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MANAGEMENT IN ACTION
CHIPOTLE NEEDS TO CHANGE
Problem-Solving Perspective
1. What is the underlying problem in this case from CEO Brian Niccol’s perspective?
2. What are some of the causes of this problem?
One cause of the problem is that the chain has grown too large to maintain the quality
that those who do go to Chipotle have come to expect. An essential part of the quality
Application of Chapter Content
1. What type of change does Niccol need to inspire—reactive or proactive? Explain.
2. Using Figure 10.1, describe what forces for change exist both inside and outside
Chipotle.
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McGraw-Hill Education.
increase employee efficiency within each restaurant—less work could mean less
employees needed. This, however, is paralleled by an outside force: the customer
preference for fresh food prepared in-house. Similarly, customers are looking for healthy
options and the issues around foodborne illnesses are a heavy deterrent for that
demographic. A third outside force, competitor restaurants, is a never-ending concern
that has been exacerbated by the internal challenges for Chipotle and weakening of the
chain’s competitive advantage.
3. Does Chipotle need adaptive, innovative or radically innovative change? Explain.
Chipotle currently needs innovative change, which entails doing something new for the
company. These new things include expanding the menu and centralizing food
4. Does Utilize Lewin’s model of change (Figure 10.2) as a blueprint and describe how
Niccol can inspire change at Chipotle.
Lewin’s model of change has three steps. The first step is unfreezing, which involves
creating the motivation to change. In this step, Niccol needs to get stakeholders on board
5. Think about the outbreak of food-borne illness at Chipotle and utilize the organizational
development process (Figure 10.4) to remedy the issue.
The first step in the organizational development (OD) process is to diagnose the problem.
In this case, the problem is that poor food handling, which is a reflection of poor
oversight as Chipotle grows too quickly for its own good, has led to food-borne illnesses
Kinicki/Williams, Management, 9e: Chapter 10 Organizational Change and Innovation: Lifelong Challenges for the
Exceptional Manager
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McGraw-Hill Education.
restaurants. One way of doing this would be to, as suggested in the case, regionally
centralize food handling and then distribute to restaurants from a single source point in
the region; another way would be to ensure staff and supervisors at each location are
better trained to oversee the food handling process. The third step is to evaluate how well
the intervention worked. In this case, the primary metric would be whether there is a
reduction in the number of food-borne illness outbreaks; a secondary metric could
involve tracking sales of foods that previously had been connected to the illnesses. The
fourth step is to, if the intervention was not successful, refine the diagnosis to create a
more appropriate intervention. Should this latter step be needed, one example of how to
refine the diagnosis would be to hone in further on the specific restaurants where the
illnesses are stemming from and the specific employees at those restaurants.
6. Does Niccol need to bring product or process innovation to Chipotle? Explain.
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LEGAL/ETHICAL CHALLENGE
DID L’OREAL GO TOO FAR IN FIRING ITS PATENT LAWYER?
Solving the Challenge
1. I would side with the company. It’s not Trzaska’s job to be a gatekeeper. Let the U.S.
Patent Office make these decisions. His role is to help the company acquire patents for its
products, and he was jeopardizing future sales by taking an unduly hard stance about
2. I would side with Trzaska. He demonstrates a quality stance on the submission of patent
applications. The company should focus on the quality of ideas submitted by researchers
rather than the work of Trzaska’s team. What is Trzaska supposed to do when people
submit poor ideas?
3. I’m not sure who is right or wrong, but I don’t like the idea of setting firm goals for
innovation such as the number of patent applications submitted.
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TEXTBOOK EXAMPLES
EXAMPLE: Radical change: The Decline of Toys R Us
This Example details the reasons behind Toys R Us going out of business after 70 years. It did
not recognize the strengths of its competitors, did not understand the new online app gaming
market, carried too much debt, and did not capitalize on digital opportunities. Toys R Us may
have had a 15 percent share of the U.S. toy market, but it still went out of business.
YOUR CALL
Suppose an entrepreneur launching a new chain of toy stores asked for your advice about how to
avoid the mistakes made by Toys R Us. What would you suggest, and why?
ADDITIONAL ACTIVITIES
Disruptive innovation is a threat to all organizations, even those that have been around a long
time and seem impervious to threats. Here is an activity:
Investopedia offers a list of industries and how they are being threatened by technological
change.
Step 3: Break the students into groups and ask them to choose one to three industries on the list
(depending on the time you wish to spend on this exercise) and brainstorm ideas for how these
industries might be able to cope with or, even better, profit from the anticipated disruptions.
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EXAMPLE: Reactive Change: The BP Gulf of Mexico Blowout
This Example discusses the April 2010 explosion on the BP drilling platform in the Gulf of
Mexico. BP has been criticized for reacting poorly to the crisis, which led to the loss of 11 lives,
tremendous economic damage, and the deaths of more than 1,400 dolphins and 1 million birds.
Litigation, which ended in 2017, has cost the company approximately $65 billion.
YOUR CALL
The BP blowout happened 21 years after the tanker Exxon Valdez’s catastrophic 1989 oil spill in
the Gulf of Alaska, the effects of which are still being felt. Wasn’t that enough time for oil
companies to plan for major accidents? Why do you think BP was not more proactive in
preparing for such events?
Proper planning may have saved BP a lot of money and resources. Though a backup shutoff was
not mandated by regulators, it would have ethically been wise. Remember the ethical decision-
ADDITIONAL ACTIVITIES
One way you could build on this Example is to have the students read The Wall Street Journal
article “Underwater Oil-Well Bolts Are Failing, Causing Alarm.” This article profiles how
manufacturers, oil drillers, and U.S. regulators are scrambling to determine why massive bolts
used to connect subsea oil equipment are failing. Although the broken bolts have caused only
minor spills so far, many are worried that the slow-pace of action on the issue creates the
possibility of a major oil leak along the lines of the 2010 Deepwater Horizon disaster. Consider
using the following discussion questions:
1. Discuss the reasons why some firms appear to be taking a reactive approach to the bolt-failure
issue. Would it be better for the firms to be more proactive? Explain your point of view.
2. Does knowledge about BP’s actions change your intentions to continue to buy the firm’s
products? Explain your position.
EXAMPLE: From Ride Sharing to Self-Driving Cars: Uber, Lyft, & the Upending of
Transportation
Kinicki/Williams, Management, 9e: Chapter 10 Organizational Change and Innovation: Lifelong Challenges for the
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McGraw-Hill Education.
This Example examines the changes occurring in the transportation industry from transportation
network companies such as Uber and Lyft to self-driving vehicles. The autonomous vehicle
surge hit a dam when an autonomous car killed a pedestrian in Arizona in 2018. The question
remains: How will change effect the transportation industry.
YOUR CALL:
1. How safe do self-driving cars have to be before they can be deployed on the road?
2. How would their use affect public transportation? The insurance industry?
Will autonomous vehicles mean the end of the Taxi industry? Uber and Lyft have been making
inroads on Taxis already. Would autonomous vehicles kill off Uber and Lyft? Or would they just
ADDITIONAL ACTIVITIES
Have students watch the TED video “The Ethical Dilemma of Self-Driving Cars.” This will link
the chapter on ethics with considerations of potential harmful outcomes from new technology.
This short video presents a series of what if scenarios involving autonomous vehicles and the
Return.
EXAMPLE: Organizational Development: Using OD to Make Money in the Restaurant
Business
This Example profiles Copilot Labs, a restaurant marketing analytics company. The organization
begins with a diagnosis, and then proposes an intervention. Finally, evaluation (how well has the
intervention worked?) and feedback (how can we further refine?) occurs.
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Do you think universities could do a better job educating students? How might the OD process
be used to improve your educational experience?
ADDITIONAL ACTIVITIES
corresponding 3-minute video explain why some restaurants will take popular items, even ones
that have been available for years, off the menu. Consider using the following discussion
questions.
EXAMPLE: IDEO’S Approach to Innovation
This Examples describes IDEO, a leading global design firm known for its creative innovations,
not only in products, but in processes and disaster planning. IDEO’s approach to creative
problem solving involves inspiration, ideation, and implementation. The teams at IDEO rely on
intuition, pattern recognition, and construction that is both functional as well as emotionally
meaningful.
YOUR CALL
1. What is appealing to you about IDEO?
Ask students if they are interested in working for a company that stresses creativity and
innovation and which is organized around teams? Some students will be fascinated by the
company, others will be a little wary of working for it. Have them explain why—what is it that
leads them to seek out or avoid such a company?
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Have them identify IDEOs approach: look for inspiration, generate ideas, link the solutions to
people’s needs and wants. IDEO is human focused, looks for what is technologically feasible and
ADDITIONAL ACTIVITIES:
Have students visit the IDEO website. Give them 15 or 20 minutes to explore the site (It’s
fascinating!). Ask them to find interesting tidbits, intriguing projects, and innovative ideas on the
site. Have them look particularly at the company blog, The Octopus. Lead a discussion using
questions such as:
1. What was the most interesting project you found on the website? Why?
2. Would you want to work for IDEO? This builds on the Your Call segment above. If you had
3. If you were a CEO, what would attract you to this company and encourage you to hire them?
Kinicki/Williams, Management, 9e: Chapter 10 Organizational Change and Innovation: Lifelong Challenges for the
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TEXTBOOK PRACTICAL ACTIONS
There are no Practical Actions in this chapter.
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SELF-ASSESSMENTS
SELF-ASSESSMENT 10.1 CAREER READINESS
Assessing Your Attitudes toward Change at Work
This survey was designed to assess students’ attitudes toward change at work.
STUDENT QUESTIONS
1. Where do you stand when it comes to your attitude toward change? Are you surprised by the
results?
2. Based on your three lowest scoring survey items, how might you foster a more positive
attitude toward change? Be specific.
3. What things might you say during an interview to demonstrate that you possess the career
readiness competency of openness to change?
Recruiters may ask about a situation in which a student encountered change, or was forced to
change, and how the student adapted to the change. Responses will hopefully describe
SUPPLEMENTAL ACTIVITY
Students should be put into groups based on their Self-Assessment scores. Students who had a
positive attitude toward change should be grouped together and students who had a negative to
CAREER
READINESS
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Return.
SELF-ASSESSMENT 10.2 CAREER READINESS
What Is Your Readiness for Change?
This survey measures students’ readiness for change at their organization.
STUDENT QUESTIONS
1. Of the four components, which is the lowest?
2. How do you think this result will affect the success of the particular change? Be specific.
10.2.
3. Who seems to be most ready, you (components 1 and 2) or the organization (components 3
and 4)?
4. What things might you say during an interview to demonstrate that you possess the career
readiness competency of personal adaptability?
SUPPLEMENTAL ACTIVITY
Students should be placed in small groups with a different mix of survey results in each group.
Groups should choose a hypothetical organization that has a culture problem and is in need of
change. Utilizing Lewin’s change model, how can they go about changing the culture?
What outcome do they want?
CAREER
READINESS
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SELF-ASSESSMENT 10.3
How Innovative Is the Organizational Climate?
This survey was designed to assess the innovation climate of students’ organizations.
STUDENT QUESTIONS
1. What is the level of innovation? Are you surprised by the results? Explain.
2. Select the three lowest survey item scores. Use the content of these items to recommend what
the company could do to become more innovative.
Student responses will vary, but here are some examples: First, management should promote
SUPPLEMENTAL ACTIVITY
Students should be put into groups based on their Self-Assessment scores. Students who had a
low innovation climate should be grouped together and students who had a high innovation
climate should be grouped together.
Students who scored highly should identify if and how the four steps to fostering innovation
have been applied at their organization:
Recognize Problems & Opportunities & Devise Solutions
Same steps.
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SELF-ASSESSMENT 10.4 CAREER READINESS
How Adaptable Are You?
This survey was designed to assess students’ level of adaptability.
STUDENT QUESTIONS
1. What is your level of adaptability? Are you surprised by the results?
2. Based on your scores, identify three things you can do to increase your level of adaptability?
Explain.
Generally, someone with high adaptability responds with a calm focus in times of stress, enjoys
3. What things might you say during an interview to demonstrate that you possess the career
readiness competency of personal adaptability?
SUPPLEMENTAL ACTIVITY
Instructor should open the floor for discussion by asking the following questions:
1. In what particular organizations or industries is it quite important to have adaptable
employees?
2. How is adaptability related to globalization and current trends in technology?
3. Can anyone name a manager that was quite adaptable? Was this manager successful? Why or
why not?
CAREER
READINESS
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SELF-ASSESSMENT 10.5 CAREER READINESS
Assessing Your Resistance to Change
This survey was designed to assess students’ resistance to change.
STUDENT QUESTIONS
1. Are you more or less willing to accept change? Discuss.
2. Based on your scores, identify three things you can do to lower your resistance to change.
These changes may involve new thoughts or beliefs or the display of new behaviors.
3. What might you say during an interview to demonstrate that you possess the career readiness
competency of openness to change?
Recruiters may ask about a time when the candidate had to embrace change, and how he or she
SUPPLEMENTAL ACTIVITY
Students should be put into groups based on their Self-Assessment scores. Students who had low
resistance should be grouped together and students who had high resistance should be grouped
together.
Students who scored highly should discuss what has caused them to be so resistant to change and
how they can overcome this.
Which cause of resistance to change from the chapter can be identified?
What can the organization do to decrease this resistance?
Students who did not score high should discuss reasons why they are less resistant to change.
What has the organization done to promote this?
CAREER
READINESS