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An Integrated Labor-Management System for Taco Bell

Author

Listed:
  • Jackie Hueter

    (Taco Bell Corporation, 17901 Von Karman, Irvine, California 92714-6212)

  • William Swart

    (College of Engineering and Technology, Old Dominion University, Norfolk, Virginia 23529-0236)

Abstract

Taco Bell Corporation has approximately 6,490 company-owned, licensed, and franchised locations in 50 states and a growing international market. Worldwide yearly sales are approximately $4.6 billion. In 1988, Taco Bell introduced six core-menu items for the reduced price of 59 cents and offered free drink refills. Taco Bell has since continued to change and innovate. Its new strategy meant restructuring the business to become more efficient and cost-effective. To do this, the company relied on an integrated set of operations research models, including forecasting to predict customer arrivals, simulation to determine the optimum labor required to provide desired customer service, and optimization to schedule and allocate crew members to minimize payroll. Through 1997, these models have saved over $53 million in labor costs.

Suggested Citation

  • Jackie Hueter & William Swart, 1998. "An Integrated Labor-Management System for Taco Bell," Interfaces, INFORMS, vol. 28(1), pages 75-91, February.
    • Handle: RePEc:inm:orinte:v:28:y:1998:i:1:p:75-91
    DOI: 10.1287/inte.28.1.75
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    References listed on IDEAS

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    1. Hugh Everett, 1963. "Generalized Lagrange Multiplier Method for Solving Problems of Optimum Allocation of Resources," Operations Research, INFORMS, vol. 11(3), pages 399-417, June.
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    2. Ety Zohar & Avishai Mandelbaum & Nahum Shimkin, 2002. "Adaptive Behavior of Impatient Customers in Tele-Queues: Theory and Empirical Support," Management Science, INFORMS, vol. 48(4), pages 566-583, April.
    3. Hwang, Johye & Gao, Long & Jang, Wooseung, 2010. "Joint demand and capacity management in a restaurant system," European Journal of Operational Research, Elsevier, vol. 207(1), pages 465-472, November.
    4. Smirnov, Dmitry & Huchzermeier, Arnd, 2020. "Analytics for labor planning in systems with load-dependent service times," European Journal of Operational Research, Elsevier, vol. 287(2), pages 668-681.
    5. Francine Lafontaine & Jagadeesh Sivadasan, 2009. "Within-firm Labor Productivity across Countries: A Case Study," NBER Chapters, in: International Differences in the Business Practices and Productivity of Firms, pages 137-172, National Bureau of Economic Research, Inc.
    6. S Eom & E Kim, 2006. "A survey of decision support system applications (1995–2001)," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 57(11), pages 1264-1278, November.
    7. Hur, Daesik & Mabert, Vincent A. & Bretthauer, K.M.Kurt M., 2004. "Real-time schedule adjustment decisions: a case study," Omega, Elsevier, vol. 32(5), pages 333-344, October.
    8. Stewart Robinson & Maureen Meadows & John Mingers & Frances A. O'Brien & Estelle A. Shale & Stephanie Stray, 2003. "Teaching OR/MS to MBAs at Warwick Business School: A Turnaround Story," Interfaces, INFORMS, vol. 33(2), pages 67-76, April.
    9. Liu, Lon-Mu & Bhattacharyya, Siddhartha & Sclove, Stanley L. & Chen, Rong & Lattyak, William J., 2001. "Data mining on time series: an illustration using fast-food restaurant franchise data," Computational Statistics & Data Analysis, Elsevier, vol. 37(4), pages 455-476, October.
    10. Doǧan A. Serel & Erdal Erel, 2008. "Coordination of staffing and pricing decisions in a service firm," Applied Stochastic Models in Business and Industry, John Wiley & Sons, vol. 24(4), pages 307-323, July.
    11. Jaime Miranda & Pablo A. Rey & Antoine Sauré & Richard Weber, 2018. "Metro Uses a Simulation-Optimization Approach to Improve Fare-Collection Shift Scheduling," Interfaces, INFORMS, vol. 48(6), pages 529-542, November.
    12. S Robinson, 2005. "Discrete-event simulation: from the pioneers to the present, what next?," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 56(6), pages 619-629, June.
    13. Michael J. Brusco & Larry W. Jacobs, 2000. "Optimal Models for Meal-Break and Start-Time Flexibility in Continuous Tour Scheduling," Management Science, INFORMS, vol. 46(12), pages 1630-1641, December.
    14. Peter C. Bell & Chris K. Anderson, 2002. "In Search of Strategic Operations Research/Management Science," Interfaces, INFORMS, vol. 32(2), pages 28-40, April.
    15. Defraeye, Mieke & Van Nieuwenhuyse, Inneke, 2016. "Staffing and scheduling under nonstationary demand for service: A literature review," Omega, Elsevier, vol. 58(C), pages 4-25.
    16. Ellis L. Johnson & George L. Nemhauser & Martin W.P. Savelsbergh, 2000. "Progress in Linear Programming-Based Algorithms for Integer Programming: An Exposition," INFORMS Journal on Computing, INFORMS, vol. 12(1), pages 2-23, February.
    17. Jahangirian, Mohsen & Eldabi, Tillal & Naseer, Aisha & Stergioulas, Lampros K. & Young, Terry, 2010. "Simulation in manufacturing and business: A review," European Journal of Operational Research, Elsevier, vol. 203(1), pages 1-13, May.
    18. Najmaddin Akhundov & Nail Tahirov & Christoph H. Glock, 2022. "Optimal Scheduling of Waitstaff with Different Experience Levels at a Restaurant Chain," Interfaces, INFORMS, vol. 52(4), pages 324-343, July.

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