Foundations and Revolutions at the Cheesecake Factory, Case Study Example

Throughout the text, case studies are examined to encourage critical thinking and support elements of learning in the management field. In Chapter 2, a particularly savory management question regarded timely production, specific practices, and the sustainability of hundreds of tasty options at the Cheesecake Factory. The company has successfully combined emergent technologies with the ethical management techniques of the late Industrial Era, and these successes serve as a positive model for a variety of food industries. The index of demand capabilities and performance are strongly, positively correlated with operational excellence (Morash, 2003). After all, a hungry clientele is an unhappy one indeed.

Management

In 1972, Evelyn and Oscar Overton established the Cheesecake Factory (TCF). The legacy of their family-run approach to management is still proudly displayed in a large black-and-white photograph of the couple proudly featured on the official website’s “Our Story” page. They originally worked 18-hour days and split the diverse responsibilities of building a positive reputation within the industry (2002-2011). Although their work ethic remains present in the company today, new equipment and more lavish interior decorations have expanded upon these home-grown foundations. The famous Zagat surveys have recognized TCF for its desserts and salads (“Our Story”).

As the company grew, the addition of employees changed the dynamic of the company from a husband-wife business to an extensive management network. This is no simple task. As Professor Henry Mintzberg states, “Management is a practice that comprises a great deal of art and craft as well as some science” (Mintzberg, 2003, p.9). Mintzberg (2003) argues that planning strategies prior to collaboration stifles the creative brainstorming which is necessary for the move from strategic theory to implementation. The merits of company mandates will also have a strong effect on policy integration, growth, and success in general (Fang, 2006).

Sustainability

The company’s original menu featured heaping helpings of twenty varieties of cheesecake, making the sustainability of many options another legacy of its founding (“Our Story”). In the modern Cheesecake Factory, pasta, seafood, salad, sandwiches, and even steak comprise a distinguished plate-full of options, but using high-quality ingredients in their confectionary creations is still a high priority in the company. TCF successfully upgraded according to demand and supply chain capabilities but must not become overextended as a result of this expansion. Solid management contributes to sustainability through executive briefings and input (Morash, 2001).

Technology

The company’s careful application of technology has streamlined the costs of production. In addition, the advances in shipping and online ordering have created a niche for web-savvy companies—a niche which The Cheesecake Company has filled for online customers (“Our Story”). A new generation may now receive a pre-sliced cheesecake—from sea to shining sea or down in Mexico. In addition, the official TCF website boasts its intent and progress in taking the company’s storefronts global. An effective inventory system and production and transportation lines are key components of the technology of globalization (Morash, 2001). Within the stores, the text writes that lights indicate available seating, that computers direct customers and chefs, that one person is assigned to monitor the completeness of each outgoing order and another to monitor the quality of these products (p. 22). Through such careful design, TCF has also utilized time-based supply strategies to synchronize supply and demand as much as possible and mediate managerial responsiveness (Morash, 2003).

Recommendations

The management has been paid generously and is held to high standards. Furthermore, the system of accountability and reporting exceeds the minimal requirements for a company of TCF’s size and reputation (Morash, 2003). Yet, amazingly, TCF has also managed to continue with its responsive address of current challenges through constant updates and largely demand-centered perspectives of supply strategy. The continuing estimation of supply and demand are crucial to sustain- and not overextend- the growth of the company. The use of technology has been conservative and limited to the basic forms of electric changes seeking to silently coordinate several processes and capitalize on every minute during the hours of operation. While technology (which also includes interior renovations) has helped in this area, the costs of such projects easily surpasses early estimates, making the scheduling and overestimation of costs and underestimation of budget the most fiscally-responsible courses for action. As companies like TCF expand, they are frequently tempted to micromanage operations. With demand-centered and time-focused strategies the temptation to do so is omnipresent. However, the simplistic roots of TCF’s people-centered start has created a loyalty between customers and company employees, and this loyalty has caused company executives to consider other aspects as equally crucial. This focus should be represented in one form or another in every professional development literature piece and every managerial briefing, because this represents the spirit underlying TCF success.

Conclusion

Of these three considerations (management, sustainability, and technology), sustainability may be the most serious concern. TCF enjoys the privilege of a loyal customer base and rather liberal pricing, so comparable sustainability in other food industries is impractical; Morash (2003) writes that customer closeness doubles as a supply strategy. Furthermore, with the rising costs of transportation, shipping, and even costs of living, profit margins in the United States are narrowing, but demand-based strategies tend to be more sustainable over longer periods of times, i.e. months rather than years (Morash, 2003). Public businesses enjoy more managerial freedoms and tend to grow with less planning than businesses which are privately owned, yet privately owned companies imply a higher level of personal investment and risk for the owners, as was evident in TCF’s own establishment (Fang, 2006). A laissez-faire business policy in this regard could cause the company to spoil. Until then, to borrow a famous quote, “Let them eat cake”.

References

“Our Story”. (2002-2011). The Cheesecake Factory. Retrieved 23 July 2011 from http://www.thecheesecakefactory.com/aboutUs/ourStory/ourStory. Web.

Fang, F. (2006). Are Public Enterprises Inefficient?. Chinese Education & Society, 39(5), 83-90. Retrieved from EBSCOhost.

Mintzberg, H. (2003). Unconventional wisdom: A conversation with Henry Mintzberg. Leadership in Action, 23(4), 8-10. Retrieved from EBSCOhost.

Morash, E. A. (2001). Supply Chain Strategies, Capabilities, and Performance. Transportation Journal, 41(1), 37. Retrieved from EBSCOhost.