Tuesday, February 4, 2014

Making Chipotle (Even) More Efficient

The Problem

Chipotle's throughput isn't fast enough. It's pretty fast, per their recent earnings statement highlighting their "four pillars of great throughput", but it still can get (much) faster in my opinion.

Theoretically, the throughput that Chipotle should be striving for is the time it takes to make an item and no more, which I believe is possible. If a burrito takes a minute to make, a minute should be the goal. There are currently factors adversely affecting this time such as payment, other ordering items (chips/guac/drinks), and customer inputs (specifics such as brown/white rice, black/pinto beans, etc.).

The Solution

I believe ALL of these adverse factors can be smushed into the time it takes to make an order. By the time my burrito is made, I have already paid for my burrito and any other things I want to order. In the article I listed above, CEO Steve Ells says he isn't against introducing a new POS system, which is essential for the solution I am about to offer.

Ells should start by pushing people to place their orders in mobile, especially when they are waiting in line. By the time a customer steps up to the employee, the employee already has their complete order and most importantly doesn't have to ask anything about the order to the customer. This frees up customer time so they can immediately go to the cashier and pay for the meal and get anything else they need to get. By the time they are done paying for everything, they are only waiting on the employee to finish making the order.

Instead of:
-place your order, name all ingredients, wait for order to be done, add chips/drinks/guac, pay

You:
-place order on mobile before getting to the front of line, pay while waiting for order to be complete, get order.

It replaces a few steps and allows throughput production to be limited to the actual order itself and nothing else. A key step of this is the customer not having to name all his/her ingredients in real time by instead putting their order on their phone. This order goes to a tablet in front of employees who will have all the info necessary to complete an order without asking a customer anything.

This also opens up to all types of possibilities on mobile, which is for another day. Most importantly, mobile allows people like me (who go to Chipotle a lot) to not have to place our same order over and over every time we go to a location. In essence, it allows Chipotle to "remember" their customers better.

If there was ever a time to push mobile, it is now.

The Numbers

Old Way: 1 Burrito (rice, beans, chicken, sauce, corn, cheese, lettuce)

Assuming
(1) You pay after your order is complete*
(2) Each individual ingredient ordered by customer takes 3 seconds**
(3) A burrito takes 1 minute to complete with no interruption***

1 min + 3 sec x (7 ingredients) + (Payment = 25 seconds) = 1 min 46 seconds

New Way: 1 Burrito (rice, beans, chicken, sauce, corn, cheese, lettuce)

= 1 min = 56.6 % faster than old way.


* Rough estimate. A customer may have to fumble through wallet/purse, hand card/cash over, wait for payment to be processed, receive card/cash back. I feel 25 seconds is a low estimate.

** Also rough estimate; maybe a little too high. Point being that an employee won't have to bother with asking customer for individual ingredients as they'll have the complete order in front of them, which eliminates (valuable) time.

***No interruption means the complete order is already known and the employee can complete the order as fast as possible.

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