Kentucky Fried Chicken (KFC) which was based in Corbin
by Harland Sanders about 70 years ago, now is the biggest fast-food chicken promoter,
fabricator and franchiser all over the globe. KFC which was PepsiCo’s
completely owned daughter company until 1997 runs about 20,000 outlets in the
world and more than half of them are franchises. From its beginning, this
organization had various aims and strategies which are the main reasons of
company’s popularity, and one of the most significant of them is to conquer
other representatives of this field and take over the market. In order to reach
these aims, the company was faced with different transformations which had
positive and negative effects on its development. But, due to company’s skills
to manage the changes by understanding every detail, predicting the next steps
and operating the transition efficiently, they had less problems and issues to
solve. Today KFC has a great international reputation which is the proof of
company’s desire to complete its missions and goals. But every organization
does not make up these changes by itself, then how they can appear?! The answer
is P.E.S.T.L.E. analysis and its aspects (political, economic, social,
technological, legal, environmental), which are the major factors that
influence the enterprise. Each section has its own rules and regulations that
company must follow in order to extinct. For KFC it is not so complex, because
this “eating house” can find the common grounds with almost every country where
it is situated.
The most preferable products of this chain are fried
chicken pieces and other variations such as chicken burgers, wings, starters, coleslaw,
French fries, desserts and different soft drinks, which are mostly supplied by
PepsiCo. People always enjoy with this food and can say without any doubts that
the eminent slogan of Kentucky Fried Chicken: “Finger Licking Good” which has
later been changed to “So good” and “Nobody does chicken like KFC” is true.
This report is based on data from various sources of
information including websites, newspapers, books, company reports and other
In today’s world, there are a lot of popular
restaurants all around the world, which are good in their own ways and have
their own styles and techniques in preparation and serving food. But there is
one unique company which is not only among well-known eating houses but is in
the top three leading fast food restaurant chains.
History of KFC
Kentucky Fried Chicken (KFC) which is the
second-largest restaurant chain all around the globe, was firstly based in
Corbin, Kentucky Colonel Harland Sanders, who was born in Indiana, United
States in 1890, an entrepreneur who started selling fried chicken from his
wayside café near the gas station in Corbin during the period of Great
Depression. His idea to mix wheat flour with 11 herbs and spices was successful
and he got his own secret recipe to cook chicken, which played a significant
role in gaining such popularity. In 1952 the first “KFC” franchise was opened
in Utah. But owing to decline of customers (the new road was constructed) Sanders
decided to sell it to a group of investors. After that the chain was sold
Nowadays, people can find KFC almost everywhere and
everyone can notice that the taste of this popular fried chicken is unique and
special. This Quick Service Restaurant business performed on a part equity and
partly warranted model has about 20000 locations all around the world and this
number is increasing from time to time. This international restaurant chain
mostly serves chicken pieces, wraps, sandwiches, burgers, salads different kind
of chicken products and desserts.
organization’s aims and strategies
In the past
The mission of this company was to
enlarge and keep the quality in junk food in world industry and to capture this
Concerning the original strategies of
this company, it included a strategy, called joint venture (in order to solve
easier many logistic problems and have access to the Chinese market).
Another competitive strategy was to
develop different types of chicken in order to have big disparity comparing to
other eating houses.
The main mission of this popular
restaurant chain is to provide food in a quick and friendly manner which
attracts more costumers.
One of the aims of this organization
is to increase profit margins time to time to fund the development of a company
and to give back revenue on investments to franchisees and owners.
Undoubtedly, the ultimate purpose of
KFC is to conquer other competitors of this sphere.
There are a lot of changes which KFC corporation has
encountered with. The table below shows the overview of the most important
switches of this company during its existence.
The company was purchased by
the investor group.
> 1980 > 1986
KFC was bought by Heublein Inc.> R.J.
Reynolds > PepsiCo.
Alternations in corporate
Kentucky Fried Chicken was changed to a name
Tricon Global Restaurants >
Sales of this chain increased 3% after falling
about 15% two years earlier.
Colonel Sanders was brought
back in advertising.
New transformations in menu and renovations of
How does KFC
manage the changes?
From the beginning KFC Company used special techniques
to control its transformations:
Understanding the present situation
of the organization which involves realizing problems the chain faces and their
Full view about the future state of
the enterprise, which consists of the picturing the most preferable situation
of the organization after the transformation is used and designing the most
important ways of transition to the new position.
Executing the change in the right manner,
which includes controlling the transition effectually.
analysis of KFC organization
This kind of analysis is a special tool that is used
to define the external factors that can have negative and positive influence on
company. There are 5 aspects of this analysis:
This factor mostly acts with the government processes
and policies which are came out through legislations. Political aspect of KFC
Health and Safety Guidelines;
Animal rights campaigns;
Marking of GM Foods;
Starting from political issues, one of the most
important factors is controlling the marketing of the company because of health
concern (cardiovascular and obesity level among population). Moreover, there is
also an issue with tax and employment as the company in foreign market. Furthermore,
protests on theme about animal rights have also negative impact on the
The second segment of the scheme refers to economic
factors, which can be national and global, such as:
Inflation and interest rates;
Cost of labor;
Enhancing disposable income;
Low set up costs;
KFC provides customers with a food packet which means
that buying the packet customers can obtain the discount. Hence, this chain can
develop with the low cost and the satisfying service.
As this company is international and it has different
social aspects according to the countries where the restaurants are situated. The
major functions of this aspect for KFC are:
Health and living standards;
Housing trends and fashion;
Attitudes to work;
Population shifts, leisure
Help the people (various donations).
The top 3 social problems
would be paying employees on the minimum salary, unethical behavior towards
animals and tempting kids to their food through various toys, activities and
KFC chain always use the modern technologies in order
to achieve their aims. For KFC, the technological analysis looks like:
Investment in various innovations;
Use of outsourcing;
The chain is gaining more popularity due to perfect
advertisements and various kinds of service, such as websites or apps for
devices which make for customers more convenient and easier to order food and pay
for it online. Furthermore, by using modern technology the company is minimizing
cost of production, hastening production and prolonging their customer mania.
Legal factors stand for the effects of laws and
regulations on business operation and customers’ behavior. There are general
samples of these laws:
Consumer law and Employment law;
Health and Safety law;
Concerning KFC enterprise, there are several problems
with health and safety regulations, because of the growth of obesity rate.
Moreover, there are particular issues regarding the legislations about
environment and animals’ rights.
This type of analysis is very essential because the
companies cannot run their transaction without full awareness of its factors. The
location, climate and weather, laws which are connected with pollutions and
energy consumption and people’s reactions to the environment are the main
factors of this sphere.
Kentucky Fried Chicken Company tries to follow all
these factors in order to project their growth efficiently. But, there are
several environmental issues that always occur in the organization, for
example: the geographical location and some changes in climate can effect
business trades negatively or protests which are held to save the environment.
All in all, if to research all facts and explanations
about Kentucky Fried Chicken, here is an undoubtable conclusion that it is a
great company which is well-known all around the globe due to perfect
management, international business strategy, transitions the organization went
through and certainly, the inspiring history including the secret recipe. It
should be mentioned, that showings of P.E.S.T.L.E. analysis are one of the most
important reasons of high level satisfaction of service, cleanness and eating
recommendations, I feel that KFC needs to follow these procedures:
The company should enhance the
quality of product and add more choices in vegetarian and nutrition menu.
KFC should set more reasonable prices
for food or add various kinds of discounts on products that can enlarge the
The chain should be able to have an
ethical management strategy and use it in order to solve the problems regarding
the social factors.