The latest episode of CBS's Undercover Boss featured Dave Rife, one of the owners of White Castle, posing as a trainee at several of the company's businesses. While the experience was aimed at giving Rife a firsthand look at life on the bottom rungs of the fast-food empire, it also shed light on some of the key aspects that separate White Castle from its competitors -- and a few of the problems that, sadly, don't.
White Castle is America's oldest burger chain, and it has been family-owned for most of its history. When it opened in 1921, Bill Ingram, Rife's great-grandfather, had to overcome the bad publicity surrounding mass-produced food that was sparked, in part, by Upton Sinclair's expose of the meatpacking industry The Jungle. In a move that seems especially resonant today, Ingram designed every aspect of his new chain with the intention of reassuring customers. The name "White Castle" was chosen for its ability to project purity and security, and the restaurants' white-porcelain walls and stainless-steel interiors were intended to convey a sense of cleanliness and sterility. The same goes for the employees' matching uniforms and white hats. In the company's early days, the "chef" would even grind the beef for the burgers in full view of the dining room.
In the process of creating White Castle, Ingram also developed his own supply chain, building a collection of companies that produced everything from paper hats to buns. On Undercover Boss, Rife came face to face with this extended web of industries when he worked a shift at a White Castle bakery. Tasked with bagging buns for shipment to the restaurants, he mangled 4,800 of the little rolls. At another factory, Rife tried his hand at preparing burgers for freezing on a fast-paced assembly line. In a sequence reminiscent of Charlie Chaplin or Lucille Ball, he attempted to keep up with a never-ending stream of burgers that needed to be constantly adjusted. Needless to say, he fell behind, throwing the production line into disarray.
Keeping It All in the Family
Unlike most of its competitors, White Castle has never franchised its restaurants and has never sold stock. Ingram, the founder, dictated that all restaurants would be operated directly by the company, which would not borrow money for expansion. This has certainly kept the company from growing on the same scale as the competition. McDonalds (MCD) currently operates over 31,000 restaurants worldwide and Burger King (BKC) has an impressive 11,000, White Castle has only 421.
The family mentality at White Castle pervades almost every major decision at the company. In his brief exploration of the entry-level White Castle universe, Rife discovered the human impact of many of his corporate decisions: because of thoughtless new store procedures, one of the restaurants he worked in was overstaffed with managers, confusing the chain of command and making employees miserable. In the same outlet, constant surveillance left some workers terrified that they were in danger of getting fired. Later, in the company's frozen-food plant, Rife learned that unclear supervision standards resulted in workers who felt abandoned by their managers.
At the conclusion of the show, Rife revealed himself to his employees, all of whom seemed deeply moved by his willingness to dive into the trenches. As he used his company's impressive resources to right wrongs, improve worker satisfaction and build company loyalty, the show felt like a sort of capitalist fairy tale, with the Prince Charming making everything OK.
Unfortunately, the happy ending evaporated when Rife presented his conclusions to the rest of the company's owners. As the camera panned around the bored, disinterested faces of his siblings and cousins, it quickly became clear that Rife's sense of personal responsibility was not necessarily shared by the rest of his family. Perhaps he isn't the only member of the Ingram clan who needs to try his hand at flipping burgers.
Take the first steps to building your portfolio.View Course »