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Question A

Decision–making is a very important process that begins with the identification and definition of a problem
that needs an effective solution to be solved, this is developed from a series of effective steps and activities. It
is one of the important processes that are done by managers in organizations (Litvaj et al 2022). Problem-
solving steps towards effective decision-making involve the following; identifying the decision, gathering
information, identifying alternatives, weighing the evidence, choosing among the alternatives, taking action,
and reviewing the decision (Talanker, 2016). These steps will be discussed below.

1. Describing the Problem

This is the first step where the context of the problem is identified and defined by gathering all background
information. Once the problem has been identified symptoms will reveal the implications of the problem, then
an investigation will have to be done and identify those who will be affected by the problem and the urgency
of resolving it. Some useful techniques can be used to gather all this information such as; sending out
questionnaires, doing some interviews, and brainstorming. While the information is gathered more indicators
may further clarify what the real problem is (Litvaj et al 2022). Chipotle faced the problem of securing
sustainable supplies for pork that was used for making carnitas a favorite dish for many consumers of its
restaurant, finding a replacement was not easy and it was likely to be worse because Chipotle had plans to
grow the business. The and the other fast-food chains were trying to find the sustainable ingredients that
Chipotle was using

2. Identifying alternative solutions

As many solutions as possible to the problem are identified through creativity to make the process more
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effective. Identify how each of these solutions relates to the problem symptoms and root cause. There will be a
need to be very analytical as some of the solutions may require to be merged and some eliminated to give the
best solution (Litvaj et al 2022). Chipotle learned that there was an Iowa farmer who was naturally raising pigs
to continue with the business he decided to engage the farmer to supply him even though it was quite costly.
 3. Evaluate the alternatives
Then evaluate all possible solutions to the problem some will be merged but some will be eliminated and then
prioritize those that remain on the list and evaluate them according to their advantages and disadvantages.
Chipotle’s new supply of pork was tastier and better than before and customers did not mind the high price.

4. Select the most suitable solution

Evaluate the selected and potential solution. Select the most feasible solution which will be the best fit for the
problem. Cognitive problem solving will be required to decide if the solution will be beneficial for the
organization (de Andreis, 2020). Identify its risks, how they will be managed and if it will be possible to
implement it within an acceptable time frame. The new supplier tried to keep up with Chipotle’s needs and
kept adding more small pig farms, but it seemed not to be able to meet the demand, thus it had to find other
suppliers.

5. Implementing the selected solution

Select a Project Manager and all who must be involved in the implementation process. Determine the start time
for the project, identify all necessary actions, and find the key milestones and actions before and during the
implementation process (de Andreis, 2020). Following Chipotle’s implementation of the solution by getting a
new supplier made its business grow and it gained market share from the traditional fast-food companies like
McDonald’s because the consumers preferred fresh, healthy food from trustworthy sourcing.

6. Evaluate the outcome

This is a very important step to be performed to ensure that the desired outcome is achieved. Evaluate the
effectiveness of the solution by considering the plan and revise it if there is a need. Evaluate if the project costs
are contained, the milestones are met, and all necessary work is completed in time. An effective evaluation
process is dependent on the following steps; data collection, defining a reporting system, and the project
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manager has to give updates regularly (de Andreis, 2020). Chipotle still faced challenges because the new
supply could not meet its demand and its competitors also made the supply to be worse. Ells had to evaluate
the situation and decided to stop selling carnitas and decide if it was still possible to continue the business’s
rapid growth objective while preserving food integrity.
 Question B
To determine the sustainability of an organization’s competitive advantage, an analysis of the dimensions of
the competitive advantage such as imitability and durability is done. To make this analysis a resource-based
view (RBV- VRIO) is used, according to (Ahmanah, 2016) the VRIO reveals valuable, rare, inimitable
resources, and the organization’s processes and routines lead to its competitive advantage. Therefore, based on
this analysis sustainable competitiveness is created when resources are valuable, rare, inimitable, and non-
substitutable. These four aspects of the framework will be discussed about Chipotle’s food integrity standards.

1. Value (valuable); Value is created if the organization can devise and implement strategies using its
resources that improve its effectiveness and efficiency for the consumers. When consumers realize the
product features, uses and differentiation they value the product no matter the price it will cost (Purwanto,
2016). When Chipotle stopped providing carnitas its customers were not happy they expressed their pain
through social media where they expressed their sadness of losing a meal they mostly liked. In a survey
that was done the data revealed that “Food with integrity” was highly valued by some consumers.
Chipotle’s consumers realized the value and they still bought the meals even though they had to pay a high
price.

2. Rare: If a valuable resource is only available to an organization and not to its competitors then it is
considered rare (Purwanto, 2016). “Food with Integrity” operated as fast food in the fast-casual space
which was rare and it used sustainable ingredients which were also rare among its competitors during the
time of Chipotle. Over the years these strategies have been duplicated in the type of business as they were
realized to have been a competitive advantage initiative that works. Even though many would claim to be
using sustainable ingredients only for attracting customers but in reality, they would not.
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3. Inimitability
The valuable and rare resources and capabilities of an organization must be hard to be replicated so that
competitors would not be able to quickly copy them because of the competitive advantage. If the valuable
and rare resources are easily imitable, then competitors would easily imitate them then the organization
would lose its potential for competitive advantage (Ariyani & Daryanto, 2018). It will not be easy to
imitate resources that are; are too costly to imitate, very complex, and lengthy thus difficult to replicate. It
would have not been easy for Chipotle’s competitors to imitate its business strategies. Its strategies placed
it at a competitive advantage in the industry because of the

The value that Chipotle had for the business and the rare commodities he used such as sustainable
 ingredients. This indicates that what made the ingredients to be rare was that it was hard to find them.
Chipotle was now experienced in using sustainable products and could have already made strong
relationships and working agreements for sourcing them which was not going to be any cheap for its
competitors if they would want to source them made it difficult for other restaurants to imitate ‘Food with
Integrity”.

4. Organization – The valuable resources of the organization have to be properly managed. Therefore a
strong and effective organizational structure with a clear coordination system has to be put in place to
maintain and make good use of the resources. The organization includes all the routines and processes
which are dynamic capabilities such as skills, management, expertise, knowledge, and expertise which are
used daily. These capabilities represent how the organization will respond to any changes in the
environment but maintain competitive and competitiveness internal routines and processes (Amana, 2016).
Chipotle most likely that he had a very strong organizational structure and proper systems in place for
“Food with Integrity”, the case mentions that there were routine audits that would be done on its suppliers.
The process of maintaining its integrity objective also suggests that the management and staff had well-
organized responsibilities which were making the business grow even though it had challenges with
suppliers not providing quality products.

This is an important method to be used for the analysis of Chipotle success, it proves that the “Food with
integrity” policy does create a sustainable competitive advantage for Chipotle. It proves that it can be used for
the future and indicate if it will be sustainable in the future it can be adapted to be used for the future of the
business.

Question C
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Chipotle’s “Food with Integrity” was a well-established business with a very stable market amidst any
challenges it was facing. The business attained its competitive advantage from the integrity that has been
maintained over the years, changing these well-established strategies of integrity and focusing on growth could
make Chipotle lose its brand identity and market. Strategies for sustainability have to be explored for the
uncertainty that was predicted. Chipotle’s uncertainty was due to scalability issues for the sustainable
agricultural production it was using for its menus and also due to the interest from its rivals in using the
sustainable ingredients it was using thus making them expensive. The situation also seemed like it was going
to be worse going forward and it was creating uncertainty about whether it was still possible to continue
maintaining its integrity commitment or decide to focus on its growth objective.
 Businesses normally resolve such uncertainties by using vertical integration. Vertical Integration when defined
by Kim 2019, is when an organization decides to perform an economic activity on its own than source it from
suppliers. The practice of vertical integration reduces uncertainty in the price of a supply of an intermediate
product by opting to produce it in-house. This becomes a very important business and economic decision
because it is an alternative way of doing economic activities through the business value chain. Chipotle could
vertically integrate the production of sustainable agriculture production by obtaining and managing the
production farms to produce enough quantities that will meet its needs, control the quality of the supply,
maximize its profits and enhance its economic efficiency. Considering that integrating another business may
come with additional costs, to eliminate that Chipotle can decide to make integration in a form of a partnership
with the producers. In a business partnership each of the partners contributes an agreed shared capital and they
share the collective profits and losses of the business. Both partners become liable for all the debts and
obligations of the partnership. Examples of partnerships could be joint ventures or strategic alliances. The
latter being the most suitable for Chipotle’s business as it most beneficial to small businesses having limited
resources (McQuaid, 2000). The producers should retain the production decisions to eliminate extra costs and
the challenge of expertise from Chipotle.

References;
Amana A. (2016) The Role of (VRIO) Analysis in the Sustainability Competitive Advantage.

Ariyani W., Daryanto A. (2018) Operationalization of Internal Analysis Using VRIO Framework:
Development Scale Resource and Capabilities Organization. Asian Business Research Journal Vol. 3.

de Andreis, F. (2020) A Theoretical Approach to the Effective Decision-Making Process. Open Journal of
Applied Sciences, 10, 287-304.
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Kim J. (2019) Vertical Integration and the theory of the firm. Oxford Research Encyclopedia of Business and
Management.

Litvaj, I. et al (2022). Decision-Making Procedures and their Relation to Knowledge Management Quality
Management. Sustainability 14, 572.

McQuaid, W. (2000) “The Theory of Partnerships-Why have Partnerships” Managing public-private

partnerships for public services: an international perspective pp. 9-35.

Purwanto H. (2016) Resource-Based View as Competitive Advantage the Company: an Empirical Review.
Advances in Economics, Business and Management Research, volume 15.
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