Management at Taco Bell
Analysis of Two Main Changes in Taco Bell Management Style
Taco Bell was founded in 1946 by Glen Bell. It is a California-based fast food restaurant that specializes in the preparation of Mexican-style fast food. The company has now grown to be the leading Mexican-style restaurant in the USA. The company serves about 35 million customers in a week which is such a commendable number. The company has gone global given that it is not only located in America. The company has got an international presence in countries like Canada, Chile, as well as other European and Asian countries. Taco Bell currently operates as a subsidiary of the Yum!Brands. It is important to make note that Taco Bell tops the list of the largest fast food company in the whole world.
Since the inception of the company, there have been some changes in management style that are currently adopted. The changes arose as part of the changes that have taken place in the business over the time. The significant changes in the company’s management techniques occurred in the 1980s and early 2000 when the company was facing some problems that were threatening its survival. The changes were aimed at making Taco Bell more profitable and to enhance its general productivity and employee performance. Taco Bell wanted to create food products that would give it a competitive advantage in the market and as a result, gain a considerable market share command.
The first major management style changed took place in the 1980s when the company was returning a negative 16% annually for five years. As a result, Taco Bell was struggling to survive in the fast food sector. The company started changing its management style after it identified that some of the problem areas that needed to be addressed and it began re-engineering itself out of the trouble (Heskett, 2006). The company changed from its autocratic and bureaucratic management style to a more liberalized management style. Under this new management style, employees were encouraged to make independent decisions that were needed or expected. The change in the management style was initiated by Taco Bell’s former CEO John Martin who joined the company in 1983.
The change in the management style was aimed at transforming the organization structure, the information system, and training and development of employees. Managers of restaurants were empowered to make independent decisions, as they were not required to consult head office in the management decisions. They were allowed to consult with their colleagues and other employees in their respective restaurants instead of the top executive in the head office (Heskett, 2006). Middle managers were encouraged to focus on meeting customer needs instead of following the traditional procedures that delayed decision making. The re-engineering was based on the need of the company to add value to customers.
The second major management style took place in the early 2000s when the company was faced with the dilemma of expanding its operations while the company was experiencing a shortage of capable managers. The change that occurred in the early 2000s is the most recent significant management style change Taco Bell experienced. The solution to the dilemma was to crew a few high-paying leadership positions and to train high entry-level managers who could manage themselves. Consequently, Taco Bell was able to assign a manager to run several stores (Heskett, 2006). The management style change was known as “self-management” initiative. The trained store managers were empowered to hire and train new employees, encouraged innovation and creativity, and to handle personnel problems (Heskett, 2006) independently. As a result, Taco Bell was able to have highly energized workers, enhanced customer satisfaction, and reduced the cost of operation. The ‘self-management’ initiative significantly reduced the top-down management style that was being associated with Taco Bell.
I believe that the Taco Bell Company is properly managed. I take this opinion given the records that are depicted in the financial statements of the company. The company, from its financial perspectives, has managed to maintain an increasing financial performance since 2006. The company's financial performance was promoted by the increase in sales that the company has experienced since 2006. It is well clear that any given company may face many difficulties, but its financial performance reflects on how it is managed. For instance, the sales per units of the company have been increasing steadily from US$1.18 million in 2006 to US$1.46 million in 2015. The financial performance, apart from showing the profitability of the business, it also reflects on the overall employee performance and satisfaction. As a result, I believe the management of Taco Bell is doing relatively well.
The Role of Top Management in Changing Taco Bell
Top management at Taco Bell has had a significant role in introducing changes since the company was founded. To save the company from collapse in the 1980s, its CEO, and Presidents, John Martin, added business process reengineering strategy that the made it profitable up to date (Heskett, 2006). He abolished centralized management style and added decentralized control that made middle managers and employees more independent and empowered. Martin, together with other executives, played a role in changing the company’s management styles, and they introduced many changes that shaped the future of the enterprise.
The current top management led by the CEO Brian Niccol has also played a major role in preparing the company for its present and ongoing changes. The current administration has introduced a top-down approach to change where the top managers are encouraging employees to come up with initiatives that can transform the fate of the firm. For instance, Niccol introduced the position of market manager in the company with enhanced responsibilities, especially when it comes to meeting customers’ needs and satisfaction.
The top management is also introducing some employee training and development programs to enhance the knowledge and skills of its workforce. The initiative was promoted by Frank Tucker, the company’s Chief People Officer. Tucker has helped in developing efficient and reliable managers who have assisted in facilitating self-management efforts that helped the company to expand to other areas across the globe (Heskett, 2006). Also, management training programs have Taco Bell to attract best talents in the industry who have introduced new changes to the firm. Therefore, the top management has assisted in facilitating self-management initiative in the company.
The transition from centralized to self-management style was deemed to be problematic. Some managers in the company did not embrace the change, and they were forced to leave their positions and had their positions replaced with skilled and ready employees. At the same time, the company had to spend a lot of money in training its employees for management positions (Heskett, 2006). At the same time, the company was forced to stall the initiative when it tried to scale it down. For instance, Brian Niccol stopped further expansion of the initiative due to cutting back problems. Therefore, the transition was problematic.
Management Use of Vendors and Spokespersons
Some reasons can make the management use vendors and spokespersons. Many firms prefer to use vendors and spokesperson in the management of the relationship between two entities, as the two parties always have disagreements that can affect their operations. The use of vendors and spoke persons helps in reducing the risks that the company faces. Effective vendor management helps in reducing supplier risks such as unforeseen costs. Therefore, the use of vendors and spokespersons can minimize the cost of operation. Also, the use of vendors and spokesperson can enhance administrative efficiencies and protect the brand. As a result, Taco Bell should use vendor and spokespersons due to many benefits they bring to the company.
Innovative Idea
Quality service is one of the main factors that determine the success of many organizations, especially in food and beverage industry. Therefore, as a manager of Taco Bell, I would come up an innovative idea that improves customer service while at the same time meeting the needs of employees. Many customers are not pleased when they are waiting in long queues due to insufficient number of staff who can offer the products and services (Prabhavathi, Kishore & Kumar, 2014). Inadequate employees tend to be overworked, and sometimes they become rude to customers, which may make buyers go to a competitor’s restaurant. I would suggest that the employment of more employees with better payment to make them work longer and dedicated to serving customers be done. The number of staff should be increased during the weekend and peaks hours also to cut the cost of operation. More employees will reduce work pressure and bad attitudes, leading to better customer service and satisfaction.
Approach in Implementing the New Idea
First, I would engage in negotiations with the top management on the need to increase the number of employees in the restaurants by emphasizing on quality customer service. Secondly, I would assess the number of additional employees expected in every restaurant before advertising the vacancy in media. For the company to reduce the cost of operation in the restaurants, other employees would be put into a part-time contract to assist the existing workers during peak hours or seasons.
Ability to Adapt to Changing Needs
Taco Bell has a high ability to adapt to changing customer needs and market environment. The company has been keen in the trends in food and beverages industry, especially when it comes to healthy eating. Many customers are now avoiding foods that have a high content of sugar and fat due to increased obesity concerns (Prabhavathi, Kishore & Kumar, 2014). As a result, Taco Bell has responded by offering many low-calorie options to its customers. It has also realized that the millennial consumers are attracted to high quality and ethnically diverse foods. As a result, the Taco Bell has customized and created ethnically different tacos that attract young customers. It has also changed the classification of its food products from “Mexican inspired” to “Mexican fusion” show that it offers diverse ethnic foods. Therefore, the company has a high ability to adapt to the changing needs in a business environment.
Importance of Open Communication Channel in Implementing Change
Almost all the changes introduced to an organization become exposed to some resistance from stakeholders. Open communication channels have the ability to reduce the events of employee resistance to change scenarios. It is only through open communication channels that organizations can give all interested parties an opportunity to ask pressing questions and concerns that they hold against the proposed changes (Mutihac, 2010). Open communication channels also enable all parties to make their recommendations on the planned change. Also, open communication enhances teamwork during the execution of change. Therefore, to successfully implement a change in an organization, the management should embrace open communication channel.
References
Heskett, J. (2006). Are We Ready for Self-Management?. Harvard Business School Working Knowledge for Business, 1-29.
Mutihac, R. (2010). Managing resistance and the use of internal communication in organizations undergoing change. Department of Language and Business communication, Aarhus School of Business.
Prabhavathi, Y., Kishore, N. K., & Kumar, M. R. (2014). Problems and changing needs of consumers in fast food industry: The Indian perspective. International Journal of Scientific and Research Publications, 4(2), 647-650.
