Assignment 1 - Organic To Go - Solution

Organic to Go (OTG) is an organic food retailer that opened a new takeout business line called Organic to Go. The business grew rapidly as it opened new locations across the city. Recently, OTG managers have noticed some hesitation in business performance and increasing problems across locations like order issues and employee absenteeism. The problems seem to be systemic as different locations face different problems.

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Assignment 1 - Organic To Go - Solution

Uploaded by

Salman Shaik

We take content rights seriously. If you suspect this is your content, claim it here.

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Organic to Go: Part 1

This is an individual assignment. Be brief in your answer. Submit a pdf document. Do Not email your
submissions. The deadline for submission is 9 am on Monday, July 04.

About two-and-a-half years ago, an organic food retailer opened a new line of business – Organic to
Go (OTG) – that offered takeout health-food meals. Customers call or book orders over Internet from
a menu of snacks, salads, soups, sandwiches, and entrees, and then pick up their orders at a designated
time. Customers also walk in and order at the counter. Although there is a small eat-in area, most
customers order takeout.
OTG has grown vigorously, attracting lots of young employees. The entire staff has been amazed at
the volume of customers that responded to the new concept. Everything about OTG has grown –
volume, customers, locations, staff, and menu. The owners are young, with a big vision, and they
gladly make room for employees to rise into management ranks. Because they have opened new
locations all over the city, employees have had many opportunities to learn about the business and to
develop new skills. Just in the last year, eight new sites were opened, including two in outlying
suburban areas.
In the past few months, OTG’s top managers have noticed some hesitation in the business
performance. The number of customers seems to be levelling off. Revenues are no longer booming.
When site managers are consulted, they report some increase in a variety of problems – botched
filling of orders, sloppy restocking, equipment and facility maintenance problems, and employee
absenteeism. There’s no clear trend, and different locations are struggling with different kinds of
problems.

Discussion Points
1. Plot the troubling trends for OTG? Which one problem among these would you choose to focus
on, if you think correcting this one would rectify others as a consequence? Offer a justification
based on your understanding of counter-intuitive behavior of social systems. [1]
Behaviour-Over-Time graphs must show metrics that correctly represent the present state of the
system. That said, two variables that could work as No of Customers and No of Customer
Complaints. Of these the former should show S-shaped pattern of growth over time while the
latter should ideally show a mirrored S curve.

No of Customers per Time No of Complaints per Time

2. Why is the problem systemic? [0.7]

Similar problem occurs when a company grows fast. And it is being observed almost at all new
(franchisee) outlets of Organic to Go.
3. What are the parts (Purpose, Element, State, Flow, Feedback Loop) in this system? [2.0]
Organic to Go which wanted to grow in a new line of business, should have a sustainable future
and not follow the path shown in ‘red ink’ in the figure above. The system has customers, money,
employees, complaints flowing through it. Customers per Time, Total Employees, Cash Balance,
Complaints per Time are some of the stocks. Net Change in Customers, Recruitment and
Departure of Employees, Net Cash Flow, Recent Complaints Received are some of the flows. The
feedback loops are shown in the CLD.

Organic to Go: Part 2

Once OTG was established and successful in its first location, its managers allowed themselves to
dream about the future. They knew they were onto a “hot” idea. They visualize how, as they opened
new locations, copying the successful model created in the original “mother store” would help them
increase their base. As growing sales volume brought in more revenue, funds would become available
for investment in more locations. OTG could be another Starbucks – Bicoastal, may be even
international!
However, the story doesn’t stop there. If we draw the “the Bigger Picture” we can see how problems
began to arise at OTG.
As the number of locations increased, the number of new employees increased. Fewer of these
employees had previously worked the original “mother store”. That meant that an increasing number
of new employees didn’t know the policies, operating procedures, and behavior, expectations that had
made the original business such a big hit with customers. As they tried to fit in to the job, the new
employees put an increasing load on their managers. Sometimes the newer employees got frustrated
and upset, and came late, left early, or took a day off without notifying their managers.
In addition, occasional problems with late or incomplete orders and with messy serving and eating
areas turned off some customers, who either came less often or stopped coming in at all. Some of
these customers complained to their friends, so OTG stopped attracting as much new business as it
had before.

Organic To Go: The Big Picture

Discussion Points
4. Assign polarity for different causal-links. [0.1 X 13]
Should match the loops in Figure. Award 0.1 mark for each correct polarity.
5. Articulate operational details of OTG, described above, with the help of the loops. Add other
loops in case you identify any missing part. [2]
It is R1 initially. But Grow-Big-Fast strategy with sufficient caution to maintain standard
energized B1 and B2 stagnating growth.
6. Compare the original purpose (Q#3) and the expanded depiction of the story’s actual outcome. Do
you see the issues at Organic to Go differently than you did at first? [1]
Short term measures like stocking popular brands (junk food), discounting products or employee
retrenchment might take Organic-To-Go in a completely different path.
7. What suggestions can you offer to OTG managers to reverse the disturbing trends? Justify your
suggestions. [2]
Problem is coming because of the B1 and B2 getting activated. So, plan to deactivate these by the
following structure.