At Biola University, in our Strategic Management, I worked with my group partners to choose our project, Chipotle Mexican Grill. This course has a fifteen-week capstone that my group and I worked on our project, Chipotle Mexican Grill. We are split our work on our categories into a problem statement, situational analysis, SWOT Analysis and new sources of Competitive Advantage, and Recommendations. We are required to include our speaker's notes on each slide that we use to passing the ball to each other that we share our work. We will deliver our final formal PowerPoint presentations in front of panelists. However, due to the coronavirus situation, we will deliver our final formal PowerPoint presentations to canvas (online) that allow the professor to grade on it.
2. The story of a simple line cook who
reinvented the fast food industry in the
21st century.
“There was no business plan,” he said on
the podcast. “I was just making this up
as I went along.”
A fine dining mentality to the fast food
industry with better and more
sustainable ingredients.
INCEPTION STORY
Steve Ells, Founder
3. TIMELINE
1993
First Chipotle opens
in Denver, CO
1999
First Chipotles established
outside of Colorado:
Minneapolis & Columbus
2000
Chipotle starts
selling naturally
raised pork
2001
McDonald’s becomes majority
Chipotle stockholder, pouring
in $350M+ over 8 years
1995
Chipotle expands with
a second location
1998
McDonald's makes an
initial minority investment
in the company
4. TIMELINE
2004
Ahead of its time - begins
using zero trans-fat frying
oil
2005
Altametrics - manages daily
business operations: managing,
inventory levels, food procurement, and
production
2006
- McDonald’s completely divests from
Chipotle
- Chipotle goes public
2007
Chipotle begins serving
naturally raised beef
2002
- USDA releases national standards that
bring organic food into the mainstream
- Chipotle starts selling naturally raised
chicken.
5. TIMELINE
2009
Chipotle reconstructs its
executive team
2010
NRN names Chipotle 3rd fastest
growing restaurant; Consumer
Reports: #1 Mexican Restaurants
2012
Chipotle agrees to join the
Coalition of Immokalee Workers’
Fair Food Program
2015
- All time peak brought an average of 750,000 customers per
day
- Chipotle becomes the first major restaurant chain to start
serving food entirely free of genetically engineered ingredients
2015-2016
E.coli, Norovirus,
Salmonella outbreaks
6. TIMELINE
2016-2017
CEO turmoil
2017
Chipotle launches its app
2018
- Brian Niccol, previous CEO of
Taco Bell, steps in as CEO
- Partnership with DoorDash
2018-2019
Stock up 240% since Niccol
was named CEO
2019
Chipotle to pay $6.5M
to settle class action
suit over non-gmo
claims
7. “FOOD WITH INTEGRITY”
“When I started Chipotle in 1993, I wanted to demonstrate that just because food
is served fast, doesn’t mean it needs to be typical fast-food, which relies on low-
cost, low-quality ingredients. ‘Food with Integrity’ is about sustainable
food, responsible treatment of the land, and care for animals. It is also
based on the idea of including diners in the experience through an “open
kitchen,” where you can see the ingredients and how the food is prepared. It is
just like having a dinner party where everybody ends up in the kitchen.”
- Steve Ells, Founder
MISSION STATEMENT
8. OPPORTUNITY STATEMENT
Chipotle Mexican Grill, Inc. operates in the fast-casual, franchised food
industry. There exists an opportunity to further leverage quality
ingredients and better prepared food in order to stand out within the
fast food industry.
9. SIGNIFICANCE TO LEADERSHIP
Our study should be designed to uncover new sources of
sustainable competitive advantage and to demonstrate to
leadership how to use corporate level strategies to leverage
new sources of competitive advantage .
10. SUSTAINABLE COMPETITIVE ADVANTAGE..
Sustainable competitive advantage is the leveraging of a company’s key
strengths and assets to establish differentiation amongst competitors
and to secure long term influence in its respective industry.
DEFINING
11. z
UNITY IN LEADERSHIP
DIFFERENTIATION FROM COMPETITORS
SERVICE QUALITY ENHANCEMENTS
INCREASE IN CUSTOMER
PERCEIVED VALUE
PREMIUM PRICES
PREMIUM PROFIT MARGIN
STRENGTHENED BRAND IMAGE
1.
2.
3.
4.
5.
6.
7.
8.
EXPECTED OUTCOMES
STRENGTHENED CORPORATE CULTURE
13. SECONDARY RESEARCH
For Credibility Purposes, we used:
- Environmental scanning - Gathered information about
events and their relationships within the organization’s
internal and external environments
- Environmental monitoring - Gathered the most timely,
relevant, and accurate information about the
organization’s environment
RESEARCH METHODOLOGY
16. Steve Ells
Former CEO & Executive Chairman
(1993 - 2020)
● Vision: bring change to the fast food
industry
● Company Founder
● 2018-2020: Executive Chairman
● 1993-2018: Former Chief Executive
“We decided long ago that we didn’t want Chipotle’s success to be tied
to the exploitation of animals, farmers, or the environment, but the
engagement of our customers.”
LEADERSHIP
STEVEELLS
17. Brian Niccol
Chief Executive Officer (2018 - Current)
● Vision: brand visibility & digital expansion
● 2018-Current: Chief Executive Officer
● 2015-2018: Former Taco Bell CEO
“The brand just became invisible. And we are working to make it more
visible.”
LEADERSHIP
BRIANNICCOL
18. Marissa Andrada
Chief People Officer (2018 - Current)
● Vision: employee driven, employee
opportunities
● 2018-Current: Chief People Officer
● 2016-2017: VP of HR for Kate Spade
● 2010-2016: VP of Partner Resources for Starbucks
“I am continually blown away by the number of stories I hear about employees who
started at Chipotle ‘for a job’ and ended up with a career and life changing
experience.”
LEADERSHIP
MARISSAANDRADA
19. Chris Brandt
Chief Marketing Officer (2018 - Current)
● Vision: digital efforts, retelling Chipotle’s
story
● 2018- Current: Chief Marketing Officer
● 2016-2018: Executive VP & Chief Brand Officer
of Bloomin’ Brands
● 2013-2016: Chief Brand Officer/Chief
Marketing Officer of Taco Bell
“I’ve always told my teams that our marketing job is threefold: We want
to be innovators, storytellers, and collaborators”
LEADERSHIP
CHRISBRANDT
20. Curt Garner
Chief Technology Officer (2015 - Current)
“We have a tremendous opportunity to further engage people who enrolled
in the platform” “being able to use data and insights to shape experience is
part of our focus”
LEADERSHIP
CURTGARNER
● Vision: Mobile App & Loyalty Program
● 2015-current: Chief Technology Officer
● 1998-2015: Chief Information Officer of
Starbucks
21. Laurie Schalom
Chief Corporate Reputation Officer
(2017 - Current)
● Vision: Strengthening Chipotle’s internal and
external communication
● 2017-current: Chief Corporate Reputation
Officer
● 2011-2017: VP of Public Affairs of Yum! Brands
● 1994-2005: Public Affairs Director of Taco Bell
“I am thrilled to join the company to help shape and strengthen its strategic
communications in support of a very important vision to make great tasting food,
made with real, whole ingredients available to everyone”
LEADERSHIP
LAURIESCHALOM
22. LEADERSHIP SUMMARY
OVERALL VISION
“We decided long ago that we didn’t want our success to be tied to the
exploitation of animals, farmers, or the environment, but the engagement of
our customers”
“Corporations are only as good as the people you have running them,” “I
firmly believe that with the talent we have in place, we are making
smarter decisions.”
-Brian Niccol (CEO)
25. SUSTAINABILITY
“Cultivate a Better World”
Food & Animals, People, & Environment
“Sustainability is the backbone of that
experience they’re creating and influences our
strategy from our restaurants, to our company
offices, to the farms from which we source our
ingredients .” - Brian Niccol
26. CHIPOTLE CULTIVATE
EDUCATION
BENEFIT PROGRAM
● Began October 2019
● Over $20M in tuition
assistance
● In partnership with GUILD
Education
“Inclusion inspires mutual learning, development and
career growth for our employees and results in further
innovation and growth for the company. I firmly believe
that we will grow Chipotle by growing our people.”
- Marissa Andrada
EMPLOYEE SUPPORT & DIVERSITY/INCLUSION
27. PHILANTHROPY
● The Cultivate Foundation
○ Established in 2011
○ “Making real food accessible for
all”
● Food and Equipment Donation
○ Harvest Program: pairs each
restaurant with a local charity or
food bank
● Disaster Relief
○ California wildfire recovery efforts
○ Hurricane Florence relief
“We understand that we are a part of the
communities in which we operate.”
29. CAREERS
R E C R U I T I N G
“Our managers are looking for great people who will help them ensure that every customer has an
excellent experience at Chipotle. They don’t ask trick questions or try to scare candidates.”
- LUCY, RECRUITING MANAGER AT CHIPOTLE
30. CAREERS
R E C R U I T I N G
INDEED ZIP RECRUITER LINKEDIN
GLASSDOOR SNAGAJOB
38. SOURCING
ALL INGREDIENTS ARE
SOURCED FROM FARMS
WITHIN 350 MILES
PRODUCE AND MEAT ARE
NATURALLY GROWN AND
RAISED
MEDICAL TREATMENT ACT
-Support preservation of antibiotics
-Reduce surplus of antibiotics given
to farm animals
39. HEADQUARTERS
● Denver, Colorado (1993-2018)
● Newport Beach, CA (May 23, 2018)
“I wanted us to be feeling good about what’s next, as opposed to dwelling on what’s
happened in the past—both successes in the past and challenges in the past”
- Brian Niccol
40. LOCAL GROWERS SUPPORT
Initiative to help local farmers
Three Key Objectives:
Education and Training
Financial Assistance
Develop new partnerships
41. RESTAURANTS
● All restaurants are company-
owned
● 2,600 restaurants in U.S. and
international
● Expanded to Canada, U.K., France,
and Germany
● More than 83,000 employees
● Queuing System
○ Established by Ells
○ Customization for the
customer
42. ● Few franchises sold in the beginning
● Chipotle currently has complete corporate ownership and control
● Does not allow licensing - domestic nor international
LICENSING
59. FINANCE SUMMARY
1. Strong technical financials
2. Impressive rebound since 2015-2016 dip
3. Digital sales has led charge to increase revenue
4. Constant re-investment in expansion
65. PLACE
● Chipotle sells through 3 channels:
○ Main stores
○ Chipotle Mobile App
○ DoorDash App
● Located near college campuses,
shopping centers, and urban areas
69. PR
● Non-Paid Broadcast Media
○ Focusing on becoming more
engaging, visible, and culturally
relevant
● “For Real” Campaign
● “Behind the Foil”
● Sustainability
“I just really believe
the brand had gotten
into this position of
being very defensive,
as opposed to talking
about what made the
brand great”
- Brian Niccol
77. MARKETING SUMMARY
● Social Media driven
● Sales Promotions
● Direct Marketing channel
○ Website
○ Mobile App
○ Social Media
● Educating Customers On
Food Quality
80. DIRECT COMPETITION
INTRODUCTION
● High Quality ingredients with
cheaper prices
● Competitive Advantage
○ Queso and Guacamole without extra cost
MISSION STATEMENT
“At Qdoba, our mission is to create a welcoming environment for our
customers with high-quality menu items featuring bold flavors”
81. DIRECT COMPETITION
INTRODUCTION
● High Quality healthy food
● Competitive Advantage
○ Customer service
○ Nature of bakery products
MISSION STATEMENT
“A loaf of bread in every arm”
85. TECHNOLOGY
● Food Delivery Services
○ Partnered with DoorDash
○ Order directly on mobile app or website
● Digital Technology (App)
○ Mobile Order (Pick-up, Drive-thru, or Delivery)
● Virtual Reality
○ Train new employees
● Kiosks/Tabletop tablets
● Automated purchasing tools
87. INDUSTRY CONSUMER
● Demographic
○ Millennials 20-35 years old
○ Well educated
○ Middle class
● Psychographics
○ Health Conscious
○ Value Social Corporate responsibility
○ Value sustainable Environment
89. MACROECONOMICS
● Strong Economic Factors
○ Lowest unemployment rate since 1969 (3.5%)
○ Strong US Dollar (low inflation, more international buying ability)
○ Consumer confidence at all-time high (more investment capital)
● Tax Cuts and Jobs Act (2017)
○ Corporate tax rate slashed from 35% to 21%
● COVID-19
91. STRENGTHS
● Sourcing
● Leadership
● Human Resources
● Digital Business Strategies
● Customizable Menu
● Strategic Alliances
● Public Relations
92. ● Rewards Program
● Overspending on Sales Promotions
● Dependent on limited number of suppliers
● Vague Mission Statement
● Underleveraged Data
● Traditional Organizational Structure
● Negative Brand Awareness
WEAKNESSES
93. ● Growing relations with sourcing
● Digital business strategies (DataBase)
● Food Delivery Methods
● Technology
● Drive-thru options
OPPORTUNITIES
95. DEFINITION OF
SUSTAINABLE COMPETITIVE ADVANTAGE
Sustainable competitive advantage is the leveraging of a company’s key
strengths and assets to establish differentiation amongst competitors and to
secure long term influence in its respective industry.
96. NEW SOURCES OF
SUSTAINABLE COMPETITIVE ADVANTAGE
CORPORATE CULTURE DIGITAL BUSINESS
STRATEGY
SOURCING
(LOCAL FARMERS AND HEALTHY
INGREDIENTS)
99. Chipotle University
Differentiate employees by current and future value
● Opt - In seminars and trainings at restaurants /
headquarters
● Differentiate employees who opt in
Qualify for 6 month Chipotle U rotation program
Evaluate - Consult - Develop
Eligibility for promotion to Restaurateur
100. Expected Outcomes
● Motivated and inspired employees
● Increased retention rates
● Advanced training for future leaders
● Separates employees by value
● Proactive approach to training
● Consistent training philosophy
Why Not Programmatic Recommendation
● Difficult roll out
● Does not insulate customer relationships
● New training program recently implemented
102. Customer Relationship
Management Program
Utilize information from Chipotle app and rewards program
Increase touch points and dialogue opportunities
Create customer communities
Divide customers into portfolios
● Most growable
● Most Valuable
● Value Subtractors
103. Expected Outcomes
● Insulated customer relationships through
relationship marketing
● Higher customer perceived value
● Data capture with existing app
● More customizable experience
Why Not Programmatic Recommendation
● Higher success probability after programmatic recommendation is
implemented
108. Program Overview & Objective
Club Chipotle would further Chipotle’s mission of “Food with Integrity”, as it would
continue to promote Chipotle’s fresh and “real” ingredients. Through this new
venture, we hope to not only bring convenience to Chipotle’s customers, but to also
bring customers closer to what makes Chipotle great.
110. Phase 1 - Farming and Sourcing Initiative
Form database of all farmers/suppliers
Supplier scorecard criteria and evaluation
Appoint meal kit supervisor to the best performing farms
Quality control of products
111. SCORECARD MOCK-UP COMPLETED INCOMPLETE NOTES
Food Safety Protocol
Food Health History
Employee Training
Food Tracing System
Labeling Processes
Timeline of Deliveries
Sustainable Technology
Core Values Commitment
Financial Independence
Speed to the Market
112. Phase 2 - Revamping Digital Platform
Utilizing the already established rewards program
Adding more features in relation to Club Chipotle
Customers input more applicable information
Customers can choose from the provided meal kit menu
115. Phase 3 - Introduction & Launch
● Help from Digital Marketing department
● Social media campaign
○ Interactive media on all platforms
● Collaborations with social media influencers
● Educational content for customers
○ Videos, Interactive quizzes, etc.
117. Phase 4 - Interaction & Adjustments
● Maintaining quality control
● Communicating with suppliers and farmers on their quality status
● Gaining customer feedback and making applicable changes
● “Meal Kit” Community
○ Separate web page on Chipotle’s website
○ Customers can include photos of their recipes and find information on
any questions they may have
123. ● Primary Research
○ Golden Questions
○ Surveys
○ Focus Groups
● Sales and Profitability
● Digital
○ Social Media - Daily Engagements and Click-Through Rate
○ Website - Impressions, Traffic Sources, Bounce Rate
○ App - Conversion Rate
127. Verses that have guided our study...
Galatians 6:9
● “Let us not become weary in doing good, for at the proper
time we will reap a harvest if we do not give up.”
Joshua 1:9
● “Have I not commanded you? Be strong and courageous.
Do not be afraid; do not be discouraged, for the Lord your
God will be with you wherever you go.”