managing strategy, Operations and partnerships

Managing Strategy,
Operations and
Partnerships

Executive summary
Fast food industry is a dynamic sector that deal in various operations. The external
environment has great influence over same and it is important that regular analysis of same is
done on regular basis. This help in identifying in influencing forces on time and measures against
the vulnerable issues can be taken accordingly. Pestle and porters is conducted which shows that
the fast food business has low barraging power of suppliers and there is lot of government
intervention on the business operations. The capabilities and value chain analyses has assisted in
analysing the resources and capabilities of the firm.

Table of Contents
Executive summary..........................................................................................................................2
INTRODUCTION...........................................................................................................................1
Critical evaluation of environment for Leon restaurants.................................................................1
PEST analysis.........................................................................................................................1
Emerging mega trends and identify those that apply to the restaurant trade..........................2
Strength of Porter’s 5 forces...................................................................................................2
Identify what it takes to succeed in the industry....................................................................3
Identify how the industry’s environment is likely to change in the future given the influence
of the megatrends you identified............................................................................................3
Critical evaluation of the strategy of Leon’s Restaurant.................................................................4
Identify the resources of the organisation..............................................................................4
Identify the capabilities of the organisation...........................................................................4
Evaluate the resources and capabilities (VRIN).....................................................................4
Compare sustainable resources and capabilities with the industry success factors................5
Critical evaluation of the operation of Leon’s Restaurant..............................................................6
Operation of Leon Restaurant................................................................................................6
Refer briefly to the vision of Leon Restaurant.......................................................................6
Critically assess the extent to which the operation supports the delivery of the vision........6
Evaluate the extent to which the operation is sustainable......................................................7
Conclusion.......................................................................................................................................7
REFERENCES................................................................................................................................9
Appendices.....................................................................................................................................10

INTRODUCTION
In today's competitive world companies need to continuously manage their operations
and strategies so that they are able to satisfy customers and gain a competitive advantage.
Partnership management is important so that opportunities in new markets can be captured by
sharing their intellectual properties and infrastructure (Ayers and Odegaard, 2017). For this
report Leon restaurants are taken which is a fast food restaurants chain based in London, UK.
Their first outlet was established in 2004 on Carnaby Street. Leon was founded by John Vincent
and Henry Dimbleby with chef Allegra McEvedy. The vision of the restaurant is to provide fast
food that is healthy and tasty. The purpose of this report is to study the impact of environment on
the restaurant industry along with the strategies that are followed by Leon restaurants. This
report will cover in detail the PESTLE and Porter's five forces model so that business operations
and strategies can be well managed.
Critical evaluation of environment for Leon restaurants
PEST analysis
For understanding the impact of external environmental factors on business operations
and functions PEST analysis plays an important role in framing appropriate strategies and
policies so it is easy to deal with the negative factors of the business environment.
Political factors- Political factors for Restaurant industry are rigid and non flexible
because of health consciousness of people. Leon’s Restaurant have to consider government
norms because there are different legal and authentic policies such as quality measurement which
has to be followed. If political policies such as pest control, quality measures, etc. are not
considered by managers of Leon’s Restaurant, then there are possibilities that excessive
government interference is possible which affects brand image of Leon’s Restaurant (Bustinza
and et. al., 2019).
Economic factor- As economy of UK is stable, so economic factors does not hamper the
business growth and development of restaurant industry. In case of inflation and change in tax
rate, price of product served by Leon’s Restaurant gets affected accordingly.. This might affect
satisfaction of consumers and profit margin for Restaurant if the changes are not favourable for
this sector.
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Social factor- As there is difference in demand of consumers and Restaurant industry
cannot satisfy all the requirements, so social factor also negatively affects growth rate of
organisations dealing in restaurant industry . As people focus on herbal and organic products,
which is costly approach for Leon’s Restaurant, hence social factors does not assist in easy
conducting of operations. (Clott and Hartman, 2016).
Technological factor- Technological development gives positive impact on
organisational growth of Restaurant industry through which is updated technology, and
machinery for production. Managers of Leon’s Restaurant use new and latest technique for
communicating with people. There is use of latest and technical machines through which
consumer' s waiting time gets reduced, so satisfactory level among them gets improved.
Emerging mega trends and identify those that apply to the restaurant trade
In current market, there is difference in demand of consumers because of analysing and
evaluating trends and difference in demographical basis. People want organic and herbal
products, this affects the restaurant sector majorly because managers of Leon’s Restaurant have
to evaluate different resources for availing raw material. Role of political parties is improved and
active, so they do the quality check of material used by management of Leon’s Restaurant
(Gibson and Parkman, 2018).
Strength of Porter’s 5 forces
Strength of Porter's Five force model is that it provides information about competition
and bargaining power of suppliers and consumers through which management of restaurant
industry can plan their best way to operate.
Competitive rivalry or competition Strong force because there are many
organisations dealing in similar sector and it
affects operations of each other because
consumer do close comparisons.
Bargaining power of buyers or customers High because they have many other options
through which they can avail better services.
Hence this affects operations of Leon’s
Restaurant while they are operating in
restaurant industry.
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Bargaining power of suppliers There are many suppliers available in
restaurant industry, hence suppliers have weak
bargaining power.
Threat of substitutes or substitution Threat of substitute is high because many
substitutes which gets replaced with fast food
are there such as herbal food products, packed
foods, etc.
Threat of new entrants or new entry It has moderate risk of new entrance because
there are many legal policies which has to be
fulfilled by people.
Identify what it takes to succeed in the industry
Leon’s Restaurant is successful because they have proper understanding about rules and
regulations which has to be followed. They have proper contracts with suppliers which are
proper time bound and legally registered. Proper research and development department which
communicates about new and innovative approaches which can be implemented.
Identify how the industry’s environment is likely to change in the future given the influence of
the megatrends you identified
Customers wants new and innovative products or services these days, if Leon’s
Restaurant serves then it attracts consumers. Hence this factor has to be considered by managers
of Leon’s Restaurant to maintain sustainability (Moxen and Strachan, 2017). These days, there
are many changes taking place in external market such as political policies, technological
changes, etc. which has to be adopted by Leon’s Restaurant through which they can sustain in
industry for longer time.
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Critical evaluation of the strategy of Leon’s Restaurant
Identify the resources of the organisation
From the study, it is evaluated that there are some resources with the help of which
managers of Leon's Restaurant are able to get growth in industry. As they get back to back
growth in sales of 10.1%, so they have strong financial background which they can ascertain in
their growth and development (Leon restaurants reports its financial results for 2017, 2019).
Managers of Leon's restaurant is using ingredients for making their recipe from local resource.
As good quality ingredients will provide organisation with competitive advantage because of
high food quality offered to consumers in comparison to competitors. With food quality, there is
variety of food items available for consumers. They have different menu for children and as per
change in season, so this is strategy with which they can attract consumers and get competitive
advantage over other associations (LEON RESTAURANTS, 2019).
Identify the capabilities of the organisation
Leon's restaurant is non-substitutable because there is no such other organisation which
can legally have same brand. Along with this, resulting brand-based competitive edge is unique
for Leon's restaurant as well as its value chain. Moreover, portfolio of popular trademarks offers
sustainable competitive advantages to company because of its non-substitutable feature. Leon's
Restaurant utilise trademark for effectual promotion of their products as well as optimise its
value chain for delivering their offerings saturated food service markets worldwide. Thus, such
capabilities provide assistance to Leon's restaurant in gaining competitive advantages as well as
long term sustainability (Rezaei, Ortt and Trott, 2015).
Evaluate the resources and capabilities (VRIN)
This framework was introduced in 1991 by Jay Barney who was American Professor in strategic
management. Here, VRIN stands value, rareness, imitability and non-substituable. Explanation
of these in relation of Leon's Restaurant are as follows :-
Leon restaurant organizational resources & capabilities V R I N
Globally recognized iconic Leon's restaurant brand ✔
Local resources of ingredients ✔ ✔
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Expansive Supply chain ✔ ✔
Moderate uniqueness of food products based on Leon's
restaurant specific recipes
✔
Leon's restaurant sustained competitive advantages/core
competencies:
V R I N
Strong Financial background ✔ ✔ ✔ ✔
Variety of menu ✔ ✔ ✔ ✔
All these resources provide assistance to company is enhancing their capabilities as they
are using trademark which help them in protecting their unique product and services. Thus, in
simple term it can be said that these two are interrelated with each other as there is no resources
it will difficult for company to get capable and fulfil customers requirement within effective
manner. In addition to this, they have some other resources also such as high brand value within
they area respective restaurant is serving along with this respective restaurant is serving in
several areas which help in their maximum utilisation and result in gaining sustainability
competitive advantages within food industry (Ross, 2017).
Compare sustainable resources and capabilities with the industry success factors
Mega trends within Food industry is that customers want easy way of offering food as
well as with some unique recipes. This become one of the major source for long term
sustainability of organization. In relation of Leon's restaurant they have these resources which
help them in gaining long term sustainability. Along with this, their recipes give them
capabilities of using trade mark for protecting these in effective manner. Thus, mega trends,
sustainable resources as well as capabilities of an organization are interrelated with each other. In
addition to this, working of these three together result in gaining competitive advantages over
several other organizations (Thaler Priest and Fuchs, 2016).
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Critical evaluation of the operation of Leon’s Restaurant.
Operation of Leon Restaurant
In restaurant industry, there are many operations which has to be conducted through
which satisfactory services can be provided to consumers. There are several type of operations
which Leon's restaurant conduct on daily basis for satisfying their customers in effective manner.
Explanation of these are as follows :-
 Customer service – It is one of the major operation which Leon's restaurant
conduct on daily basis. Because effective services are the only way through which
company will be able to gain competitive advantages as well as loyal customers.
 Preparation of food – In kitchen of restaurant food is prepare on daily basis for
serving customers and it cook on the basis of guest demand, taste and preferences.
Restaurant in based on serving food to their customers thus, preparation of food is
primary operation of Leon's restaurant.
With the help of above mentioned operations, it is clear that these are two main
operations of organisation which assist in understanding and evaluating changes in different
manner. For getting growth in industry, it is essential that operations of Leon's restaurant has to
be performed in appropriate and relevant manner.
Refer briefly to the vision of Leon Restaurant
Leon restaurant was started because they want to prove that it is possible to serve food
which is good in both taste and quality. Along with this, they want to make it easy for people to
eat well on the go and they want to do this in major cities at global level (Thompson, Strickland
and Gamble, 2015). Apart from this, menu of Leon's restaurant is inspired through flavors,
variety and natural healthiness of Mediterranean cooking.
Critically assess the extent to which the operation supports
the delivery of the vision
Operations of Leon’s Restaurant is to prepare food and consumer service and then vision
is to provide best quality products to consumers . Management of Leon’s Restaurant is
performing operations through which they can ascertain external market and perform operations
in lieu to serve timely services. So operations are performed for achieving vision as no
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comparison with the quality and of raw material is done and it is ensured by the production
department that they produce such food which is fit for health (Uhl and Gollenia, 2016).
Evaluate the extent to which the operation is sustainable
Operations of Leon’s Restaurant are suitable and best for consumers because they are
operating with best and provide quality services to consumers with understanding proper quality
check. Most of the business operations are valid and suitable as per external market policies, so
growth prospects for Leon’s Restaurant is more (Warner and Sullivan, 2017). when
organisational operations are performed in order to improve quality of product with variety of
food items, then growth prospects and sustainability can be achieved. As there many competitors
in restaurant industry for Leon’s Restaurant, so with evaluating their strategies and improvise it
while operating, then operations are sustainable and relevant in context of external market.
Conclusion
From the above discussion, it is clear that there is requirement of proper understanding
about external market through which operations of organisation get an specified pathway for
achieving success. In restaurant industry, there is more government interference regarding
maintaining quality of food, use of standardise product, etc. Porter five force analysis shows that
there is high risk from competitors and bargaining power of buyers, so it is important to consider
these two factors. With the help of VRIN model, resources and capabilities of association are
organisation are evaluated and strategies are framed to proper utilise it. Best resources available
with restaurant organisation is variety of menu and strong financial background which assist in
achieving competitive advantage. Operations of organisation are as per vision, so this assist in
achieving their targets and goals.
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REFERENCES
Books and Journals
Ayers, J. B. and Odegaard, M. A., 2017. Retail supply chain management. CRC Press.
Bustinza, O. F. and et. al., 2019. Product–service innovation and performance: the role of
collaborative partnerships and R&D intensity. R&D Management. 49(1). pp.33-45.
Clott, C. and Hartman, B. C., 2016. Supply chain integration, landside operations and port
accessibility in metropolitan Chicago. Journal of Transport Geography. 51. pp.130-139.
Gibson, P. and Parkman, R., 2018. Cruise operations management: Hospitality perspectives.
Routledge.
Gong, Y., 2015. Global operations strategy. Springer.
Moxen, J. and Strachan, P., 2017. Managing green teams: environmental change in
organisations and networks. Routledge.
Nurmala, N., de Leeuw, S. and Dullaert, W., 2017. Humanitarian–business partnerships in
managing humanitarian logistics. Supply Chain Management: An International
Journal. 22(1). pp.82-94.
Rezaei, J., Ortt, R. and Trott, P., 2015. How SMEs can benefit from supply chain
partnerships. International Journal of Production Research. 53(5). pp.1527-1543.
Ross, J. E., 2017. Total quality management: Text, cases, and readings. Routledge.
Thaler, T. A., Priest, S. J. and Fuchs, S., 2016. Evolving inter-regional co-operation in flood risk
management: distances and types of partnership approaches in Austria. Regional
Environmental Change. 16(3). pp.841-853.
Thompson, A., Strickland, A. J. and Gamble, J., 2015. Crafting and executing strategy: Concepts
and readings. McGraw-Hill Education.
Uhl, A. and Gollenia, L. A. eds., 2016. A handbook of business transformation management
methodology. Routledge.
Warner, M. and Sullivan, R. eds., 2017. Putting partnerships to work: Strategic alliances for
development between government, the private sector and civil society. Routledge.
Online
Leon restaurants reports its financial results for 2017. 2019. [Online]. Available through:
<https://www.verdictfoodservice.com/news/leon-restaurants-financial-results/>.
Porter's Five Forces of Restaurant Industry. 2019. [Online]. Available through:
<https://www.porteranalysis.com/porters-five-forces-of-restaurant-industry/>.
PESTLE Analysis of the Food Industry. 2019. [Online]. Available through:
<https://pestleanalysis.com/pestle-analysis-of-the-food-industry/>.
Restaurant PESTLE Analysis. 2019. [Online]. Available through: <https://bizfluent.com/info-
7911098-restaurant-pest-analysis.html>.
PESTLE- PESTLE ANALYSIS OF RESTUARANT INDUSTRY. 2019. [Online]. Available
through: <https://freepestelanalysis.com/pestel-pestle-analysis-of-restaurant-industry/>.
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Appendices
Basis References
PEST Analysis
PEST analysis is framework with the help of
which external market components can be
understood. While conducting operations, there
are chances that external factors such as
government policies, laws and regulations
affects operations of Leon’s Restaurant.
Political factor- Political factor talks
about government norms and policies related
to food industry. There are some rules and
regulations such as Food Safety Act framed by
Food Standards Agency which has to be
followed by managers of Leon’s Restaurant.
Some standards of cleanliness, quality of
ingredients is specifically considered by
government for restaurant. Quick quality check
of food is performed by authorised body
because this might affect health of consumers
negatively such as checking of quality of food
ingredients.
Economic factor- Economic policies of
UK government are unfluctuating and does not
affects restaurant sector majorly. There are
different taxes imposed on services of
restaurant, hence this affects purchasing power
of consumers. In case Inflation rate of UK
fluctuate, then price rate of products offered by
PESTLE Analysis of the Food Industry. 2019.
Restaurant PESTLE Analysis. 2019.
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Leon’s Restaurant also gets affected, so
managers have to analyse it. This affects
purchasing power of consumers. But economy
of UK is stable, hence Leon’s Restaurant can
sustain in industry for longer time.
Social factor- These days, there is
awareness among people about ill- effects of
junk and fast food, hence people avoid to avail
this type of food. In UK working class people
are more, then in this case there is difference in
demand of consumers as well. But people want
good quality of product and services because
they are more conscious regarding their health.
Social factor might give negative impact on
growth of Leon’s Restaurant if these are not
considered by managers.
Technological Factor- This is the
factor in which technological changes are
studied. There is use of different technology
for various purpose such as television
advertisements, use of machinery for
manufacturing, etc. This is the way through
which quality of food product can maintained
and it is easy to communicate with consumers
about launching of new product through
different advertisement platform.
Technological up- gradations assist in
evaluating and providing better quality services
to consumers.
PESTLE- PESTLE ANALYSIS OF
RESTUARANT INDUSTRY. 2019.
PESTLE- PESTLE ANALYSIS OF
RESTUARANT INDUSTRY. 2019.
Porter's five force model
Porter's Five Force model is the tool with the
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help of which dynamics of business
environment will be achieved. There is proper
understanding about forces which affects
business growth and developed. This model is
propounded by Michael Porter with the help of
which strategic information about conducting
information is clear and specific as per external
market. There are five forces under this model
which is discussed as under-
Competitive rivalry or competition –
There are many organisations which are
dealing in restaurant sector, so it is not easy for
managers to enter in new market because of
tough competition. There is requirement of
more cost for establishing business such as
operating cost, fixed cost, etc. so managers of
Leon’s Restaurant affect with competitors in
industry. This shows competition as Strong
Force for Leon’s Restaurant
Bargaining power of buyers or
customers – As there are many competitors in
restaurant industry, so in this case there is huge
power to consumers. When there is change in
price of product offered by Leon’s Restaurant,
then it affects consumer's prospective. If
consumer is getting stuff at cheap rate, then
they can switch to other brand. Hence in case
of over- pricing of product and services,
Leon’s Restaurant gets limited consumers.
When consumers are not getting good services,
they does not prefers to invest their money and
Porter's Five Forces of Restaurant Industry.
2019.
Porter's Five Forces of Restaurant Industry.
2019.
Porter's Five Forces of Restaurant Industry.
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wants some different option which is more
fruitful for them.
Bargaining power of suppliers –
Suppliers are the individuals who serves raw
material to Leon’s Restaurant. There are some
suppliers from whom raw material while be
purchased by Leon’s Restaurant because of
considering quality. Leon’s Restaurant gives
bulk orders to suppliers, so in this case they
have less bargaining power. They have to alter
their pricing decision as per purchaser Leon’s
Restaurant. Suppliers have to sell their
products in bulk quantity with proper and
effective manner. Suppliers have to analyse
changes which are taking place in external
market. Hence this shows weak power to
suppliers.
Threat of substitutes or substitution –
In current market, people are smarter and
conscious about price they are paying. Leon’s
Restaurant deals in fast food industry and
people can switch to organic and other good
quality food item, hence if quality of food
served by Leon’s Restaurant is not up to the
mark, then this affects consumer's level of
satisfaction. As switching to other brand is
easy, so consumer does not think twice. If
consumer does not get good experience, then
they might get to other organisation.
Threat of new entrants or new entry
– There are tough policies of government to
2019.
Porter's Five Forces of Restaurant Industry.
2019.
Porter's Five Forces of Restaurant Industry.
2019.
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enter in restaurant industry, because of tough
rules and regulations, hence in this case there is
less threat of new entrants in restaurant
industry. This does not affect profits as well
because people does not rely on new entrants
rapidly. In order to understand and evaluate
changes properly. There is requirement of
understanding ways through which innovation
and creativity can be implemented in
organisation hence consumer does not switch
to other organisation.
<http://www.foodchainmagazine.com/2015/04/13/leon-restaurants/>.
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