Aug 8, 2012

Kentucky Fried Chicken (KFC) Business

Case Studies
Kentucky Fried Chicken
Top companies worldwide have their own avatars and logos to represent their brand. One that is
regarded as the most successful is Harland Sanders, the worlds most famous Colonel, now
with over 14,000 chain stores cooking delicious fast food in over 100 countries. His white suit
and the same white goatee have made many loyal KFC diners feel right at home. Perhaps only
after 65 years after the creation of the KFC brand, can we truly understand the success beyond
the struggles of Kentucky Fried Chicken.
The Life of Colonel Sanders
Harland David Colonel Sanders was born on September 9, 1890 in Central Indiana, USA. He
lived on an ordinary farm and had an ordinary and simple childhood. His quiet life ended when
he was 6 years old, after his fathers sudden death. In order to make a living, his mother had to
work at a local canning factory. As the eldest son in the family, Sanders naturally assumed the
task of looking after his two younger siblings. His first cooking class came from having to
prepare meals for them. It was said that Sanders learned how to do more than 20 dishes in one
year, and was known as the Little Chef. At 10 years old he found a casual part-time job at a
local farm; but, in order to help support his family, he soon dropped out of school and worked
there full-time. Two years later his mother remarried, but Sanders and his stepfather were always
at odds.
Sanders left home and eventually joined the U.S. Army when he was fifteen. He was then sent
off to serve in Cuba. After the war, he soon ended up married and ultimately held various jobs.
He sold insurance in Alabama, worked in a small motorboat crossing company in Ohio, and he
was also in a gas lamp factory. Sanders found it difficult to find a satisfactory job, and decided
on having his own new venture. It was around this time as well when his wife and children had
left him. He was already 40 years of age at this time, but the door of fate was soon to be open.
Prototype of the Kentucky Fried Chicken
Sanders opened a service station on the busy 25
th
Road in Kentucky. At the face of the Great
Depression in 1930, Sanders wanted to increase revenue by feeding travelers. He began to take
the first steps in testing the fast food industry. He started small, with only a table and six chairs.
His small business with shabby furnishings located next to a small gas station, turned out to be
the starting point of the huge KFC fast-food empire.
Sanders began to develop his own secret recipe on a variety of family food, including the
budding form of what became known as Kentucky Fried Chicken. His convenient form of fast
food was so successful that soon after Sanders had to choose a new site for his establishment. It
was then that he moved to motel restaurant with 142 seats available. Because of lack of
experience in hotel management, he went back to school and studied at Cornell University for
two months.
Kentucky Colonel
A few years later, Sanders began to focus on improving his restaurants most popular chicken
recipe. Soon, a formula containing 11 kinds of spices was born. The chicken kept juicy on the
inside and with a layer of crispy-skinned surface is the predecessor of Kentuckys best-selling
secret original recipe with 40 spices.
Colonel Sanders also discovered a technique to shorten the traditional method of cooking fried
chicken which takes 45 minutes of pan frying, while guests wait anxiously. Sanders used the
pressure cooker which lets him not only cook his fried chicken in 15 minutes, but also makes it
taste more delicious.
Sanders was awarded the honorary title of Kentucky Colonel. He seized this opportunity to
develop his brand distinctive of the southern United States. He eventually remarried and created
his trademark look and authentic Southern family cuisine that has made him the Dear Colonel
Sanders of today.
Colonel Sanders at 65
During the 1950s, the U.S. federal government announced the 75 interstate highway construction
plans that will reduce traffic to Sanders restaurant and destroy all previous efforts of the
Colonel. The new highway took away almost all of the cars that made the 25
th
Road so busy.
Sanders sold his beloved motel, and found himself bankrupt at 65 years of age.
Sanders began his second venture and decided to franchise.
The First Fast Food Franchise Industry
Sanders was heard to have said that he was rejected 1009 times before the 1010
th
All right
answer. The delicious fried chicken soon put Sanders back on his feet. More than 400 Kentucky
Fried Chicken chains have opened in the entire North American continent.
Four years later, Sanders sold the chain to an investment group with a high industry price of $2
million. Later, Sanders publicly acknowledged his regret over this decision, but his figure has
remained active in the buildup of this vibrant company until he died of leukemia at 90 years old.
His first fast food franchise form has forever changed the catering industry.
Illustrating the Brand Identity
KFC belongs to the Yum Group. Yum is the worlds largest restaurant group, and has more than
33,000 stores and 840,000 employees in over 100 countries and regions around the world. They
own well-known restaurant brands such as Pizza Hut, Taco Bell, and the East Dawning (Chinese
food). They ranked first in the field of cooking chicken, pizza, Mexican food and seafood dining.
Kentucky Fried Chicken and Pepsi have formed a strategic alliance with the restaurants
exclusive sales of PepsiCo carbonated soft drinks (but with exceptions in some countries such as
Japan and South Korea, that sell Coca-Cola products).
In November 2006, Yum Groups KFC was to become the worlds first brand that can be seen
from outer space. A huge mountain of the Colonel Sanders logo was unveiled in Area 51 in
Nevada Desert, United States. Nearly 50 designers, engineers, scientists (including
astrophysicists), architects and other professionals teamed up for three months to create and
construct the worlds largest logo. It is a 65,000 square feet of colored tile visual of the KFC
emblem.
The new KFC logo retained Colonel Sanders trademark bow tie; but, his classic white double-
breasted suit was replaced by a red apron. This red apron represents the brands home style
cooking tradition. It tells customers that the KFC 50 years ago where Colonel Sanders worked
hard in providing fresh, delicious, high-quality food is still present todays modern world.
The updated logo will be applied to restaurant design, advertising, food packaging, staff
uniforms, the public share products and all other visual elements. Su, president of Yum Brands
China Division said, Colonel Sanders is one of the most familiar images of the world; placed
upon him is the new face of today, indicating a new future of Kentucky. Kentucky is fast,
delicious, and has high standards of quality. Kentucky provides a balanced diet and healthy
living, based on the world, on innovation and unlimited fast food.
Training of Tremendous Teamwork
KFC respects team spirit and the enthusiasm of every employee. They are involved and
committed to provide the staff with comprehensive training, welfare, protection and development
plan, to enhance each employees potential to the fullest. This is precisely the reason why more
and more good, young partners are attracted to Kentucky.
As one of the worlds largest and most successful restaurant chains, Kentucky Fried Chickens
secret of success is:
Always have the courage to challenge young people to open the door and focus on staff training,
in order to encourage the staff and the company to be vibrant and grow together.
KFC attributes its success to the concerted efforts of nearly nine hundred thousand employees
worldwide. Around the world, KFC will always place the needs of customers first to ensure a
variety of high quality food and beverages, where they can feel the most cordial and first class
service and dining environment.
Strategic Development in the Western Culture
In such a competitive fast-food service industry, how does Kentucky Fried Chicken always
maintain a strong momentum of development?
We believe that to enter the market, there are different stages of development and strategies that
are consistent with the organizational culture and strategic logic. One of which is the new fast-
food service system that introduces a of Western-style dining concept.
1. A unified logo, uniforms, a consistent distribution mode of the new chain business model,
and ultimately relying on the companys quality products, fast and friendly service, and
clean dining environment to establish its position in the market.
2. Localizing employees and continuing to invest in manpower training on various aspects
of each level. From waiters and restaurant managers, to the management of corporate
functions, all should be in accordance with the nature of their work requirements.
Arrangements are made for technical and rigorous training programs and professional
fast-food management standards for management employees at the Kentucky Fried
Chicken Restaurant Management Professional Training Base Education Development
Center.
3. Being in the fast food industry places emphasis on being speed-oriented. The spirit of this
enterprise highlights on teamwork in order to achieve high efficiency; thus, ensuring a
fast and reliable output during peak service period. The secret to form a highly efficient
and flexible team is an advanced management incentive mechanism created to motivate
team spirit and excellent management.
4. Quality service is when guests receive more than they originally hoped or expected to
get. Kentuckys aim is to put their customers first; to make every dining customer,
whether adult or child, feel at home.
60 years ago, KFCs Colonel Sanders, founded what is now known as: the family dinner
alternative that is to provide complete meals for family time when unwilling or unable to
prepare home cooked food. He also called it: Sunday dinner seven days a week. Today, the
spirit and heritage of the Colonel has become a symbol of the Kentucky brand. The image of
Colonel Sanders as the Kentucky Fried Chicken logo has become one of the best and most
recognizable brands in the world