Analysis of Hooters chain restaurants in China using theories X, Y and Z

Management Theory & Practice

1.0 Introduction

There are a great many fads of management during the past 50 years. And different schools hold different perspectives on the issue of quick fixes and new techniques of management solution can work permanently. And many people also agree the idea that it is a must for managers to apply modern ideas and technology to face the challenges of continuous improvement and changes in the uncertain world.

And there are three types of management theories will be discussed in this paper such as theories X, Y, Z, the one minute manager and total quality management. And then we’ll discuss the most valuable theory in 2012 under the analysis of Hooters chain restaurants in China from these theories are total quality management.

2.0 Theories X, Y, Z

In the book of The Human Side of Enterprise, McGregor (1960) came up with theory X, which treated people to be lazy in the working. In theory X, McGregor (1960) summed up the standpoint of the fact that the average people are born with the instinct of disliking work and avoiding doing it as long as they can. This standpoint in theory X is made up of several facets. First of all, for the sake of dislike of work, it is seemed as a must for many people to be regulated and threatened before they start to work effective enough. In the next place, it is the common view, that the average people would rather to be directed, have low level sense of responsibility, be unambiguous and have the desires to work with safety in all facets. In the third place, the theory X has aroused two kinds of management ways lying behind principles of most organizations such as tough management with character of punishments and tight restrictions and soft management with character of harmony. In the fourth place, people need more than financial motivations such as these higher order of stimulations to catch opportunities and fulfill themselves. At last, theory X managers may not be able to offer employees with so many types of motivations, so that most of people in their firms behave in the designed and expected way.

Li and Wang (2009) disclosed major issues in theory Y. First and foremost, theory Y has the faith in the truth that human beings have the instinct of working positively and actively. First of all, the same role as play or rest, physical and mental devotion in work is thought of as nature for human beings. In the next place, there are more than one way to motivate employees besides punishment and control. Extraordinarily, if people are directed by themselves when they are committed to the aims of their firms, they can work as their own motivators. In the third place, the higher level of the job satisfaction from employees, the higher level of employees’ commitment to their firms. In the fourth place, the major aim of self development of human beings is not only to pursue more knowledge and development but to seek more responsibilities. In the fifth place, for the large number of employees, creativity, imagination and ingenuity works as valuable essences for them to solve work place problems. At last, the intelligent potential of most people are only partially aroused under the circumstance of modern industry life.

Theory Z is the modern management theory contrasted to theory X and Y in accordance with the difference between Japanese enterprises and American enterprises to summarize the Japanese corporate culture (Li & Wang 2009). Theory Z thinks highly of the corporate culture which is made up of trust, intimacy and subtlety. According to this theory, management ought to trust their employees, which may arouse the loyalty and honesty of employees towards their jobs, colleagues and their companies. Theory Z has faith in the standpoint that understanding the subtlety is to understand the different personality of employees to form the most effective teams with the maximum productivity. Theory Z supports the function of intimacy of employees to maintain the harmonious relationship between employees and employees, employees and managements so as to work together for the common objectives.

3.0 The One Minute Manager

In the works of Blanchard, Flower and Hawkings (n.d.) and Blanchard and Johnson (1982), three secrets are revealed in the one minute manager by the search of a young man on the perfect leadership techniques and managing skills. The focus of the one minute manager is a one minute manager, who is the venerable leader respected and admired highly by his employees, whose three secrets on management working as the key to the success of him.

One minute manager’s first key to success is one minute goals, involving the meeting between managers and employees, in which objectives are agreed upon, recorded down in the clear and brief statement and occasionally monitored to ensure the occurrence of productivity. The whole procedures are supposed to be completed within a short length just as long as a minute, which truly implies this is a quick meeting. The aim of the one minute goal setting is to ensure that obligations of each task or assignment is clear for employees with the understanding of confusion often results in low productivity, inefficiency and low working enthusiasm.

One minute manager’s second key to success is one minute praising, referring to the open- mind towards performance from people. When catching somebody performing something right, one minute manager’s goal is to praise these people immediately to tell them clearly and specifically on the right performances they have carried out. And pause a moment to allow them to have the time to feel how pleased and good the managers feel referring to their significance to their organization and finish via hands shaking.

One minute manager’s third key to success is one minute reprimand, which indicates acting honestly and frankly with these people around the managers involving reprimanding when something is wrong. Step one is to reprimand in time and specifically, identical to the first key to success of one minute manager, which impels the understanding of obligations and how to fulfill them in the correct way. Following the reprimand, hands shaking and reminding the person that the importance of him or her to the company and it is just his or her performance isn’t so right, both play equally important role. That is to say, the reprimand and the reassurance are equally important in the third key to success of one minute manager. Ignoring of either one may result in mistakes and ineffective.

4.0 Total Quality Management

Jablonski (1992) proposed total quality management is the method for management used to improve organizations’ quality and productivity in business, which is the approach with comprehensive system working horizontally through the whole company including all sections and staffs and extending both forward and backward involving firms’ suppliers and consumers. Three characteristics of total quality management are indentified by Jablonski (1992), too. The first characteristic is the participative management is the first characteristic, referring to the involvement of all staffs of a firm in the procedures of management. In this management style, the inputs and guide from employees towards policy setting and key decision making are emphasized by managers, which improve the grasp of operation for up level management. The second characteristic is the continuous process of improvement, involving emphasis of small or incremental gains are the cornerstone of the total quality. This standpoint believes the long term consequences of the continuous process, which will leads to good results. Teamwork is the third necessary characteristic for the success of total quality management, involving the cooperation of teams with cross function in the firm. This kind of approach helps individual workers to share knowledge with each other, find out problems, catch opportunities and develop the comprehensive understanding on their working roles in the total procedures and integrate their working objectives with their firm’s objectives.

Roberts and Bernard (1993) provided some guidelines for firms to implement total quality management. Each step is designed to play the role as the ingredient of the long term objective on improving quality and productivity of the firm. Step one is preparation, during which management make up the decision on whether adopt the total quality management or not under the help of initial training to find out the requirements and needs a from consultants outside their firm, develop the suitable mission and vision for their firm, draft out the regulations and policies for the firm, make commitment to these necessary resources and clarify and communication the goals to the whole firm. Second step is planning involving the plans on necessary capital budget and schedule, infrastructure and resources. Step three is assessment, which emphasizes the self assessment a lot including the performance and working quality of individual employees, teams and even the whole company. Step four is implementation, during which the calculation or eventuation on the return from investment of total quality management will be estimated by support from personnel such as training and developing on the working content and meanings, the awareness of what total quality management is exactly and what is expected from employees by their firms. The last step is diversification, during which management makes use of techniques and experience from total quality management to align firm’s suppliers, distributors and other business partners with it quality process. Activities of diversification often refer to training and developing, assistance and rewarding, cooperation between different groups embraced by initiatives of total quality management in the firm.

5.0 Company example and justification

5.1 Company background

Hooters China is the target organization in our research to evaluate the most valuable management theory out of the three such as theories X, Y, Z, one minute manager and total quality management. Hooters China is known for the dinning environment of American beach theme, which is the chain restaurant in China under the support of American investors. And the reputation of Hooters in Chinese market is also good under the support of good dinning environment and services such as amiable atmosphere, authentic American flavor with a variety of food categories, spicy Hooters girls and so on (Hooters 2012).

Hooters’ characteristics (Hooters 2012)

American investors

American beach theme

VIP card, Hooters’ magazines, T-shirts with Hooters’ logo

Staff (Hooters 2012)

There are five chain restaurants of Hooters in China with about 400 employees, half of which are Hooters girls.

Selling Points (Hooters 2012)

Spicy Hooters girls

Considerate service

Amiable and cozy dinning environment

Delicious food and tasteful drinks with American flavor

Target clients (Hooters 2012)

Hooters China’s major target group is the male consumers aging from 25 to 60 years old.

5.2 Organizational diagnosis

Kuo (2010) and Minkey (2009) had investigation the situation of Hooters in China and found out the problem it is faced with as below. It has launched China for more than five years till now, which has a strange phenomenon that the sales performance in the first few months is often shot up and it often collapses in the following months with high rate of employee turnover.

With reference to the actual situation of Hooters China, we’ll diagnose the performance of Hooters by Weisbord’s Six-Box Organizational Model on its current issue and then analyze the most valuable management theory.

Figure 1.0 is the Six-Box Organizational Model from Weisbord to explore the overall performance and management of a firm (Palmer, Dunford & Akin 2009)

Figure1. Six-Box Organizational Model

table 1.0

Table 1.0 is the organizational diagnosis on Hooters China according to six box organization model as below.

Table .1.0 Six-Box Organizational Model on Hooters China

Purpose Business scope It is in industry of catering and makes up the plans to open hotels and offers sponsorships on these sport events. Meanwhile, it also plans to open new chain restaurants in other regions of Chinese market.
Mission To open new restaurants, and market itself by many promotion campaigns
Structure tasks distribution Hooters China’s task distribution system is very authoritarian, including business development and HR recruitment issue.
Structures setting Its structure setting isn’t so suitable. For instance, Hooters girls take up more than half number of employees, which is so imbalance.
Reward-specific incentives Every year, Hooters Chinese Swimsuit Pageant is held in China to promote its brand. The winner of this Pageant will be given a certain amount of money prize and gain the chance to take part in the International Swimsuit Pageant in the U.S.A. While the reward system for other staffs in Hooters China isn’t so satisfactory and well built.
Help mechanism Budget towards global expansion development and other aspects A big sum of money has been invested by Hooters China to open new chain restaurants in different places of China. While in the issue of staff training and development, the budget is so limited compared to the budget plan in other issues.
Communication methods Routine staff meetings are held in Hooters China to discuss and evaluate current issues. While improper structure setting of the management in Hooters often leads to ineffective communication.
Current situation on career training and developing Practical and effective training and developing programs’ design, implementation and evaluation are in a shortage in Hooters China.
Relationships Working atmosphere and relationships in Hooters China aren’t harmonious and well designed.

The culture difference hinders the smooth development of Hooters in Chinese market.

Leadership Leadership style in Hooters China belongs to task oriented one, which only focuses on the fulfillment of tasks rather than relationship building. This leadership style results in working environment indifferent and high turnover rate of employees.

From the analysis of actual performance of Hooters China in the above, we can find out four major problems. The first one is the mismatch of proposals and actual operation. The second problem is impropriate operation in human resource management such as the imbalance number of Hooters girls and other employees. The third one is impropriate reward systems. And the last one is the ineffective communication system inside Hooters. (Kuo 2010 & Minkey 2009)

5.3 Analysis on theory X, Y, Z

In theories X, Y Z, there are three different definition of people’s nature to use different management theories.

5.3.1 Analysis on theory X

Theory X treats people to be born with the nature of dislike work. And under the influence of lazy nature, people may try to avoid some responsibilities in their work if they can (McGregor 1960). In this condition, a tough management style may be used to manage these people to pursue expected performance. In Hooters China, two the biggest problems are the human management problems and ineffective communication problems, which are mainly due to the task oriented and harsh management practices in this firm (Kuo 2010).

Palmer, Dunford and Akin (2009) disclosed too rigid and coercive management style may arouse the resistance of employees. In Hooters China, the communication between employees and the upper management aren’t so well in the present time, if it still uses the Theory X to guide its management such as human resource management and communication system building, it may make the situation worse. Referring to the situation of Hooters China, the resistance and complaints from employees towards their management practices are seemed to soar out of sight, which needs some mild and comprehensive ways to improve working satisfaction rather than tough management approach to force employees to work. In this standpoint, theory X isn’t suitable for Hooters China referring to its actual situation.

5.3.2 Analysis on theory Y

Li and Wang (2009) disclosed major issues in theory Y, which has the faith in the truth that human beings have the instinct of working positively and actively. For Hooters, its problems not only exist in the human resource, leadership aspect but in the overall operation part such as mismatch of company operation and proposals, ineffective rewards system, dysfunction communication mechanism and so on (Kuo 2010 & Minkey 2009). While the main spirit of theory Y is people. It is to give people the more priority and right to go in for the decision making and other key operation issues. But for Hooters, this management style advised by theory Y isn’t so practical.

For example, the trust between employees and employers of Hooters China hasn’t build up which might be reflected from the high turnover rate of employees (Kuo 2010 & Minkey 2009). If Hooters China offers employees the high level of right in decision making without the full support of mutual trust, things may mess up. For example, other employees not the Hooters girls may add more rewards and self-advantages policies in the process of reward system building but not stand from the side of whole organization when they are endowed with the right to give advices, which may only result in a disorder and dysfunctional situation.

All in all, theory Y isn’t the right choice for Hooter China either.

5.3.3 Analysis on theory Z

Theory Z thinks highly of the corporate culture which is made up of trust, intimacy and subtlety (Li & Wang 2009). It also believes management ought to trust their employees, which may arouse the loyalty and honesty of employees towards their jobs, colleagues and their companies. In the actual situation of Hooters China is like this (Li & Wang 2009). The trust extent between employees and managers are low in Hooters China (Kuo 2010 & Minkey 2009). That is to say, if Hooters management in China applies theory Z, it has the primary requirement on the good relationship or trust built between employees and managers, which isn’t fit for the situation of Hooters China, whose inside relationship isn’t so harmonious and proper.

In conclusion, theories X, Y, Z are not the choice for Hooters China to touch up its situation and chase better performance.

5.4 Justification on one minute manager

Blanchard, Flower and Hawkings (n. d.) and Blanchard and Johnson (1982) give a thorough explanation on one minute manager, which offers three golden rules for success including one minute goal setting, one minute praise and one minute reprimand.

First all of in the one minute goal setting, it requires the high quality meeting between managers and employees in Hooters China. Yet, both the managers and employees in Hooters China go along badly with each other. That is to say, the quality of the one minute meeting in Hooters China may be not as high as the one minute manager theory expected, which will directly impact the quality of one minute goal setting and the following steps.

In the second place, on the standpoints of the one minute praising and one minute reprimand, the open attitudes both for managers and employees are important for people in Hooters China to face their achievements and faults. In fact, some major headaches for Hooters’ management are the ineffective communication system and inharmonious relationship between them, which result in the non-objective attitudes of both managers and employees towards achievements and failures. And the task oriented leadership style in Hooters at the present time may make managers only accept the achievement and refuse the failures and faults of employees. (Flower & Hawkings (n. d.); Blanchard & Johnson 1982)

Supposing in Hooters China, it puts one minute manager to use in its chain restaurants of China, lacking of mutual trust, harmonious working environment suitable reward system may only result in the unsatisfactory results. That is to say, in the situation of Hooters China, the one minute manager theory isn’t suitable for its actual situation.

5.5 Justification on total quality management

In total quality management theory, it has a wider focus on the overall improvement of firms’ performance quality and productivity in their business operation (Jablonski 1992). For example, it focuses the side of employees and the side of suppliers and customers. That is, this theory has developed a special focus on both the external environment and the internal elements of a firm to complete its management practices and related issues.

In Hooters China, we have already discovered the facts (Kuo 2010 & Minkey 2009). First of all, the management style is over authoritarian in both developing strategy and employees’ recruitment, which hinders the healthy development of harmonious working atmosphere and reduces the sense of belonging from employees towards Hooters China (Cummings & Worley 2008). In the second place, the staffing strategy isn’t proper either, which results in the imbalance number of Hooters girls and other employees. Under this improper setting, the relationship building in Hooters is a tough task either (Newham 2005). In the third place, the reward systems focus the performance of Hooters girls too much but ignore the praising for the good performances from others. This imbalance may also increase the rate of employee turnover (Xinhua net 2009). In the fourth place, Hooters’ communication mechanism isn’t proper built up which often results in ineffective communication inside Hooters. In the last place, human resource training and developing programs in Hooters China aren’t so satisfactory either (Kuo 2010 & Minkey 2009).

From these facts, total quality management is the most suitable and valuable theory for Hooters China referring to its actual situation.

First of all, total quality management supports participate management to build good relationship with employees, which can help Hooters China to rebuild and modify its unsatisfactory relationship between employees and management (Roberts & Bernard 1993). Secondly, Total quality management supports the long term results, which stands in the overall situation of the firm to focus the actual returns from inputs in the long term round. It may help Hooters China to focus all employees’ interest not just the Hooters girls, which can relieve the pressure of high turnover rate and increase other employees’ sense of belonging (Roberts & Bernard 1993). And total quality management also emphasizes the function of teamwork. Daft (2010) approves team building will improve the cohesiveness of members in Hooters China with their commitment to the integrated goals and have positive influence on the working morale and total output. That is to say, with teambuilding, people in Hooters China may work together whole heartedly and be binding together to really treat Hooters as their home.

In a conclusion, total quality management is regarded as the management theory with great value in contrast to theories X, Y, Z and one minute management in accordance with the actual situation of Hooters China.

6.0 Conclusion

With the contrast among three management theory including theories X, Y, Z, one minute manager and total quality management, we use the actual example of Hooters China, which is an American invested chain restaurants shining for its American beach theme and American flavor food.

Although the business practice of Hooters in China can be regarded as satisfactory, there are many problems inside this company. By making comparison of the three theories regarding with the actual performance and operation of Hooters China, we summarized total quality management theory has the great value than the others.

Reference

 

Blanchard, K., Flower, S. & Hawkings, L. (n. d.), “Self Leadership and The One Minute Manager”, Harper Collins e-books,

Blanchard, K. & Johnson, S. (1982), “One Minute Manager”, William Morrow and Company, New York,

Cascio, W.F. (2010), “Managing Human Resources: Productivity, Quality of Work Life, Profits”, 8th edn, McGraw Hill, New York,

Cummings, T. G. & Worley, C.G. (2008), “Organization Development & Change”, Thomson South Western, Ohio,

Daft, R. L. (2010), “New era of management” , 9 edn, South-Western, n.p,

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On line: <http://www.hooters.com/About.aspx>

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<http://articles.latimes.com/2010/apr/09/world/la-fg-china-hooters10-2010apr10>

Li, Z. L. & Wang, W. F. (2009), “实用护理人际学” Practical Interpersonal Skills, Electronic Industry Press, Beijing,

McGregor, D. (1960), “The Human Side of Enterprise”, McGraw-Hill, New York,

Minkey (2009), “ 猫头鹰餐厅Hooters“胸脯+餐馆”的经营创意” Hooters Business Ideas of ‘Breast Plus Restaurant’, Bossline.com, viewed 8 May 2012,

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Palmer, I., Dunford, R. & Akin, G. (2009), “Managing Organizational Change”, 2nd edn, McGraw Hill, New York,

Roberts, H. V. & Bernard F. S. (1993), “Quality Is Personal: A Foundation for Total Quality Management”, The Free Press, n.p.,

Xinhua net (2009), “猫头鹰餐厅杭州店暂停营业” The Hooters restaurant of Hangzhou closed down, info.ppsj.com.cn, viewed 9th May 2012,

On line:

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