question 1,2,3

Cases for Critical The factors w here he ese proc es organized to become profitable are any of these companies moving toward models that remove the human factor that mechanize the way that it looks Ube b e g te machane are the financial values of some of the companies being determined in light of the lowes expe w menced by some w hat factors yang on these fanciu ? Are people speculating an unknown future? his company h ad being a national brand. The was for Chipose to leverage the buying power and super During growth , M onalised over $350 Chip and at one time owned more than of the company a s the path o locations Buthorised is wanted to grow the form th e expansion and without franchise owners wer e comode you growth a nd we had great people the Chipotle went public in an in public offering Poto wether "Fast Casual with fresca Chipotle is faucasuala fusion of a fast food and finding At some of t h e more the transactions during the how ones were one transaction about every il seconds. Becutive pay close antion to its customersetting through the line whic h Chipotle MEXICAN GRILL agingly long lunch and dinner lines still cause problem "We've come long way, but there is a long line and there are people way at the end." says a Chipotle operations et Sustainable sourcing Chces vision and mission statement made to change the way people think about and eat fast food" A threefold value philosophy called "Food with integrity includes finding and sourcing the very best ingredients raised with respect for them , the n and the farmers." As a big enough buyer of pork, Ells knew he could create change Saying new at that momenti did not my success to be based on this kind of exploitation, so we started buying all naturally raised meat. His initial curiosity about the meat supply was promoted by the the wound up with a product produced by humanewal treatment that tasted better to customers. Despite price increase is happy reports. We started twice a s Case di Chipotle-Changing Fortunes Since its humble beginnings in Deviver, Colorado Chipotle hos energetically implemented the control process. Whether reviewing sales-to-contratos same-store sales figures to gauge growth, payment initiatives to speed checkout during peak lunch hours, or tracking stock performance, man. agement control is a big part of the firm's culture of performance The First Burrito In 1993, Steve Ells, trained in classical French cooking, opened his first Chipotle in Denver, Colorado With a loan of $85,000 from his father and inspiration from the huge number of taquerias in San Francisco's Mission district, Ells took over an old Dolly Madison ice cream store near the University of Denver campus. He calculated his first store needed to sell 107 burritos per day to break even. After 1month, sales of 1,000 burritos a day far exceeded his wildest dreams. Chipotle was an instant success, and Ells knew he was onto something big Culture Clash with McDonald's After getting 16 stores up and running in Colorado, Ells brought the McDonald's burger empire on board as a minority owner to help fuel Safety Scandal and Financial Woes Chipotle is a company that committed to constantly improving perfor mance. But its high stock price and the increasingly competitive nature of the fast-casual food industry raise questions about future growth More recently, the burrito innovator has been in the news for the wrong reasonsE coll outbreaks and tumbling Mock prices, e ecutive resignations, and store closings. Starting in October 2015, in a multistate outbreak from Washington to California to Minnesota to Massachusetts, more than 350 people became ill with coll virus af- ter eating at Chipotle. The outbreak led to the temporary closing of more than 2,000 store locations, turnover at the CEO level with co-CEO Monty Moran resigning his position, the company's stock price tum bling from a high near $750 per share in August 2015 to $370 dollars per share in December 2016-a more than 50% loss in value. Although the U.S. Centers for Disease Control and Prevention (CDC) announced that the E. coll outbreak was officially over in February 2016, the company is experiencing ongoing woes. It was just reported that, in March 2017, Chipotle will shut down all of its ShopHouse Asian Kitchen Restau rants. Although Chipotle only launched the Asian Kitchen concept in 2011, Chipotle's spokesperson Chris Arnold announced, "We now have a deal in place to sell the Shophouse leases and believe that is the right decision at this time." C-8 Cases for Critical Thinking What this turn in Chipotle's fortunes makes clear is that main taining sustained success in the restaurant business can be a difficult recipe to get right. Case Analysis Questions 1. DISCUSSION How did CEO Steve Ells use the control process to move Chipotle forward with success? Explain your answer using at least three examples based on the case. How can the control process be used to move the company out of its current downturn? 2. PROBLEM SOLVING A balanced Scorecard helps top managers to exercise strategic control. The scorecard includes customer satis- faction and internal process improvement. What do you recom- mend that Chipotle do to implement the scorecard approach and consistently score high in each category? 3. FURTHER RESEARCH Go online to find and analyze Chipotle's most recent annual report. Check and critique the company's re. cent financial performance. Review reports from competitors- e.g., Baja Fresh, Qdoba, or Moe's Southwest Grill. How are they doing, and what threats, if any, do they pose to Chipotle? How about product extensions? Was the move to close all of its Shop House Asian Kitchen Restaurants a good move? Why? Target on Emerging Markets Most Americans have experienced the Dunkin' Donuts brand through one of its almost 11,000 outlets. The Dunkin' brand has carved out an international niche, not only in expected markets such as Canada and Brazil, but also in some unexpected ones such as India, Brazil, Qatar, South Korea, Pakistan, and the Philippines. The company is betting big on emerging economies. "Emerging markets are attractive because they are growing very quickly, they've a fast-growing middle-class (eating out more), and they love American brands," says CEO Nigel Travis. The company's growth plans include opening between 80 and 100 outlets in India, bringing the country's total number of Dunkin' Donuts stores to 500 within a 15-year period. "The company plans to locate in Asia a 'disproportionate' number of the 350-450 outlets that it plans to open outside the U.S. this year, Travis said. There are now more than 10,850 Dunkin' Donuts retail locations, including in excess of 7,650 in the United States alone, and they are operating in more than 3,150 locations in other countries. As of the end of January 2017, all Dunkin' Donuts locations were owned and operated by franchisees. New Products For most of its existence, Dunkin' Donuts' main product focus has been donuts and coffee for dunking them. Since Stan Frankenthaler became executive chef and vice president, Dunkin' has launched about 25 new products annually as part of a new product innovation initiative. It has stepped up by offering a variety of espresso-based drinks and sugar-free flavorings, including caramel, vanilla, and mocha swirt Dunkin's strategy now includes breakfast Sandwich combina- tions of eggs, cheese, ham, and sausage on Texas toast, as well as MUND O Chipotle "Fast-Casual" Chipotle is "fas At someo than 350 trans transaction at its customers sales revenue agingly long a long way, b away at the e MEXICAN GRILL Sustainable Chipotle's vis people think called "Food best ingredie and the farm As a big saying: "kr on this in meat is fact that he wou that ta report TJP/Alamy Safe Chip mai Case 6 Chipotle-Changing Fortunes Since its humble beginnings in Denver, Colorado, Chipotle has energetically implemented the control process. Whether reviewing sales-to-cost ratios, same-store sales figures to gauge growth, payment initiatives to speed checkout during peak lunch hours, or tracking stock performance, man- agement control is a big part of the firm's culture of performance. The First Burrito In 1993, Steve Ells, trained in classical French cooking, opened his first Chipotle in Denver, Colorado. With a loan of $85,000 from his father and inspiration from the huge number of taquerias in San Francisco's Mission district, Ells took over an old Dolly Madison ice cream store near the University of Denver campus. He calculated his first store needed to sell 107 burritos per day to break even. After 1 month, sales of 1,000 burritos a day far exceeded his wildest dreams. Chipotle was an instant success, and Ells knew he was onto something big. SOnazw Cases for Critical Thinkin Fofitable companies his company's growth toward being a national brand. The of these companies was for Chipotle to leverage the buying power and supplier neu uman factor-that enjoyed by the burger empire's economies of scale. could be seeking to During critical growth years, McDonald's invested over $360 milli some of these sis into Chipotle and at one time owned more than 80% of the compan huge losses expe- With McDonald's as their partner, Chipotle's store locations skyrocketed are likely playing But the two companies eventually parted ways. e speculating on Ells wanted to grow the firm through internal expansion and without franchise owners. "We wanted to own the economic model. You franchise if you want money and people. We had plenty of money for our growth rate, and we had great people," he said. Chipotle went public in an initial public offering (IPO) to settle the McDonald's breakup. "Fast-Casual" with a Difference Chipotle is "fast-casual," a fusion of a fast-food and fine dining. At some of its most efficient restaurants, Chipotle averages more than 350 transactions during the lunch hour alone, or on average, one transaction about every 11 seconds. Executives pay close attention to its customers getting through the line quickly, which results in higher sales revenues and a higher-quality customer experience. But discour agingly long lunch and dinner lines still cause problems. "We've come a long way, but there is still a long line, and there are people turning away at the end," says a Chipotle operations executive. Sustainable Sourcing Chipotle's vision and mission statement reads: "to change the way people think about and eat fast food." A threefold value philosophy, called "Food with Integrity," includes "finding and sourcing the very best ingredients raised with respect for the animals, the environment and the farmers." As a big enough buyer of pork, Ells knew he could create change, saying: "I knew at that moment I did not want my success to be based on this kind of exploitation, so we started buying all naturally raised meat." His initial curiosity about the meat supply was prompted by the fact that he was unimpressed with the quality. By switching sources, he wound up with a product produced by humane animal treatment that tasted better to customers. Despite a price increase, Ells happily reports: "We started selling twice as many carnitas as before." Safety Scandal and Financial Woes Chipotle is a company that commits itself to constantly improving perfor- Cases for Critical The factors w here he ese proc es organized to become profitable are any of these companies moving toward models that remove the human factor that mechanize the way that it looks Ube b e g te machane are the financial values of some of the companies being determined in light of the lowes expe w menced by some w hat factors yang on these fanciu ? Are people speculating an unknown future? his company h ad being a national brand. The was for Chipose to leverage the buying power and super During growth , M onalised over $350 Chip and at one time owned more than of the company a s the path o locations Buthorised is wanted to grow the form th e expansion and without franchise owners wer e comode you growth a nd we had great people the Chipotle went public in an in public offering Poto wether "Fast Casual with fresca Chipotle is faucasuala fusion of a fast food and finding At some of t h e more the transactions during the how ones were one transaction about every il seconds. Becutive pay close antion to its customersetting through the line whic h Chipotle MEXICAN GRILL agingly long lunch and dinner lines still cause problem "We've come long way, but there is a long line and there are people way at the end." says a Chipotle operations et Sustainable sourcing Chces vision and mission statement made to change the way people think about and eat fast food" A threefold value philosophy called "Food with integrity includes finding and sourcing the very best ingredients raised with respect for them , the n and the farmers." As a big enough buyer of pork, Ells knew he could create change Saying new at that momenti did not my success to be based on this kind of exploitation, so we started buying all naturally raised meat. His initial curiosity about the meat supply was promoted by the the wound up with a product produced by humanewal treatment that tasted better to customers. Despite price increase is happy reports. We started twice a s Case di Chipotle-Changing Fortunes Since its humble beginnings in Deviver, Colorado Chipotle hos energetically implemented the control process. Whether reviewing sales-to-contratos same-store sales figures to gauge growth, payment initiatives to speed checkout during peak lunch hours, or tracking stock performance, man. agement control is a big part of the firm's culture of performance The First Burrito In 1993, Steve Ells, trained in classical French cooking, opened his first Chipotle in Denver, Colorado With a loan of $85,000 from his father and inspiration from the huge number of taquerias in San Francisco's Mission district, Ells took over an old Dolly Madison ice cream store near the University of Denver campus. He calculated his first store needed to sell 107 burritos per day to break even. After 1month, sales of 1,000 burritos a day far exceeded his wildest dreams. Chipotle was an instant success, and Ells knew he was onto something big Culture Clash with McDonald's After getting 16 stores up and running in Colorado, Ells brought the McDonald's burger empire on board as a minority owner to help fuel Safety Scandal and Financial Woes Chipotle is a company that committed to constantly improving perfor mance. But its high stock price and the increasingly competitive nature of the fast-casual food industry raise questions about future growth More recently, the burrito innovator has been in the news for the wrong reasonsE coll outbreaks and tumbling Mock prices, e ecutive resignations, and store closings. Starting in October 2015, in a multistate outbreak from Washington to California to Minnesota to Massachusetts, more than 350 people became ill with coll virus af- ter eating at Chipotle. The outbreak led to the temporary closing of more than 2,000 store locations, turnover at the CEO level with co-CEO Monty Moran resigning his position, the company's stock price tum bling from a high near $750 per share in August 2015 to $370 dollars per share in December 2016-a more than 50% loss in value. Although the U.S. Centers for Disease Control and Prevention (CDC) announced that the E. coll outbreak was officially over in February 2016, the company is experiencing ongoing woes. It was just reported that, in March 2017, Chipotle will shut down all of its ShopHouse Asian Kitchen Restau rants. Although Chipotle only launched the Asian Kitchen concept in 2011, Chipotle's spokesperson Chris Arnold announced, "We now have a deal in place to sell the Shophouse leases and believe that is the right decision at this time." C-8 Cases for Critical Thinking What this turn in Chipotle's fortunes makes clear is that main taining sustained success in the restaurant business can be a difficult recipe to get right. Case Analysis Questions 1. DISCUSSION How did CEO Steve Ells use the control process to move Chipotle forward with success? Explain your answer using at least three examples based on the case. How can the control process be used to move the company out of its current downturn? 2. PROBLEM SOLVING A balanced Scorecard helps top managers to exercise strategic control. The scorecard includes customer satis- faction and internal process improvement. What do you recom- mend that Chipotle do to implement the scorecard approach and consistently score high in each category? 3. FURTHER RESEARCH Go online to find and analyze Chipotle's most recent annual report. Check and critique the company's re. cent financial performance. Review reports from competitors- e.g., Baja Fresh, Qdoba, or Moe's Southwest Grill. How are they doing, and what threats, if any, do they pose to Chipotle? How about product extensions? Was the move to close all of its Shop House Asian Kitchen Restaurants a good move? Why? Target on Emerging Markets Most Americans have experienced the Dunkin' Donuts brand through one of its almost 11,000 outlets. The Dunkin' brand has carved out an international niche, not only in expected markets such as Canada and Brazil, but also in some unexpected ones such as India, Brazil, Qatar, South Korea, Pakistan, and the Philippines. The company is betting big on emerging economies. "Emerging markets are attractive because they are growing very quickly, they've a fast-growing middle-class (eating out more), and they love American brands," says CEO Nigel Travis. The company's growth plans include opening between 80 and 100 outlets in India, bringing the country's total number of Dunkin' Donuts stores to 500 within a 15-year period. "The company plans to locate in Asia a 'disproportionate' number of the 350-450 outlets that it plans to open outside the U.S. this year, Travis said. There are now more than 10,850 Dunkin' Donuts retail locations, including in excess of 7,650 in the United States alone, and they are operating in more than 3,150 locations in other countries. As of the end of January 2017, all Dunkin' Donuts locations were owned and operated by franchisees. New Products For most of its existence, Dunkin' Donuts' main product focus has been donuts and coffee for dunking them. Since Stan Frankenthaler became executive chef and vice president, Dunkin' has launched about 25 new products annually as part of a new product innovation initiative. It has stepped up by offering a variety of espresso-based drinks and sugar-free flavorings, including caramel, vanilla, and mocha swirt Dunkin's strategy now includes breakfast Sandwich combina- tions of eggs, cheese, ham, and sausage on Texas toast, as well as MUND O Chipotle "Fast-Casual" Chipotle is "fas At someo than 350 trans transaction at its customers sales revenue agingly long a long way, b away at the e MEXICAN GRILL Sustainable Chipotle's vis people think called "Food best ingredie and the farm As a big saying: "kr on this in meat is fact that he wou that ta report TJP/Alamy Safe Chip mai Case 6 Chipotle-Changing Fortunes Since its humble beginnings in Denver, Colorado, Chipotle has energetically implemented the control process. Whether reviewing sales-to-cost ratios, same-store sales figures to gauge growth, payment initiatives to speed checkout during peak lunch hours, or tracking stock performance, man- agement control is a big part of the firm's culture of performance. The First Burrito In 1993, Steve Ells, trained in classical French cooking, opened his first Chipotle in Denver, Colorado. With a loan of $85,000 from his father and inspiration from the huge number of taquerias in San Francisco's Mission district, Ells took over an old Dolly Madison ice cream store near the University of Denver campus. He calculated his first store needed to sell 107 burritos per day to break even. After 1 month, sales of 1,000 burritos a day far exceeded his wildest dreams. Chipotle was an instant success, and Ells knew he was onto something big. SOnazw Cases for Critical Thinkin Fofitable companies his company's growth toward being a national brand. The of these companies was for Chipotle to leverage the buying power and supplier neu uman factor-that enjoyed by the burger empire's economies of scale. could be seeking to During critical growth years, McDonald's invested over $360 milli some of these sis into Chipotle and at one time owned more than 80% of the compan huge losses expe- With McDonald's as their partner, Chipotle's store locations skyrocketed are likely playing But the two companies eventually parted ways. e speculating on Ells wanted to grow the firm through internal expansion and without franchise owners. "We wanted to own the economic model. You franchise if you want money and people. We had plenty of money for our growth rate, and we had great people," he said. Chipotle went public in an initial public offering (IPO) to settle the McDonald's breakup. "Fast-Casual" with a Difference Chipotle is "fast-casual," a fusion of a fast-food and fine dining. At some of its most efficient restaurants, Chipotle averages more than 350 transactions during the lunch hour alone, or on average, one transaction about every 11 seconds. Executives pay close attention to its customers getting through the line quickly, which results in higher sales revenues and a higher-quality customer experience. But discour agingly long lunch and dinner lines still cause problems. "We've come a long way, but there is still a long line, and there are people turning away at the end," says a Chipotle operations executive. Sustainable Sourcing Chipotle's vision and mission statement reads: "to change the way people think about and eat fast food." A threefold value philosophy, called "Food with Integrity," includes "finding and sourcing the very best ingredients raised with respect for the animals, the environment and the farmers." As a big enough buyer of pork, Ells knew he could create change, saying: "I knew at that moment I did not want my success to be based on this kind of exploitation, so we started buying all naturally raised meat." His initial curiosity about the meat supply was prompted by the fact that he was unimpressed with the quality. By switching sources, he wound up with a product produced by humane animal treatment that tasted better to customers. Despite a price increase, Ells happily reports: "We started selling twice as many carnitas as before." Safety Scandal and Financial Woes Chipotle is a company that commits itself to constantly improving perfor