KFC and the global fast food industry Term Paper

KFC and the global fast food industry - Term Paper Example KFC is a leading food chain in the world. When it comes to starting a new franchise in a new market, KFC would have to evaluate and analyze number of factors in its external and internal environment. The SWOT analysis for KFC is i. Strengths International recognition Ranked highest among chicken restaurants Unique flavor and recipe ii. Weakness Declining quality due to over franchising Less focus on R&D department Lack of relationship building iii. Opportunity Demographics trends have increased the growth Increased delivery services Updating restaurant and its menu iv. Threats Rapid change in customer demands Health awareness Increased competition PORTER’S VALUE CHAIN Michael Porter has given the concept of value chain in his book â€Å"The Competitive Advantage†. According to Porter, each and every activity and operation adds value to the produced product or service. So, every operation should support each other and should work at an optimum level. Porter suggested tha t organizations have two kinds of activities, â€Å"primary activities† and â€Å"secondary activities† (Overbeck 2009, p.26.). Primary activities: Inbound logistics: Involves obtaining raw material from supplies. KFC should make it clear to its suppliers, regarding the quality and time of delivery. Operations: Raw materials are combined to make the final product. This is the stage, where KFC has to keep check on quality and ingredients. In this stage, KFC can bring changes in its formula. Outbound logistics: Manufactured product is delivered to market. In case of KFC, it will not go to retailer or wholesaler, rather will go directly to costumer. Marketing and Sales: Marketing should be done in accordance to the needs of the end users. KFC should open its franchise in places where there is more demand, like near residential areas or in parks. Services: The services should include after sales services. KFC should provide services like feedback and royalty cards etc. to its regular users Support Activities: Procurement: The raw material acquired by KFC, should be properly accessed by KFC in order to assure best quality at best price. Technology development: The technology use can help KFC in maintaining the inventory record, sales, employee salary and attendance, and many other things. Human resource management: KFC has to recruit best available employees for its company, in order to deliver consistent quality to its consumer. Firm infrastructure: Organization structure matters a lot when it comes to adding value to the organization. KFC has to enforce and embrace a structure and culture that favors two way communications between employer and employee. b) Use Porter?s Five Forces framework to critically evaluate the opportunities and threats that faced KFC Corporation from the mid – 1990s to the year 2000. PORTER FIVE FORCE MODEL Michael Porter’s model has focused on how the corporate strategy should meet the opportunities and threats in corporation’s external environment. Porter has given 5 forces, on the basis of which a company can analyze its industry and market competition. These five forces are as follows: (Kurtz, MacKenzie&Snow, 2009) Bargaining power of suppliers: The supplies mean every kind of input that will help the organization in providing best products and services. The bargaining power of suppliers is high when suppliers are few and have a significant market share, and when cost of switching