We distinguish three elements of service-product bundle in Dunkin Donuts’ service:
1) The tangible service (explicit service) - fast and accurate service. This includes the interactions with the employees, the fact that most locations are open 24 hours per day and the overall visual experience.
2) The psychological benefits of the service (implicit service) – customers’ feeling about the interaction and the pleasantness of the surrounding. Bottom line, the customers’ wants and needs must be met and done so quickly.
3) The physical goods (facilitating goods) - building, tables, convenient parking lot and the food itself. While operations management can fairly tightly control both the explicit service and facilitating goods, the implicit services, or the feeling customers get from a service, are obviously harder to control. In addition, they may vary greatly from one customer to another.
Dunkin Donuts is categorized mostly as a provider routed service. Although customers are given options from a menu, very little of their order can be modified. Muffins, for instance, come as is and ingredients in them cannot be changed. Coffee is the area of the menu that can be the most customized. Even so, machines pour the correct amount of milk or cream and sugar is measured prior to being poured into the coffee. So, under the customer wants and needs part of the matrix, service is standardized and customers have low decisions-making power. Under the operations service system part of the matrix, there are a limited number of pathways, where a line flow is used. Customers can many times find several Dunkin Donuts locations within driving distance, and many are open 24 hours a day. However, every location uses the same menu and systems to deliver the service. Customers can also purchase items for delivery to a home or business, but these items are limited to mostly coffee beans. In all, Dunkin Donuts can be compared to McDonalds when it comes to the service matrix.
The type of customer contact that Dunkin’ Donuts has is a Permeable System with face-to-face tight specs. The degree of contact can be compared with McDonalds, where a large portion of the order can be processed away from the customer. Examples include the pre-making of muffins and donuts. Allowing for the employee to simply place the product in a bag and hand it to the customer ultimately increases efficiency, reduces costs customers must incur, and allows for excellent customer satisfaction. The fast food industry requires the employees to sell more than just the menu; they must sell a positive experience. The company enforces this idea by providing a tentative script outlined for the cashier to follow. For example, all customers are greeted with a pleasant smile the moment they approach the counter. After the customer’s order is placed, the employee will politely suggest additional menu items or simply ask, “Is there anything else I can get for you?” This stimulates sales and provides customers with the excellent face-to-face service they expect.
Customization is limited and skills are procedural. Despite the mass customization Dunkin Donuts provides, there is an option of self-service. When customers order beverages, they may have the employee add sugar, creamer, milk or anything else, or, there is a station where customers can finalize a self-made product.
Uncertainty related to customers does exist, but because contact is limited, a flow control is used, and production efficiency is high, managers need not worry so much about these challenges. Arrival and request variability are perhaps the most important aspects to oversee, for managers cannot always predict when customers will enter their restaurant and what exactly they would like to order. Running out of or making too many products, such as bagels and muffins, can negatively impact sales, costs and service.
Dunkin’ Donuts uses many different types of technology in order to maximize customer care and optimize its business. One of the technologies that Dunkin Donuts uses is E-pay. This is a gift card that is reloadable so the guest can have a better experience, the restaurant can increase sales, and the speed of service can be improved. The card can even be given as a gift. Each restaurant also uses Local Store marketing, which allows franchisees to promote their business by providing coupon offers, promotions and other items desirable to the customers. Touch screen registers are also used, which provides employees with easy to find buttons along with pictures and descriptions of all products. This reduces mistakes and enhances the customer experience.
Dunkin Donuts is also using technology to step up their training by offering Dunkin Donuts online courses. These courses are offered 24/7 and allow the Dunkin Donuts crew unlimited access to all of the training programs. Dunkin Donuts is also experimenting with voice recognition, which can configure the customers’ age and gender and then display ads targeted toward them. Even the simple things, like pouring of the coffee is technology oriented. Pressing of a button disperses the exact measure of cream, milk, or flavor needed to make the perfect cup of coffee.
This link below outlines Dunkin Donuts’ use of technology to enhance the overall customer experience and increase value to the franchisee.
Although technology plays a huge role in the daily tasks of the restaurant, Dunkin Donuts franchisers and franchisees work hard to balance this with the utilization of front-line employees.
All employees are considered the greatest assets to the restaurant, for without them, Dunkin Donuts would not exist. Providing a safe, welcoming, and comfortable environment is necessary to run the business successfully. Enforcing of policies and procedures, properly training the staff, giving discounts to its employees, and providing health benefits are ways of ensuring that employees maintain their loyalty to the franchise. In addition, managers always intervene when customers show aggression or inappropriate behavior towards its crew.
Service Recovery and Guarantees are very important factors for the success of Dunkin Donuts, as they have been maintaining their status as number one in customer loyalty for a long time. In this tough economy, only businesses that maintain high ethics and standards while providing the best possible experience to their customers can survive. A recent independent survey finds Dunkin Donuts number one in customer loyalty for four strait years in its coffee category, proving their amazing ability to bring consistently valuable food and service with great recovery and guarantee procedures.
The service recovery consists of the action necessary to compensate for failures made by the company and restore, if possible, the service requested by it customers. It is imperative for the operation manager to ensure that solutions for all demands that arise are provided, and done so in a timely manner. This allows the business to be competitive, reliable, and market oriented. Some examples of how Dunkin Donuts provides customers with service recovery are coupons, gift cards, apology letters, and the simple but important words of “I am very sorry” and “thank you very much.”
Service guarantee is another important factor for Dunkin Donuts, for it is a way to define their service and ensure satisfactory results are brought to the customer in a positive way. Following specific standards to ensure the highest quality of food and beverages is the primary way of ensuring their guarantees are met. To maintain the standards, managers and their staff do regular inspection in their restaurants to ensure customers are purchasing fresh products. All franchisees must follow the same time frame required to keep the food and beverages fresh. For example, freshly brewed coffee can only be kept on a burner for 18 minutes before it is discarded and a fresh pot is made.
The company also has a national hotline for customers to complain or make suggestions. This aids in ensuring that every store is performing their duties in the best possible way. Ultimately, this ensures not only that the service recovery and guarantee process is running well, but also the amount of time spent recovering customer dissatisfaction is decreased.
Below is a Dunkin Donuts web site for customers to email feedback of a recent visit to a restaurant. The hotline number is also listed here.
Below is an article describing Dunkin Donuts’ loyalty reward.
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