WEBVTT - Chipotle CEO at The Bloomberg 50

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<v Speaker 1>This is Bloomberg Business Week with Carol Messer from Bloomberg Radio. Well,

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<v Speaker 1>this week's cover story we talked about it earlier with

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<v Speaker 1>Brett Began and Joe Weber Business Week. It's the Bloomberg fifty.

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<v Speaker 1>And as part of our virtual reveal that we did

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<v Speaker 1>yesterday of the names on that list and the individuals

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<v Speaker 1>on that list, I actually caught up with someone who

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<v Speaker 1>was on last year's Bloomberg fifty list, and we're talking

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<v Speaker 1>about the chairman and CEO of Chipotle Mexican Grill, Brian Nicol.

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<v Speaker 1>He is now in the job for about two and

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<v Speaker 1>a half years, and in this excerpt from our conversation,

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<v Speaker 1>Brian talks about the importance of really understanding your customer

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<v Speaker 1>check it out. You know, you want to understand about

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<v Speaker 1>companies dealing with crises and having to think about their customers,

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<v Speaker 1>think about their employees. You're really right in the ship

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<v Speaker 1>when you got to Chipotle back, So when you first

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<v Speaker 1>got there, why didn't you want to know after you

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<v Speaker 1>know the problems at the company, what did you want

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<v Speaker 1>to know about the customer um and where they were,

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<v Speaker 1>what they were thinking about your brand? Yeah, that's that's

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<v Speaker 1>exactly right. That the very first step was where are

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<v Speaker 1>our customers you know, uh, what are their thoughts, feelings, trust,

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<v Speaker 1>level of engagement, you know, um, belief systems. So you know,

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<v Speaker 1>step one for me was understanding that. And then also

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<v Speaker 1>the other piece too was understanding where employees were. You know,

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<v Speaker 1>our company, our experience is really driven by our employees.

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<v Speaker 1>So did they feel like they were on their front foot?

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<v Speaker 1>Did they feel like they're on their back foot? Because

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<v Speaker 1>if their experiences, you know, one of defensive, I think

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<v Speaker 1>our customer feels that it's a defensive experience as well.

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<v Speaker 1>So we really spent a lot of time, frankly, in

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<v Speaker 1>the first couple of months diving into understanding both of

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<v Speaker 1>those things. And frank that's what's driven our strategies UM

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<v Speaker 1>from day one. Well, and it's interesting, what what did

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<v Speaker 1>you maybe learn about those first two years in the

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<v Speaker 1>company and dealing with that and then getting to the

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<v Speaker 1>current crisis and again the customer, right was worried. Your

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<v Speaker 1>employees were worried as well. Yeah, yeah, so you know,

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<v Speaker 1>look when we went back, you know, if you've rewind

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<v Speaker 1>the tapes here a couple of years ago, what consumers

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<v Speaker 1>were saying to us, Our customers were saying to us is,

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<v Speaker 1>you know, you guys need to get back to talk

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<v Speaker 1>what makes your special? Um, you know, remind me why

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<v Speaker 1>I feel good about eating at Chipotle. And you know

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<v Speaker 1>the answer was they felt good about eating Chipotle because

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<v Speaker 1>it's real culinary, it's ingredients with integrity. Um. You know,

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<v Speaker 1>we take a different approach to how we prepare and

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<v Speaker 1>cook our food. Um. And so that was really what

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<v Speaker 1>enabled strategy number one, which is around being more visible

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<v Speaker 1>and you know, frankly more looked. And you know, we

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<v Speaker 1>really set down that mission of just talking about what

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<v Speaker 1>makes Chippole unique. The other thing that we knew we

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<v Speaker 1>had to do was dial up our culture of safety

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<v Speaker 1>and wellness. And you know, our employees they viewed the

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<v Speaker 1>practices as more of an initiative, not an ongoing culture.

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<v Speaker 1>And you know, in my opinion, it's like, look, we

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<v Speaker 1>can only have employees working if they're healthy. So it

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<v Speaker 1>sounds harsh, but we had to install a zero tolerance

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<v Speaker 1>policy on this where if you don't do the wellness

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<v Speaker 1>check and you're not honest on your wellness check, you

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<v Speaker 1>will lose your job. Um, Like, we've got no tolerance

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<v Speaker 1>for that. And so that was a tough you know,

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<v Speaker 1>a couple of months because I got a lot of

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<v Speaker 1>emails from people saying like, I can't believe lost my

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<v Speaker 1>job because I didn't do wellness checks. And you know,

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<v Speaker 1>it was like, look, this is our culture. If you

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<v Speaker 1>want to be a part of our company, that's what

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<v Speaker 1>we do. And also, if you're not truthful, we've got

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<v Speaker 1>two problems. One, we're a company of high integrity and

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<v Speaker 1>to you know, you're putting our company at risk when

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<v Speaker 1>you're not truthful whether or not you have symptoms. You know,

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<v Speaker 1>by the way, we have a program where you get

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<v Speaker 1>paid sickly, so there's no incentive, you know, to not

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<v Speaker 1>tell us the truth. So, you know, doing things like

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<v Speaker 1>that that materially changed the culture. And unfortunately sometimes it

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<v Speaker 1>takes a couple of stories being retold about we're really

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<v Speaker 1>meaning business on this zero tolerance approach to wellness and

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<v Speaker 1>food safety as well as then you know, reminding our

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<v Speaker 1>consumers why they loved Chipotle was at the forefront of

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<v Speaker 1>what were really instituted day one, and that just got

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<v Speaker 1>us back to running great restaurants again. You know, it

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<v Speaker 1>was like, look, if we know we have healthy employees,

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<v Speaker 1>we know we're practicing the right protocols. We can focus

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<v Speaker 1>on making delicious guacamole, terrific chicken, you know, the rice correctly,

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<v Speaker 1>and every detail matters in our business. So, you know,

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<v Speaker 1>this was a crazy year, disruptive, it was an upsetting

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<v Speaker 1>you as you well know you guys, you do your

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<v Speaker 1>very purpose driven. I mean it's really in the DNA

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<v Speaker 1>of your company. How have you as an organization and

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<v Speaker 1>as a company kind of demonstrated that. Yeah, Look, you know,

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<v Speaker 1>I think, uh, I'm really proud of how our company

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<v Speaker 1>has done that. Um. I think we've been tested numerous

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<v Speaker 1>times and whether or not we were going to be

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<v Speaker 1>true to our values and our purpose um, and I

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<v Speaker 1>think we've stepped up and done that in every way,

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<v Speaker 1>you know. So whether it was when the pandemic hit, um,

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<v Speaker 1>you know, I had a lot of employees that we're

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<v Speaker 1>worried they're gonna lose their job. Um. And then when

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<v Speaker 1>they realize, you know, we've got a really healthy balance sheet. Fortunately,

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<v Speaker 1>we are an essential business. We're gonna be able to

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<v Speaker 1>continue to operate. Not only are not losing your job,

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<v Speaker 1>we're gonna you know, because I know other people in

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<v Speaker 1>your family probably have been impacted. We're going to increase

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<v Speaker 1>wages for temporary and we honored first quarter bonuses because look,

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<v Speaker 1>January February, the guys were doing an unbelievable job. March

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<v Speaker 1>hit and it wiped out would have been their bonus,

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<v Speaker 1>and that just wasn't the right thing to do. And

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<v Speaker 1>you know, fortunately we were in a position to do it,

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<v Speaker 1>so we did it. And uh, you know, it was

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<v Speaker 1>those types of examples that you know, I think we

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<v Speaker 1>stepped up with our values and making those decisions consistent

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<v Speaker 1>with our values time and time again. And you know,

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<v Speaker 1>I don't know if you've seen our Round Up for

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<v Speaker 1>Real Change program that we've instituted as well, but you know,

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<v Speaker 1>we did that because we wanted to participate aid on

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<v Speaker 1>a bigger level on these various causes that are important,

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<v Speaker 1>from historically black college all the way to the farmlingk

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<v Speaker 1>program that we're doing right now. And that was the

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<v Speaker 1>Chipotle Mexican Grill chairman and CEO. Brian Nickel caught up

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<v Speaker 1>with him yesterday at our Bloomberg fifty reveal event UH

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<v Speaker 1>and he was part of the b fifty list last

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<v Speaker 1>year because of the incredible turnaround after the food UH

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<v Speaker 1>poisoning incidents at the company. That really pushed down Chippotle

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<v Speaker 1>as a company and as a share Brian came in

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<v Speaker 1>and really turned it around. The stock was on a

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<v Speaker 1>tier last year. UH, it's continuing its run up this year.

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<v Speaker 1>You can listen to more of that interview. It's on

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<v Speaker 1>our weekend show on Bloomberg Radio and also on our

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<v Speaker 1>podcast feed at Bloomberg dot com. And I don't know

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<v Speaker 1>if you've heard recently that Chipotle opened up its first

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<v Speaker 1>digital only restaurant in the US. UH. It's in Highland Falls,

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<v Speaker 1>New York. And what it does is it requires customers

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<v Speaker 1>to order in advance online or through a third party

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<v Speaker 1>delivery company, and then orders can we essentially picked up

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<v Speaker 1>from a lobby that it says we'll have kind of

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<v Speaker 1>um or that does have the sounds and smells of

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<v Speaker 1>kind of a kitchen and kitchen views of a traditional restaurant.

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<v Speaker 1>And apparently it's going to allow Chipotle to enter more

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<v Speaker 1>urban areas where a full sit down restaurant just doesn't

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<v Speaker 1>make sense. And one of the big strategies and themes

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<v Speaker 1>of Chipotle, and really since Brian Nickel came on board,

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<v Speaker 1>was digital and digitization of the company. And they even

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<v Speaker 1>were already h ramping up their strategies prior to the pandemic,

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<v Speaker 1>but when everybody was working from home, living at home

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<v Speaker 1>and ordering in they even increased it even more to

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<v Speaker 1>really tap into the markets and the needs of individuals

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<v Speaker 1>and consumers at home, and digitization just and digital ordering

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<v Speaker 1>really took off at that company. So again, check out

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<v Speaker 1>that full interview. As I mentioned earlier, it's in our

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<v Speaker 1>weekend show and you can find it certainly at Bloomberg

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<v Speaker 1>dot com and also wherever you get your podcasts.