The purpose of this report is to make an analytics of business processes and key issues in the Kentucky Fried Chicken Restaurant Chain and to recommend specific changes the company should make to achieve lean operations.
Kentucky Fried Chicken Corporation is a member of Pepsico family of quick-service restaurants. It was established in 1952 and consists of more then 2,000 company-owned and over 3,000 franchised restaurants. The quick-serve restaurant industry is one of the most saturated and competitive industries in the United States. Growth in market share for one company comes only at the expense of some other company’s market share. The pressure that restaurants in this industry face from their competitors means that a quick-service restaurant must be offer consistent and with high-quality service. What is more, improving service quality also means improved productivity that can lead to lower costs and higher profitability. Recognizing a big importance of managing service quality and the features of the market, Kentucky Fried Chicken restaurant needs specific changes that can change their business system in conformity with the conception of lean operations.
To achieve this purpose KFC uses the understanding of customer expectations, which is given in the results of continuing revising of its quality measurement schemes. According to the researches, KFC restaurants around the world have various complaints regarding service. The most common argue is that employees are rude, lazy and negligent to customers. They make the situations, which slow down the process of ordering and issuing of orders. Company needs to take measures in order to prevent the losses from such a negative part of staff interaction.
The second issue of Kentucky Fried Chicken operation management implies food quality. Customers meet cold food, which brings dissatisfaction and lost revenue. The failure of food to meet customer expectations can come in many forms. It can be cold or not fried as it has to be, with more salt inside etc. Sometime the food quality is not up to par with that of some other restaurants where the consumer has been to. The common reason of it is usually the absence of time control and distraction of cooker on two different processes.
The third issue deals with the increase in health awareness among people. Nowadays many American customers want to have a healthy diet thereby avoiding fried products. It was one of the greatest disadvantages for Kentucky Fried Chicken as it offers fried chicken both nutritious and calorie gaining. Company needs to change some production processes and change some old menu positions to new one. This problem may correlate with the fact that KFC lacked long term approach in defining the key strategy audience, like the administration of McDonalds did. Some changes in the situation may bring the eliminating of waste of production which brings less money and do not get much consumers.
In order to improve the quality of service and the productivity of production, to decrease the losses which appear because of imperfect management system, KFC needs to face changes in business processes that will bring a possibility to achieve lean operations.
The first proposition is that KFC should introduce some new KFC products in vegetarian. This new product would attract new customers from the family segment of market leading to a higher market share and increasing profits. In order to implementsuch an approachcompany needs to apply a principle of eliminating wastes of over production, based on the survey of customers. The rare bought positions from menu should be taken away, while new vegetarian dishes should be added. Such changes are also based on the principle of removing variability. They give possibility to achieve lean operations at the productive stage. The everlasting optimization of list of products with advertising actions for each new point would bring a new audience to KFC restaurants and guarantee the status of dynamic company.
The second proposition for Kentucky Fried Chicken restaurant is based on the lean principle of increasing throughput and suggests changes in the number of cookers and staff during the day, in order to prevent quarrels in the common room, or problems with a speed of order execution. The empirical information from researches may help in making an optimal schedule of work. Such changes would prevent Kentucky Fried Chicken reputation and give an additional point in the competitive struggle in the service sphere.
The third proposition unites various principles of lean operations and suggests trainings ofthe staff team in the various actions while visiting other non competing businesses that have implemented lean. It can be cashier experience at the supermarkets or staff experience in the serious big restaurants. Such group of educated and prepared managers could continue their work in little staff groups, preparing the staff to face new challenges (Page, 2004). The exchange of experience is extremely important in lean operations, because the implementation of such three basic lean principles as eliminating waste, removing variability and increasing throughput depend on the current market situation and need an everlasting monitoring and analyzing with the participation of staff at all levels of management system.
Quality Management at Kentucky Fried Chicken.Retrieved February 25, 2014 from http://sba.pdx.edu/faculty/melliep/339/QualityMgmtKFC.pdf
KFC. About Us.Retrieved February 04, 2014 from http://www.kfc.com/about/
Page, Julian. (2004).Implementing Lean Manufacturing Techniques: Making Your System Lean and Living With It. Hanser Gardner Pubns. 212.