Exploring Alternative Ordering Methods for Gino’s Pizza (Obj. 1)
eBuyer Group, a leading consumer and research firm, has been asked to study alternative ordering methods for Gino’s Pizza, a 30-unit delivery and takeout chain. Fast-food franchises across the nation have become increasingly interested in using the Internet to supplement traditional takeout and delivery options. In fact, several prominent national pizza chains have already adopted, or are testing, online ordering. Well-known examples include Papa John’s, Pizza Hut, and Domino’s. Another more recently explored option is interactive television (iTV). Gino Vanilli, CEO of Gino’s Pizza, wants to know whether the chain should continue using its conventional phone-ordering/delivery method or adopt one of the two alterna- tives. The following represents your preliminary research.
The Online Consumer
● Approximately 50 percent of American adults have shopped online (Scarborough Research).
● Currently, about 80 percent of the online population over age 13 shops online (eMarketer).
● Thirteen percent of online shoppers have made food or drink purchases (Ernst & Young).
● By 2010, 85 percent of U.S. homes will be online. Approxi- mately 75 percent will use a computer for access (Strategy Analysis).
● The composition of online shoppers is 56 percent male, 39 per- cent of whom are between the ages of 18 and 34 (Scarborough Research).
Online Ordering
The most common method involves using an intermediary that ac- cepts orders for the restaurant. For example, Food.Com licenses its ROSY (Restaurant Ordering System) to Papa John’s. The intermedi- ary’s Web site contains the interactive menus of its client restaurants.
After consumers join Food.Com, they are able to access participating restaurants’ menus and place orders; then, Food.Com sends the completed order by fax to the restaurant. A percentage of each sale, roughly 3 percent, is billed monthly to the restaurant.
Advantages of Online Ordering
● The intermediary handles most technological aspects of the process.
● The restaurant does not spend as much on computer technol- ogy and training.
● Most restaurants already use fax machines to conduct business with suppliers and main offices.
● Capital expenditures are minimal.
● Many pizza takeout and delivery restaurants and chains have created a Web presence.
Disadvantages of Online Ordering
● Because of current technology, ordering by phone takes less time.
● Consumers are still concerned about online security issues.
● One Pizza Hut operator reported receiving 5 Internet orders per day compared with a typical 140 telephone orders.
● The Pizza Time delivery and restaurant chain reported sales ex- pectations of 10 to 12 percent of total sales based on a recent online ordering survey it conducted.
In a recent survey, the Pizza Time delivery and restaurant chain learned that online ordering would account for only 10 to 12 percent of its total sales. This is not significant enough to justify the costs. In addition to the previous information, several Internet-based grocery and food delivery ventures have disappeared (e.g., WebVan, Home Grocer, and Publix Direct) or struggled with expansion and had to downsize to survive (Pink Dot).
The iTV Consumer
● Satellite TV subscribers as of the end of last year totaled 9.39 million (OpenTV.com).
● Approximately 95 percent of U.S. households receive digital TV via a direct-to-home satellite service (OpenTV.com).
● Within three years, 117 million homes worldwide will be receiv- ing digital TV from cable operators, and 145 million households will be receiving it from satellite services (OpenTV.com).
● Approximately 85 percent of homes in the country have cable access (Strategy Analysis).
● Roughly 6 percent of U.S. homes have iTV (Strategy Analysis).
iTV Ordering
iTV can be delivered in a number of ways. TV sets with integrated interactive receivers are on the market. However, trends suggest that some consumers will use iTV through set-top boxes for some time. Set-top boxes, such as those provided by WebTV or DirectTV, are available at local retail stores and have a street price of about
$200. The most prominent player in the iTV market is OpenTV. Pizza Hut and Time Warner test marketed ordering by cable TV in Hawaii
using digital cable boxes. Domino’s teamed with RespondTV, a San Francisco–based software firm, to offer pizza delivery through WebTV. Finally, iTV is popular in Europe, and ordering pizza is one of its most popular uses.
Advantages of iTV
● A significant number of consumers already have cable TV.
● It eliminates the need for the consumer to input name and ad- dress repeatedly.
● It creates a secure channel for passing charge account informa- tion.
● The interface is intuitive and user friendly.
Disadvantages of iTV
● Conversion to digital cable and satellite TV has been slow.
● Arguments over technical standards have delayed a mass- market rollout in the United States.
● The viability of marketing restaurant food is unproven.
● Costs are relatively high for businesses.
Consumer Survey
Following are the results of a telephone survey obtained from a random sample of Americans from across the nation:
Questions Yes No
1. Have you ordered pizza for delivery within
the last month? 799 226
2. Would you consider ordering pizza online
as opposed to calling? 133 892
3. Would you consider ordering pizza using
your television set as opposed to calling? 665 360
Your Task. As a consultant for eBuyer Group, study the preced- ing information. You have several options for the type of report you could prepare, based on the research data. Choose from among the following options, and address your report to Mr. Gino Vanilli, CEO of Gino’s Pizza. Use at least one visual aid.
a. You could write a yardstick report establishing criteria and then comparing and contrasting the various forms of pizza ordering and delivery. You should recommend the most efficient and cost- effective solution. Decide whether to organize the report directly or indirectly.
b. You have heard from a reliable Gino’s Pizza company insider that Mr. Vanilli privately strongly favors the iTV option. However, you find this option risky because iTV is still in its infancy and its future reception by consumers seems shaky. Prepare a feasibility report discussing the viability of the iTV option for Gino’s Pizza.
As an ethical consultant, you are beholden to the truth. If you disagree with the client, you need to find a way to dish out the unpleasant findings gently. If iTV is an appropriate option in your view, then your approach could be direct.
c. Prepare a justification/recommendation report that studies the several ordering options and proposes the most appropriate one for Mr. Vanilli’s business. Although you cannot discuss the spe- cific costs of each proposal, you can draw conclusions and make practical recommendations based on the facts presented here.
What items are most important to show visually?
Grammar and Mechanics C.L.U.E. Review 12
Total Review
The first ten chapters reviewed specific guides from Appendix A:
Grammar and Mechanics Guide (Competent Language Usage Essen- tials). The remaining exercises are total reviews, covering all of the grammar/mechanics guides plus confusing words and frequently misspelled words.
Each of the following sentences has a total of three errors in grammar, punctuation, capitalization, usage, or spelling. On a sepa- rate sheet, write a correct version. Avoid adding new phrases, start- ing new sentences, or rewriting in your own words. When finished, compare your responses with the key beginning on page Key-3.
Example: After our supervisor and her returned from their meeting at 2:00 p.m. we were able to sort the customers names more quickly.
Revision: After our supervisor and she returned from their meeting at 2 p.m., we were able to sort the customers’ names more quickly.
1. Reports are a fact of life in american business consequently busi- ness writers must learn to prepare them.
2. Adrians report, which he sent to the manager and I, was distin- guished by three characteristics, clear content, good organiza- tion, and correct form.
3. 6 members of our team will attend the writers’ workshop, there- fore, be sure they recieve notices.
4. More then ninety percent of companies now use e-mail. Which explains why we need an e-mail policy.
5. To search the Internet you need a browser such as Microsoft internet explorer.
6. Rachel was offered four hundred dollars to complete Roberts report but she said it was too little.
7. The format of a report is determined by: length, topic audience and purpose.
8. Our latest press release which was written in our Corporate Com- munication Department announces the opening of 3 Canadian offices.
9. Letter reports usualy has side margins of one and one quarter inches.
10. The CEO and Manager, who had went to a meeting in the West, delivered a report to Jeff and I when they returned.
Chapter 13
Proposals and Formal Reports
OBJECTIVES
After studying this chapter, you should be able to
1 Discuss the general uses and basic components of proposals and grasp their audience and purpose.
2 Discuss formal proposals and how to anticipate a receiver’s reaction to your message.
3 Identify the components of typical business plans and ethically create buy- in for your business ideas.
4 Describe the formal report components that precede the introduction as well as elements to include in the introduction and how they further the purpose of your communication.
5 Describe the formal report components that follow the introduction and how they further the purpose of your communication.
6 Specify tips that aid writers of formal reports as they use their analytic skills and reflective thinking skills.
© Comstock Select / Corbis
Preparing Formal and Informal Proposals
Proposals are written offers to solve problems, provide services, or sell equipment. Some proposals are internal, often taking the form of justification and recommendation reports.
You learned about these reports in Chapter 12. Most proposals, however, are external, such as those written at Raytheon. They are a critical means of selling equipment and services that generate income for the giant aerospace company.
Because proposals are vital to their success, high-tech companies and defense contrac- tors maintain specialists, like Dr. Mark Grinyer, who do nothing but write proposals. Such proposals typically tell how a problem can be solved, what procedure will be followed, who will do it, how long it will take, and how much it will cost. One proposal expert said that companies today want to be able to compare “apples with apples,” and they also want the protection offered by proposals, which are legal contracts.2
Proposals may be divided into two categories: solicited and unsolicited. When firms know exactly what they want, they prepare a request for proposal (RFP), specifying their requirements. Government agencies as well as private businesses use RFPs to solicit com- petitive bids from vendors. Most proposals are solicited, such as that presented by the city of Federal Way, Washington. Its RFP offered $10,000 to the winning consulting firm for pro- moting tourism in the region.3 Enterprising companies looking for work might submit un- solicited proposals. For example, a team led by Goldman Sachs submitted an unsolicited proposal for a truck-only toll lanes project on an interstate in Georgia.4
LEARNING OBJECTIVE 1 Discuss the general uses and basic components of proposals and grasp their audience and purpose.
LEARNING OBJECTIVE 1 Discuss the general uses and basic components of proposals and grasp their audience and purpose.
Government agencies and many companies use requests for proposals (RFPs) to solicit competitive bids on projects.
Government agencies and many companies use requests for proposals (RFPs) to solicit competitive bids on projects.
It was a sunny November morning in Southern California. The director of operations at Raytheon Company’s Santa Barbara business unit stood in front of an audience of about 20 engineers and managers—
the individuals selected by management to write a proposal for the Aerosol Polarimetry Sensor on the National Polar-Orbiting Opera- tional Environmental Satellite System. He began by telling them,
“The request for proposal (RFP) has finally arrived. I know that many of you have been thinking about how to win this contract for more than a year. Now it’s time to turn that thinking into words—time to write the proposal!”1
He then introduced the proposal volume managers. They would be directing most of the team’s writing efforts. Finally, he identified the proposal team’s newest member, Dr. Mark Grinyer, a Raytheon proposal specialist who had been asked to write the vitally impor- tant executive summary volume. He closed with a final comment,
“Remember, everyone, we’re on the clock now. We’ve got less than 60 days to build a winning proposal for almost $100 million in new business.”
As Dr. Grinyer listened, he thought, “It’ll be a busy holiday sea- son.” Such schedules, however, were typical for aerospace industry proposals. Several companies were competing for this contract, and only one proposal would win.
A leading aerospace company, Raytheon is a Fortune 500 giant with about 73,000 employees. Most are technicians, engineers, scientists, and managers involved in high-technology military and government programs. Raytheon’s Remote Sensing business unit in Santa Barbara specializes in high-quality electro-optical sensor systems for weather satellites and other space-based vehicles. Their sensors on weather satellites provide images seen on TV every day and enable better weather predictions around the world.
Like most aerospace companies, Raytheon’s success depends on its ability to produce winning proposals selling complex systems
Winning New Business at Raytheon
© Steven E. Frischling / Bloomberg News / Landov
Communicating at Work Part 1
Steven E. Frischling / Bloomberg News
that involve many disciplines. High-tech companies use a struc- tured proposal development process. This process enables teams of employees who are neither professional writers nor proposal experts to work together, often under pressing time constraints. Their goal is to develop winning proposals against tough competition.
Critical Thinking
● Why are proposals vitally important to a company like Raytheon?
● How are proposals at Raytheon similar to and different from proposals or long reports written by students?
● How can team members maintain consistency and meet dead- lines when writing important, time-constrained, multivolume documents such as this proposal?
http://www.raytheon.com
Components of Informal Proposals
Informal proposals may be presented in short (two- to four-page) letters. Sometimes called letter proposals, they may contain six principal components: introduction, background, pro- posal, staffing, budget, and authorization request. As you can see in Figure 13.1, both infor- mal and formal proposals contain these six basic parts. Figure 13.2, an informal letter proposal to a Tampa dentist to improve patient satisfaction, illustrates the six parts of letter proposals.
Informal proposals may contain an introduction, background information, the proposal, staffi ng requirements, a budget, and an authorization request.
Informal proposals may contain an introduction, background information, the proposal, staffi ng requirements, a budget, and an authorization request.
FIGURE 13.1 Components of Formal and Informal Proposals
Appendix
Background, problem, purpose
Authorization Budget
Staffing Proposal, plan, schedule
Introduction List of figures Table of contents Title page
Abstract or summary Letter of transmittal Copy of RFP (optional)
Optional in informal proposals:
Generally appear in both formal and informal proposals:
© Emilio Ereza / Alamy
Hoku Scientific is a hot new player in the solar energy market. As a maker of space-age photovoltaic installations that provide solar- generated electricity to homes and businesses, the Hawaii- based clean-energy producer is helping create a sustainable world powered by 100 percent renewable energy. Hoku’s proposals have led to formal negotiations and million-dollar contracts with Suntech Power Holdings, Sanyo Electric, and Hawaiian Electric Co. What persuasive “hooks” could Hoku include in its proposals to persuade companies to buy its solar components?
March 3, 2009 Peter R. Daltrey, DDS 1015 Oaks Plaza Tampa, FL 33620 Dear Dr. Daltrey:
Helping you improve your practice is of the highest priority at Becker Marketing.
That’s why we are pleased to submit the following proposal outlining our plan to help you more effectively meet your patients’ needs by analyzing their views about your practice.
Background and Purpose
We understand that you have been incorporating a total quality management system in your practice. Although you have every reason to believe your patients are pleased with the service you provide, you would like to give them an opportunity to discuss what they like and possibly don’t like about your service.
Specifically, your purposes are to survey your patients to (a) determine the level of their satisfaction with you and your staff, (b) elicit their suggestions for improvement, (c) learn more about how they discovered you, and (d) compare your “preferred” and “standard” patients.
Proposed Plan
Based on our experience in conducting many local and national customer satisfaction surveys, Becker Marketing proposes the following plan to you.
Survey. We will develop a short but thorough questionnaire probing the data you desire. Although the survey instrument will include both open-ended and closed questions, it will concentrate on the latter. Closed questions enable respondents to answer easily; they also facilitate systematic data analysis. The questionnaire will measure patient reactions to such elements as courtesy, professionalism, accuracy of billing, friendliness, and waiting time. After you approve it, the questionnaire will be sent to a carefully selected sample of 300 patients whom you have separated into groupings of “preferred” and “standard.”
Analysis. Data from the survey will be analyzed by demographic segments, such as patient type, age, and gender. Our experienced team of experts, using state- of-the-art computer systems and advanced statistical measures, will study the (a) degree of patient satisfaction, (b) reasons for satisfaction or dissatisfaction, and (c) relationship between responses of your “preferred” and “standard”
patients. Moreover, our team will report to you specific suggestions for making patient visits more pleasant.
Report. You will receive a final report with the key findings clearly spelled out, Dr. Daltrey. Our expert staff will also draw conclusions based on these findings.
The report will include tables summarizing all responses, broken down into groups of preferred and standard patients.
1302 Prudential Drive Jacksonville, FL 32099 (866) 270-5110
www.beckermarketing.com
Becker Marketing
MARKET RESEARCH CONSULTANTS
Grabs attention with “hook” that focuses on key benefit
Announces heart of proposal
Divides total plan into logical segments for easy reading
Uses opening paragraph in place of introduction
Identifies four purposes of survey
Describes procedure for solving problem or achieving goals
1
1 Prewriting 2 Writing 3 Revising
Revise:Revise to emphasize benefits.
Improve readability with functional headings and lists. Remove jargon and wordiness.
Proofread:Check spelling of client’s name. Verify dates and calculation of budget figures. Recheck all punctuation.
Evaluate:Is this proposal convincing enough to sell the client?
Research:Collect data about the reader’s practice and other surveys of patient satisfaction.
Organize:Identify four specific purposes (benefits) of this proposal.
Specify the survey plan. Promote the staff, itemize the budget, and ask for approval.
Compose:Prepare for revision by composing at a word processor.
Analyze:The purpose is to persuade the reader to accept this proposal.
Anticipate:The reader must be convinced that this survey project is worth its hefty price.
Adapt:Because the reader will be resistant at first, use a persuasive approach that emphasizes benefits.
FIGURE 13.2 Informal Proposal
Introduction. Most proposals begin by briefly explaining the reasons for the proposal and by highlighting the writer’s qualifications. To make your introduction more persuasive, you need to provide a “hook,” such as the following:
● Hint at extraordinary results with details to be revealed shortly.
● Promise low costs or speedy results.
● Mention a remarkable resource (well-known authority, new computer program, well- trained staff) available exclusively to you.
● Identify a serious problem (worry item) and promise a solution, to be explained later.
● Specify a key issue or benefit that you feel is the heart of the proposal.
Although writers may know what goes into the proposal introduction, many face writer’s block before they can get started. When she worked as a proposals manager at Hewlett-Packard, Mary Piecewicz recognized that writer’s block was a big problem for sales representatives on a proposal team. They simply didn’t know how to get started. Piecewicz
Dr. Peter R. Daltrey Page 2 March 3, 2009
Schedule. With your approval, the following schedule has been arranged for your patient satisfaction survey:
Questionnaire development and mailing Deadline for returning questionnaires Data tabulation and processing Completion of final report
April 1–6 April 25 April 25–26 May 2
Professional and administrative time Questionnaire development Questionnaire mailing Data processing and tabulation Analysis of findings
Preparation of final report Mailing costs
300 copies of questionnaire Postage and envelopes Total costs
Estimated
Hours Rate Total
3 4 12 15 5
$150/hr.
40/hr.
40/hr.
150/hr.
150/hr.
$ 450 160 480 2,250 750 150 350
$4,590 Authorization
We are convinced, Dr. Daltrey, that our professionally designed and administered client satisfaction survey will enhance your practice. Becker Marketing can have specific results for you by May 2 if you sign the enclosed duplicate copy of this letter and return it to us with a retainer of $2,300. The prices in this offer are in effect only until July 1.
Sincerely,
Ann Becker, PhD President AB:las Enclosure Staffing
Becker Marketing is a nationally recognized, experienced consulting firm specializing in survey investigation. I have assigned your customer satisfaction survey to Dr. Ellen Mayo, our director of research. Dr. Mayo was trained at Penn State and has successfully supervised our research program for the past nine years. Before joining Becker, she was a marketing analyst with Procter &
Gamble Company. Assisting Dr. Mayo will be a team headed by Gordon Scott, our vice president for operations. Mr. Scott earned a bachelor’s degree in computer science and a master’s degree in marketing from the University of South Carolina, where he was elected to Phi Delta Mu honor society. Within our organization he supervises our computer-aided telephone interviewing (CATI) system and manages our 30-person professional interviewing staff.
Budget
Promotes credentials and expertise of key people
Uses past-tense verbs to show that work has already started on the project
Itemizes costs carefully because a proposal is a contract offer
Makes response easy
Builds credibility by describing outstanding staff and facilities
Closes by repeating key qualifications and main benefits Provides deadline FIGURE 13.2 (Continued)