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Business Case Competition IOC 2021



Tema Lomba: Industry 4.0 in New Normal Era: Internet of Things, Advanced Robotics & Simulations.



Peserta membuat paper dan PowerPoint yang memuat analisis dan solusi yang dapat digunakan pada kasus yang diberikan, dikaitkan dengan tema Internet of Things & Simulations serta syarat dan ketentuan lomba yang ada.



ATAU



Peserta membuat paper dan PowerPoint yang memuat analisis dan solusi yang dapat digunakan pada kasus yang diberikan, dikaitkan dengan tema Advanced Robotics & Simulations serta syarat dan ketentuan lomba yang ada.



Syarat dan ketentuan lomba dapat dilihat pada file yang dilampirkan pada website https://iociisebinus.com/. Timeline lomba juga dapat dilihat pada guidebook, website, dan Instagram IOC. Peserta dimohon membaca semua dokumen yang tersedia dengan baik dan cermat sebelum bertanya kepada panitia lomba.



Contact Details Instagram Line Email



: @IOCBINUS : @093kclgy : [email protected]



“Innovation distinguishes between a leader and a follower” -Steve Jobs-



April, 2020



Internal Version for BBS Used Only



TOTO EDRINAL SEBAYANG



SHABU HACHI GROUP: MANAGING IN TURBULENT TIMES “Shabu Hachi, Hachi Grill or Hachi Group is not just a brand. It is a promise we make to the customer.” – Githa Nafeeza (Shabu Hachi Founder) Healthy, halal food at an affordable price. This is the kind of promise that Githa Nafeeza, founder of Shabu Hachi, had in mind when together with her husband, she launched the Shabu Hachi restaurant chain. It didn’t take long for the restaurant to gather wide attention and later it became a success. Shabu Hachi was first established in 2015, in the midst of intense competition from big players such as Gyu Kaku, Kintan Buffet and the well-known family restaurant chain Hanamasa. Despite the tough food and beverage (F&B) industry competition, Shabu Hachi managed to develop and earn its own success. The new restaurant chain started to grow rapidly within the first three years and opened a total of six new outlets since the brand first hit the market in 2015. In the following years more outlets were introduced, including the restaurant chains new concepts in 2018 such as Hachi Grill in Alam Sutera Tangerang and, in 2019, Shabu Hachi at Gatot Subroto Museum Satria Mandala. The brand continued to grow and evolve and is currently known as Hachi Group. Despite the restaurant’s continued growth and success, having a strong brand and winning awards together with national recognition, it would soon face a new kind of challenge. In 2020, the year after the company’s success, Indonesia would face an inconvenient truth. The coronavirus, initially started in Wuhan, China, had reached Indonesia, particularly the capital of Indonesia, Jakarta. The restaurant chain would face unexpected changes they had never experienced before. Indonesia’s growing economy suddenly turned around, as massive isolation measures and safety protocols were introduced nationwide. People were asked to stay at home; schools, universities, recreation sites and shopping centers were closed down, economic recession became inevitable, and the future of the company was now at question.



Company History Established in 17 April 2015, Shabu Hachi was founded as a local Indonesian company 1. It was founded by an Indonesian couple, Githa Nafeeza, a former television anchor, and her husband Sudjarwo Budiono. The couple’s idea came when they both travelled to Japan, Hong Kong and Singapore. By the time the couple returned back to Indonesia, they both found it hard to find the same food sensation they could easily find overseas. After careful consideration and thoughtful business analysis, the couple decided to enter the Shabu F&B industry. The name ‘Shabu Hachi’ itself means the product ‘shabu’ (thin meat and vegetable cooked in stock with dipping sauces) and ‘hachi’ in Japanese means number eight which represents the symbol of infinity and a constant 1 Amadea, A. 19 November 2019 “Gurihnya Kuah Berkolagen di Outlet Terbaru Shabu Hachi”



https://kumparan.com/kumparanfood/gurihnya-kuah-berkolagen-di-outlet-terbaru-shabu-hachi1sHPVsivUAv Accessed on Apr 23, 2020 Toto Edrinal Sebayang prepared this case from published sources under BCC’s supervision. BBS cases are developed solely as the basis for class discussions. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management Copyright © 2020 BINUS Case Center. To order copies and request permission to reproduce materials, call 62-21-720-2222 or go to http://bbs.binus.ac.id/casecenter/. 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 permission of BINUS Case Center.



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flow of energy and power. In Japanese culture, the number eight is often associated with material wealth, money, and success in business.



Eat Better, Feel Better, Live Better The company’s tagline ‘Eat Better, Feel Better, Live Better’ is not just a slogan but has become the core philosophy of the company. The company believes that its true success comes from their customers’ ultimate satisfaction. The restaurant offers healthy food that can be served quickly at an affordable price. “This is the kind of promise that the company wants to deliver to the customer”, said Githa Nafeeza, CEO of the Hachi Group. The restaurant serves a range of 40 different food choices (Exhibit 1) mainly shabu shabu and yakiniku that consists of imported beef, seafood, salad, vegetables, and even a wide range of cakes choices such as dorayaki, takoyaki, yakitori/robatayaki, Korean kimchee, chocolate pudding and sweet cassava from Thailand. In August 2018, Shabu Hachi was awarded both the Halal MUI (Majelis Ulama Indonesia) and MURI (Museum Rekor Indonesia) certification for being the first all-you-can-eat (AYCE) shabu-shabu and yakiniku halal restaurant in Indonesia. In 2019, the following year, Hachi Grill was also awarded the Halal MUI certification with ‘Excellence’ (Exhibit 2) for their Halal Assurance System implementation.



Industrial Background Back in 1987, the pioneer of all-you-can-eat (AYCE) Japanese restaurant in Indonesia was ‘Hanamasa’. For almost 30 years Hanamasa had no significant competition and was the sole player in the industry. In 2014, the Boga Group introduced another all-you-can-eat Japanese BBQ restaurant named ‘Kintan Buffet’ and joined the competition. 2 Later in 2015, the largest Yakiniku restaurant operator from Japan with 700 outlets worldwide, ‘ Gyu-Kaku’ opened its first outlet in BSD Tangerang3. Around the same time, ‘Shabu Hachi’ opened its first branch in Ampera, South Jakarta4. During the past 5 years, Indonesia experienced stable and continuous economic growth, making the Indonesian F&B all-you-can-eat industry interesting to the players that started at nearly the same time, and thus were competing head-to-head with one another. According to Statista (Exhibit 3), since 2017 the estimated revenue growth in the Indonesian F&B segment nearly quadrupled its market size from US$472m in 2017 to US$1,501m in 2020, making the segment increasingly interesting5. Indonesia’s continued economic growth rate and rising middle class helped the F&B industry continue to grow. According to the BPS Statistical Yearbook of Indonesia (Exhibit 4), another interesting trend that could be found in the rising middle class was that the percentage of monthly expenditure per capita for prepared food and beverages continued to rise for both urban and rural citizens from initially 16.82% in 2018 to 17.26% in 2019. This rising trend indicated that people were spending more money for prepared food and beverages and that this trend would likely grow in the future.



Pandemic and Economic Crisis 2



Ajani, A. 05 July 2019.” Setelah Penantian Panjang, Restoran Shaburi & Kintan Buffet Resmi Kantongi Sertifikat Halal” https://glitzmedia.co/post/wellness/food-diet/shaburi-kintan-buffet-halal Accessed on Apr 23, 2020. 3 Gyu Kaku Website. 2017. https://gyu-kaku.id/en/about/index Accessed on Apr 23, 2020. 4 Palupi, D. 05 June 2017 “Githa Nafeeza, Sosok Wanita di Balik Resto Shabu Hachi” https://swa.co.id/swa/profile/profile-entrepreneur/githa-nafeeza-sosok-wanita-di-balik-resto-shabu-hachi Accessed on Apr 23, 2020 5 Statista Website. January 2020. “Revenue in the Food & Beverages segment amounts to US$1,501m in 2020” https://www.statista.com/outlook/253/120/food-beverages/indonesia Accessed on Mar 26, 2020 Page 2 of 12



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On 2 March 2020, two Indonesian citizens tested positive for the novel coronavirus after being in contact with an infected Japanese national. It was announced by Indonesia’s President Joko Widodo on national television6. The coronavirus took Indonesia by storm; within six weeks more than 7000 Indonesian citizens (Exhibit 5) would test positive with the coronavirus, with the death rate reaching over 600 cases. The virus, now known as COVID-19, would suddenly drag the country into both a human and economic crisis. The coronavirus pandemic didn’t just affect Indonesia but had also been recognized as an international pandemic worldwide, infecting millions of people and even killing hundreds of thousand people. These events had a huge impact on the nation’s economy, as the public started to panic. There was a run on health masks, vitamins, hand sanitizers and groceries by the public. The USD-IDR exchange rate fell around 15% from Rp. 14,000 to Rp. 16,500 (Exhibit 6), while the Indonesian stock exchange rate plummeted nearly 40% to 3.8 from initially 6.0 in early January 2020 (Exhibit 7), the lowest since 2016. Soon after, massive isolation measures and safety protocols were introduced in the country. Starting with the nation’s capital in Jakarta, the largest city in Indonesia with a population of over 10 million, all schools and universities were suddenly closed. Recreation sites such as Ancol (a coastal area in north Jakarta) and Monas (the national monument) were restricted and/or closed. Shopping centers were closed down, while offices started to send their workers to work from home and citizens were requested to stay at home and strictly avoid crowds whenever possible. Saving the nation’s economy in the face of suddenly spiking unemployment rates was deemed the priority. Companies had to make provisions to establish a ‘new normal’. The Hachi Group worried that their restaurants would become a potential source of infection.



People, People, People Since its first opening in 2015, the Shabu Hachi restaurant chain grew at a faster speed than the Hachi Group could imagine. The number of restaurants under the Hachi Group jumped from two outlets in 2015 to a total of eleven outlets in 2019 causing the number of restaurant crew to grow rapidly to 1400. Githa understood that the crew is what made Shabu Hachi great. She always treated the crew like her own family, and for Githa, family always comes first. A company that takes care of their employees, would eventually have employees that take care of the customers. Soon Githa would face a difficult decision between choosing to close all their outlets for the safety of their workers and customers. Closing outlets would mean stopping sales and producing no income without knowing when this pandemic would end while risking the future of the company. On the other hand, remaining open would produce sales but at the risk of the safety of their workers and their customers. Either decision would greatly affect the company.



Delivery and Take-Away Launch The Hachi Group restaurant chain was well-known for its warm and unique ambience, friendly service and their wide range of food choices. These characteristics were the core strengths of the company. In April 2020, the coronavirus had already spread nationwide and on April 9, 2020, the Governor of Jakarta announced that large scale social restrictions ( PSBB) were effectively to be



Ratcliffe, R. 2 March 2020 “First coronavirus cases confirmed in Indonesia amid fears nation is ill-prepared for outbreak” https://www.theguardian.com/world/2020/mar/02/first-coronavirus-cases-confirmed-inindonesia-amid-fears-nation-is-ill-prepared-for-outbreak Accessed on Apr 23, 2020 6



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held in the capital7. These restrictions were later extended until 22 May 2020 8. These large-scale social restrictions impacted strongly on the F&B industry. No dine-in customers were allowed as citizens were to stay at home to comply with restrictions on social life imposed by the government to contain the spread of the coronavirus9. More than 6800 restaurants were forced to close down and over 200,000 employees in this industry had to be laid off amid the pandemic 10. In order to save their employees and the future of the company, the Hachi Group were forced to think of new solutions to save their business and planned to launch new delivery and take away services (Exhibit 8). After careful consideration, preparations were made, and the restaurant chain planned to launch the new services starting from April 6, 202011.



Shabu Hachi’s Crisis Management Starting from March 22, 2020, Hachi Group finally decided to close all their outlets to support the government’s large-scale social restrictions (PSBB). During the closing period, the management team implemented new safety and health protocols for their employees. Facing the ‘new normal’ era, all on-duty staff were to undergo 14 days of self-quarantining, applying health check procedures such as checking body temperature, and using hand sanitizers. Further measures were implemented such as regular outlet sterilization, masks for both customers and staff, extra selfhygiene for staff and limitation on the number of customer dine-ins. Ansoff (1965, 1979, 1984) analyzed the relationship of capability, strategy, environment, and performance and presented theoretical propositions; for different types of environments, different solutions are applied. Change in the business model environment greatly affected the business environment of the F&B industry (Exhibit 9). Despite Shabu Hachi’s previous success, its survival would now depend on the response of their management team.



What to do?



Due to the coronavirus pandemic outbreak, large scale social restrictions (PSBB), extensive massive isolation measures, and safety protocols imposed nationwide severely affected the F&B industry. Dining in at restaurants was no longer allowed. What were the effects of the existing service blueprint? What marketing strategies were required to improve the organization’s capability to save the business? Was the Hachi Group’s attempt to change its product from a warm and unique ambience to delivery and take-away services the right kind of innovation? What were the social and economic effects on the target customers? What could the Hachi Group restaurant chain do to save both the future of the company and the safety of their workers? How could Shabu Hachi sustain its competitiveness and stay profitable with increasing costs due to increasing safety protocols and extensive isolation measures?



7



Sutrisna, Tria. 09 April 2020 “Berlaku 14 Hari, Penerapan PSBB di Jakarta Sampai 23 April 2020” https://megapolitan.kompas.com/read/2020/04/09/23332221/berlaku-14-hari-penerapan-psbb-di-jakartasampai-23-april-2020 Accessed on Apr 23, 2020 8 Bernama. 22 April 2020 “Large-scale social restrictions in Jakarta extended until May 22” https://www.thesundaily.my/world/large-scale-social-restrictions-in-jakarta-extended-until-may-22EY2320897 Accessed on Apr 22, 2020 9 Ydp. 26 March 2020 “Major restaurants temporarily close as COVID-19 outbreak worsens” https://www.thejakartapost.com/news/2020/03/26/major-restaurants-temporarily-close-as-covid-19outbreak-worsens.html Accessed on Mar 26, 2020 10 Hamdani, T. 20 April 2020 “Gelombang PHK Kian Besar, Ada Tambahan dari Ribuan Restoran” https://finance.detik.com/berita-ekonomi-bisnis/d-4984043/gelombang-phk-kian-besar-ada-tambahan-dariribuan-restoran Accessed on Apr 20, 2020 11 Shabu Hachi Instagram. 22 Maret 2020 “See you again soon” https://www.instagram.com/p/B-B9g3HlFhV/ Accessed on Apr 20, 2020 Page 4 of 12



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Exhibits Exhibit 1. Company’s Products



Source: http://www.shabuhachi.com, April 2020



Exhibit 2. HACHI GRILL HALAL MUI CERTIFICATION



Source: https://www.instagram.com/githanafeeza/?hl=id, April 2020



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Exhibit 3. Revenue in the food & beverages segment amounted to US$1,501m in 2020



Exhibit 4. Percentage of Monthly Expenditure per Capita by Commodity Group and Urban Rural Classification, 2018 and 2019



Source: https://www.bps.go.id, April 2020



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Exhibit 5. The Graph of Coronavirus outbreak in Indonesia



Source: www.detik.com, April 2020 Exhibit 6. USD-IDR exchange volatility 01-Jan 20 to 01-Apr 20



Source: www.bi.go.id, April 2020



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Exhibit 7. Indonesia stock exchange volatility Mar-19 to Mar-20



Source: www.idx.co.id, April 2020



Exhibit 8. Delivery and Take Away Services



Source: https://www.instagram.com/shabuhachi/?hl=id, April 2020



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Exhibit 9. Business Model Environment Model



Source: https://isaacjeffries.com/blog/2017/6/5/bmc-part-sixteen-the-business-modelenvironment, July 2020



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Sources and References



Ansoff, H.I. et al., Implanting Strategic Management. 3rd ed. Palgrave Macmillan, 2019.



Berlaku 14 Hari, Penerapan PSBB di Jakarta Sampai 23 April 2020 (Apr 09, 2020) Retrieved from https://megapolitan.kompas.com/read/2020/04/09/23332221/berlaku-14-hari-penerapanpsbb-di-jakarta-sampai-23-april-2020 (Apr 23, 2020)



First coronavirus cases confirmed in Indonesia amid fears nation is ill-prepared for outbreak (Mar 02, 2020) Retrieved from https://www.theguardian.com/world/2020/mar/02/first-coronaviruscases-confirmed-in-indonesia-amid-fears-nation-is-ill-prepared-for-outbreak (Apr 23, 2020)



Githa Nafeeza, Sosok Wanita di Balik Resto Shabu Hachi (Jun 05, 2017) Retrieved from https://swa.co.id/swa/profile/profile-entrepreneur/githa-nafeeza-sosok-wanita-di-balik-restoshabu-hachi (Apr 23, 2020)



Githa



Nafeeza Instagram (Apr 03, 2020) https://www.instagram.com/githanafeeza/?hl=id (Apr 30, 2020)



Retrieved



from



Gelombang PHK Kian Besar, Ada Tambahan dari Ribuan Restoran (Apr 20, 2020) Retrieved from https://finance.detik.com/berita-ekonomi-bisnis/d-4984043/gelombang-phk-kian-besar-adatambahan-dari-ribuan-restoran (Apr 30, 2020)



Grafik Data Kasus Corona di RI Per Hari ini, 22 April 2020 (Apr 22, 2020) Retrieved from https://news.detik.com/infografis/d-4986966/grafik-data-kasus-corona-di-ri-per-hari-ini-22april-2020 (Apr 23, 2020)



Gurihnya Kuah Berkolagen di Outlet Terbaru Shabu Hachi (Nov 19, 2019) Retrieved from https://kumparan.com/kumparanfood/gurihnya-kuah-berkolagen-di-outlet-terbaru-shabuhachi-1sHPVsivUAv (Apr 23, 2020)



Gyu Kaku Website (2017) Retrieved from https://gyu-kaku.id/en/about/index (Apr 23, 2020) IDX Monthly Statistics (Mar 01, 2020) Retrieved from https://www.idx.co.id/media/8550/idxmonthly-march-2020.pdf (Apr 18, 2020)



KURS



TRANSAKSI



BANK



INDONESIA



(Mar 20, 2020) Retrieved from https://www.bi.go.id/id/moneter/informasi-kurs/transaksi-bi/Default.aspx (Apr 18, 2020)



Large-scale social restrictions in Jakarta extendend until May 22 (Apr 22, 2020) Retrieved from https://www.thesundaily.my/world/large-scale-social-restrictions-in-jakarta-extended-untilmay-22-EY2320897 (Apr 23, 2020)



Major restaurants temporarily close as COVID-19 outbreak worsens (Mar 26, 2020) Retrieved from https://www.thejakartapost.com/news/2020/03/26/major-restaurants-temporarilyclose-as-covid-19-outbreak-worsens.html (Mar 26, 2020)



Osterwalder, A. & Y. Pigneur., Business Model Environment. 2010. Retrieved from https://isaacjeffries.com/blog/2017/6/5/bmc-part-sixteen-the-business-modelenvironment (July 08, 2020) Page 10 of 12



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Revenue in the Food & Beverages segment amounts to US$1,501m in 2020 (Jan 2020) Retrieved from https://www.statista.com/outlook/253/120/food-beverages/indonesia (Mar 26, 2020)



Shabu Hachi Instagram (Mar



22, 2020) “See you again https://www.instagram.com/p/B-B9g3HlFhV/ (Apr 20, 2020)



soon”



Retrieved



from



Shabu Hachi Instagram “Coming to your door” (Mar 20, 2020) Retrieved from https://www.instagram.com/shabuhachi/?hl=id (Apr 23, 2020)



Setelah Penantian Panjang, Restoran Shaburi & Kintan Buffet Resmi Kantongi Sertifikat Halal Retrieved from https://glitzmedia.co/post/wellness/food-diet/shaburi-kintan-buffet-halal (Apr 23, 2020)



Statistical



Yearbook



of



Indonesia



(Feb 28, 2020) Retrieved from https://www.bps.go.id/publication/download.html?nrbvfeve=NmU2NTRkZDcxNzU1MmU4Mm ZiM2MyZmZl&xzmn=aHR0cHM6Ly93d3cuYnBzLmdvLmlkL3B1YmxpY2F0aW9uLzIwMjAvMDIv MjgvNmU2NTRkZDcxNzU1MmU4MmZiM2MyZmZlL3N0YXRpc3Rpay1pbmRvbmVzaWEtLXBlbnll ZGlhYW4tZGF0YS11bnR1ay1wZXJlbmNhbmFhbi1wZW1iYW5ndW5hbi5odG1s&twoadfnoarfea uf=MjAyMC0wNC0yMyAxMjo1MDo1MA%3D%3D (Apr 22, 2020)



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About the Author Toto Edrinal Sebayang was the winner of the CIMB EMERALD AWARD 2017 from CIMB Bank Malaysia and Best Teaching & Best Lecturer Award Nominee at BINUS University in 2018, 2019 and 2020. He was recognized as one of the Five Most Outstanding Students from Prasetiya Mulya University in 2011. The author had twelve years’ experience in CIMB Niaga Bank Indonesia where he was Assistant Vice President with his last position as Test Management Head. He joined Binus Business School undergraduate program as a faculty member in 2015. Toto Edrinal Sebayang holds an undergraduate degree in Computer Science and a master’s degree in Business Administration (MBA Finance) and Business Law (in trade, investment, competition and policy law). He also taught at CIMB IT Academy as an IT Trainer for topics related to System Development Life Cycle (SDLC) and Quality Assurance. In 2018, he was sent by CIMB Niaga Bank Indonesia to Cambridge Judge Business School (CJBS) to enroll in the Emerging Banking Leaders Program. In 2019, the author was also selected as a Microsoft Master Trainer after successfully completing a six-month program from Microsoft Indonesia & BINUS University. Currently, he is pursuing his Doctor of Business Management degree specializing in Strategic Management at School of Business IPB University.



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