Professor Howard Weiss always has an interesting view of operations management to share
June 2 is National Donut Day so let’s consider the operations of Kristy Kreme.
Location (Ch. 8) In 1937, Vernon Rudolph opened the first Krispy Kreme factory in Winston-Salem, North Carolina. He mainly sold the doughnuts to local grocery and convenience stores but he also sold fresh donuts directly to customers who came into the store during early morning baking hours. Today there are over 350 locations where Krispy Kremes are produced. The company’s goal is by 2026 to have donuts available at more than 75,000 outlets including supermarkets and McDonald’s.
Global Operations (Ch. 2) In 2001 Krispy Kreme opened its first store outside of the U.S., in Canada. It now has locations in over 30 different countries.
Product Design (Ch. 5) The traditional donuts are round and have holes because they cook more evenly with holes. In 2007, Krispy Kreme began producing donuts with more fiber to match a fad in foods.
Process (Ch. 7) In the beginning, the process was manual but since the 1950s it is mostly automated with one assembly line. Originally the holes were cut out but now the dough is dropped onto the assembly line already in the shape of a donut with a hole.
Capacity (Supp. 7) In the 1950s the capacity was 720 donuts per hour. In the 1960s the process was computerized leading to a capacity of 3,000 donuts per hour.
Assembly Lines (Ch. 9) The assembly line is a relatively simple one with several steps which can be modified easily to create the non-traditional donuts. It begins with the mixer that mixes the dough which includes a secret mix for exactly 14 minutes. The dough is put in a hopper and then transferred by hand to the extruder which creates the circles of dough with the holes. The “proofer” allows the dough to rise for over 30 minutes.
Quality Control (Ch. 6) At this point a worker inspects the donuts to make certain the shape is correct. Donuts are then cooked, on both sides, in the fryer using hot oil and then cooled before they are glazed. They are then cooled some more prior to packaging.
Distribution (Ch. 11) There are 154 U.S. production locations and each serves an average of 47 sales locations.
Classroom discussion questions:
- Krispy Kreme insists that the donuts must be sold within 24 hours. What can be done with the leftover donuts?
- Where is the closest Krispy Kreme manufacturing location to your home or school?