Food Safety: Taco John’s Trial by Fire

Despite planning for the worst, Taco John’s learned about crisis management the hard way.

By Mary Boltz Chapman, Editor-in-Chief -- Chain Leader, 3/1/2007

When three Taco John’s were hit by an E. coli outbreak last fall, the company put its crisis-management plan into action, which included frequent communication with operators about how to assure customers.

An E. coli outbreak has been traced to your restaurants. It’s the stuff that nightmares are made of. But executives at Taco John’s were not able to wake up, shake off the bad dream and head into work. The nightmare was real. In November and December, an outbreak affected three units in Minnesota and Iowa, making 81 customers ill; 26 needed to be hospitalized.

Coming on the heels of the fresh spinach recall and outbreak at East Coast Taco Bell units, the incident garnered a lot of media attention. The company was named in two lawsuits (though later dismissed from both). Health officials were able to trace the strain of E. coli to lettuce grown in California, but there are still questions as to how contaminated food got through to customers.

"We were shocked and devastated," says Vice President of Marketing Brian Dixon. "Fortunately, however, we started getting ready two years ago."

Working on Pre-Prep

Executives at the 430-unit, Cheyenne, Wyo.-based chain began a comprehensive vul-

nerability assessment in March 2005. Like most chains, Taco John’s has long had an 800 crisis line and manual for franchisees to follow for local incidents. But Dixon says the company wanted to ensure it was prepared in case something happened. It brought in two consultants, one to focus on the corporate headquarters and the other, crises in the restaurants or their markets. About a year ago, the assessment was complete and the team moved to planning.

Key was a communication plan. "What roles do we have?" Dixon says the team asked themselves. "What kind of statements do we make? What kind of facts do we have to gather? What attitude do we have to have to respond quickly? Who speaks?"

Taco John’s installed an e-mail blast program and voicemail blast system. "During the height of this unexpected crisis, we were able to have conference calls that at one point involved 290 people on the phone," Dixon says. Franchisees received a quick and consistent message about what they needed to do to assure their customers. Conference calls occurred every three or four days, re inforcing a package of printed information and frequent e-mail updates.

However, the technology was not ready when the incident occurred. According to Dixon, it was about 70 percent developed and had to be finished basically overnight. About 98 percent of Taco John’s system is franchised, and it found it did not have up-to-date contact information for everyone. The company is building a system in which franchise support in the field can easily keep their operators’ information current.

Another missing piece of the program was practice. "We planned to have a dry run and some on-site training," says Dixon. "It became on-the-job training. We could have been a lot more ready if we had a drill and practiced sending messages and knowing our roles."

Roles include a point person for managing communication and another for managing staff. According to Dixon, it took a few days for everyone to settle into their roles, noting a high level of anxiety, especially before the corporate office had adequate answers about the source of the E. coli.

After the Smoke Clears

The height of the crisis lasted about three weeks. After the organization got through it, its focus shifted to recovery. Sales at the affected units were hit "certainly by double digits," and the sales impact lessened as units got farther away. Taco John’s used the media attention it was receiving, plus advertising and its own Web site, to assure customers and franchisees that its food is safe.

When Dixon spoke to Chain Leader, he was between a series of meetings debriefing the management team on the crisis. "It’s not just a hand-wringing experience, when you think about all the nasty things that happened to customers and to businesses," he says. "It’s, here’s what we did right, here’s what we made mistakes on, here’s how we can improve, here’s how we’re going to be stronger to take better actions in the unlikely case something happens in the future."