Strategic Management of Burger King: Corporate, Business and Functional Level Strategies

This report analyses the strategic decisions of Burger King in terms of corporate, business and functional level strategies. It covers the overview of the organisation, its corporate level strategies such as expansion and combination, business level strategies such as cost leadership and differentiation, and functional level strategies such as marketing and human resource strategies.

Strategic Management

Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Overview of case study organisation...........................................................................................1
Corporate level strategy...............................................................................................................1
Business level strategy.................................................................................................................4
Functional level strategy..............................................................................................................5
RECOMMENDATIONS.................................................................................................................7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Strategic management refers to a process of setting procedures, goals and objectives for
making an organisation or a company highly competitive for its competitors. It provides overall
directions through deploying policies and plans that are designed in order to achieve objectives
along with this it also allocate resources in order to implement the plans (Köseoğlu and Parnell,
2020). For the following report, selected company is Burger King which is an international chain
of hamburger fast food restaurants based on America. The company is founded by firstly as
Insta-Burger King owners Keith J. Kramer and Matthew Burns in 1953 and its headquarters is in
Miami-Dade Country, Florida, United States. The report covers overview of case study
organisation along with the definitions and examples of case study's strategic decisions for
corporate level strategy, business level strategy and functional level strategy. It also covers
analysis and evaluation of strategic decisions for corporate level and functional level strategy. It
further covers recommendations for future strategies.
MAIN BODY
Overview of case study organisation
Burger King is first largest fast food chains in all over the world along with this it earn
more than $2 Billion revenue every year. It is also known as second largest hamburger fast food
chain in all over the world. It has around maximum 12,000 restaurants that covers 73 different
countries as well as 50 States (Information about Burger King, 2022). Its has wide range of
products which includes chicken sandwiches, whopper sandwiches, fries, hamburgers, chickens,
soft drinks, milkshakes and chicken tenders. It also offers other choice products to its potential
customers which includes breakfast items, salads and desserts. The company was founded as
Insta-Burger King in 1953 in Jacksonville, Florida, U.S. After it faces financial difficulties it was
purchased by its two franchisees that were David Edgerton and James McLamore in 1954 which
names as Burger King. In 1963 it expand its business in another country in Puerto Rico.
Corporate level strategy
In the opinion of Johnson, Scholes and Whittington (2006), corporate level strategy
makes the concerned in overall scope of an organisation along with this helps them to find
effective that add values in all the different parts of an organisation (Arun and Ozmutlu, 2021).
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According to Plunkett and Attner (1994), corporate level strategy describes those
strategies that helps organisation in decision-making and planning process that guides in its long-
term directions.
Corporate level strategies defined a specific plan that hit a specific target required for
achieving a business goals in better manner. This plan can be an effective instrument that
highlights the organisation's goal for a following period. The type of corporate level strategy that
an organisation selects can be form an indicator that helps in making their financial success
along with the methods to generate profits. This is mainly used by the multi-tired company plan
which has been used by the leaders in order to outline, define and achieve a specific business
goals. It can also be used by the small companies in order to increase their profits for next fiscal
years. On the other hand, large organisation used this strategy to oversees the multiple businesses
operations in order to achieve their more complex goals such as selling the company, or
expansion in new market. This will used by the management of Burger King in order to make
strategic decisions for determining the overall scope as well as directions for its organisation as
well as find an effective way in which its different business units works together in order to
attain their specific goals (Arun and Ozmutlu, 2021). The examples of strategic decisions which
has been taken by the management of Burger King are described below:
Expansion strategy- This type of corporate level strategy is selected by the company is
when it wants to serve the additional products or service sectors to public or wants to increase its
markets or functions. This make company to focus on its strategic decisions which helps in
increasing their growth in the market. This strategy basically involves redefining of the business
by adding to the scope activity or through substantially increasing the efforts of the present
business. When this strategy is pursued by the company, it makes company either to develop
new product or new market or functions. The strategic decision taken by the management of
Burger King through expansion strategy is in order to expand their business in another country
with their existing product in order to increase their growth (Bokareva and Yudina, 2020).
Combination strategy- This strategy refers to a mixture of stability, retrenchment and
expansion which helps companies in order to improve its overall performance. In this strategy,
strategist apply various generic strategies in different parts of the organisation or to different
future periods. The logical possibilities in this strategy are stability in some areas and
retrenchment in others, stability is some areas and expansion in others, retrenchment in some
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areas and expansion in other as well as all the three strategies in different areas of the company.
The strategic decisions of the management of Burger King in order to use this strategy is to
greater variety of hamburgers to its customers which shows its stability and increase its product
range by providing more organic foods to its customers shows its expansion strategy.
Analysis and evaluation of strategic decisions-
The strategic decisions in terms of expansion and combination strategies of corporate
level of strategy are important for every organisation in order to make their business smooth and
effective that enhance their growth in better manner (Stephens and Martin, 2019). These two
types of strategies makes company to find an effective way in order to make better decision
which helps in improving the functions of the company as well as enhance their competitive
growth in the market. In order to evaluate the strategic decisions of Burger King for corporate
level strategy is effective or not its advantages and disadvantages are described below:
Advantages-
Attract new customers- The main purpose of the company in order to make their
decisions related to expansion and combination strategy is to attract more and new customers
towards their products. This will help Burger King in order to increase their customer base by
using strategic decisions regarding expansion and combination strategy which makes them to
expand their business in another country or increase the variety of customers and increase their
product range through organic foods.
Economies of Scale- When an organisation expand their business, they often spread the
risks of doing business as well as reduce the potential of one product or one poor decision can
damage their business. The strategic decision of Burger King related expansion and combination
strategies help them to spread the costs of doing business across the more customers or markets
while operating in multiple markets or in many product areas (Bodrunov and Plotnikov, 2019).
Disadvantages-
Capital requirement- The strategic decision may create problem for Burger King which
makes to invest money and other resources for their corporate level strategy. For expanding their
business or increasing the variety in their products may require more capital in order to make
their decision in order to implement them.
Spread too thin- This describes the another risk which can be faced by the management
of Burger King related to their strategic decisions. Many companies leader thinks that they have
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to spend their business if all things of their business are going well. This makes if the Burger
King get involved in too many markets of products range can affects its abilities in which they
can not operate their business in better manner.
Business level strategy
According to Jacek Pytlik (2019), business level strategy describes a outlining of policies,
actions and goals that focus on delivering the value to the customers while maintaining their
competitive advantage.
As per the Porter, M. E. (1980), business level strategies analyse how an organisation can
compete in their industry. Companies uses these strategies in order to make decisions about to
gain competitive advantages is according to their price or differentiation while targeting narrow
or broad market.
The business level strategy of a company help them to determine their position in their
industry along with the direction of their profits. This will also affects the efficiency of a
company how they are able in order to serve their customer base in better manner (Westney,
2021). This level of strategy help management of Burger King in order to make an effective
decision which help company to increase their competitive growth in the market. The examples
of strategic decision of Burger King in relations to its Business level strategy are described
below:
Cost leadership strategy – This type of business level strategy makes company to take
decision in order to decreases the price of their products and service can help company them to
increase their profits by reducing their operational costs. This makes management of Burger
King to either charge industry average prices or lower price than their competitors in order to
attract more and more customers towards their products. This will also helps them to enhance
their competitive growth in the market in better manner. This makes the management to ensure
that they have substantial capital which helps in investing in efficient logistics, labour, material
as well as right technology in order to decrease the price of their products in order to gain various
advantages (Randrup and Jansson, 2020).
Differentiation- This is also an effective strategy that makes company in order to take
important decisions related to differentiation in their product or service. This refers to a
fundamental that defines how a company can become a industry leader within its market. This
business level strategy makes company to focus on more on quality instead of cost. This strategy
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makes management of Burger King to make an effective decision which makes their product
different from their competitors in order to gain various advantages. As a competing business the
main goal of the Burger King is to add value in their product in order to make their position in
the market. If the management of Burger King effectively implement their differentiation
strategy which helps them to effectively increased their target customers to their products so they
effectively stand out in their market. This strategy helps them to gained trust for their target
customers as well as make them willing in order to pay a premium price for their customers
(Bolland, 2020).
Functional level strategy
According to Hitesh Bhasin, (2020), functional level strategy refers to as day-to-day
strategy that are developed in order to help in the application of business as well as corporate
level strategies.
In the point of view of Sam Thomas (2020), functional level strategies are some
objectives and actions that are distributed among the departments in order to promote their plans
at business and business level.
In all type of organisation, their top level management provides guidelines in order to
develop a functional level strategy. This will be directly relates with the decision making at the
operational level of an organisation. The decision made by the top level management of an
organisation can be used in different areas of the business which includes manufacturing,
marketing, research and development, finance, human resources, logistics, etc. The functional
level strategies are important for the Burger King in order to operate their different department of
their business in better manner as well as helps in making their corporate and business level
strategies (Desai, 2019). In order to develop their functional level strategy of their company, it is
important for the top level management of Burger King to make strategic decisions in order to
conduct their daily operations in better manner. Examples of their strategic decisions regarding
to their functional level strategy are described below:
Marketing strategy- It covers all those activities that are required in order to promote
product and service of a company along with this it identifies the needs of delivery of their
products and service in the market. Marketing mix refers to as one of the essential parts of the
marketing strategy that includes all those steps that are required in order to increase the demand
of product or service in the market. It includes 4Ps related to marketing that are product, place,
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price and promotion. This makes top level management of Burger King in order to make their
strategic decision regarding to their marketing which helps company to attract more and more
customers towards their product and service. There are various of marketing techniques related
to strategic marketing available which helps Burger King in order to increase their sales for their
products which includes augmented marketing, relationship marketing, concentrated marketing,
social marketing , guerilla marketing, etc. This will also makes them to focus on improving the
efficiency of their marketing by reducing the overall cost of marketing. This strategy will also
helps Burger King in order to increase the quality of their products by improving the accuracy of
customer as well as need assessment within the market (Dingle and Mallen, 2020).
Human resource strategy- This types functional level strategy mainly concerned with
the working of employees within an organisation. It is the responsibility of top level management
of an organisation in order to provide healthy and good working environment to their employees
so, they contribute their best efforts to achieve success of their organisation in better manner.
The human resource department of the company is also responsible on recruiting right candidates
in right job in order to help company to operate their business in better manner. This strategy
makes management of Burger King to make effective decision which helps in managing various
activities of the human resources which includes personal development, recruitment, the
motivation of the employees, retention of the talented employees and salary management. This
strategy will also helps them to improve the efficiency of their employees by reducing the
expenditure that incurred in on boarding employee process. This will also helps them to increase
the quality of their employees by minimising the employer through extensive technical training.
Analysis and evaluation of strategic decisions-
The strategic decisions regarding functional level strategy is important fore every
organisation in order to operate their daily routine task in better manner in order to achieve their
goals on time (Tskhadaya, 2018). The strategic decisions that make by the management of
Burger King related to functional level strategy are evaluated by analysing their advantages and
disadvantages are described below:
Advantages-
Increased customers- The strategic decision of the management of Burger King in order
to reduce the overall cost of marketing helps them to improve the efficiency of their marketing
strategy which helps them to increase the customers. By the use of more effective strategy of
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marketing helps them to attract more and more customers for their products which also helps
company to increase their sales as well as generate more revenue.
Improve the performance- The strategic decision which has been make by the
management of Burger King in order to manage their employees in better manner. This helps in
making their employees motivated in order to give their best in order to conduct their task in
better manner. This will helps Burger King in order to improve their overall performance of their
business in better manner.
Disadvantages-
Time and effort may not yield a return- Some times when an organisation gives their
best efforts and spend more time in order to make their marketing strategy which may fails. This
will affects the Burger King to does not get effective outcomes by making strategic decisions
regarding to functional level strategy (Daidj, 2018). This may also cause loss for Burger King in
order to implement their strategies.
Incurred more cost- This describes that the Burger King need more cost in order to
implement their strategies related to functional areas in order to gain various advantages. Human
resource strategy and marketing strategy of the organisation my helps them to operate their daily
operations smooth but it require large amount of capital in order to implement it.
RECOMMENDATIONS
According to the above discussion, it has been analysed that corporate, business and
functional level strategies are important for Burger King in order to improve their operations,
increased their sales as well as enhance their competitive growth in better manner. Corporate
level strategy help company to to improve their overall performance of the company which helps
them to achieve their long-term goals in better manner (Marinov, 2018). Business level strategy
helps them to make effective decision which helps in increasing their competitive growth of the
company in better manner. Whereas functional level strategy helps them to operate and manage
day-to-day functions in better manner which helps them operate their business in better manner.
In order to maintain their competitive growth in the market, it is important for the Burger King in
order to find the effective strategy which helps in their future operations in order to increase their
sales and growth in the market. As per the above discussion, the following strategy has been
recommended to the management of Burger King in order increase their competitive position are
described below:
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Expand their business- It has been recommended to the management of Burger King in
order expand their business in more countries which helps them to increase more customer base
for their products in better manner. This will helps Burger King to provide their tasty and
delicious products in more country by analysing their needs and wants of their customers which
helps them to make to increase their sales in future in better manner.
Decrease the price of their product- The other things which has been conducted by the
management of Burger King in its future is to decrease the price of their product. This make
them to provide their product and service in below their competitors product price which helps in
gaining the attractions of their customers towards their products. As it also help company to
increase the competitive position in the market. This will be an effective strategy for the Burger
King in order to increase their competitive position in the market. This will helps company to
increase their sales and profitability in future (Mirza, 2021).
Increase digital marketing strategy- The another strategy which has been
recommended to the management of Burger King to increase their digital marketing strategy
which helps them to attract more and more customers for their products and service in future.
This will also helps in making their other operations better in which also helps in increasing the
sales of their products.
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CONCLUSION
From the above discussion, it has been concluded that strategic management help
companies to become proactive instead of reactive in order to make it analyses the actions of the
competitors as well as take necessary steps which assist them to compete in the market in better
manner. Excellent strategic management can modify the performance of an organisation in order
to make fortunes for shareholders or change the industrial structure. There are three types of
business strategy which helps company to operate their business effectively as well as survive in
the competitive market which includes corporate level strategy, business level strategy and
functional level strategy. Corporate level strategy help company to maximise its profitability as
well as maintain its financial success in the future. It also helps them to increase their
competitive advantages from its competitors as well as continue to provide unique and different
product and service to their consumer. Business level strategy encourage companies to work on
its strongest strengths. This enables organisation to realise actual challenges, gives proper control
over the costs, helps to fight with talent war as well as also helps them to manage their suppliers
and other external stakeholders in better manner. Functional level strategy helps companies helps
company to achieve their organisational goals as well as told them what needs to be conduct in
what manner. This will provide better view of the operations of each department of their
business. It is important for the company to set their corporate level and business-level-strategies
before setting their functional level strategy.
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REFERENCES
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Bolland, E.J., 2020. Evolution of strategy: origin, planning, strategic planning and strategic
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Tskhadaya, N.D., 2018. Values in the Strategic Management of a Modern Russian
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Westney, D.E., 2021. MNCS and cross-border strategic management (pp. 301-318). Oxford
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Online-
Pytlik, J., 2019,[Online]. Available through <https://tracktime24.com/Blog/business-level-
strategy>
Thomas, S., 2020, [Online]. Available through <https://tracktime24.com/Blog/business-level-
strategy>
Bhasin, H., 2020, [Online]. Available through <https://www.marketing91.com/functional-level-
strategy/>
Information about Burger King, 2022, [Online].Available through <https://www.bk.com/about-
bk?>
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