Managing Strategic Resources & Operations

Question :

Internal processes of a company contribute to the company's overall effectiveness. Identifying ways to improve internal processes helps build a highly efficient organization. Root causes need to be identified. Methods to identify root causes may require substantial analysis or be apparent based on a major problem within the organization.

Answer :

Existing Process of Chipotle

Chipotle had a great start with Steve Ellis, who grew the company from few stores to nationwide fast food chain. The company has become successful and it worked well towards sourcing ingredients from best sources and preparing the items with hand. However, this goal also led to some challenge in 2015 and 2016 when several people got infected by E. Coli after they ate Chipotle. This led the company to revisit its supply chain and look for problems. The company’s original supply chain of the company included sourcing of vegetables and meat from various sources it distribution center. After that, the item reaches various restaurants of Chipotle. However, in this chain, it became quite difficult to identify the supplier who was responsible for the infected meats. As per CDC, the company was very contributing in the investigation of the situation, but due to the way entire supply chain was designed, it was difficult to identify the source of the problem (Blum, 2018). Therefore, in order to prevent such problems to occur in the future, there was a need to bring improvements in the existing supply chain. The existing supply chain of the company is shown in the diagram below: \

Figure 1: Existing Process of Chipotle

Chipotle Improved Supply Chain

In order to improve on the supply chain of the company Chipotle looked at different ways to practice food safety. In the late October, Mansour Samadpour was brought into the company. He was heading IEH Laboratories and Consulting Group in Seattle. The purpose was to ensure that the an aggressive safety plan is put in place with the goal to reduce the future possibility of contaminations (Berfield, 2015). The company also started to prepare their food before shipping it out to the restaurants. It also implemented safety measures of testing and screening the food before it was sent to the distribution centers. The rigorous testing of its food was the plan in order to make sure that this does not happen to the company again. Passing the initial supplies with quality check is expected to reduce the possibility of any issue in later stage of the supply chain. The responsibility for cleaning and packaging would be on the commissaries rather than on the restaurants, whether it is lettuce shredding or tomato dicing. The recommended supply chain for the company is shown in the flowchart below. It has a new process called quality control and inspection of received supplies. Here, if the quality identified is good, then it will moved further, else items will be discarded, or it can be returned to suppliers. 

Figure 2: Chipotle Improved Supply Chain

After further research it turns out that this change in the supply chain did not seem to fix all of the company’s problems. After the changes were made there was another outbreak. The CDC later released their tests, which stated that it was an outbreak of clostridium perfringens. This is a bacteria that occurs when foods is left at an unsafe temperature. Even though this does not have to do with the supply chain of the company it does cause people to be caution about eating at Chipotle. This problem seems in the training of the employees but this event has had a very drastic impact on the companies’ reputation. With these changes the company trying to regain its public imagine and come back stronger than ever from the epidemic. Recommendations for Chipotle would be to practice Six Sigma concepts and philosophy. It is because Six sigma will ensure that the company regularly monitors and improves its processes and activities to achieve the desired level of quality. In six sigma, the company is expected to reach 99.99% of correction in the defects (Josiam et al, 2017). The goal is significantly higher, but it is likely to push company towards betterment on a regular basis. Chipotle could further test their meats and vegetables to ensure safety. The company could also help to retrain its staff in order to promote safety. This plan could reinstall the company values with in the eye of the public. 

References

Berfield, S. (2015). Inside Chipotle’s Contamination Crisis. Retrieved May 4, 2019, from https://www.bloomberg.com/features/2015-chipotle-food-safety-crisis/

Blum, S. (2018). The CDC Finally Figured Out What Caused Chipotle's Massive Food-Borne Illness Outbreak. Retrieved from https://www.thrillist.com/news/chipotle-food-poisoning-outbreak-cdc-cause-revealed

Josiam, B. M., Malave, R., Foster, C., & Baldwin, W. (2017). Assessing quality of food, service and customer experience at a restaurant: the case of a student-run restaurant in the USA. Hospitality Marketing and Consumer Behavior: Creating Memorable Experiences.