Assignment on Global Business Management

Added on - 28 May 2020

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Running head: MANAGING GLOBAL BUSINESSManaging Global BusinessName of the Student:Name of the University:Author Note:
1MANAGING GLOBAL BUSINESSExecutive SummaryThis report intends to shed light on the process of managing global business. The companyselected for the analysis is Kentucky Fried Chicken (KFC). The report will first provide ananalysis of the external environment of the company selected. The external environmentanalysis will take into consideration the political, legal, economic, social, environmental andvarious other factors into consideration in a bid to understand the industrial condition of thecompany. The report will then focus on the process of global diversity and give an account ofthe business of the concerned company in the country of India. The report will also take intoconsideration the cultural condition of the two countries of India and America in a bid tounderstand the cultural conditions of the two countries and the required changes that thecompany needs to make in order to make its business profitable in the country of India. Thereport will also focus on the risk and risk management. Lastly, the report will provide anoverview of the risks faced by the company in India and also provide some measures bymeans of which the company can mitigate the amount of risks faced by it for the overallgrowth as well as the development of its business operations in that particular country.Table of Contents
2MANAGING GLOBAL BUSINESSIntroduction................................................................................................................................3Political factors.......................................................................................................................4Economical factors.................................................................................................................4Social factors..........................................................................................................................5Technological factors.............................................................................................................5Environmental factors............................................................................................................6Legal factors...........................................................................................................................6Global Diversity.........................................................................................................................7Management of the business in India.........................................................................................9Targeted customer base and competitors.................................................................................10Risk Management.....................................................................................................................11Risks faced by KFC in India....................................................................................................11Conclusion................................................................................................................................13References................................................................................................................................15IntroductionKFC founded by Colonel Harland Sanders, also known as Kentucky Fried Chicken, isan American fast food chain popular for their fried chicken items. They have their
3MANAGING GLOBAL BUSINESSheadquarters in Louisville, Kentucky. It is the world’s second largest chain of restaurant afterMcDonalds with its presence in almost 20,000 locations globally in 123 countries (Alviola IVet al.,2014). KFC was one of the foremost American restaurants to expand internationally inCanada, Mexico and United Kingdom in the mid 1960s. The KFC chain is a subsidiary of theYum brands, a brand that also owns pizza hut and taco bell chains (Kelly & Swinburn, 2015).KFC’s original product was the fried chicken piece that was seasoned by Sander’s secretrecipe of 11 herbs and spices. However, since the 1990s they expanded their menu to includechicken fillet burgers, wraps, salads, side dishes like French fries and soft drinks.A PESTEL analysis is a method used to analyze and monitor the external marketingenvironment that has its impact on an organization, which is used to identify threats andweaknesses of the firm. PESTEL stands for political, economic, social, technological,environmental and legal.Political factorsPolitical factors study how and to what extent the government intervenes into thefunctioning of the economy. This includes the policies of the government, the politicalstability or instability in the market, tax policy, foreign trade policy, environmental law, legallaw and trade restrictions. India has a steady government. The labor force is expensive andthe companies have to pay high taxes, which reduces the profit rate in the country. Thegovernment has given freedom to the companies to do their business there way (Samnani,2014). KFC designs the pricing structure keeping in mind the income of the people that wayKFC can cater to all the classes. The political climate of India is friendly towardsinternational businesses, which is an advantage for KFC. The operation of KFC is affected bythe government rules and policies regarding the fast food industry. Currently government iscontrolling the fast food restaurants because of the various health issues and obesity relatedproblems attached to it. KFC maintains a good relation with the government by paying taxes
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