KFC IN CHINA

KFC in China

KFC in China

Introduction

The case explains how the company became successful and stretched out by not altering the local culture of the country. The company maintained strong bonds with the Chinese government, hired a management team of local people, while deploying local sources of food and by bringing changes in the menu, which matches with the requirements of style of eating and taste of the Chinese people.

As a result of homogenization it has become easier for the fast-food giants to maintain their existence throughout the globe, by establishing their replicas, the fries and the burgers simultaneously. However, in an exceptional case of the world's most populated country, a fast-food giant achieved success, not by establishing its replicas; but, by being different.

In this case, the authors have analyzed "Yum! China," and sand studied how the company's Brands, got success. Yum! China is the mother company of Pizza Hut and KFC in China; outperforming McDonald's becoming the mainland China's most successful company (Hammond, 2008).

The Significance of STEP

STEP is an environmental model of analyzing a business's external environment. STEP stands for Social, Technology, Economic and Political. This model, along with analyzing the external business environment, also represents the frame work of macro-environment factors and decision making used in scanning the environment prior to starting a business. Thus, this model provides the company with a list of macro environmental factors critical for the conduct of business in a particular country.

STEP has a high significance for the business and is widely used because of its simplicity; moreover, this model also provides an overview of the potential changes which might occur in the environment of a country in the future.

Discussion

KFC succeeded in Chins because modified its operations in a Chinese way rather than remaining operating the way it does in the whole world. Both the restaurants, i.e. Pizza Hut and KFC in China vary noticeably in a number of ways from their counter parts who are located in the Western part of the world. And whilst Pizza Hut did a great job by opening 500 restaurants across 120 cities of China (till December 2010), the performance of KFC has been outstanding. The fried chicken is available in only dark meat, which most of the times disappoints tourists coming from the United States. Beijing KFC was the first place where fried chicken was served first in 1987, since then, KFC in China grew by covering 650 cities and opening over 3000 restaurants, with a new restaurant opening each day.

This case is not a mere story of a Western organization achieving success in a country like China; it also sheds light on the rapidly changing patterns of diets in Chinese with the advancements in income levels. Because, this country is amongst the largest countries of the world, this success will have an impact on the entire system of food around the globe.

What happens in China, what Chinese people eat, impacts what you and I pay for ...