UNIVERSITI UTARA MALAYSIA

KUALA LUMPUR CITY CAMPUS

BJMP5023 OPERATIONS & TECHNOLOGY MANAGEMENT

DOMINOS PIZZA
LECTURER:
DR. MARTINO LUIS
PREPARED BY:

GROUP ASSIGNMENT
NOR AZHAN BIN MOHAMMAD NOR (806580)

DATE SUBMITTED:
25TH NOVEMBER 2012

INDIVIDUAL ASSIGNMENT
BJMP5023

Contents
1.0

OVERVIEW...........................................................................................................1

2.0

HISTORY..............................................................................................................1

3.0

PRODUCTS..........................................................................................................3

4.0

VALUE AND SUPPLY CHAIN..............................................................................6

5.0

OPERATIONS STRATEGY..................................................................................8

6.0

TECHNOLOGY..................................................................................................11

7.0

CONCLUSION...................................................................................................12

8.0

REFERENCES..................................................................................................13

1.0

OVERVIEW
Dominos Pizza is the No. 1 Pizza Delivery Company in the world and the
undisputed pizza delivery expert. The Company has a unique business and
operation model and is a pioneer in the fast food industry. Since 1960, Dominos
Pizza has successfully expanded from 3 outlets in the United State to 9,350
stores operating in seventy countries. Dominos operation in Malaysia and
overseas uses the franchise model. The parent company, Dominos Pizza LLC is
head quartered in Michigan, United State of America. It maintains overall control
on the sourcing and supplying of raw materials to the master franchises and
enforces quality of the service and products sold.

2.0

HISTORY
The legend of Dominos Pizza dates back to December, 1960 with the purchase
of a small pizza shop in Ypsilanti, Michigan by brothers Tom and Jim Monaghan.
The brothers bought the restaurant from friend Dominick DeVarti for USD500

OPERATIONS & TECHNOLOGY MANAGEMENT

Page | 2

INDIVIDUAL ASSIGNMENT
BJMP5023

cash and assuming the stores USD8,000 debts. Neither Tom nor Jim had the
intention of making the restaurant business their career, but rather saw the
opportunity as a part-time venture to help cover the cost of their studies at the
nearby University of Michigan. By June the store was earning a profitable
USD400 a week but briskly fell off when students at the University went home for
summer. Faced with the prospect of a slow phase, Jim sold Tom his half of the
business in 1961 and changed the name from Dominicks to Dominos. The same
year, Tom decided to quit school to devote more time to the business.
Aware of his lack of experience in pizza making and operations and
management, Tom spent much of his time visiting many similar pizzerias around
the state acquiring advice on operations and recipes. By the mid 60s, Tom had
restructured the interior of the store, rearranged all areas and systems, ultimately
improving the flow of work in all facets of the operation from order-taking to
delivery. Monaghans system was reminiscent of those developed by the
managers of White Castle Hamburger in the 20s and the McDonald brothers in
the 40s. The implementation of this system formulized the production process as
a unified whole, and included the standardization of materials, clever and
thoughtful placement of equipment, and detailed division of labor; all geared to
achieve the continuous production of its limited product line. By 1967, Dominos
emphasis on uniform quality and rapid delivery proved a successful system for
operating a pizza shop and therefore provided opportunity for expansion through
franchising.
The company landed in Malaysia in September 1997. Launched by its founder,
Tom Monaghan himself, Dominos Pizza became an overnight sensation. It was
so well-received that Dominos Malaysias commissary was recognised in the
Annual Dominos International Audit as the Best Commissary in Asia Pacific.
Malaysia's bullish food and beverage industry coupled with Domino's promise of
quality food and delivery service was highly accepted and gained new customers
OPERATIONS & TECHNOLOGY MANAGEMENT
Page | 2

INDIVIDUAL ASSIGNMENT
BJMP5023

nationwide.
As at early January 2012, there are 77 stores operating all over Malaysia, with 51
in the Klang Valley, 10 stores in Johor, 4 in Penang, 6 in Negeri Sembilan, 4 in
Perak and 2 in Melaka.
With the healthy growth in Malaysia, Domino's extended its presence to
neighbouring Singapore in 2009. There are currently 13 outlets operating in
Singapore and growing aggressively.

3.0

PRODUCTS
Free Delivery Service

Discount Coupon for future purchase

Pizza
Side Orders
30-Minutes Delivery Guarantee
Beverages

Credit Card payment for online orders

15-Minutes Take-Away Guarantee

Exhibit 4.1 Dominos Pizza Customer Benefit Package

Dominos Pizza offers a wide range of meals to its customers. They offer variety
of pizza, pasta, side orders and beverages. They have 5 unique pizza crusts i.e.
Classic Hand Tossed, Crunchy Thin Crust, Cheese Burst Double Decker, New

OPERATIONS & TECHNOLOGY MANAGEMENT

Page | 3

INDIVIDUAL ASSIGNMENT
BJMP5023

York Crust and Extreme Edge to satisfy Malaysian customers appetite.

Exhibit 4.2 Dominos Pizza 5 unique Pizza Crust

Dominos Pizza also offered numbers of topping such as Ultimate Hawaiian, 7Meat Wonders, Meatasaurus, Prawn Passion, Chicken Perfection, Tuna
Extreme, Prawn Sensation, BBQ Chicken, Aloha Chicken, Extravaganza,
Classified Chicken, Plain Cheese, Beef Pepperoni, Chicken Pepperoni, Classic
Chicken, Flaming Tuna, Meat Mania, Seafood Delight, Spicy Sambal, Spicy
Sausage, Tuna Temptation, Vegie Fiesta and Vegie Galore. Dominos Pizza also
allowed their customers to customize their pizza by offering 2 options i.e. Make
Your Own and Half & Half.

Exhibit 4.3 Dominos Pizza delicious Specialty Pizza & Customize Pizza

OPERATIONS & TECHNOLOGY MANAGEMENT

Page | 4

INDIVIDUAL ASSIGNMENT
BJMP5023

Dominos Pizza comes with 3 Signature Pizza Sauces such as Dominos

Signature Sauce, Spicy Sambal Sauce and Top Secret Sauce.

Exhibit 4.4 Dominos Pizza signature Pizza Sauces

Dominos Pizza also serve varieties of side orders such as Chicken Wings BBQ,
Chicken Wings Hot & Spicy, Spaghetti Bolognese, Chicken Lasagna, Creamy
Custard Puff Desert, Garlic Twisty Bread, Garlic Cheese Onion Rings, BreadStix,
Banana Kaya Desert, CinnaStix & Icing and Chocolate Lava Cake.
Dominos Pizza also offers Coca-Cola, Sprite and Fruit Tree Fresh Apple & Aloe
Vera for its beverages.
The above products are considered primary goods for Dominos Pizza and these
products will ensure that Dominos Pizza customers needs of foods will be fulfill.
Dominos Pizza has introduced its Unique Selling Preposition (USPs) which
includes:1. 30-Minutes Delivery Guarantee! - Domino's is the only pizza company
that guarantees customers order will arrive within 30 minutes or Dominos
will give its customer a free Regular Pizza voucher;
2. Product Satisfaction Guarantee - Domino's guarantees satisfaction!
Their pizza and side orders are guaranteed to be hot, fresh, and great
tasting when they arrives at customers doorstep, otherwise Dominos will
replace the product or refund customers money.
3. 15-Minute Take-Away Guarantee - Domino's guarantees customers will
receive their Take-Away orders within 15 minutes or Dominos will give
them a free Personal Pizza voucher.

OPERATIONS & TECHNOLOGY MANAGEMENT

Page | 5

INDIVIDUAL ASSIGNMENT
BJMP5023

4. Free Delivery - No extra charges for delivery to customers doorstep.

Dominos Pizza also introduced discount coupons for its customers future
purchase. This method is really works for Dominos Pizza where they tie-up their
customer with the attractive offer for future purchase. This will also create loyalty
among Dominos Pizza customers.
Dominos Pizza also allowed their online customers to pay their orders using
credit card where previously they only accept cash payment for the online
purchase.
The above services can be considered as peripheral services where it will benefit
Dominos Pizza customers and will add confident for the customers to choose
Dominos Pizza rather than other Dominos Pizza competitors such as Pizza Hut
and Papa John.

Exhibit 4.5 Dominos Pizza Unique Selling Prepositions (USPs)

Further to the above Dominos Pizza also obtained a Halal Certification for all its
products from Jabatan Kemajuan Islam, Malaysia (JAKIM) which will add more
confident to Dominos Pizza current and future customers.
4.0

VALUE AND SUPPLY CHAIN

It is important to consider how a customer need drives Dominos to create the
product. The customer need that drives the entire value chain is the need for a
dependable take away restaurant, reasonably priced hot quality food and variety
that suits the local palette.

OPERATIONS & TECHNOLOGY MANAGEMENT

Page | 6

INDIVIDUAL ASSIGNMENT
BJMP5023

Exhibit 4.1 Dominos Pizza Value Chain

Dominos has focused on these key customer needs throughout the value chain,
and has not allowed any digressions in this area unlike other competitors who
have evolved a mixed model of full service restaurants and takeaway outlets, or
a hybrid combination of both. This has diluted their strengths in the segment
Dominos focuses on - Takeaway / Home delivery. Its global operational model
allows for lean stores, well-trained staff and flexibility at a country level to
customize menus to suit customer tastes. Operational requirements have
prompted the use of technology to make the customer experience more
enriching, it has a history of firsts they were the first to use TV as a distribution
channel, an online tracking system that allows customers to track the pizza order
and a proprietary point of sale system. A combination of the Company level
strategy and the Operational Strategy has resulted in Dominos having a
reputation for reliability and consistent pizza quality these strategies have
ensured that Dominos continues to meet its customer needs.
For instance, Dominos Pizza is committed to leading the industry in product
quality and using the best ingredients for its customers. Domino Pizza also
includes local flavours into their menu as one of the key things that Dominos
Pizza do to appeal to the local market, creating tasty and innovative
combinations.
OPERATIONS & TECHNOLOGY MANAGEMENT
Page | 7

INDIVIDUAL ASSIGNMENT
BJMP5023

Dominos Pizza has adopted the Make-to-Stock Approach for its Supply Chain
Management. The company supply chain is supports lean production and is
based on just in time stock management and stock control.
Dominos has an innovative supply chain model that ensures all purchases are
managed centrally across all franchises around the world. The core entity, which
runs the supply chain network, is called Dominos supply chain services a fully
owned subsidiary which supplies the dough, raw materials (the condiments, and
ingredients that go into the food products), the kitchen equipment / machinery.
This entity supplies to all the master franchises effectively giving the company a
few key advantages:
(1) With a centralized buying department, the company is able to leverage its
buying power, and is able to negotiate the best costs for its purchases. This
also ensures purchases on a scale which makes suppliers want to tie into
the Dominos supply chain services. For instance Coca-Cola is integrated
into Dominos supply chain network, and is seen more as a partner rather
than a supplier; this was made possible because centrally Dominos has
agreed to only sell Coca-Cola products at all its outlets around the world.
(2) Consistency and Quality of products across the board - Since the sourcing
is centralized, this ensures consistent quality of food products used, and
similar machines / kitchen equipment that make training easy for staff.
(3) Economies of scale: Dominos is also able to use its large buying power to
hedge better costs when commodity prices fluctuate; it also gives it a better
bargaining power with suppliers.
5.0

OPERATIONS STRATEGY
Other fast food chain such as Pizza Hut which operates conventionally, needs a

OPERATIONS & TECHNOLOGY MANAGEMENT

Page | 8

INDIVIDUAL ASSIGNMENT
BJMP5023

nice and big restaurant with an attractive layout to impress their customers since
their main business is for dining-in customers compared to Dominos Pizza which
main business is pizza delivery. As such, Dominos Pizza does not need huge
capital to start. Dominos Pizza just needs a strategic place and a well built user
friendly and convenience website to attract customers.
Dominos operations strategy mainly focuses on the providing high service quality
to the customer:
1.

Minimize operations cost: To minimize the operating cost by improving the

efficiencies and process at the stores.

2.

Strategic store locations to facilitate the delivery service: To leverage the

strategic location of the store in order to facilitate quick service to the
customer and maximize the revenue.

3.

Production oriented store designs: To utilize the production oriented store

design in order to facilitate efficient production and quick service to the
customer.

4.

Efficient order taking, production and delivery: To execute an efficient

operational process that includes order taking, pizza preparation, cooking,
boxing and delivery.

5.

Use of Dominos PULSE point-of-sale system: Use of Dominos PULSE

system to improve operating efficiencies, provide corporate management with
easy access to financial and marketing data and reduce time consumption
and expenses.

6.

Product and process innovations: To promote an innovative culture that

increases both quality and efficiency.

7.

A focused menu: To maintain a focused menu that is designed to present

an attractive quality offering to customers, while minimizing order errors, and
expediting the order taking and food preparation processes.

OPERATIONS & TECHNOLOGY MANAGEMENT

Page | 9

INDIVIDUAL ASSIGNMENT
BJMP5023

8.

A comprehensive store operations evaluation program: To utilize a

comprehensive store audit program to ensure that stores are meeting both as
the expectations of the customers.

The Performance Prioritizing would help Dominos in prioritizing its operational

strategies based on the order-winning criteria and the current issues it faces in
relation to the competition.
1.

Dominos invests in promotional strategy to a greater extent as compared

to other food chain outlets. It offers many discount coupons to attract
customers. Discount offers do help to some extent in attracting customers but
too many discount and promotions tend to lower the brand image. So
Dominos need to cut down some expenses in that section which will not affect
its sales.

2.

Dominos has got an excellent unmatched home delivery service through

which it stays ahead of its rivals. The 30-minute luxury of Dominos has
given the brand a strong image among the customers. This gives Dominos a
clear balance between its competitors and customers.

3.

Dominos need to improve its product quality in order to maintain reputed.

It needs to emphasize on the pizza quality and prioritizing all aspects that
relate to the customer. For example, Pizza Hut specifies the calories
consumption in each pizza. This reflects the brand concern for the customer.
So Dominos should also initiate some measures which would foster the
emotional connection to its customers.

4.

In order to increase the service to customers, Dominos should ensure

speedy delivery of pizzas to customers. For this, Dominos need to work on its
existing process design. There should be enough space and staff for service
and extra machines to handle any machinery failure during peak periods.

OPERATIONS & TECHNOLOGY MANAGEMENT

Page | 10

INDIVIDUAL ASSIGNMENT
BJMP5023

6.0

TECHNOLOGY
Domino's Pizza launches Malaysia's first fast food on line ordering portal which
recognized by the Malaysian Book of Records in 2003. By introducing the on line
ordering portal, Dominos Pizza has increase their potential customer base as the
portal can be reached anywhere, anytime.
In 2010, Dominos Great Pizza Service (GPS) pizza tracker system was
introduced at all Dominos Pizza outlets in Malaysia. This first-of-its-kind system
in Malaysia enables customers to track their pizzas at every stage of the delivery
process.

Exhibit 6.1 Dominos Pizza GPS

Recently, other fast food chain such as Pizza Hut, Mc Donalds and Kentucky
Fried Chicken has introduced their on line ordering portal to compete with
Dominos Pizza.

In striving to attract more customers in an easier and more efficient manner,

Dominos placed great importance on sales via its technology platform. Dominos
has witnessed an ongoing trend of pizza orders coming in electronically, rather
than over the phone.
In contrast to telephone orders being placed to the stores, the online system
requires less labour, and causes fewer mistakes. In addition, Dominos online
sales system has the ability to track customers preferences and past orders.
OPERATIONS & TECHNOLOGY MANAGEMENT
Page | 11

INDIVIDUAL ASSIGNMENT
BJMP5023

7.0

CONCLUSION
Dominos Pizza is recognized as the world leader in pizza delivery. The
companys fortune in the industry reflects their active arrival as the first chain to
offer delivery to the consumer. Since Dominos focused its business solely on
delivery, they were also the driving force behind pizza delivery technology.
Dominos Pizza has achieved success in creating the pizza box that has become
a standard for the pizza industry.
Dominos dominated the market with the delivery concept until its main
competitor Pizza Hut began experimenting with delivery in 1999. Dominos is
also commonly known for creating the 30-Minutes Delivery Guarantee for its
pizza delivery. Domino's is the only pizza company that guarantees customers
order will arrive within 30 minutes or Dominos will give its customer a free
Regular Pizza voucher. This slogan helped the company attract customers.
Dominos has benefited greatly from implementing the first truly effective home
delivery system.

8.0

REFERENCES
1) http://www.wikipedia.org
2) http://www.dominos.com.my

OPERATIONS & TECHNOLOGY MANAGEMENT

Page | 12