Burger King Corporation

Harvard Business School 9-681-045 Rev. February 27, 1998 Burger King Corporation The first Burger King restaurant in Miami in the mid-1950s featured a walk-up window, a limited menu (burgers and shakes for 19? , sodas and fries for 10? ), and “your food ready by the time you’d paid for it. ” As one early manager recalled, “Our windows faced front so we could see customers driving in. With the limited menu, we pretty much knew what they’d order and we’d have it ready. In the 1960s and 1970s, Burger King developed an assembly-line production process that delivered a fresh, hot, high-quality sandwich, yet that had the flexibility to customize that sandwich. One executive explained, “Market research showed us that our ability to give the customer what he wanted clearly differentiated us from McDonald’s, so we capitalized on it. ” The following jingle was used by Burger King in the 1970s: Hold the pickles, hold the lettuce Special orders don’t upset us All we ask is that you let us serve it your way. Later, however, Fortune noted: Hold the jingle.

The Burger King hamburger chain has abandoned that bouncy promise to build its sandwiches to suit the customer. Tailoring Whopper Sandwiches was manageable when relatively few fast-food fanciers were coming through the doors. But now so many are lining up, at least at peak hours, that special orders are, well, upsetting. Burger King will still make it your way, if you insist, but isn’t going to invite you to and rather hopes you won’t. 1 The Burger King Corporation Founded in 1954 by Jim McLamore and David Edgerton, Burger King Corporation had grown from one store in 1954 to 2,766 units, including 136 outside the United States, in 1980.

Milestones in the company’s development included the invention by Edgerton of the continuous chain broiler, and creation by McLamore of the Whopper sandwich, both in 1956; franchising agreements in 1959; the sale of Burger King Corporation to the Pillsbury Company in 1967; and the 1Fortune, June 16, 1980, p. 90. Research Associate David C. Rikert prepared this case under the supervision of Professor W. Earl Sasser, Jr. , as the basis for class discussion rather than to illustrate either effective or ineffective handling of an administrative situation.

The cooperation of Burger King Corporation and the Hillybourne restaurant manager and personnel is gratefully acknowledged. Burger King and Whopper are registered trademarks of Burger King Corporation. The operational aspects of the Hillybourne restaurant are presented for case study purposes only and do not necessarily reflect operating procedures of the Burger King restaurant system. Copyright © 1980 by the President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-545-7685, write Harvard Business School Publishing, Boston, MA 02163, or go to http://www. bsp. harvard. edu. No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means—electronic, mechanical, photocopying, recording, or otherwise—without the permi ssion of Harvard Business School. 1 This document is authorized for use only by xiaoxia lu in MBA513: OPERATIONS MANAGEMENT – FALL 2011 taught by JOEL D. GOLDHAR from August 2011 to January 2012. For the exclusive use of X. LU 681-045 Burger King Corporation hiring of Donald Smith, then 36 and third-ranking executive at McDonald’s, as chief executive in 1977.

Systemwide sales grew 26% to $1. 84 billion, an 11% market share in the hamburger fast-food industry (led by McDonald’s with a 35% share) for the fiscal year ending May 31, 1980. Average annual sales for the 412 company-operated domestic units rose 13% to $747,000. Advertising and promotion expenses grew 35% to $88 million. At year-end, the corporation had a real estate interest in 804 of the 2,218 domestic franchised units. Average investment per store was estimated by industry experts at slightly over $500,000 per unit. Also in 1980, Burger King headquarters were located in Miami, Florida.

The company, a wholly owned subsidiary of the Pillsbury Company, was organized on a geographic basis with three divisions and, within them, a region, area, and district structure. On average, for example, five company-operated restaurants reported to a district manager. The corporate relationship with franchise restaurants had evolved from a policing function to one that included significant consulting. Support services such as personnel, training, and accounting reported to the regional level. Burger King restaurants varied widely in size and design, reflecting locations that ranged from shopping malls to interstate highway intersections.

Typically, each store had a unique pattern of sales and a work force drawn from the local labor market. The Hillybourne Restaurant Hillybourne (a disguised location) was a New England college town with a population of about 30,000. The Burger King restaurant was located on heavily commercialized Maple Street, about one-quarter mile south of an interstate highway intersection and one and one-quarter miles north of the town center. The modern, landscaped, brick and glass building sat between a diner and a manufacturing plant (with 200 employees) and across the street from the shopping plaza.

Toward town, Maple Street was lined with several restaurants, including a McDonald’s, half a dozen car dealers and gas stations, and a dozen small businesses. The central business district adjacent to the college contained public buildings, theaters, department stores, banks, and restaurants. The Hillybourne Burger King restaurant, a company-owned unit, was open from 10:00 A. M. to midnight, 363 days a year. 2 The restaurant had a drive-thru window and dining room seating for 80 people. The parking lot accommodated 70 cars and 5 buses. Annual volume was about $700,000 with an average check of about $2. 0. Sales typically peaked at noon during the day and on Friday during the week. Further details are presented as Exhibit 1 (menu and product mix), Exhibit 2 (weekly and daily distribution of sales), Exhibit 3 (June 1980 profit and loss statement), Exhibit 4 (restaurant visitation report), and Figure A (the food flow). Restaurant manager Frank DeMasi grew up in the Hillybourne area and joined Burger King in 1971 after graduating from the state university. Married and the father of three children, DeMasi had been Hillybourne restaurant manager since 1974.

He described the restaurant business: We have a predictable peak just after noon, when the plant workers come over for lunch. Friday and Sunday nights are often heavy with travelers and, on Friday, with families out shopping. But there are a lot of variables, too, such as weather, the time of year, or a holiday. After being here a while, you get a sense of what to expect, but there are always surprises, too. 2During the summer of 1980 restaurants in the Hillybourne area considered adding breakfast. It was anticipated that this meal would be served from 6:00 A. M. o 10:00 A. M. and would feature biscuits, sausages, and eggs scrambled on a grill whose bottom surface was heated by the oil in a frying vat. This document is authorized for use only by xiaoxia lu in MBA513: OPERATIONS MANAGEMENT – FALL 2011 taught by JOEL D. GOLDHAR from August 2011 to January 2012. 2 For the exclusive use of X. LU Burger King Corporation 681-045 Figure A xxx The Food Flow Sandwiches Cook (hold) Complete Drive-thru (39%) Takeout (40%) Inventory Freezer Refrigerator Dry Storage Cook fries, pies, onion rings Hold Food Counter (61%) Dining Room (60%)

An Overview of Restaurant Operations Hamburger Preparation The Burger King hamburger-based sandwiches consisted of a beef patty (in one of two sizes—2 or 3. 6 ounces), a bun, and several condiments (see Exhibit 5A for exact composition). The beef patties were cooked, and the buns were toasted, as they passed through an infrared broiler while on a continuous chain. The broiler had two meat chains, each with an 80-second transmit time (yielding 8 burgers per minute or 5. 5 Whopper sandwiches per minute per chain) and one bun chain that moved twice as fast (see Figure B for diagram).

Both sizes of patties were the same thickness and were cooked in the broiler for the same length of time. Since the chains traveled relatively slowly, a two-foot loading space had been designed at the front end of the broiler so that the operator could “batch load” the chains with up to 12 burgers (eight Whopper sandwiches). As the patties and buns reached the end of the broiler, they fell into separate pans from which they were taken and mated, Whopper patty with Whopper bun, and placed in the steam table for storage (for up to 10 minutes).

The broiler was typically run by one employee as part of or all of his or her assignment, although in very busy periods, a second person was assigned to “catch. ” Sandwiches were finished on the board, a stainless steel table bounded at one end by the steam table and at the other by the chutes upon which finished sandwiches were placed (see Figure B). The board had a row of condiments down the middle, accessible to a worker on either side, and a shelf over the condiments upon which the two microwave ovens sat, one facing each side, and upon which sandwich boxes were stored.

Although a sandwich could be made on either side of the board, the Whoppers and doubles were typically made on the left side and the remainder on the right because DeMasi had found that this division worked well in this restaurant: “The Whopper side is a little light, but that person often has fries or specialty sandwiches, too. Some restaurants use a cheese and noncheese division. ” Sandwiches were held for 10 minutes after preparation and, if not sold within that time, discarded. A clock, with only the minute hand on it, was used for the timing, with the digit at which the sandwich was to be discarded written on the wrapper or box. This document is authorized for use only by xiaoxia lu in MBA513: OPERATIONS MANAGEMENT – FALL 2011 taught by JOEL D. GOLDHAR from August 2011 to January 2012. For the exclusive use of X. LU 681-045 Burger King Corporation Figure B xxx Broiler and Board buns Top View FR meat meat CH MO ST Side View FR Broiler Board CO MO CH CO CH __ ST MO MO FR ST MO freezer steam table microwave oven condiments chutes chains To finish a cheeseburger, for example, a worker took a burger and bun from the steam table, pulled a cheeseburger wrapper from a dispenser, and set the sandwich on it with the crown (bun top) set to one side.

Two pickles were placed on the center of the patty by hand, ketchup and mustard were dispensed in a spiral pattern from plastic squeeze bottles, and a slice of cheese was positioned. The worker replaced the crown, wrapped the sandwich, and placed it in the microwave oven for a 12second timed cycle. When the buzzer sounded, the worker removed the sandwich, marked the appropriate symbols on the wrapper if a customer was “having it her way,” noted the discard time on the wrapper, and slid the completed sandwich into the cheeseburger chute (on the lower level if a standard sandwich, on the upper level if a special).

See Exhibit 5B for examples of the special markings on the wrappers and boxes, and see Exhibit 6 for a summary of the production process for a Whopper. Elapsed time from steam table to chute was about 30 seconds for a burger or Whopper sandwich. In busy periods, output was increased because workers used the microwave time to work on other sandwiches, and because many steps, such as reaching for a burger from the steam table, were as quickly done for two as for one. (In DeMasi’s words, “You have two hands, use them! “) DeMasi estimated that his day crew could produce 200 burgers and 100 Whopper sandwiches per hour.

Specialty Sandwich Preparation Burger King specialty sandwiches were oblong, in contrast to the smaller, circular burgers. Specialty sandwich preparation followed the same general pattern as burger preparation, but it was carried out in a separate area. Frozen fish and chicken portions were fried for 4 and 3 1/4minutes, respectively, in batches of up to 10 portions in a deep fat fryer with an automatic timer and buzzer (activated by pressing a button with a fish or chicken symbol on it). Cooked portions were held in a warmer, called the Henny Penny, for up to 30 minutes.

The roast beef and ham portions, precooked and individually wrapped, were held at the specialty sandwich table and opened as a sandwich was made. To make a fish sandwich, for example, the worker placed both halves of the bun in the top of the specialty bun toaster from which the bun emerged in 20 seconds. The worker spread tartar sauce on the heel and crown, sprinkled lettuce on the crown, placed the fish portion on the crown, mated the two halves, sliced and wrapped the sandwich, placed it in a box, marked it for type, discard time, and any specials, and handed it to the board worker to slide into the appropriate chute.

The procedure was the same for other specialty sandwiches, except that a roast beef portion was microwaved for 10 seconds before assembly. Elapsed time to produce a specialty sandwich was about 45 seconds although, as before, output could be increased. DeMasi estimated that a good worker could produce 150 specialty sandwiches per hour. 4 This document is authorized for use only by xiaoxia lu in MBA513: OPERATIONS MANAGEMENT – FALL 2011 taught by JOEL D. GOLDHAR from August 2011 to January 2012. For the exclusive use of X. LU Burger King Corporation 681-045 Fry Products

Six-pound bags of frozen french fries were emptied into wire baskets that were stored on a rack while the fries thawed for at least one, but not more than three, hours. A six-pound bag contained 24 regular servings or 16 large servings of fries. Fries were cooked in one of four computer-controlled fry vats for just over two minutes, when a flashing light and buzzer signaled the completion of the cooking cycle. The fries were briefly drained, emptied into the dump station, and salted. Individual servings were bagged with a special scoop; the bagging was done to order during slow periods and ahead of time for the busy periods.

Fries were held for seven minutes in the dump station and for two minutes when bagged. Frozen apple pies were cooked for 6 1/2 minutes in the same fryer used for chicken and fish, cooled for 10 minutes, boxed, and held on the chutes for up to two hours. Frozen onion rings were blanched in the fryer for two minutes, then stored on a tray in a nearby freezer for up to 30 minutes. When an order was received, a serving was finished in the fryer for 30 seconds and then put in a designated section of the dump station for immediate bagging service. The Counter

Customers entered the front of the Hillybourne restaurant and faced the counter with the menu board above and behind it. The counter had three drawers—registers with labeled buttons for each item and microphones—spaced along it. “May I help you? ” After greeting the customer, the counterperson accepted the order, keyed each item into the register, and called each sandwich into the microphone, which was connected to the loudspeaker in the production area. He or she would also call other noteworthy items such as onion rings or a large root beer to alert production personnel.

Specials, such as a fish sandwich with extra tartar sauce, were marked on the printed register slip. Payment was requested, change given, and the slip placed on a tray (“for here”) or on the counter (“to go”). The counterperson assembled the order in a drink-sandwich-fries sequence so that there would be a clockwise traffic flow around the service area. Shakes took about 6 seconds to pour and soft drinks from 5 seconds (for small) to 15 seconds (for large) to ice and pour (all operator-controlled operations).

The drink machine dispensers, accessible from the front and rear, consisted of two Coke, one root beer, one orange, and one 7Up. Milk was picked up from a refrigerated tray, while coffee and tea were poured from pots. The register slip was used to check the order as it was given to the customer. The Hillybourne restaurant service standards specified a three-minute, “door-to-door” target (the total time a customer spent in line and at the counter). During a recent inspection, the restaurant had averaged four minutes, five seconds. If part of an order was delayed, the customer was asked to wait, and another order was taken.

Area guidelines, however, specified that no more than one customer be left “on hold” at any drawer. The Drive-Thru The Hillybourne restaurant had a designated drive-thru lane and ordering station (menu board and speaker) at the rear of the building. The pickup window was along the side of the building under the roof. The order-taker greeted each customer with “Welcome to Burger King! Can I help you? ” As the order came in over the speaker, the order-taker keyed in the items at the register and repeated the sandwich items over the internal microphone system.

Specials were marked on the register slip, and the order was confirmed and totaled. In order to match each meal with the correct customer, each order was numbered sequentially. The number was written on the register slip and next to the dollar total on a ruled sheet used by the employee at the window to request payment in 5 This document is authorized for use only by xiaoxia lu in MBA513: OPERATIONS MANAGEMENT – FALL 2011 taught by JOEL D. GOLDHAR from August 2011 to January 2012. For the exclusive use of X. LU 681-045 Burger King Corporation the correct sequence.

The register slip was used to assemble the order and to match the order with the proper customer. Although the restaurant preferred one check per car, multiple checks were allowed. One to three people staffed the drive-thru window. During very slow times, a hand-held extension speaker enabled a single worker to take orders on one of the counter registers, while in busy times, the three tasks of taking orders, assembling them, and handling cash were separated. Information Flow Whopper, large fries . . . three burgers, ketchup only . . . two fish . . . Whopper, double cheese, large root beer . . cheeseburger . . . two Junior . . . chicken . . . Whopper, no onions . . . fish, large fries . . . Whopper Sandwiches . . . During busy times, workers in the back heard a constant stream of sandwich orders over the speaker system, as illustrated above. Each worker had to extract the orders she or he was responsible for from this general flow. Special orders (Whopper, no onions), which represented about 20% of the total, were assembled immediately, while the flow of orders for standard sandwiches helped the workers gauge the appropriate stocking levels for the chutes.

In very slow times, a minimum supply of cooked burgers was kept in the steam table (fish and chicken in the Henny Penny), and all finished sandwiches were made strictly to order. As volume picked up, an increasing inventory of standard sandwiches was maintained in the chutes under heat lamps as specified on a “level” chart posted over the chutes. Levels I to IV were signaled by a series of four red lights controlled by the manager; one red light meant Level I and so forth (see Exhibit 7A for DeMasi’s level chart).

Workers on the board and at the specialty table could see the chutes and the level lights and were responsible for keeping the chutes stocked with standard sandwiches (as well as, of course, for making special sandwiches on order). The employee on the broiler was responsible for keeping the steam table appropriately stocked. This involved, according to DeMasi, “the ability to watch and sense the flow of product. ” The workers tended to dislike the position since it was hot and active. Support Activities

The Hillybourne restaurant had two walk-in freezers and a walk-in refrigerator, as well as two small, open-top freezers near the broiler and fry vats. Dry items such as paperware were stored on high shelves around the production area. The restaurant received one delivery per week from Distron®, a Burger King subsidiary, and three or four deliveries per week from local suppliers of buns and milk. Most foods arrived at the restaurant ready to use or cook. One exception was tomatoes, which were received whole and were sliced every morning as part of the opening procedures.

The daily opening tasks required two hours while the closing tasks took an hour and a half. During these times machines were set up or cleaned, supplies restocked, drawers prepared or their cash checked, and major cleaning done. Cleaning continued throughout the slower periods of the day in the kitchen, restrooms, dining room, and parking lot. Staffing DeMasi set staffing levels based upon his projections of hourly sales and upon corporate standards for labor hours per sales dollars. Using the “sales and labor worksheet,” DeMasi developed his projections and staffing needs on a day-by-day basis, working six days in advance. For example, on Tuesday he worked on the plan for the following Monday; thus the Monday pattern was freshly in mind when the Monday schedule was constructed. ) DeMasi noted: Our volume is surprisingly consistent, at least over an hour and certainly by day. I can often project a day, for example, within $25-$50, an hour within $10-$20. 6 This document is authorized for use only by xiaoxia lu in MBA513: OPERATIONS MANAGEMENT – FALL 2011 taught by JOEL D. GOLDHAR from August 2011 to January 2012. For the exclusive use of X. LU

Burger King Corporation 681-045 Once I have the sales projected, and hence know the labor hours I’m allowed, I schedule my people, within the constraint that someone must work at least a threehour shift and that minors (under 18) can’t work past 10:00 o’clock on school nights. In practice, I schedule some people pretty regularly—for example, Fran works 9:00 A. M. to 2:00 P. M. every weekday—while I use others where their schedules let them fit. We tend to think of people as day or evening/weekend people rather than as counter or broiler people.

In fact, I’ll use people in different jobs over time to give us more flexibility—quite in contrast to what is possible in some city restaurants that are unionized, with workers classified by job. I also have flexibility with when I schedule breaks 3 (and, on the spot, with when people actually take them), and the kids will help me out sometimes by leaving early or staying late. On the other hand, someone is missing almost every day for one reason or another, and I almost have to plan on that. As volume increased, broad jobs were broken down into more specific duties.

For example, under minimum staffing, one person ran fries, specialty sandwiches, and the left side of the board; under maximum staffing, these three components were split into three separate jobs. In addition, expediting roles developed both behind the counter and in spots such as the drink station. (A good expediter could practically have an order assembled by the time the customer had finished paying, but the corporation preferred adding another drawer to using an expediter. ) A supply of popular drinks was kept ready at the drink station in a refrigerated tray with a holding time of five minutes.

More unusual drink orders, such as a large orange, were poured when a call was heard or when a counterperson requested it in passing. The manager typically circulated, helping here and there to clear bottlenecks, trying to anticipate problems, reassigning people as volume changed, getting problems taken care of, and constantly watching how people were working. See Exhibit 7B for a listing of job assignments as volume increased. In June 1980 the Hillybourne restaurant employed 33 hourly workers, 15 of whom were minors. Hourly pay ranged from $3. 10 (minimum wage) to $3. 0, and workweeks ranged from 3 to 40 hours. DeMasi noted: I’ve been at this restaurant store for six years now. Most of my workers are young, school, and college-aged, and I’ve had several kids from the same family come work for me over the years. I do have several employees in their late twenties, and am pleased now to have two older folks working at lunch—great workers, and I hope their being here will encourage others to apply. DeMasi advertised for openings in local papers, used on-site signs, worked through school counselors, and, of course, encouraged referrals from employees.

New workers spent about a halfhour on paperwork with DeMasi, were given a detailed employee’s handbook, taken on a thorough tour of the restaurant, and shown, over time, a series of 19 videocassette training films, which lasted for 15 minutes and were shown in the office. A new worker typically started during a slow period (such as 2:00 P. M. to 5:00 P. M. ) on a cash drawer or the broiler, and worked under the supervision of an experienced worker or the manager. “Some may be on their own by the second shift,” DeMasi reported, “while others may take six or eight [shifts]. Training was a continuous process, both formal and informal. For example, “Susan, will you show John how to make Whopper Sandwiches now? ” was a frequent request in slower periods. DeMasi tried to introduce workers to all parts of the operation over time. Workers began at minimum wage. Day crew members and closers (generally the more serious workers) were eligible for a 10? raise after two weeks if they were particularly good. All were evaluated informally after 60 days (formally, if there were problems, to build a disciplinary record). Employees who worked shifts four to eight hours long were entitled to half-hour unpaid breaks. These were usually spent sitting (and eating) at a booth in the dining room near the kitchen door. 7 This document is authorized for use only by xiaoxia lu in MBA513: OPERATIONS MANAGEMENT – FALL 2011 taught by JOEL D. GOLDHAR from August 2011 to January 2012. For the exclusive use of X. LU 681-045 Burger King Corporation In January and June, the manager conducted a formal crew member performance review, rating the employee on job performance, attitude, dependability, and appearance.

Raises were granted by the district office, with the amount based upon seniority and grade (typically, 10? to 20? ). “That raise is pretty mechanical,” DeMasi noted. In addition, I can recommend raises any time if I feel one is needed, but I have to convince my supervisor to sign off on it. I can usually take care of my good workers. And, you have to remember, nondollar benefits such as flexibility with working hours or a Saturday off can mean a lot to many of these people. Employee benefits included free uniforms, half-price meals, and paid holidays and vacations (with amount based on hours worked).

Full-time employees (more than 30 hours per week) received company-paid medical insurance, group life insurance, and a pension plan after six months of service. Management The Hillybourne restaurant operated with a three-person management team—DeMasi, first assistant manager (AM1) Natalie Banks, and second assistant manager (AM2) Debbie Brown—who covered the 14 weekly shifts (8:00 A. M. to 6:00 P. M. and 4:00 P. M. to closing). The manager on duty was responsible for “good food, fast service, and a clean restaurant,” with the prime focus on running the shift. Paperwork was done after hours. ) Managers were hired and promoted by the district manager, with input from the restaurant manager. New assistant managers worked in the restaurant for one week to learn the positions, spent 10 days in a regional training center to learn basic management and people-handling skills, and then worked two weeks on site to learn the paperwork routines, the opening and closing procedures, and so forth. The new AM2 was then “shift ready. ” New restaurant managers typically attended Burger King University in Miami after five to six months in their new position.

Managers were paid straight salary with pay ranging from $11,500 to $26,000. Raises were based upon annual evaluations that graded managers on areas of performance such as profits, attitude, and ability to train and control people. Evaluations ranged, DeMasi noted, from “walks on water” to “look for another job. ” All managers were also evaluated on a quarterly basis in order to identify and prioritize areas for improvement in performance. District Manager Sandy Philbrick described restaurant management in this way: I find that a crew will take on the image of the manager.

So we look for an outgoing person who is good at getting things done through others, who can tell people exactly what he or she expects, who can train people, and not just come down on them. To say, for example, “Waste is too high, reduce it,” is useless. The good manager will figure out why it is too high, and do the training necessary to reduce it. In fact, 90% of the job is training. Similarly, my job is to develop the managers in my restaurants. 8 This document is authorized for use only by xiaoxia lu in MBA513: OPERATIONS MANAGEMENT – FALL 2011 taught by JOEL D.

GOLDHAR from August 2011 to January 2012. For the exclusive use of X. LU Burger King Corporation 681-045 Exhibit 1 xxx Menu and Product Mix, June 1980 Sandwiches Burgers Whopper Whopper with cheese Whopper Jr. Double cheeseburger Cheeseburger Hamburger Other Specialty Roast beef Chicken Ham and cheese Fish Price Percent of Sandwiches $1. 25 1. 40 . 72 1. 10 . 56 . 48 — 1. 69 1. 59 1. 49 1. 25 14. 5% 7. 7 9. 0 9. 4 20. 0 18. 6 4. 0 3. 4 6. 2 2. 5 4. 7 100. 0 Fries Regular Large Onion rings .45 . 60 . 65 34. 9 20. 9 9. 3 65. 1 Beverages Shakesa Soft drinks b Small Medium Large Other .60 . 2 . 49 . 59 15. 5 17. 0 19. 9 8. 5 15. 7 76. 6 — Desserts Apple pie Note: $0. 40 2. 7% The data are from June 1980 (Hillybourne restaurant): Volume: $56,681 Customers: 22,750 Number of sandwiches sold: 34,227 aVanilla, chocolate, strawberry. bCoke (66% of soft drinks), root beer, orange, 7-Up. 9 This document is authorized for use only by xiaoxia lu in MBA513: OPERATIONS MANAGEMENT – FALL 2011 taught by JOEL D. GOLDHAR from August 2011 to January 2012. For the exclusive use of X. LU 681-045 Burger King Corporation Exhibit 2 xxx Weekly and Daily Distribution of Sales, June 1980 A.

Weekly Sales Percent of Week’s Sales 12. 8% 11. 9 11. 4 12. 5 16. 5 18. 0 16. 9 100. 0% B. Daily Sales For Hour Ending Percent of Day’s Sales 11:00 a. m. 12:00 1:00 p. m. 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 2. 0% 8. 7 17. 9 10. 7 6. 3 4. 3 6. 5 10. 4 9. 9 7. 0 5. 5 4. 3 3. 1 3. 4 100. 0% Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday Source: Hillybourne restaurant. Exhibit 3 xxx Profit and Loss Statement, June 1980 Line Item Sales Food Waste Condiments/shortening Paper Percent of Sales 100. 0% 31. 5 0. 1. 1 3. 6 36. 6 63. 4 17. 7 6. 0 3. 5 3. 2 30. 4 33. 0 4. 9 1. 6 9. 0 4. 0 3. 0 22. 5 10. 5% Gross profit Hourly wages Salaries Fringes Other controllable expenses Controllable profit Utilities Sales promotion Rent Advertising and promotion Other Restaurant operating profit 10 This document is authorized for use only by xiaoxia lu in MBA513: OPERATIONS MANAGEMENT – FALL 2011 taught by JOEL D. GOLDHAR from August 2011 to January 2012. For the exclusive use of X. LU Burger King Corporation 681-045 Exhibit 4 xxx Restaurant Visitation Report

Restaurant Number _____________ Address ______________________________________________________ A. D. I. ________________ Date ___________________ Day ________________ Time _____________ Report by __________________________________________ Title and Name of Person in Charge ____________________________________________________________ _______________________ Grade: I. _____________ II. _____________ III. _____________ IV. ____________ V. _____________ Overall ___________________ INSTRUCTIONS FOR SCORING Only fill in the areas applicable to your visit.

Grading is on an all-or-nothing system, with a comment provided on all deficient areas. For the overall score, divide the actual points received by the total points possible. I. 1. 2. 3. 4. 5. 6. 7. 8. OUTSIDE APPEARANCE SIGNS: In good repair, clean and properly lighted LIGHTS: In good working order. LANDSCAPING: Well maintained and free of litter DUMPSTER: Clean, neat, gate closed PARKING LOT: Free of litter, clean, sealed and striped. WASTE RECEPTACLES: Clean, in good repair. SIDEWALK: Clean, free of ice, snow or trip hazards. WINDOWS & DOORS: Clean. 2 3 2 2 2 4. 2 2 5. 6. TOTAL POSSIBLE 18, SUBTOTAL _________________________ COMMENTS:___________________________________________ ______________________________________________________ ______________________________________________________ II. DINING ROOM 1. 2. 3. 4. 5. DINING ROOM: Floors, seats, tables, walls, ceiling, vents, lights, decor, plants, clean and in good repair. REST ROOMS: Clean and fully supplied. MENU BOARD AND P. O. P. : Clean and current. CUSTOMER CONVENIENCES: Napkin and straws available, high chairs and booster seats clean and in good repair.

WASTE RECEPTACLES: Clean, in good repair, not overflowing. 5 2 2 2 5. 2 MOVE TIMES: ___________________________________________ TOTAL POSSIBLE 33, SUBTOTAL ____________________________ COMMENTS: ____________________________________________ ________________________________________________________ ________________ ________________________________________ IV. 1. 2. 3. QUALITY SANDWICHES: Hot, neat, proper portions, proper handling in steamer & in the chutes. FRIES: Hot, fresh, salted, flavorful, neatly packaged, seven-minute holding time observed.

SOFT DRINKS: Proper amounts of ice, carbonation good, temperature correct, cup filled properly, clean, capped, flavor and ratio correct. SHAKES: Proper viscosity, flavor good, cup clean and properly filled. COFFEE: Proper serving temperature, good flavor and aroma, cup clean and properly filled. ONION RINGS & PIES: Hot, fresh, holding times being observed, and neatly packaged. 10 10 8 6 5 7 TOTAL POSSIBLE 46, SUBTOTAL ____________________________ COMMENTS:_____________________________________________ ________________________________________________________ ________________________________________________________ V.

OTHER 1. 2. 3. 4. EMPLOYEE APPEARANCE: Uniforms clean, free of wrinkles and stains, well and properly groomed. STEAMER AND SANDWICH CHUTE: Controls being utilized. HOSTESS PROGRAM: Being used properly. DRIVE-THRU: Staffed properly, flow of traffic moving smoothly, move times within standards. KITCHEN APPEARANCE 5 10 5 8 5 TOTAL POSSIBLE 13, SUBTOTAL _________________________ COMMENTS:___________________________________________ ______________________________________________________ ______________________________________________________

III. SERVICE 1. 2. 3. 4. Adequate number of crew and management working for this period and are they located properly? Proper procedures being followed by cashiers (greeting, thank-yous, attentive). SPEED OF SERVICE: Average of door-to-door times not in excess of three minutes. ATTITUDE: Courteous, smiles, enthusiastic, helpful, overall sense of urgency. 9 MANAGER B. O. A. ___________________% 8 6 7 EMPLOYEE B. O. A. __________________% TOTAL POSSIBLE 30, SUBTOTAL _________________________

OVERALL COMMENTS AND FOLLOW-UP______________________ ________________________________________________________ COMMENTS:___________________________________________ ________________________________________________________ ______________________________________________________ ________________________________________________________ ______________________________________________________ ________________________________________________________ DOOR-TO-DOOR TIMES:__________________________________ ________________________________________________________ ______________________________________________________ ________________________________________________________ Note: The district manager completed at least one Restaurant Visitation Report per month during a shift run by the store manager and by each assistant. DeMasi noted, “It is very hard to score well on the RVR because it is an all-or-nothing system.

For example, I got a 49 score on the last one my boss did. But it is the improvement that he looks for. ” 11 This document is authorized for use only by xiaoxia lu in MBA513: OPERATIONS MANAGEMENT – FALL 2011 taught by JOEL D. GOLDHAR from August 2011 to January 2012. For the exclusive use of X. LU 681-045 Burger King Corporation Exhibit 5A xxx Sandwich Composition Dressings Sandwich Whopper patty Whopper Whopper w/cheese Burger patty Whopper Jr. Double cheeseburger Cheeseburger Hamburger Roast beef Chicken Fish Ham and cheese Cheese Ketchup X X X X X X Mustard Pickles X X X X X X Onions X X X Lettuce X X X Tomato Slice X X X Mayonnaise X X X Tartar Sauce X X X X X X X

X X X X X X X X X X Exhibit 5B xxx Sandwich Wrapper/Box Markings For Burgers: Markings on the wrapper (hamburgers, cheeseburgers) and box (Whopper, Whopper Jr. ) conveyed two bits of information from the production people to the counterpeople: 1. The end of the 10-minute sandwich holding period, signaled with a digit corresponding to the clock’s minute-hand reading at discard; and 2. The customer’s special instructions, such as “plain cheeseburger” or “Whopper, no onions,” if any, signaled by marking the appropriate condiment sign (the condiments were pictured on each wrapper/box) with one or more of the following symbols: 0 Only X Extra ______ None

Thus, in the examples below, A represents a regular cheeseburger that was to be held until 20 of the hour (8 on the clockface), and B represents a Whopper with extra ketchup and no onions that was to be held until 10 past the hour (2 on the clockface). a. b. (continued on next page) 12 This document is authorized for use only by xiaoxia lu in MBA513: OPERATIONS MANAGEMENT – FALL 2011 taught by JOEL D. GOLDHAR from August 2011 to January 2012. For the exclusive use of X. LU Burger King Corporation 681-045 Exhibit 5B (continued) For Specialty Sandwiches: The four types of specialty sandwiches were packaged in one box that had four symbols on it: Roast Beef Ham and Cheese Fish Chicken The markings on a specialty sandwich box included the holding time and special instructions, as with burgers, plus a mark to indicate the type of sandwich.

In the example below, a worker has prepared a fish sandwich with tartar sauce only that can be held until half past the hour (6 on the clockface). 13 This document is authorized for use only by xiaoxia lu in MBA513: OPERATIONS MANAGEMENT – FALL 2011 taught by JOEL D. GOLDHAR from August 2011 to January 2012. For the exclusive use of X. LU 681-045 Burger King Corporation Exhibit 6 xxx Burger Sandwich Preparation Process Whopper Sandwiches Top —put bun crown in box; spread mayo, lettuce, tomato Turn top onto bottom, close box, mark Freezer Broiler Steam Table Bottom—put patty and heel in microwave for 12 seconds; remove, put in box, add ketchup, pickle and onion Burger

Put condiments on patty, replace crown, wrap, microwave for 12 seconds Remove, mark 14 This document is authorized for use only by xiaoxia lu in MBA513: OPERATIONS MANAGEMENT – FALL 2011 taught by JOEL D. GOLDHAR from August 2011 to January 2012. For the exclusive use of X. LU Burger King Corporation 681-045 Exhibit 7A xxx DeMasi’s Level Chart Number of Sandwiches in Steamer Whopper Burger Double burger Chutes Whopper Whopper with cheese Double cheese Burger Cheeseburger Whopper Jr. Whopper Jr. with cheese Fish Chicken Roast beef Ham and cheese At Hourly Dollar Volume Level 1 Level 2 $100-$200 $200-$300 Level 3 $300-$400 Level 4 > $400 “Opening”