difference between a live person, a photograph, and a video clip. Restaurant employees use it to clock in and out, then the data is transferred to the DSR system and used to calculate performance and other operational metrics of the restaurant. In addition to that, this data is fed to the time clock system and used to calculate wages.

RGMs and shift managers can access reports on actual workloads in the DSR’s web UI.

Apart from that, the Android tablet provides employees with information: whenever it goes to standby mode, it displays a carousel of banners showing target values and tasks specific to each employee.

The system can later be expanded to check not only the clock-in/out times of employees, but also the quality of their work at specific restaurant stations: the system can be connected to several surveillance cameras and adjusted to identify employees online.

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Vadim Mazin

Chief Commercial Officer, Surf
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