Frito Lays Quality

Controlled Potato
Chips

Gagan Gulati
B018
Gupta B020
Siddharth Gupta B024
Ingale B025

Anantaya
Indrayani

Company Overview
The primary snack food brands produced
under the Frito-Lay name includeFritos corn
chips,Cheetoscheese-flavored
snacks,DoritosandTostitos tortilla
chips,Lay's potato chips,Rold Gold
pretzels,Ruffles potato chips
andWalkerspotato crispseach of which
generated annual worldwide sales over $1
billion in 2009.

Frito-Lay
headquartered
in
Texas, established in
1930, merged with
PepsiCo in 1965
Largest
globally
distributed
snack food
company
in the
world

One of Fast
Companys
Most
Innovative
Companies
(2010-2011)

FL-NA
accounts
for 31%
of
PepsiCos
annual
sales

Grocery
Manufacture
rs
Association
award for
Innovation &
Creativity
(2012)

Quality Control at Lays

From factory to
retail stores
ingredients and
final product
inspected 11 times
Use of proprietary
vision systems for
defective potato
chips
2 key metrics: 1)
total customer
complaints 2)
hourly or daily
statistical process
control scores

Regular employee
Inspections
AIB standards- two
visits per year.
Scores are posted
so that each
employee knows
how the firm is
performing
15 member quality
assurance staff:
training employees,
automated process
log equipment, SPC
charts

Why is quality a critical function at Frito-

1)
Frito
Lays
produces
edible
items,
which
should
meet
certain
quality
standards

2)
Consistency
in taste and
quality
are
the
two
important
factors
for
the
chips.
These need
to
be
consistently

3)High
deviation
from
these
might
result
in
decrease
in
customer
loyalty
and

Statistical Process Control

Chart
Sample means are taken at regular intervals and plotted
on a control chart
If the sample means lies:
Between the UCL and LCL the process is assumed to
be on target
Outside the UCL and LCL the process is said to be off
target and action is required
Upper Control
Limit
Mean
Lower Control
Limit

Q1-Evaluate a new salt

delivery process system
Sample
Sample
Sample
Sample
Sample

1
2
3
4
5

1.98
1.99
2.2
2.18
2.01

2.11
2
2.1
2.01
2.08

2.15
2.08
2.2
2.23
2.14

2.06
1.99
2.05
1.98
2.16

Average
2.08
2.02
2.14
2.10
2.10

Statistical Process Control Chart for Salt Content(%) in

Samples
2.22%

Salt Content
(%)

UCL
Mean
LCL

1.98%
Sample

What are the advantages and disadvantages

of Frito-Lay drivers stocking their customers
shelves

35 percent
of
workforce
are drivers

Commissio
n based job
based on
sales

Goes to
store
before 4
AM
How to, how
much and
which
Take back
any stale or
damaged
product
Takes care of
his own area,
10 hours and
multiple
stores

Restock
the shelves
Rotate stock
Merchandize
inventory
Gather
competitive
pricing

Advantage
s
Reduction in
inventory
Direct control
of its
inventories

Disadvanta
ges
Possible
reduction in
visibility
Extreme
closed
collaboration
between
retailer and
manufacturer

Why is quality a critical function at

Frito-Lay?
Produce Edible Items, thus needs to
meet certain quality standards under
Government Regulations
Consistency in taste and quality are the
two important factors for the chips.
These need to be consistently checked
High deviation from these might result in
decrease in customer loyalty and tarnish
brand image