{"id":153,"date":"2015-11-28T00:17:09","date_gmt":"2015-11-28T05:17:09","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/chipotle-nation\/"},"modified":"2015-12-13T11:10:16","modified_gmt":"2015-12-13T16:10:16","slug":"chipotle-nation","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/chipotle-nation\/","title":{"rendered":"Chipotle Nation"},"content":{"rendered":"

An unanticipated success\"\"<\/strong><\/p>\n

When Steve Ells opened the very first Chipotle in Denver in 1993, he only planned to stay in the burrito business long enough to accumulate sufficient capital to launch his first fine dining restaurant. [1]<\/a>\u00a0\u00a0Little did he know that by 2015, Chipotle would grow to 1,900+ stores with annual revenues of over $4.1B [2]<\/a>, revolutionizing the US restaurant industry in the process.<\/p>\n

 <\/p>\n

\n

Having your guac and eating it too: winning with the fast casual business model
\n<\/strong>
\nAs a pioneer and emblem of the \u2018fast casual\u2019 dining segment, Chipotle has designed and executed a business model that provides customers with the best of two worlds: the speed and convenience of fast food alongside the elevated food quality found in sit-down casual restaurants.
\nInitially opened to compete with other fast food chains, Chipotle has always taken speed as a given in terms of customer value. \u00a0Where it has deviated and excelled in comparison to its fast-food peers is through a philosophy of quality which is encapsulated in Chipotle\u2019s current motto, \u201cFood with Integrity.\u201d<\/p>\n

\"chipotle_food_with_integrity_300x3003\"Specifically, Chipotle\u2019s offerings center around fresh preparation and quality of ingredients. \u00a0Most ingredients are prepared fresh daily in-store: lettuce, onions and cilantro are chopped by hand, chicken is grilled in-house and tortilla chips, rice, and guacamole are all also made fresh each day.\u00a0[3]<\/a><\/p>\n

Raw ingredients are held to a standard well beyond those of competitors; Chipotle has committed to GMO-free produce as well as meat\/dairy from animals raised without antibiotics and artificial hormones. \u00a0(In 2015, Chipotle stuck to its promise and eliminated a previous pork supplier who failed to meet standards despite a resulting nine month absence of carnitas)\u00a0[4]<\/a><\/p>\n

\"Screen<\/p>\n

 <\/p>\n

Under its fast \u201cFood with Integrity\u201d business model, Chipotle has experienced continuous growth while fast food giants increasingly struggle. \u00a0Notably, the Chipotle business model has won over health and quality conscious consumers (particularly Millennials) who are willing to pay a significantly higher average ticket price ($11 versus $4 for McDonald\u2019s) than for traditional fast food.\u00a0[5]<\/a><\/p>\n

\n

A recipe for success: providing value through operations<\/strong><\/p>\n

How does Chipotle do both fast and high quality? \u00a0The answer is a unique operating model that flies in the face of conventional fast food wisdom, both in terms of in-store and company-wide operations.<\/span><\/p>\n

In-store<\/strong><\/em><\/p>\n

Menu:<\/em><\/p>\n

Whereas most fast food restaurants have extensive menus and rely on new\u00a0menu introductions to drive sales, Chipotle\u2019s very limited menu offers a choice of four items, all of which use virtually all the same ingredients. \u00a0This significantly simplifies food production, both in preparation and assembly, reducing cycle and wait times. \u00a0Additionally, consistent\/limited ingredients cut down on food waste and allow greater focus on quality ingredient sourcing (more about that later!).<\/p>\n

 <\/p>\n

\"Assembly\"\"menu\"<\/p>\n

 <\/p>\n

 <\/p>\n

 <\/p>\n

 <\/p>\n

 <\/p>\n

 <\/p>\n

Assembly line:\u00a0<\/em>
\nA central aspect of Chipotle\u2019s operations is the assembly line, where a meal is ordered and assembled in front of and with input by the customer. Ingredients are all collected\u00a0in one area and\u00a0laid out in order to allow\u00a0rapid assembly, with servers quickly developing skills through repetition. Visibility during assembly allows the customer to directly specify requests and reduce mistakes\/re-work to keep the line moving. \u00a0To further speed up the assembly line during peak hours, employees are cross-trained to handle any part of the assembly process, as well as various preparation tasks in the kitchen, and top servers are assigned to assembly duty during meal rushes. \u00a0Finally, specific support roles are in place to maximize line speed including \u201cexpediters\u201d that get drinks\/bags orders and \u201clinebackers\u201d that refill food bins and clean counter tops to keep servers focused on assembly.[6]<\/a>\u00a0The result: you get your meal in minutes.<\/p>\n