KFC Ltd Analysis of Kentucky Term Paper

Excerpt from Term Paper :

Weston's previous position as a salesman for IBM in Japan and Ohkawara's familiarity with the Japanese culture enabled them to devise strategies that helped overturn KFC's performance in the country. Realizing that the fast-food business is more profitable when located in urban areas in order to entice higher customer volume; thus, KFC-J relocated to Tokyo, which has a higher volume of people, therefore increasing the chances of the store to attract potential customers. Apart from changes in the store location, KFC-J also decided to change its store size into half the recommended store size in the U.S. Despite the expensive cost of space rental and limited space in Tokyo, KFC-J thrived because it is accessible to people who are most likely to patronize fast food items. Knowing the Japanese appetite also helped Weston and Ohkawara introduce changes in the menu, thereby making the KFC menu more suitable to the customers' taste and preferences.

Despite these advantages that Weston and Ohkawara had introduced in KFC-J, the company had experienced conflict with KFC-U.S. because of Weston's disregard for the changes implemented in managing KFC food stores all over the world. Weston reasoned that because of KFC-J was able to recover from its loss satisfactorily; it does not need any help from its mother company, who is also experiencing difficulties in managing its stores located domestically. But what makes Weston's argument disagreeable is that he failed to recognize that despite its exclusive operation from KFC-U.S., it is still part of the organization, therefore, he is entitled to cooperate and respond to the company's calls for implementing new managerial changes and plans for the succeeding years of KFC-J's operations. Disadvantages that emerge from KFC-J's autonomy from its mother company include: (1) the discontinuity of the "KFC heritage" in Japan; (2) internal conflict with the management because of differences in management strategies and techniques; and (3) tendency of Weston, as head of as vice-president for the North Pacific operations of KFC, to focus its attention on Japan only, and leave out management problems occurring from KFC's other branches in the North Pacific region.

The first problem is that KFC-J's independent operations serves as a detriment for the KFC brand in the country, mainly because it cannot be denied that what also entices the customers is the prestige and tradition of good-tasting chicken that KFC carries with it, whether the store is located in the U.S. Or in Asia. Thus, because Weston 'discontinued' KFC's heritage in KFC-J, he may experience potential disadvantage in marketing the KFC brand in the future, especially when it persuades its market -- upscale young couples and children -- in a highly modernized and Westernized Japan. In effect, to lose connections with KFC-U.S. would mean a losing out on the tradition of quality fried chicken KFC was known for. In relation to this problem, discontinuing Japan's operations with that of U.S.'s would also result to conflict between the two managements, which has actually happened in Weston's case. Instead of increasing profitability by further increasing the standards of providing good and quality food products and excellent service to customers, the internal conflict happening between KFC-J and KFC-U.S. leads to problems in fast-food operations, as staff and employees become confused in determining whose authority they should follow. Lastly, Weston should also realize that despite his personal involvement in 'turning around' KFC-J's profitability in the country, he has the responsibility to make sure KFC-J's similar fate happens to its other branches in North Pacific. It is vital that Weston begin thinking about the welfare of the whole organization instead of KFC-J only.

Thus, it is recommended that Weston should implement the proposed changes by KFC-U.S. And apply these changes and plans to all of KFC branches in North Pacific. Moreover, KFC management should also assume its role to make Weston realize that the reason he was assigned as VP for Northern Pacific Operations is because he knows the strategies and have the management skills to make KFC's other branches profitable and attractive to other customers as well. Thus, leveraging on Weston's capabilities and potential influence in KFC's Northern Pacific Operations, KFC resolves the internal conflict in management with Weston, while at the same time, the company manages to keep Weston, a vital employee of the company, an asset rather than a liability for the company's fast food operations management.

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