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Donios

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INTERACTIVE SESSION: ORGANIZATIONS
DOMINO'S SIZZLES WITH PIZZA TRACKER
When it comes to pizza, everyone has an opin ion .
Some of us think th at our current pizza is just fine the way it is. Others h ave a favorite pizza joint th at makes it like no on e else. And m any pizza lovers in
America agreed up until recentl y that Dom ino 's home-delivered pizza was amo ng the worst. The home-delivery market for pizza cha ins in th e United
States is approximat ely $15 billion per year.
Domino's, which owns th e largest home-delivery market share of any U.s . pizza chain, is find ing ways to innovate by overhauling its in-store transaction processing systems and by providing other us eful services to customers, su ch as its Pizza Tracker. And more important, Dom ino's is try ing very h ard to overcome its rep utation for poor quality by radi cally improving ingred ient s an d fresh ne ss. Critics b elieve the company sign ificantly im proved the qu ality of its pizza and cus tomer service in 2010.
Domino's was founded in 1960 by Tom Mon agh an and h is brother James wh en th ey purchased a single pizza store in Ypsilan ti, Michigan. The company slowly b egan to grow, and by 1978, Domino's h ad 200 stores. Today, th e compa ny is h eadquartered in Ann
Arbor, Mich igan, and operates alm ost 9,000 store s located in all 50 U.S. states and across th e world in 60 international markets. In 2009, Dom ino's h ad $1.5 bill ion in sales and ea rned $80 million in profit.
Domino's is part of a heate d battle am ong promi­ n ent pizza chains, incl uding Pizza Hut, Pap a John's, and Little Caesar. Pizza Hut is th e only chain larger th an Domino's in the U.S., but each of th e four h as significant m ar ket sh are. Domin o's also compe tes with local pizza stores througho ut th e U.S. To gain a com pe titive advantage Domino 's n eeds to deliv er excell ent customer service, an d m ost importantly, good pizza. But it als o b enefits from hi ghly effective in formation systems.
Domino's proprietary point-of-sale system, Pulse, is an im portant asset in maintaining cons iste n t and efficie nt management func tions in each of its re stau­ rants. A point-of-sale system captures purchase and payment data at a physical location where goods or services are bought an d sold using com puters, auto­ mated cash registers, scanners, or other digital devices. In 2003, Domino's implemented Pulse in a large porti on of its stores, and those stores reported improved customer service, reduced m istakes, and

sho rter training tim es. Since th en, Pulse h as become a staple of all Domino's franc hises. Some of th e func ­ tion s Puls e performs at Domino's franchi ses are tak­ ing and custom izing orde rs using a tou ch-screen interface, maintaining sales figures, and compili ng customer in formation . Domino's prefers n ot to discl ose th e sp ecific dollar amo unts th at it has saved from Pulse, but it's clear from indus try analysts th at th e technology is work ing to cut costs and inc rease customer satisfaction .
More recently, Domino's released a n ew hardware and software platform called Pul se Evolution , which is now in use in a m ajority of Domino's m ore th an
5,000 U.S. branches. Pulse Evolution improves on th e older technology in several ways. First, th e older software us ed a 'thick-clie nt' m odel, wh ich re quired all m achines using th e software to be fully equ ippe d personal compute rs running Windows. Pulse
Evolution , on th e othe r h and, uses 'th in-clien t' arc hi­ tecture in wh ich n etworked workstat ions with little indep endent processing power collect data and sen d th em over th e In ternet to powerful Lenovo PCs for pro cessing. These workstations lack h ard drives, fans, and othe r mo vin g parts, m aking th em les s expe nsive an d easier to m aintain. Also, Puls e
Evolution is easier to updat e and m ore secure, sin ce th ere's onl y on e machine in th e store wh ich n eeds to be updat ed .
Along with Puls e Evolution, Domino's rolle d out its stat e-of-th e-art on lin e orde ring system, wh ich in cludes Pizza Tracker. The syste m allows cus tome rs to watch a sim ulated photographic version of th eir pizza as th ey customize its size, sau ces, and toppings.
The im age changes with each ch ange a cus tome r m akes. Then, once customers place an order, th ey are able to view its pro gress online with Pizza
Tracker. Pizza Tracker displays a h orizontal bar tha t tracks an ord er's progress graph ically. As a Domino's store comple tes eac h step of th e order fulfillme nt pro cess , a section of th e bar becomes red . Even customers th at place th eir ord ers via telephone can m onitor th eir pro gress on th e Web usin g Pizza
Tracker at stores using Pulse Evolution . In 2010,
Dom in o's introduced an online polling syste m to contin uo usly upload information from local stores.
As with m ost in stances of organi zationa l ch ange of this magnitude, Domino's expe rienced som e resis­ tan ce. Domin o's originally wante d its fra nc hises to

select Pulse to com ply with its requirements for data security, but some franchises have resisted swit ching to Pulse and sought alte rn ative systems. After
Domino's tri ed to com pel those franchises to use
Pulse, th e u.s. District Court for Minnesota sided with franchisees who claimed that Domino's could not force them to us e this system. Now, Domino's continues to make improvements to Pulse in an effort to make it overwhelmingly appealing to all fra nc h isees.
Pizza Hut and Papa John's also have online ord er­ ing capability, but la ck the Pizza Tracker and the sim­ ulated piz za features that Domino's has su ccessfully implemented . Today , online orders account for almost 20 percent of all of Domino's orders, which is up from less th an 15 percent in 2008. But th e battle

CASE STUDY QUESTIONS
1. What kinds of systems ar e describ ed in this case?
Identify and des crib e th e busines s processes ea ch supports. Des crib e the inputs, pro cess es , and out­ puts of th es e systems.
2. How do th ese syst ems h elp Domino's improve its busin ess performance ?
3. How did th e online piz za ord ering system improve th e pro cess of ord ering a Domino's pizza?
4 . How effective ar e thes e systems in giving
Domino's a com pe titive edge ? Explain your answer. to sell pizza with tech nology rages on. Pizza Hut cus­ tomers can now us e the ir iP~one s to place orders, and Papa John's customers ca n place orde rs by tex­ ting. With many billions of dollars at stake, all th e large national pizz a ch ains will b e develo ping inno va­ tive new ways of ordering pizza an d pa rticip ating in its cr eation.
Sources: PRN Newswire, ' Servant Systems Releases Dom ino 's Store
Polling Software," PRN Newswire, April 14, 2010; Julie Jargon,
"Domi no's IT Staff Delivers Slick Site, Ordering System," The Wall
Street [ournal, November 24, 2009; www .dominosbiz.corn, accessed
May 17, 2010; Paul McDougall, "lnterop: Domino's Eyes Microsoft
Clo u d," Inform ation Week, Ap ril 26, 2010; "Dom in o's Builds New
Foun dation Und er Prop rietary Store Tech, " Nation's Restaurant
News , Februar y 25, 2009; "and "In side Domino's 'Pizza Tra cker.'
What It Does, Why , and How," Nation's Restaurant News, February
27,2008.

MIS IN ACTION
Visit Domino's Web site and exam in e th e orde r place­ ment an d Pizza Tracker features. Then answer th e following qu estions:
1. What steps does Pizza Tracker display for the us er? How does th e Pizza Tracker im prove the cu stomer expe rience?
2. Would the Pizza Tracker service influence yo u to ord er pizza from Domino's in stead of a competing chain ? Why or why not?
3. What improvements wou ld yo u m ake to the orde r placement feature?

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