Systems

Cutting corners with technology

There has been an invasion of a different kind in the hospitality industry - technology. In the kitchen and the points of sales for F&B, this is not only increasing efficiency but also cutting costs. Neeti Mehra analyses

It is time for hospitality Luddites to take cover as an influx of cutting edge technology in this sector threatens to make the former school of thought obsolete.

Be it the use of gadgets that plump bottom lines or software to keep an eagle eye at each point on the value chain, the verdict is clear. The industry has to keep abreast of innovations, lest it wants to be left behind due to changing trends, both in terms of customer service and production methods. At the end of it all, the key to survival in this industry is to stay a step ahead of the competition; and today nothing short of a few light years ahead will do.

Facts and figures

A Federation of Hotel & Restaurant Associations of India (FHRAI) and HVS International's ‘Indian Hotel Industry Survey 2004-05’ shows that technology penetration stands at respectable rates in areas such as MIS and points of sales for F&B. Whereas the current use of MIS systems across the board in all categories of star hotels stands at 66.1 per cent, the use of technology at points of sale for F&B stands at 72.4 per cent, with five-star hotels leading the pack at 88.2 per cent and 97.1 per cent, respectively.

But how much have costs benefited out of this? F&B costs, as a percentage of revenue, have declined from 55.9 per cent in 2003-04 to 53.9 per cent in 2004-05. Though there is no direct correlation, tight fiscal measures have played a crucial role in reducing costs and industry watchers attribute this to the advent of technology. H A Mishra, MD of Foodesign Hotels & Resorts Systems Pvt Ltd, has essayed the role of a food cost controller in Copper Chimney Chain, Blue Foods Pvt. Ltd, Khyber restaurants, and Pantaloons food chains among others. He says that capital investment in new equipment may in certain cases be cheaper than maintaining existing equipment or the process it replaces, but it may not be so in all cases.

But the value-adds caused by the consistency in food preparation and reduction in wastage is insurmountable, he avers. "With new equipment in the kitchen space, the result is consistency in standard food portions and the quality of food, which is integral to the customer service experience. This is in addition to cutting down wastage, saving labour costs with lesser time and greater efficiency in operations," Mishra says. He cites that the rate of obsoletion is 35-40 per cent per annum in case of Indian machinery whereas in the case of international machinery it is 10-15 per cent.

It need not always be adoption of new technology but new methods of utilising old technology as well. Jochen Kern, executive chef, Master of Trade, Intercontinental The Grand, has been using his digital camera to cut costs. "Over the past three years, this has eliminated food photography costs needed for recipes, promotions and even newspaper articles, translating to no more photographers, no more prints and no more development," he exclaims. The pictures displayed in his kitchen, as done in most restaurants to maintain consistency in food presentation, are his handiwork, assisted by the Sous Chef.

Software and some more

IT and its offshoots are also major perpetrators of the Luddite annihilation, be it software or hardware. Sajan Ibrahim, restaurant manager-cum-sommelier at Mumbai’s Salt Water Grill, says, "Profit and loss calculations at the store, payroll in-store, and accounts payable and receivable are no longer manually done. A majority of operators also use computers for inventory management, tracking employee time and attendance, processing customer orders, and processing credit or debit card transactions."

Kern lauds the use of software for MIS and points of sale, a sentiment echoed by Dharmesh Karmokar, COO of Impressario Entertainment & Hospitality Pvt Ltd that owns Mocha - Coffees & Conversations. Whereas the former utilises OPERA, the latter uses Shawman. Karmokar feels that technology has changed the way they work. "In a country where perishability is one of the biggest challenges due to absence of cold storage chains across the country, we have to devise measures to keep our costs and wastage low by eliminating its occurance."

They therefore established a system where purchases, kitchen and the storage were centralised, the centre connected to each outlet through an online network. With this they managed to control purchases and issuance, and bring down costs by saving on real estate and labour costs, plus put to use information gathered from the combined points of sales reports to phase out items from menus that weren't popular. "With technology we have a clear view of consumption patterns and our centralised kitchen makes the basic mix of all the recipes before despatching it to each outlet," he adds.

Interestingly enough, this has brought down the costs in each outlet by avoiding carrying out the process at each outlet and has also helped in saving their proprietary recipes by keeping the critical processes under wraps in the central kitchen. This went hand in hand with replacing machines, to reduce costs. For instance, by replacing their traditional ice crushing machines with modern Chinese ones, they saved nearly half a lakh per machinery, and did away with constant breakdowns and inconsistency in the produce.

Scrolling forward

Technology has phased out some of the sloppy methods followed earlier by incompetent waiters and careless kitchen hands. Now a kitchen order taken is fed on a PDA or a palm top, or on a touch-screen computer device to be printed in the respective kitchen. And inventory is measured by software modules, a method that helps recipe development also.

The Internet is a necessity rather than an add-on. Websites are the virtual identity of a restaurant without the culinary offerings in real time, but nonetheless real. Cyberspace is a convenient way to make reservations without phone calls left on hold during peak time dinner rush. In the restaurant industry, fingerprint technology eliminates ‘buddy punching’ using a computer system that requires an employee to log in using his or her fingerprint, making him accountable for his own actions. In conclusion Karmokar says, "To err is human, but machines never err." Mistakes rack up costs, some prohibitive too. But with technology, it promises to be smooth sailing all the way.