Last week, The Motley Fool hosted Chipotle
Moran has been co-CEO of the fast-food burrito chain since January 2009, during which time the stock has run up more than 300%. Chipotle makes food based on its "Food With Integrity" philosophy, which emphasizes locally sourced, sustainable ingredients. With more than 1,000 restaurants selling burritos in the U.S. and Canada, Chipotle is branching out with a new Asian concept -- but don't expect a drive-thru any time soon. Here are a few excerpts from the chat:
Ryan: How did this idea start?
Monty Moran: A good place to begin. Steve Ells, our founder, has always loved food. He's thought about it every day since he was a little boy. Eventually he went to cooking school and began to work in a fine dining restaurant in San Francisco. He honed his skills at that restaurant, but during the day found himself having to go to more convenient restaurants to suit his lifestyle. During that time, he dreamed of having his own restaurant -- a "real" restaurant. But before doing that, he wanted to make some money, because he knew the economics of a fine dining restaurant were difficult. So he started Chipotle! But when he created Chipotle, he didn't know anything about fast food, except that he could make really good food and serve it quickly. And so he did. That is what Chipotle is all about.
Gene: What is your vision for the future of CMG? More restaurants? Different area demographics?
Monty Moran: Our vision is to change the way people think about and eat fast food. We are doing that in a variety of ways -- through our commitment to serve food made with ingredients from more sustainable sources (what we call "Food with Integrity") and with a people culture that is based upon empowering and rewarding top performers.
Streeter: What are the benefits to sharing the CEO role?
Monty Moran: Steve and I are both very passionate about this business, but we bring different focuses. Steve spends more time on sourcing and cooking the best food possible, designing the best restaurants, finding the best kitchen equipment and ensuring that customers enjoy the best possible dining experience when they come to Chipotle. I spend most of my time working to develop the very best people culture possible, to provide the best "engine" to support the healthy and vibrant growth for the company, and a lot of the day-to-day management of the business.
John: Geographically, where do you see your biggest future growth? And as you expand (as I assume) internationally, how do you think your restaurant format/menu might adapt?
Monty Moran: For now, our focus remains on domestic growth. We have a little more than 1,000 restaurants nationwide now, and think there is plenty of room for growth in this country. But we are also excited about the notion of building Chipotle restaurants in Europe and we are doing that by planting some seeds in the U.K. and France that we hope will become part of a future growth story.
As for the menu, it's largely the same. There may be some slight changes based on our ability to source different ingredients in different countries. But part of Chipotle's success is rooted in our focusing on doing just a few things, but doing them really well. We think that's important wherever we operate.
Jesse: It seems Chipotle's focus on speed at the expense of having a broader menu is part of what has made it so successful. Assuming that's the case, why haven't there been more businesses using this model? And of the ones who do (Qdoba, for example), what might the key factors be that separate Chipotle from them?
Monty Moran: What really makes Chipotle work is our passion for the highest-quality ingredients, cooking those using classic cooking methods, offering an interactive service format with top-performing crews and managers who are committed to delivering a great customer experience. Speed is important, but speed arises out of our focus on doing just a few things very, very well. We don't feel like adding additional menu items even if it didn't cause us to slow down, because adding things necessarily detracts from the quality of the things you're already doing. Restaurants that try to be "all things to all people" tend to lose something in their quality that customers notice, so we keep focusing on doing the things we already do better and better all the time. We do this through better ingredients, better cooking methods, better restaurant designs, better managers and crews, and a culture that keeps all of that improving.
Tom Gardner [Motley Fool co-founder and CEO]: Monty, thanks for hanging with a bunch of Fools. What's the most unorthodox aspect of your leadership style/philosophy at Chipotle?
Monty Moran: Pleasure to be with you, Tom. Most of what I do is unorthodox! My idea for leadership is to create a culture where each person in the company is evaluated not just upon what they do personally, but based upon the success they tend to bring to the people around them. Therefore, I work hard to build a culture where we attract the type of people who are empowering to the other people in the organization. My definition of top-performer is someone who has the desire and the ability to perform excellent work and through their constant effort to do so, elevates themselves, those around them, and Chipotle as a whole. Obviously, this pays off in better food, better service, and a better atmosphere. All of this leads to a financially healthy company.
