Risk Management for KFC: Key Stakeholders, SWOT Analysis, and Internal and External Risks

This study is focused on the strategic planning of KFC that assists KFC’s risk management. Read about the key stakeholders of KFC, strengths, weaknesses, opportunities and threats of KFC and also analysis and evaluate the strategies of internal and external risks.

Running head: RISK MANAGEMENT
RISK MANAGEMENT
Name of the Student:
Name of the University:
Author Note:

Executive Summary:
This study is focused on the strategic planning of KFC that assists KFC’s risk management.
Environmental scanning affects the business climate of KFC, which influence the company’s
day-to-day business operation. The study aims to find out the key stakeholders of KFC,
strengths, weaknesses, opportunities and threats of KFC and also analysis and evaluate the
strategies of internal and external risks. KFC is one of the famous fast-food franchise in present
days which has almost 15000 branches in the worldwide. Its logo of their products is “Crispy
outside, the juice inside”. The company focused on delivering quality foods and excellent
customers. KFC maximise profitability, deliver sustainable growth and improve its shareholder's
value year after year. KFC concentrates on the competitor’s goods and surveys the market for the
knowledge of consumers.

Table of Contents
Introduction:....................................................................................................................................4
Discussion:.......................................................................................................................................5
Key Stakeholders:........................................................................................................................5
SWOT Analysis of KFC:.............................................................................................................6
Internal risks:...............................................................................................................................8
External risks:..............................................................................................................................9
Summary Table of Risks:..............................................................................................................10
Conclusion:....................................................................................................................................11
References:....................................................................................................................................13

Introduction:
KFC is an American fast-food restaurant, headquartered in Louisville, Kentucky, and it
specialises in crispy fried chicken. The other name of KFC is Kentucky Fried Chicken. It is the
second-largest restaurant chain internationally. In 1952 KFC was founded by Colonel Harland
Sanders in Corbin, Kentucky. In the fast-food industry, KFC is famous for its fried chicken and
expanding their business by challenging the well-known dominance of the hamburger. KFC’s
first product is pressure fried chicken which is an on-the-bone chicken piece with Colonel
Harland Sanders' "Original Recipe" of 11 spices and herbs. The item is usually available in a
family size cardboard bucket, which is normally holding 6 to 16 chicken pieces or three or four-
piece individual servings. Strengths define the features which the KFC Company is best and
what separates them from their other competitors. Weaknesses stop the company from
functioning at its best level. The businesses are zones where the industry must be developed to
remain competitive. Opportunities define the features which the company can utilize to its
service to increase their sales, market share and product recognition. Threats identify the factors
which are potential to the company’s loss in the upcoming days. KFC is one of the famous fast-
food franchise chains in present days which have almost 15000 branches in the worldwide. The
logo of their products is “Crispy outside, juice inside”. The company focused on delivering
quality foods and excellent customers. KFC maximise profitability, deliver sustainable growth
and improve its shareholder's value year after year.

Discussion:
Key Stakeholders:
There are many stakeholders of Kentucky Fried Chicken such as customers, employees,
delivery services, contracted cleaning companies and contracted vending companies (Hussain,
2014)
Customers: Customers are always excited to go to the KFC restaurant to have a fast food meal
and enjoy with their close ones. Without clients going to KFC, it would not make revenue and
ultimately go bust (Zhu, Anagondahalli & Zhang 2017).
Employees: In the business, employees are important stakeholders because they provide the
services to the consumers who eat at KFC. Without experienced workers, the company cannot
run smoothly (Gendron, 2019). The staffs are satisfied with their stage wage and secure job in
the organisation. If the workers feel that they are poorly treated then they will less passionate
about their work. Employees of KFC also deliver the services to the clients who travel through
Translink (Nelson et al., 2014).
Delivery services: Delivery services expand the items and services for the consumers. The
excellent reputation of KFC is its outstanding services on-time and excellent quality of foods
(Crane, Matten & Spence, 2013).
Contracted Cleaning Companies: The Company insure that KFC’s image is good, and its
products are hygienic (Harrington, Ottenbacher & Fauser, 2017).
Contracted Vending Companies: Their concern is to provide their foods to KFC so that their
products sell in the KFC restaurant (Harrington, Ottenbacher & Fauser, 2017).

SWOT Analysis of KFC:
In 2015, KFC generated $16 billion in sales. SWOT analysis of Kentucky Fried Chicken
including its strengths, weaknesses, opportunities and threats.
Strength:
 Variety in Menu: The important strength of KFC is the different kind of food that KFC
deliver to their clients. KFC tweaks its products and menu providing, basis of the state in
which the company operates (Sholihah et al., 2016).
 Strong global presence: More than 131 countries and 21,010 outlets, KFC has a
remarkable worldwide existence. KFC is the world’s second-largest restaurant and
market topper in most of the nations in the Non-veg food sector (Basu, Saha & Maity,
2018).
 KFC’s Secret recipe: In the catering industry Sanders’ Original Recipe of “11 herbs and
spices” is one of the popular trade secrets. A signed by Sanders and copy of the recipe is
a safe inside, held inside and a vault in KFC’s headquarters in Louisville (Basu, Saha &
Maity, 2018).
 Loyal Customer Base: KFC has its loyal customer profile, and all the credits go to their
secret chicken menus. Customers loved the crunchiness and the flavour of KFC’s
chicken.
Weakness:
 Managing Franchisees: Franchisee management is one of the serious concerns in the
achievement of the fast-food industry and for the conflicting functional problems

between KFC and their franchisees some of its stores got locked as its inception
(Shoyemi, 2014).
 Supply chain and Distribution issues: Kentucky Fried Chicken has faced main
distribution problems with their chicken delivery. This issue turned so large that the
company led to shutting down some of its outlets in the United Kingdom. It took a KFC
a huge effort in marketing and logistical to overcome of this coup (Idrobo Jiménez,
2017). For escape facing a similar problem in the upcoming days, KFC must take more
care of its distribution and supply of its raw materials chain like spices and chicken etc.
Opportunities:
 Exploring new food items in Menu: Food preparation of the shifting food needs and
demands of the millennial, Kentucky Fried Chicken has a significant opportunity to
launch diet foods in their food menu which are fewer calories and fat.
 Expanding to new Geographies: Developing economy, changing the standard of living
of customers and their growing purchasing tendency is allowing the giants of fast-food to
discover new geographies to enlarge their market revenue and shares (Nguyen et al.,
2016)
Threats:
 Food quality challenges: Food quality is an essential challenge of KFC. In the past,
Kentucky Fried Chicken has faced many blame and also the oil quality it uses for making
its food.
 Changing consumer food trends and preferences: For the emergence of Millennial,
food preferences and trends are changing. Customers have preferred that kind of foods

which are healthy (fewer calories and fats) in nature. These shifting food choices of the
customers are putting extra stress on the fast-food giants, such as KFC (Basu, Saha &
Maity, 2018).
 Competition from global and local players: Kentucky Fried Chicken faces tough
competition from not just international competitors but also local competitors as well.
Their competitors are launching new food items to their menu list to increase their
customer base and market share.
Internal risks:
Human factors:
Kentucky Fried Chicken (KFC) is one of a global organization which has started its business
early and nowadays KFC is one of the largest organization in the world. Kentucky Fried Chicken
built its connection socially with other company or the organization all over the world. In the
country KFC took place where they established its outlets and beside the KFC restaurant, they
also delivered the food which is the similar taste like its products (Banu, Rahman & Khan,
2018). In addition to the staffs, they are worked for the customers from the nation which are
having a talent and an excellent performance in cooking as the chef. Kentucky Fried Chicken
(KFC) also supported lot of events, and help the committee or the association by sponsored that
event. Sometimes KFC donates to the old and sick people. The company or the organization is
known with these social activities.
Technological factors:
In this study, KFC can go out of its home country. KFC apply the latest technology to
promote their product. Organization creates a website of KFC, and people search on the internet

what they want to eat from KFC and also check different informations about KFC so easily
(Nguyen et al., 2016). By the internet people can also do transaction, and the KFC’s delivery
staff supplied the order to the client’s address.
Physical factors:
Kentucky Fried Chicken is the authorised organization. They develop by the Yum!
Brands. KFC gather with Mc. Donald’s and Pizza Hut as they are the food organization. This
physical factor helps them to go out of the nation because the organizations which want to going
for global business are the authorized organization. For this reason, KFC also can hold its recipe
so that other competitor cannot steal its recipe. The staffs also protect their cooking recipes from
stealing. Presently, Kentucky Fried Chicken Company’s growths are increased. The company is
authorized, so all of the activity is done legally (Majdoub, 2018).
External risks:
Economic factors:
Kentucky Fried Chicken delivers their foods at a minimum price. The company have
food packet; people buy the packet, then they can get the discount coupons or something that
helps their customers to purchase there again (Nilsson & Sala, 2018). The advantages of
economic factors change the strategy of the global business of Kentucky Fried Chicken. KFC
develop their businesses with satisfying service and lower cost.
Natural factors:
The natural factor is one of the important analyses that must be had by the organization.
Without natural factors, Kentucky Fried Chicken cannot run its transaction; thus, the

environment or the natural factors are its clients and they income from the product that bought.
Most of the customers prefer Kentucky Fried Chicken Company because they are not preferred
the industrial organization. The company never disturbs any of the public activity by making a
noisy (Diachenko, 2014). They offer the people to come to their restaurant to enjoy the food with
their loved ones.
Political factors:
Kentucky Fried Chicken delivers the fast-food service to the customers. To reach their
aims, they create a political method that helps them, and this is called a guided facility. This
political method modifies their business strategy and makes the growth to their organization. For
example, KFC Company has staffs that run the activity in the restaurant (Anand & Yeung 2018).
They create an agreement with the workers, and it is a pension fee. They also offer another
ordering in Kentucky Fried Chicken. KFC Hospice Dinners which is delivered their helping hand
to the terminally sick patients. The Hospice provides the meals to the ill peoples in countrywide.
These meals are directly reached to the terminally ill patient in their own house. They always
called for delivery the orders. After enjoying the services the clients feel better. KFC Cafeterias
delivered to the dishes competitors.
Summary Table of Risks:
(A= extreme high, B= high, c= medium, D= low, E= extreme low)
(1= extreme low, 2= low, 3= medium, 4= high, 5= extreme high)
Risk Category Risk Type
(Human,
physical,
environmental,
Stakeholders
affected
Likelihood
Rating
(A,B,C,D,E)
Consequence
rating
(1,2,3,4,5)
Method
(elimination,
substitution,
engineering,

financial etc) administration,
process/
equipment)
Human factors Human,
physical
yes B 2 Process/
equipment
Technological
factors
Financial yes B 3 engineering
Physical
factors
Physical, human yes C 2 administration
Economic
factors
Financial,
environmental
yes A 5 elimination
Natural factors Environmental,
human
yes B 4 substitution
Political
factors
Environmental,
human, physical
yes D 1 elimination
Conclusion:
There are many challenges that Kentucky Fried Chicken faces, but still, it is the high
brand equity, top current market position, and the opportunities or chances that pose a high
success in the upcoming days for the brand. After the research and so many findings of Kentucky
Fried Chicken Company, it concluded that KFC is the large and strong organization which has
been famous all over the world. The brand has excellent management, global business strategy,
and secret recipe that support Kentucky Fried Chicken to adhere to the client’s mind. They
collect many features to make the brand perfect. KFC popularized for its fried chicken in the
fast-food industry, expanding the business by challenging the well-known dominance of the
hamburger. Kentucky Fried Chicken basic product is pressure fried which is an on-the-bone
chicken piece with Colonel Harland Sanders' "Original Recipe" of 11 spices and herbs. The item

is usually available in a large size cardboard bucket, normally holding 6 to 16 chicken pieces or
three or four-piece individual servings. All of the strategies guide the organization to be better
position and expect that the brand can make a perfect organization and can reach a brighter
future.

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