KFC Online Delivery Analysis: Impact of Information Technology on Management

This report analyzes the impact of information technology on the management of KFC, with a focus on online delivery. It discusses the use of systems such as ECRM and MIS, and the application of ERP in KFC's operations. The report also examines KFC's tall organizational structure and provides recommendations for further improvement.

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Executive Summary
KFC which stands for Kentucky Fried Chicken is a restaurant which offers fast moving
food mainly specializing in offering fried chicken. The owner and the founder of the company
Colonel Harland Sanders began the company with one restaurant where he was selling fried
chicken. KFC stands to be the second largest franchise offering fast moving food after
McDonald's and is located in about 20, 000 places and in about 123 countries worldwide.
The company makes fried chicken using a recipe of 11 spices and herbs which the
company keeps as a trade secret. KFC does not only offer fried chicken but it offers other foods
such as soft drinks, salads, French fries, and other fast-moving foods. The company which has a
slogan that no one can make chicken like theirs stands to be one of the fast-developed
franchising companies in America. The company practices a tall organizational structure where a
general manager leads or is the head of each of the single branch.
Apart from having many branches in many countries worldwide, the company also started door
to door delivery of their fried chicken. This was back in 2015 where the company, decided to be
delivering their product at the doorstep and first tried it in the morning. This was made possible
by having a mobile application for ordering and a website where customers craving for fried
chicken can make orders and get the product right at their doorstep.
In this report, the analysis of the management of KFC was done. The managerial
structure was the main focus of this report. The study was based on the online delivery of KFC to
study how information technology impacts management. There are team leaders assigned

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different jobs to help the manager achieve the organizational goals.
Table of Contents
Introduction........................................................................................................................4
Scope of the Research........................................................................................................5
Application of Information Technology..........................................................................5
Information Technology and Management.....................................................................6
KFC Organizational Structure.........................................................................................8
Recommendation...............................................................................................................9
Conclusion........................................................................................................................10
Reference..........................................................................................................................11

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Introduction
Kentucky Fried Chicken which is commonly known as KFC is a fast-moving food
restaurant that deals mostly with fried chicken and other items related to chicken. According to
Pradhan (2018 p. 18), the company which was incorporated in 1995 was begun by Harland
Sanders. KFC headquarters are now in Louisville in the United States of America. The company
stands to be the second fast moving food restaurant after the biggest one McDonald's. KFC has
opened many branches in many countries of which is about 120 countries with about 19000
branches worldwide. Harahap (2018 p. 80) argue that in the beginning, the company owned its
own brand but KFC now stands to be under the Yum! Brand. The Yum! Brand also has other
branches under its umbrella.
The branches are the Taco Bell and the Pizza Hut. According to Okazaki (2005 p. 170)
the famous thing about KFC is that it offers its fried chicken prepared with spices and herbs. The
company up to today has employed around 16000 employees in all the branches. According to
Isher et al. (2005 p. 495) initially, Sanders Harland started the company by opening a roadside
restaurant which was in Corbin Kentucky. Sanders then started to franchise with the restaurant in
order to make his recipe more famous. Pantoja et al. (2018 p. 141) In a period of ten years, in
1963 KFC had around 600 franchises and was still growing. In 1964, and due to the
uncontrollable growth of the company, Sanders decided to sell the company to his investors for
$2 million including salary to be paid per year which was $40000. The salary was increased later
to $200000. Later, Sanders decided to sell KFC but by this time he was earning $300000 pure
profit.

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KFC was one of the fastest growing companies and it was expanded to Britain, Mexico,
Canada and to Jamaica. Today, KFC operates in South and North America, Africa, Europe,
Australia and across Asia. In 1968 KFC was owned by another company PepsiCo which bought
it at an approximate price of $800 million. PepsiCo, later on, turned its company group to the
public company and opened another restaurant which was named Tricom Global restaurant.
Tricon also owns the two companies, Taco Bell and Pizza Hut. In 2002, Tricom was renamed
and the new brand was called Yum! Brand.
Scope of the Research
This report shall be discussing the impact of the information technology on the
management of the KFC. Today the technology is changing rapidly and the application of the
technology in management has some impacts. Many fast-moving food restaurants use the current
technology and many of them like KFC have online ordering of food and the food is delivered at
the doorstep. The use of technology includes the use of the system such as customers interactive
systems where the customers can order food while at home, pay for the order and get the order
delivered at their doorstep.
Application of Information Technology
Like many other fast-moving foods applies information technology in its management to
boost the and enhance customers satisfaction. Mostly, the commonly used technology in fast
food chains is the web-based system known as Electronic Customer Relationship Management
(ECRM). Qin et al. (2010 p. 430) argue that there are automated online questionnaires for
collecting feedback from the customers who give the company satisfaction feedback and suggest
improvements on the services. Aliyu et al. (2017 p. 3) in KFC, there is need to use information

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systems and in fields like marketing, supply chain and operation administration. ECRM is used
for servicing customers via the Internet to provide fast and quality services. The other systems
are used for marketing the brand, billing such as billing system and the system for running the
administration.
The other commonly used system is called the Management Information System abbreviated as
MIS. According to Hujainah et al. (2017 p. 9140), MIS is an integrated system used in the
management of many organizations. KFC also applies the use of the MIS to make its operations
smooth. Application of MIS in the organization has many positive impacts. MIS comprises
integrated computer systems where there are many departments of the organization using the
system. KFC use management information system which comprises of the human resource part,
accounting and also the production part. Mondurailingam et al. (2015 p. 52) argue that the
system helps the human resource to come up with set policies which help in the rating of their
employees. The MIS assist in the processing of any needed information required by either the
executive or the general workforce. MIS systems are usually useful in the management of any
organization since they help collect data and produce useful tools for making of decisions.
According to Ribeiro-Junior et al. (2018 p. 372) information technology helps also in the
effective communication between the customers, the employees, and the management. The
employees will receive the feedback from the customers and pass the feedback to the
management for decision making. This will help improve customer services and also help the
company grow. Suchun (2007 p. 10) the other internal systems such as the MIS will help the
human resource department which comprises of the management to come up with reports for
rating the employees and monitoring the performance of the employees. The system comprising
all the segments of the MIS and ECRM is known as the Enterprise Resource Plan system (ERP).

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Information Technology and Management
KFC makes use of ERP to process data and enable smooth management. Enterprise
Resource Plan system is a system that is composed of many applications such as Customer
Relation Management system, accounting system, order tracking system, invoicing system,
payroll system, and many other systems. Olszewski (2015 p. 124) argue that there are many
benefits which come when a company is using the ERP system. Some of these benefits include
costs like maintenance and training costs are cut, it is simple to keep the data held in the system
up to date and the software expenses are generally reduced.
The main functions of the ERP system in KFC are the systems handles manufacturing,
distribution and logistics, shipping, inventory control, accounting and invoicing. Jiang et al.
(2018 p. 412) argue that the system can also be used to handle and control many activities such
as sales and marketing, delivery where the customers can track their order, quality management
to ensure customer satisfaction, production, and billing.
The ERP is applied in the following ways at KFC;
1. Electronic Data Interchange (EDI). Shen et al. (2015 p. 83) argue that this is the form in
which data is transmitted from one computer to another in an organization. This can be
the transfer of data from one department such as marketing to another department such as
procurement.
2. Attendance Monitoring System (AMS). This monitors the registration and the attendance
of the employees in an organization. According to Bhat et al. (2018 p. 654), it helps the
human resource department to capture data for the employees and monitor their job

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attendance. The advantage with this system is that it allows the use of distributed
processing where the data is stored in the database server.
3. Computer-Aided Design. Li et al. (2018 p. 112) believe that this system helps in the
manufacturing department of the organization. This is where there are a drawing and
design of the products to be manufactured.
4. Document Management System (DMS). This system is used for the storage, security, and
version of the data. It can also be used for the retrieving of documents. The system allows
editing, confirmation and crosschecking of how authentic the documents are.
5. Communication Management Systems. This is the system used for the entire
communication of the organization. This includes communication with the customers
who have made online orders.
6. Security Management System. According to Dhanda et al. (2005 p. 148) this system is
used for maintaining security in the organization. It can track the movement of vehicles,
people and even other materials in the organization. It also restricts any unauthorized
access and therefore making the entire organization safe.
KFC Organizational Structure
According to Harrington et al. (2017 p. 560) KFC uses the tall hierarchy management
system. In this system, the manager is at the top of the organization. The general manager is
usually assisted by the assistant manager who is second in the rank. At the bottom of the assistant
manager is the shift manager who is in the same rank as the unit manager. The unit manager is in
charge of a single unit in the organization and has an assistant. Mills et al. (2008 p. 70) the unit
manager have several duties which include, he is the overall manager for the team leaders,

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maintenance technician, food service worker, customer service worker, counter person, fast food
crew member, preparation team member, and the refrigeration team member.
According to Liu et al. (2018 p. 860), each of the team leaders, unit manager, and the
assistant and the shift manager represent a department. The maintenance technician deals with
the technical department, the customer service worker deals with the customers' services
delivery, the food service worker deals with the quality of the food to be delivered the
preparation team member organizes and prepares the team and refrigeration team member makes
sure that all the products are well refrigerated.
Kentucky Fried Chicken Company Organizational Structure
Recommendation
The use of information technology has had a great change in KFC. It is therefore
recommended that the company should use the ERP and other important practices of information
technology in order to improve further in its operations. Use of many feedback automated forms
where customers can suggest and comment on their satisfaction will help the company to capture

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all customer needs. By doing this, the company will start offering products acknowledged and
exceeding customer expectations.
The use of an ERP system leads to enhancement in supply chain management, financial
management and most importantly human resource management. The new system also is quicker
in generating revenue, sales, and inventory reports. It is therefore recommended that KFC should
renew or update their system frequently.
Conclusion
In conclusion, information technology is useful in the management of any organization.
This will help attain customers’ needs and even sometimes exceeding the needs. The rapid
development in technology urges all the organizations to consider applying current technological
practices in its management. Technology has been there to help the organizations to improve and
grow faster. However, it has some negative impacts if used wrongly. It can lead to loss of
customers which will lead to the loss of the organization. Since all organizations are working
hard to double their profits, gaining losses can be very disappointing. The use of the information
system enables centralized data storage, this reduces the cost of finding many storages. The
system also allows the use of automation of the invoices. This allows the flow of the work to be
smooth and helps keep and maintain consistency and efficiency in the operations. Therefore,
KFC made the best choice to use the information technology in the management to run their
operations.

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