We observed Qdoba\'s operations and made recommendations for improvement.

1. OM 725: Adding Value through Operations and Technology
TEAM 1
Jeremy Blanchard
Cesar Calvo Medina
Dong Sun Chang
Evan daSilva
Jiten Goyal
Shannon Rohan

2. Company Overview
Main Figures
RESTAURANTS 1,457
EMPLOYEES 42,700
REVENUE $2,539M
INCOME $119M

3. Qdoba at the Prudential Center
COMPETITIVE ENVIRONMENT
Plenty of options available, reducing client tolerance for waits

4. Qdoba at the Prudential Mall Layout
LOOK & FEEL RESTAURANT
Tables and services shared with other competitors

5. Qdoba at the Prudential Center
“Fast Casual” Restaurant Customers
Food Selection Factors Restaurant Selection Factors
Health
Quality
20%
27%
Taste
27%
Freshness
26%
Office workers, local shoppers, retail store staff

6. Methodology
1st Field Observation 02/27/2009
• Observation of the process identifying the different tasks and procedures
• Time measurement of the different tasks in two different batches, one for
the peak time and one for the non-peak
2nd Field Observation 04/03/2009
• Verify observation analysis to see if reality confirms our data analysis
• Confirm the feasibility of the recommendations

7. General Project Workflow
Queue
Add Sauce
Steam Add Basic Roll up the
and Extra
Tortilla Ingredients Burrito
Choices
Order No No
Take Collect
a
Away? Payment
Drink?
Yes Yes Prepare
Prepare
Bag
Drink

8. Project Workflow Non-Peak Times
Queue
Work station 1
Add Sauce
Steam Add Basic Roll up the
and extra
Tortilla Ingredients Burrito
Choices
38‘’
Order No No
Take Collect
Work station 2
a
Away? Payment
Drink?
Yes Yes Prepare
Prepare
Bag
Drink
41 ‘’

9. Analysis of Cycle Time Non-Peak Period
Task Max Min Average Customers Capacity Capacity
Time* Time* Time * per Hour Per Hour Utilization
Steam Tortilla -> Add
Basic Ingredients ->
Add sauce and extra
77 28 38 64 95 67%
choices ->Roll up
Burrito
Beverage, Bagging
& Payment 111 6 41 64 88 73%
Collection
*Times in seconds

10. Analysis of Non-Peak Through-put Time
9
8
Avg: 3 min 59 sec
Min: 1 min 39 sec
7
Max: 9 min 50 sec
6
Frequency
5
4
3
2
1
0
<=50 50- 100- 150- 200- 250- 300- 350- 400- 450- 500- 550- 600- >650
100 150 200 250 300 350 400 450 500 550 600 650
Seconds
80% of the clients served in less than 6’ 57”

11. Analysis of Non-Peak Wait Time
8
Avg: 1 min 46 sec
7
Min: 1 sec
6 Max: 5 min 3 sec
5
4
3
2
1
0
<=0 0- 25 25- 50- 75- 100- 125- 150- 175- 200- 225- 250- 275- >300
50 75 100 125 150 175 200 225 250 275 300
Seconds
80% of the clients wait in line less than in 3’ 34”

12. Observation During the Non-Peak Period
• Some customers were indecisive and talked to the workers
• Waiting line was almost empty
• Each food prep worker completed one entire prep process
• Worker stocked ingredients, cleaned work station, and took
breaks
• Manager greeted every customer with a smile while performing
his tasks

13. Project Workflow Peak Times
Queue
Work station 1 Work station 2 Work station 3 Work station 4
Add Sauce
Steam Add Basic Roll up the
and Extra
Tortilla Ingredients Burrito
Choices
15” 14 ‘’ 9‘’ 16 ‘’
Order No No
Take Collect
Work station 5
a
away? Payment
Drink?
Yes
Yes Prepare
Prepare
Bag
Drink
35 ‘’

14. Analysis of Cycle Time Peak Period
Task Max Min Average Customers Capacity Capacity
Time* Time* Time * per Hour Per Hour Utilization
Steam Tortilla 83 3 15 179 240 74.5%
Add Basic Ingredients 40 4 14 179 257 69.6%
Add Sauce and Extra
choices 43 3 9 179 400 45%
Roll up Burrito 29 9 16 179 225 79.5%
Beverage &
Bagging/Payment
85 5 35 179 154** 116%
Collection
*Times in seconds
** Capacity calculated taking into account 1.5 workers, to include the times when the manager helps with the drinks.

15. Analysis of Peak Through-put Time
40
35 Avg: 8 min 3 sec
Min: 3 min 16 sec
30 Max: 11 min 39 sec
25
Frequency
20
15
10
5
0
<=50 50- 100- 150- 200- 250- 300- 350- 400- 450- 500- 550- 600- >650
100 150 200 250 300 350 400 450 500 550 600 650
Seconds
80% of the clients served in less than 9’ 59”

16. 2
4
6
8
10
12
14
0
<=0
0- 25
25- 50
Min: 8 sec
50- 75
75- 100
Avg: 4 min 5 sec
Max: 8 min 39 sec
100- 125
125- 150
150- 175
175- 200
200- 225
225- 250
250- 275
Seconds
275- 300
300- 325
Analysis of Peak Wait Time
325- 350
350- 375
375- 400
400- 425
425- 450
80% of the clients wait in line less than in 5’ 44”
450- 475
475- 500
>500

17. Observation During the Peak Period
• Workers did not chat with each other besides calling orders and remained at
their work stations
• Line is full most of the time. Potential customers were deterred by the long
line
• Manager tried to help the bottle neck by preparing soda (from the soda
fountain)
• Number of food prep workers increased from 1 to 4
• Workers completed orders in assembly line fashion

18. Recommendations
Reduce Cycle Time
• Add soda-fountains right next to registers
Shift Demand
• Offer coupons to encourage non-peak orders
• Implement online ordering system
Make wait more enjoyable
• Offer free tortilla chips to customers in line

19. Reduce Cycle Time: Moving Soda Fountain
New Lay Out Goal
To increase the capacity of the
bottleneck
Impacts
• Lower cycle time at the registers
• Shorter lines
• More clients

20. Shifting demand: Coupons
Coupons Goal
To shift demand from peak
time to non-peak
Impacts
50 cents
OFF
• Higher CU at non-peak
** Order between 10.00
• Additional customers
a.m. and 12.00 p.m.

21. Shifting demand: Online Order Service
Internet Order Goal
Shift and increase demand
Impacts
• Higher income
• Increased loyalty
• Leverage corporate capabilities

22. Make waiting enjoyable: Free Tortilla Chips
Free Samples Goal
Improve quality of service by
making the wait during peak
times more enjoyable
Impacts
• Higher service quality
• Increased loyalty
• Non material increase in cost

23. Impact of recommendations
INCOME STATEMENT ($000)
Soda Discounts Internet Free Tortilla
Current
1,801 1,888 1,857 1,904 1,809
Revenues
(602) (631) (620) (636) (604)
COGS
(668) (669) (668) (712) (669)
OPERATING COST
(216) (216) (216) (216) (216)
Rental
(60) (61) (60) (60) (60)
Other operating Cost
(392) (392) (392) (436) (392)
Salaries
531 588 569 557 536
Operating Margin

24. Impact of Recommendations
Operating Profit ($000)
657
5
26
38
57
531
+24%
Current Soda Fountain Discount Internet Free Torilla Total

25. Priority of Recommendations
Implementation Priority List
1 Soda Fountain
2 Free Tortilla Chips
3 Discount Coupons
4 Internet Ordering

26. Thank you for your
attention - Q&A