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IN THE BEGINNING...

Colonel Harland Sanders, born September 9,1890, actively began franchising his chicken

business at the age of 65. Now, the KentuckyFried Chicken business he started has grownto be one of the largest retail food servicesystems in the world. And Colonel Sanders, aquick service restaurant pioneer, has become asymbol of entrepreneurial spirit.

KFC, which was franchised in 1952, now

operates in 72 countries, A research was

carried out to see the problems ofcommunication faced by KFC. The

organizational chart is given, KFChas a wide

span of control. All the communicationtechniques are stated in the report, alongwith some recommendations. More than twobillion of the Colonel's "finger lick in' good" chicken dinners are served annually. Andnot just in North America. The Colonel's cooking is available in more than 82countries around the world.

When the Colonel was six, his father died. His mother was forced to go to work, andyoung Harland had to take care of his three-year-old brother and baby sister. Thismeant doing much of the family cooking. By the age of seven, he was a master of ascore of regional dishes.

At age 10, he got his first job working on a nearby farm for $2 a month. When hewas 12, his mother remarried and he left his home near Henryville, Ind., for a job ona farm in Greenwood, Ind. He held a series of jobs over the next few years, first asa 15-year-old streetcar conductor in New Albany, Ind., and then as a 16-year-oldprivate, soldiering for six months in Cuba.

After that he was a railroad fireman, studied law by correspondence, practiced injustice of the peace courts, sold insurance, operated an Ohio River steamboat ferry,sold tires, and operated service stations. When he was 40, the Colonel began cookingfor hungry travelers who stopped at his service station in Corbin, Ky. He didn't have


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a restaurant then, but served folks on his own dining table in the living quarters ofhis service station.

As more people started coming just for food, he moved across the street to a moteland restaurant that seated 142 people. Over the next nine years, he perfected his

secret blend of 11 herbs and spices and the basic cooking technique that is still usedtoday.

Sander's fame grew. Governor Ruby Laffoon made him a Kentucky Colonel in 1935 inrecognition of his contributions to the state's cuisine. And in 1939, hisestablishment was first listed in Duncan Hines' "Adventures in Good Eating."

In the early 1950s a new interstate highway was planned to bypass the town ofCorbin. Seeing an end to his business, the Colonel auctioned off his operations.

After paying his bills, he was reduced to living on his $105 Social Security checks.

Confident of the quality of his fried chicken, the Colonel devoted himself to thechicken franchising business that he started in 1952. He traveled across thecountry by car from restaurant to restaurant, cooking batches of chicken forrestaurant owners and their employees. If the reaction was favorable, he enteredinto a handshake agreement on a deal that stipulated a payment to him of a nickelfor each chicken the restaurant sold. By 1964, Colonel Sanders had more than 600franchised outlets for his chicken in the United States and Canada. That year, hesold his interest in the U.S. company for $2 million to a group of investors includingJohn Y. Brown Jr., who later was governor of Kentucky from 1980 to 1984. TheColonel remained a public spokesman for the company. In 1976, an independentsurvey ranked the Colonel as the world's second most recognizable celebrity.

Under the new owners, Kentucky Fried Chicken Corporation grew rapidly. It wentpublic on March 17, 1966, and was listed on the New York Stock Exchange onJanuary 16, 1969. More than 3,500 franchised and company-owned restaurants were

in worldwide operation when Heublein Inc. acquired KFCCorporation on July 8, 1971,

for $285 million.

KFCbecame a subsidiary of R.J. Reynolds Industries, Inc. (now RJR Nabisco, Inc.),

when Heublein Inc. was acquired by Reynolds in 1982. KFCwas acquired in October

1986 from RJR Nabisco, Inc. by PepsiCo, Inc., for approximately $840 million.


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In January 1997, PepsiCo, Inc. announced the spin-off of its quick service

restaurants -- KFC, Taco Bell and Pizza Hut -- into an independent restaurant

company. TRICON Global Restaurants, Inc., is the world's largest restaurant system

with nearly 30,000 KFC, Pizza Hut and Taco Bell restaurants in more than 100

countries and territories.

Until he was fatally stricken with leukemia in 1980 at the age of 90, the Colonel

traveled 250,000 miles a year visiting the KFCempire he founded.

And it all began with a 65-year-old gentleman who used his $105 Social Securitycheck to start a business.

SUCCESS TIMELINE

1939Colonel Harland D. Sanders perfects secret blend of 11 herbs and spices in Corbin,Ky., and restaurant.

1952

Pete Harman in Salt Lake City becomes the first KFCfranchise.

1956Colonel Sanders sells Corbin, Ky., restaurant and goes on the road to enlist newfranchisees. The Colonel signs his first international franchisee in Canada.

1964

KFCsold to a group of investors including John Y. Brown Jr. and Jack Massey for$2 million.

1969

KFClisted on New York Stock Exchange, Colonel Sanders buys first 100 shares.


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1971

KFCacquired by Heublein Inc.

1980

Colonel Sanders dies and is buried in Louisvilles Cave Hill cemetery.

1982

KFCbecomes a subsidiary of R.J.Reynolds Industries when Heublein Inc. is acquired

by RJR (now RJR Nabisco Inc).

1986

KFCbecomes subsidiary of Pepsi Co, Inc for $840 million. Grand opening of Colonel

Sanders Technical Center in Louisville, KY.

1987

KFCopens first Western-Style quick service restaurant in China.

1991A new logo is introduced to emphasize chicken variety replacing Kentucky Fried

Chicken with KFC.

1993KFCadds non-fried chicken to menus in the U.S. and Australia.

1994

KFCofficially opens its 9,000th restaurant in Shanghai, China and announces a $200

million investment over the next four years for 200 restaurants in 48 Chinese cities.

1995

KFCintroduces Colonels Crispy Strips and smashes Guinness record with WorldsLargest Pot Pie in New York City to introduce Chunky Chicken Pot Pie, opens first

restaurant in Moscow.

KFCalso opens its first outlet in Karachi, Pakistan.


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1996

KFCintroduces Tender Roast Chicken pieces and brings back one of the worlds

most recognized packages The Bucket.

KFCopens its first outlet in Garden Town, Lahore, Pakistan.

1997

KFCintroduces Honey BBQ-flavored Tender Roast, Spicy Buffalo Crispy Strips TM

and Chicken Twister TM chicken and veggies like a meal all wrapped up and readyto go.


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INTRODUCTION TO COMPANY

OUR MISSION

To establish in Pakistan our position as the leading WQSR (Western QuickService Restaurant) chain, serving good value, innovative chicken basedproducts. Consistently providing a pleasant dining experience, with fast friendlyservice, in a clean and convenient location. At all times, we must be dedicated toproviding excellent service and delighting customers.

OUR GOALS

Build an organization dedicated to excellence. Consistently deliver superior quality and value in our products and

services. Maintain a commitment to innovation for continuous improvement and

growth, striving always to be the leader in the market place changes. Generate consistently superior financial returns and benefit our owners

and employees.

OUR VALUES

Focus all our resources to our restaurant operations because that iswhere we serve our customers.

Reward and respect the contributions of each individual at KFC.

Expand and update training with time and be the best we can be and more. Be open, honest and direct in our dealings with one another. Commit ourselves to the highest standards of personal and professional

integrity at all times. Encourage new and innovative ideas because these are the key to our

competitive growth. Reward results and not simple efforts. Dedicate ourselves to continuous growth in sales, profit and size of

organization.

Work as a team.


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KFC TODAY

Today, KFCis the worlds largest and most well known chicken restaurantchain, with more than 10,000 locations worldwide. In 78 countries KFC

and its franchisees employ more that 200,000 people worldwide.

KFC serves more than 4.5 billion pieces of chicken annually, to

approximately 7 million customers a day, worldwide.


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ORGANIZATIONAL STRUCTURE

Regional Manager(Main Reporting Authority)

Operations

Deputy Area Manager(Restaurant Manager Report him)

Marketing => Assistant Manager(Institution Sales Coordinator Report him)

Quality Assurance Department

Finance and Account Department(Senior Accountant)

(Assistant Accountant Reports him

Project Department(Store Officer Reports)

Human Resource & Admin. Dept.(Miss Ambreen) (Reports Driver, Peon Etc.)

Training Department(Assistant Manager)


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INTRODUCTION

The McDonald brothers' first restaurant, founded in 1937 in a parking lotjust east of Pasadena, Calif., didn't serve hamburgers. It had no playground

and no Happy Meals. The most popular item on the menu was the hot dog, andmost people ate it sitting on an outdoor stool or in their cherished new autoswhile being served by teenage carhops.

That model was a smashing success--for about a decade. Then America'stastes began to change, and the Golden Arches changed with them. As carslost some of their romance, indoor restaurants took over. When adultsbecame bored with the menu in the 1960s, a new sandwich called the Big Macwooed them back. As consumers grew weary of beef, McDonald's introduced

bite-size chunks of chicken in the early '80s and within four years was thenation's second-largest poultry seller.

The changes were vital, but never radical. McDonald's gave us what wewanted before we even knew we wanted it, whether it was movie tie-ins orEgg McMuffins. Along the way, it built one of the world's best-knowncorporate icons and its most ubiquitous store. The philosophy was neatlysummarized by Ray Kroc's brash vow: whatever people ate, McDonald'swould be the ones to sell it.

But now, two years shy of Kroc's benchmark for the far-off future, thatgoal seems less assured than ever. Forget for a moment all the recent talkabout Burger King Corp. and Wendy's International Inc. stealing customersfrom McDonald's. With a 42% share of the U.S. fast-food burger market,McDonald's still easily outpaces its rivals. Nonetheless, the problems underthe famous Golden Arches are far more serious than a failed Arch Deluxehere or a french-fry war there. Quite simply, McDonald's has lost some ofits relevance to American culture--a culture that it, as much as any moderncorporation, helped to shape. Not even a still booming international division,responsible for half of sales and 60% of profits, can mask the troubles.

The company that once seemed a half-step ahead of pop culture today isunable to construct even an appealing new lunch sandwich. Its last successfulnew product was the Chicken McNugget, which launched in 1983. In the '90s,the company has careened from tests with pizza and veggie burgers to


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confusing discount promotions such as last year's Campaign 55. Earnings in1997 inched up 4%, to $1.6 billion, on sales of $11.4 billion, up 7%. That'swell below projections McDonald's itself made just a few years ago.

For a company that enjoyed sizzling growth for five decades based on itsability to read and shape popular trends, the breadth of its problems isastonishing. Since 1987, McDonald's share of fast-food sales in the U.S. hasslipped almost two percentage points, to 16.2%. The drop has come even asthe company has increased its number of restaurants by 50%, far outpacingthe industry's expansion rate. The result: Domestic sales have climbed only18% since 1989, while operating profits haven't even kept pace withinflation. They've risen just 2% a year in that period. That trend has slashedU.S. per-store profits by 20% since 1989--or a huge 40% after inflation.Meanwhile, nearly every other top consumer brand, from Disney to Marlboro,has prospered.

MENU TWEAKING

McDonald's has chalked up that dismal record despite the fact that it ownsone of the best known brands on the globe. The company has been unable toharness the strength of its brand to grow beyond its basic formula ofburgers and fries. During a period when Americans have abandoned theirkitchens in droves for food cooked elsewhere, the Golden Arches--easily theworld's largest provider of prepared food--has failed to profit. It's as ifhundreds of thousands of people started drinking soda for breakfast andCoca-Cola Co. wasn't benefiting. ''McDonald's has totally failed to adapt itsoriginal concept,'' says Simon C. Williams, chairman of the Sterling Group, aNew York-based brand consultancy that works with food companies.

Now, McDonald's is embarking on an effort at reform. Last year, Chief

Executive Michael R. Quinlan shuffled his U.S. management team. He saysthe decentralized structure will rekindle the company's entrepreneurialflair. A new cooking system set for 2000 should make it easier to customizesandwiches, improve quality, and expand the menu. Fundamentally, however,tomorrow's McDonald's won't be much different. ''Do we have to change?''


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asks Quinlan. ''No, we don't have to change. We have the most successfulbrand in the world.''

McDonald's, though, is doing some tinkering. The new head of the domestic

division--Jack M. Greenberg, a pleasant 54-year-old lawyer who has beenwith the company 16 years--has brought in a handful of new managers,including executives from Burger King, Boston Market, and General ElectricCo. ''We are not afraid to do things differently,'' Greenberg says. In a firstfor the burger giant, McDonald's in February bought a stake in anotherrestaurant, a 14-outlet chain in Denver called Chipotle Mexican Grill.

But execs emphasized that the heart of the company's menu will remain thesame--and that it believes it can squeeze new profits from the U.S. burgerbusiness, even though McDonald's already dominates the crowded segment.

''We will extend our line, rather than going in more radical, differentdirections,'' says Quinlan, 53, who started in the company mailroom at age19. ''I'm a fan of menu tweaking.''

Compare the McDonald's strategy with that at other companies that haveprospered despite wrenching changes in their industries. When GE realizedthat manufacturing had become less profitable, it moved into financing.When Walt Disney Co. found it hard to lure more people to its theme parks,it built hotels and captured more dollars from the tourists already there.

And Coca-Cola spun off its bottling business and focused instead onbecoming a marketing powerhouse. The difference is profound: IfMcDonald's had added shareholder value at the same rate as Coca-Cola overthe past ten years, its shares today would be worth $170 each. Instead,they bring less than $55.

FAMILY VALUES

By contrast, McDonald's core recipe has changed little since the early '80s.''McDonald's needs to move the question from 'How can we sell morehamburgers?' to 'What does our brand allow us to consider selling to our

customers?''' says Adrian J. Slywotzky, a partner at Corporate DecisionsInc., a consulting firm in Cambridge, Mass.


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Such sweeping vision will not come easily. McDonald's is one of the nation'smost insular large companies, with a management team more typical of aprivate company than a global powerhouse. The average top executivestarted working at the company when Richard Nixon was President. The 15-

member board of directors has sat out the corporate-governance revolutionand is more than two-thirds filled with current and former executives,vendors, and service providers (page 76).

As the company's performance has deteriorated, top execs have tended toblame others. They have publicly blasted dissident franchisees, whom theydismiss as a small faction. Negative news accounts are chalked up tomisperceptions by reporters. And one persistently critical Wall Streetanalyst--Damon Brundage, now at J.P. Morgan & Co.--was barred from thecompany's latest biennial briefing.

And while some companies, such as IBM and AT&T, have brought in outsideleaders--albeit reluctantly--to help guide management as the businesschanged, McDonald's has largely clung to the ''McFamily'' philosophy of the1950s and 1960s, which rewards managers who start young and stay for life.Headhunters, noting that virtually no alumni from the McDonald's Oak Brook(Ill.) headquarters can be found running other companies, say it isn't wherethey look for talent. ''They are no longer the beacon of great success theyused to be,'' says a Chicago-area recruiter.

Wall Street seems to share that sentiment. Over the past two years, whilethe Standard & Poor's 500-stock index grew by 63%, McDonald'sshareholders could have made more money in an insured savings account. Had

you invested $100 in the company two years ago, you'd be holding $103today. Of the world's 10 most powerful brands, as ranked by Interbrand, aNew York consultant, only beleaguered Eastman Kodak Co. has had a worserun over that period (table, page 71). Shareholders of Gillette Co.,meanwhile, have more than doubled their money.

NOT HOLDING THE PAST SACRED

Even some investors who still believe in the brand are concerned. DavisSelected Advisers, with $500 million in McDonald's stock, has been a


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shareholder since 1994 on the strength of the company's internationaloperations, but the big investor believes there needs to be changes inmanagement and in the business. ''It means not holding the past sacred,''says Chris Davis, a portfolio manager. ''There needs to be a sense of

urgency.''

Even McDonald's formidable international business faces some seriouschallenges. On the plus side, operating earnings have more than doubled inthe past five years, and some emerging markets will soon see economies ofscale. Says James R. Cantalupo, who runs the division: ''We're nowhere nearany kind of penetration that I think is possible.''

But the easy markets have been tapped. Now, McDonald's is expandingbeyond the bustling Londons and Moscows. As it does, margins are dropping--

from 20.5% in '94 to 19.1% last year in overseas company-owned outlets. Ineach of the past two years, McDonald's has badly missed its projection of18% to 20% international earnings growth, falling short of 10% per yearafter accounting for currency fluctuations. In the fourth quarter, keymarkets such as Germany and Japan underperformed, largely because oflocal economic climates and a strong dollar. Overall, says analyst Dean T.Haskell of EVEREN Securities Inc., ''the international story is not quite asgood as McDonald's would have you believe.''

And the Arches' domestic woes raise a troubling question for the overseasoperations: If McDonald's cannot respond to changing market forces athome, how will it adapt over time as its most important overseas marketsmature? ''It's hugely problematic,'' Slywotzky says. ''If the same set ofconditions duplicate themselves abroad, then you have a dead end waiting tohappen.''

Of course, the strength of the McDonald's brand gives it opportunities toavoid that dead end. Thanks to the movie tie-in trinkets that it gives away,

for example, McDonald's is hugely popular with kids. Imagine, saysSlywotzky, if it used low-margin burgers to sell a line of high-margin toys--instead of vice-versa. McDonald's says that's not its core business. But thepoint, says Slywotzky, is that it needs to worry less about market share andmore about new profit vehicles.


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First, though, McDonald's needs to address an even more fundamentalproblem: the quality of its food. While the burger giant focused on buildingmore stores, consumers have decided they want better food and morevariety. Consumers who eat fast food at least once a month say that both

Wendy's and Burger King offer better-tasting fare, according to a recentBUSINESS WEEK/Harris Poll. And in a soon-to-be-released survey forRestaurants & Institutions magazine in which 2,800 consumers graded chainsbased on the taste of their food, McDonald's ranked 87th out of 91--justbehind Hooters. ''We clearly think we have to do some things with ourmenu,'' says Greenberg, who believes the new cooking system will be aturning point.

The fact is, convenience is no longer enough. In the Harris Poll, more than90% of consumers listed both taste and quality as ''very important'' factorsin their choice of a restaurant, while location and speed were selected bybarely half. Why? With an abundance of choices, consumers no longer chooseMcDonald's just because there's one around the corner. And with newentrants offering ethnic fare, vegetarian menus, and fully stocked saladbars, fast food no longer has to mean fried food.

WHITEWASHMore significant than the Chipotle venture is McDonald's managementreorganization of last summer. Quinlan nudged Edward H. Rensi, whoformerly was head of the domestic division, into early retirement andreplaced him with Greenberg, who franchisees say is easier to talk to. Fivenew regional division chiefs, whose territories divvy up the country, nowreport to Greenberg. The idea: create smaller companies within the largerMcDonald's that will recapture its earlier entrepreneurial zeal.

But even the shuffling shows signs of McDonald's discomfort with change.Of the five new division heads, none has set up shop outside the Chicagoarea, and only one has immediate plans to do so. The majority of franchiseesstill report to the same person. The reorganization, charges EVEREN analystHaskell, ''is an effort to whitewash the public by trying to convince Wall


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Street things have changed when they really haven't.'' Says one investorwho manages more than $30 million in McDonald's stock: ''The changes werean improvement, but I don't think it's a dramatic improvement.''

One of the most troubling signs of McDonald's unwillingness to grapple withunderlying problems is its reaction to outside critics. Greenberg hasdismissed the Consortium, a San Diego-based group of franchisees unhappywith the company's direction, as ''eight people and a guy with a faxmachine.''

Adams, a former McDonald's owner who runs the Consortium, claimsmembership of 300 but refuses to release a list, saying franchisees fearreprisals. But other evidence indicates that unhappiness is more widespreadthan Greenberg's comment suggests. In a 1997 internal survey, only 28% of

franchisees said they thought McDonald's was on the right track. Thecontroversial push to put up more stores remains a flashpoint for many. Saysone former operator who claims new stores helped to put him out ofbusiness: ''Ray Kroc once told me, 'If you work hard, you get treated fairly.'But these guys don't care about the operators.''

The media also get blamed for McDonald's bad news. During a guest lectureat Northwestern University's Medill School of Journalism last year, chiefMcDonald's spokesman Charles Ebeling lashed out at reporters. Ebeling

dismissed as ''bullshit'' a story in The Wall Street Journal thatprophetically detailed the problems with Campaign 55, a complicateddiscount promotion. Then he called Crain's Chicago Business, a respectedweekly that had run critical stories on the company, ''a scandal sheet'' witha ''corrupt'' editor. Ebeling says the remarks, reported in Rolling Stonemagazine, were taken out of context.


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Comparison between McDonald's and KFC

Analysis

1. Organizational Goals Both McDonald's and KFCshare the same basicorganizational goals of profitability, sales volume, fast and courteousservice, and cleanliness. There are minor variations to these goals byboth companies.

2. Organizational Structure When observing McDonald's and KFC, theorganizational structures of the two restaurants were very similar.There appeared to be a crew leader who was a non-managerialemployee and, there was a manager who was present behind thecounter. The managers of the restaurants seemed to be in control of

every aspect of the entire food service process. He had keys to thestore, and registers, and also was the only one to take phone calls. Onemight assume that because both restaurants are chains, there is ahierarchy of command. There is perhaps a regional manager, then adistrict manager, all the way up to a CEO of McDonald's and KFC. Thedistinction between the management and the staff was very clear andapparent by looking at their uniforms.

3. Technology Both McDonald's and KFCare on the cutting edge oftechnology. They both employ state of the art cash registers and both

have electric timers built into their cooking machines. Although thecooking styles vary between KFC and McDonald's, the method ofproduction is the same. Large batches of food are cooked at once thenplaced under heat lamps or put in the microwave when an order isplaced. Both stores have the same drive through technology with aspeaker and a well-lit menu to relay the message to the cooks. Usuallywhoever takes the order is also the same person to collect the money;however, a different person usually puts the order together for thecustomer.

4.Employee Motivation The motivation of both stores for employees toperform well is hard to ascertain from just observing, but it appearssomewhat obvious. The people working in these establishments appearto have a lower social economic status, and the fact that a paycheck iscoming at the end of the week may be the only motivation they have.The stores do have an "employee of the month" plaque on the wall, but


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it is doubtful that this is motivation to strive day in and day out for.There is also the fear of potentially losing their jobs if they performsub standard.

5.Communication Both stores employed a very open communication

policy. Employees were talking, sometimes shouting at one another tobe heard. The management was openly involved in the employeesroutines and the employees felt no barriers to prevent theircommunication with the manager. Sometimes in both stores, therewould be a break down in communication somewhere along the line andthat would result in extended waiting times for customers andsometimes, screwed up orders.

6. Environment The environment at McDonald's and KFCseems to be asimple, yet unstable one. It is apparent that the majority of people

who work there, are not choosing their employment as a career option.Therefore, the workforce is constantly changing and adapting to newemployees and new situations.

7. Job Design The design of the job in both McDonald's and KFCransmoothly at times. There was autonomy between the differentpositions. For example, the fry person would just make fries. If he raninto a problem, he could use his knowledge of the fry machine to fixthe problem without having to go to management. There was a visualbarrier between the different positions, however no position seemed

more glorified than another one.8.Leadership Style There was similar leadership style employed by the

management at both stores. Task orientation was essential to meetingthe goal of fast food. Each person had to be focused on the task athand, because during certain hours of the day, both stores were verybusy. There seemed to be little flexibility from management if itmeant compromising their goals.

9.Policies/Procedures/Rules/Standards Standardization seemed to be

the key at both stores. One can walk into any McDonald's in thecountry and find that a "Big Mac" is the same everywhere. Similarly, a"Whopper" will taste the same at every location. Therefore, theingredients, and cooking methods must remain constant throughout.There can be no variation. Rules and procedures were posted on clearsigns and made directly available to the employee.


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10. Organization Climate There seemed to be individual autonomyfor the most part at both stores. However, the reward system wasnot easy to identify. They seemed expected to do their jobconsistently and accurately, perhaps in fear of punishment. They

received cooperation from management as long as they were workingdiligently.

Contrast between McDonalds and KFC

Analysis:

1. Organizational Goals At first glance there are no posters on the wallthat state the goals that McDonalds are trying to each. A customercan find a list of the McDonalds goals in what look to be childrensflyers round the restaurant. The flyers stated that McDonalds goal is100% total customer satisfaction. Also if you werent completelyhappy with your meal that the restaurant would do whatever it took tomake it right. This is not a very realistic goal for a fast foodrestaurant because with the amount of food that is served everydaythere is no way that every customer will be satisfied. When I got to

KFCthere were no pamphlets for the customer to read. There wasnothing that let the consumer know what the company was all about.There was a large sign, which read the slogan Workin for You. Thiswas what appeared to be the organization goal and it was interestingto see that the slogan was in improper English. Although this goal ismuch more realistic than the McDonalds counterpart.

2. Organizational Structure Although the structure of the twoorganizations are basically the same there were two differences thatI noticed. One difference is in the specific tasks of the employees

working the front. In McDonalds there is one person who takes yourorder and gets your food. Only one person is helped at a time becausethe cashier has to wait for the food and then serve you. In KFCthereare two separate stations to order and then pick up your food. At thebeginning of the line the customer orders and pays in exchange for anumber. Then you move down the line to where the customer picks upthe food in accordance with the number. This greatly speeds up the


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lines and reduces the waiting time. The other difference is in themanagement. At both restaurants there is one manager that handlesall the employees working at the time. In McDonalds the manager wasno where to be found but in KFCthe manager was at the front letting

himself be seen and talking with the customers. He also wore adifferent colored uniform to signify his position in the organization.3. Technology The production level of the two restaurants is the main

difference in their technology. McDonalds makes their food in massproduction. The burgers are already made and waiting under a heatlamp for you when you order. They are separated into rows dependingon what type of burger you order. In KFCthe burgers arent alreadyput together. The burger is cooking in the back but the toppingsarent added till the individual orders come. This gives the customer a

better chance of getting a fresh meal.4. Communication There wasnt much communication going on inMcDonalds when we were there. The cashiers didnt smile and werentthat polite when taking my order. The communication between thecashiers and the cooks consisted of the cashiers screaming into thekitchen. The manager wasnt around so I wasnt able to see themanagers interactions with the staff. At KFCI was welcomed by asmile. The cashiers were nice and even held a conversation with me.The manager was out in front conversing with the staff and theemployees. The staff appeared to treat the manager as a friendinstead of a superior.

5. Environment McDonalds environment was neither customer noremployee friendly. Everything in the restaurant is colored brownwhich just isnt inviting to customers. The staff has pinstripeduniforms that resemble prison uniforms. The restaurant was alsobadly lighted which didnt help the color. In KFCthere were windowseverywhere and the restaurant was extremely bright. The staff worebright colored uniforms and there was music playing which wasenjoyable for the customers as well as the staff.

RECOMMENDATIONSAfter our group observed the interactions between management,employees, and customers at both operations, we discovered a few areas


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where KFCand McDonalds both needed improvement. To begin with, ourMcDonalds experience was overall enjoyable, yet a few small, butimportant, details should be considered. Most of the employees uniformswere worn properly and neatly, but the rest were just plain sloppy. Shirts

should be tucked in and clean, and hats should be worn the way hats weremeant to be worn. This would show that employees value their jobs, andtake them seriously. While we were dining, we could not help but noticethe loud, high pitched, constant beeping noises coming from the kitchenarea. These extremely irritating noises did not stop the entire time. Thisprevents the guests from enjoying their meals in a soft, relaxingatmosphere. Quiet background music at McDonalds would probably helpthe ambiance a bit and offset some of the noises coming from thekitchen. We also noticed that even though it was not busy, there was not

a manager in sight. In fact, we can not be sure that one was on duty atthe time of our visit. At KFCit was nice to see the manager working alongwith the employees by taking orders and preparing food. The majorproblem that we found with KFCwas the lack of menu consistency. Thelocation that we visited did not offer salads, while most other KFCs do.We feel that if a salad is available at one location, then a customershould expect to be able to enjoy the same salad at any KFC. It iscomforting to a customer to know that the food will be the same (inpreparation and availability) at whichever store he or she chooses tovisit. We did enjoy how they were willing to accommodate ourpersonalized orders, but it is not appropriate to charge for one slice oftomato or lettuce. McDonalds did advertise quite a bit of communityinvolvement and service. At KFCwe did not see signs of any type ofcontribution to the community. People may think that the company isgreedy and only cares about profit. A charity would show that KFCcaresabout the community. In addition, both of these restaurants desperatelyneed to incorporate the fundamentals of great service into their gameplans. It would make a tremendous difference if a cashier would verysimply smile and say thank you after returning your change. From theexpressions on the faces of some of the employees we felt as if weruined their entire day just by walking through the door! Personality andattitude should be major considerations when hiring employees. Hire onlythose who will take pride in their jobs, be professional, and treat theguests very well. Our final recommendation for both operations is toadopt a Total Quality Management philosophy. Food should come out


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with the right ingredients and at the correct temperature. It is a wasteof time and money to make an order over again if it is not perfect thefirst time. With better training and communication there should be noreason for orders to be less than perfect. The proper attention could be

directed to the next customer waiting in line. If things are donecorrectly the first time, it will save aggravation for the guest, who, bythe way, will remember that his order came out exactly how he wanted it.Basically, just take care of the customer. Give employees the power to dowhatever it takes to make them happy. Exceed their expectations and, inreturn, you will have a life long patron. He will be back again, and again,increasing long run profitability. This concept should be applied toMcDonalds as well as KFC, to helpattain their corporate goals.

QUESTIONAIRE

1) What do you prefer when you want to eat fast food?a) KFC b) McDonalds

2) Why?

a) Taste b) digestive

3) If you dont get your desired fast food would you take thecompetitive fast food its replacements?a) Yes b) No c) Sometimes

4) Which fast food T.V advertisement attracts you the most?a) KFC b) McDonalds

5) Which beverage roadside hoarding/billboard attracts you themost?

a) KFC b) McDonalds

6) Whenever asked which beverage jingle can you recall as once?


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a) KFC b)McDonalds

7) Do you find it difficult to get your preferred fast food in the

market?a) Yes b) No

8) Which logo does you like the most?a) KFC b) McDonalds

9)Do you like to see your hero or model star in a T.V commercial?a) Yeah b) Not really c) Maybe

10) Which company is more successful overall?a) KFC b) McDonalds

11) Which restaurant offers the best scheme (i.e. Prizesetc.)?

a) KFC b) McDonalds

12) Which restaurant according to you is economically good?a) KFC b) McDonalds

Documents

KFC+ +a+Preview