Frito-Lay's Quality-Controlled Potato Chips
Video Case
Frito-Lay, the multi-billion-dollar snack food giant, producesbillions of pounds of product every year at its dozens of U.S. andCanadian plants. From the farming of potatoes—in Florida, NorthCarolina, and Michigan—to factory and to retail stores, theingredients and final product of Lay’s chips, for example, areinspected at least 11 times: in the field, before unloading at theplant, after washing and peeling, at the sizing station, at thefryer, after seasoning, when bagged (for weight), at cartonfilling, in the warehouse, and as they are placed on the storeshelf by Frito-Lay personnel. Similar inspections take place forits other famous products, including Cheetos, Fritos, Ruffles, andTostitos.
In addition to these employee inspections, the firm usesproprietary vision systems to look for defective potato chips.Chips are pulled off the high-speed line and checked twice if thevision system senses them to be too brown.
The company follows the very strict standards of the AmericanInstitute of Baking (AIB), standards that are much tougher thanthose of the U.S. Food and Drug Administration. Two unannounced AIBsite visits per year keep Frito-Lay’s plants on their toes. Scores,consistently in the “excellent†range, are posted, and everyemployee knows exactly how the plant is doing.
There are two key metrics in Frito-Lay’s continuous improvementquality program: (1) total customer complaints (measured on acomplaints per million bag basis) and (2) hourly or dailystatistical process control scores (for oil, moisture, seasoning,and salt content, for chip thickness, for fryer temperature, andfor weight).
In the Florida plant, Angela McCormack, who holds engineeringand MBA degrees, oversees a 15-member quality assurance staff. Theywatch all aspects of quality, including training employees on thefactory floor, monitoring automated processing equipment, anddeveloping and updating statistical process control (SPC) charts.The upper and lower control limits for one checkpoint, salt contentin Lay’s chips, are 2.22% and 1.98%, respectively. To see exactlyhow these limits are created using SPC, watch the video thataccompanies this case.
Discussion Questions
- Angela is now going to evaluate a new salt process deliverysystem and wants to know if the upper and lower control limits at 3standard deviations for the new system will meet the upper andlower control specifications noted earlier.
The data (in percents) from theinitial trial samples are:
- Sample 1: 1.98, 2.11, 2.15, 2.06
- Sample 2: 1.99, 2.0, 2.08, 1.99
- Sample 3: 2.20, 2.10. 2.20, 2.05
- Sample 4: 2.18, 2.01, 2.23, 1.98
- Sample 5: 2.01, 2.08, 2.14, 2.16
Provide the report to Angela.
- What are the advantages and disadvantages of Frito-Lay driversstocking their customers’ shelves?
3.Why is quality a critical function at Frito-Lay?
