Business Health Check Report

The report presents a comprehensive business health check for KFC, analyzing its objectives, internal and external factors affecting its operations, and potential improvements using strategic frameworks like SWOT, PESTLE, and Ansoff's growth matrix. It reviews the effectiveness of KFC's business practices and outlines plans for enhancing management skills and overall business performance.

BUSINESS HEALTH
CHECK

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Analyzing the objectives of the business..............................................................................1
1.2 Explaining factors which impacts on KFC:..........................................................................2
1.3 Identifying potential improvements for KFC by using Ansoff's growth matrix...................3
TASK 2............................................................................................................................................5
2.1 Reviewing the effectiveness of business...............................................................................5
2.2 Developing plans for improving business ............................................................................6
TASK 3............................................................................................................................................6
3.1 Skills of management and staff.............................................................................................6
3.2 Justifying plan and development for skills of management and staff...................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Business health check refers to a very key aspect in the business process. It has some
major questions in context to business such as its strength and weakness, evaluating employees
and tools used in business. The present report is giving brief discussion on business health check
in context of KFC : Kentucky Fried Chicken. The whole research report is on task basis. Each
task has its own priority, it has highlighted on business objectives, external and internal factors
by SWOT, PESTEL and porters five force model. Further it has also discussed about potential
improvements of KFC by using growth matrix. The business effectiveness has been measured in
context of sales, products and many more. The major skills are classified for achieving success
for organization.
TASK 1
1.1 Analyzing the objectives of the business
KFC Corporation founded and also known as Kentucky Fried Chicken is a chain of fast
food restaurants based in Louisville, Kentucky. KFC is the largest chicken restaurant and the
third largest quick service chain in the world. The companies of KFC has more than 36,000
locations around the world which is very successfully running. Every day, more than 12 million
customers are being served at KFC restaurants in more that 109 countries and territories around
the world. The companies of KFC has more than 15,000 units around the world (ACHOLA,
M.A. 2016).
KFC has various numbers of aims and objectives which they have set to achieve in the
future. Some SMART objectives of the Organization, are as follows,
 KFC tries to provide a tasty, health-conscious, and chicken-based product which the
customers can enjoy and can return to buy it again.
 Providing quality food, a hygienic environment, and a positive and dynamic customer
experience
 It wants to increase the profitability of its outlets to attract more investors and franchisees
 KFC wants grow its business and withstand pressure from other fast-food competitors,
although these are goals set by most commercial entities.
 To increase the overall growth of the company by 95% at the end of 2018. This will help
the company to increase there sales and production.
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 KFC is planning to introduce a vegetarian food item into their menu to attract the
customers which prefers only vegetarian food.
1.2 Explaining factors which impacts on KFC:
There are various internal as well as external factors which affects the organization's
functioning. External or macro environmental factors can be identified by PESTLE analysis or
by Porter’s 5 force model. And the internal or micro environmental factors is calculated by a
method known as SWOT analysis.
 PESTLE analysis of KFC : It will discuss all the business environment of the company
with respect to the factors as discussed below :
1. Political Factors : KFC has to follow all the rules and regulations of the country in
which they are operating in order to work effectively in the target market.
2. Economic Factors : Many economic factors affects the management system of KFC.
Based on the cost of the living index in the respective country and the purchasing power
of the customers affects the company in setting pricing for its products and services
which is served to their customers (Newton, P. 2014)
3. Social Factors : In these factors, company tries to serve their products according to their
customers needs and preferences. It helps them to understand their customer more.
4. Technological Factors : Technologies plays an important role to operate the company's
functions. As maximum work is done by machines, its very important for KFC to be
updated with the latest technology which is currently being used in the market.
5. Legal Factors : As per the specific business and country’s legal systems, they have to
follow it strictly to produce their products (Shuailing, L.I. and Zhi, Y.U. 2015)
6. Environmental Factors : KFC has specific regulations and makes sure that their
customers are not throwing their wastes openly into the environment. They ensure that its
products and its processes are environmental friendly.
 Porter’s 5 Forces Model : From this method, KFC company can evaluate their business
and can help to plan strategies according to its various factors,
1. Bargaining Power of Customers : KFC has set their product price so reasonable which
makes their customers to easily afford their products. They are also managing the prices
according to their competition in the market.
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2. Threat from new entrants : Every year there is a new entry in the target market which
makes KFC to come up with some new offers which can attract the customers to but their
products (E. Dobbs, M. 2014).
3. Threat of Substitute products : KFC is basically serves products which is chicken
based, whereas other competitors and the new entrants into the market is serving variety
of products into their menu. This can be a great threat to KFC.
4. Bargaining power of suppliers : There are limited suppliers which sell their raw
material to almost all the fast food chain supplier in the market which increases the
competition in the market. This helps the supplier to sell its material on a very high
price.
5. Competitive Rivalry within an industry : There are different companies which is
operating on the same field, for example, McDonald's, Pizza Hut, Burger King etc. which
makes them to serve more and better products to their customers.
 SWOT Analysis : It helps to evaluate the internal strength of the organization on the
following factors,
1. Strengths : It has global presence of more than 15,000 restaurants worldwide. It is the
fastest growing fast food chain in Asia. It has a strong financial performances. It has so
much variety in their menu which makes their customers satisfied.
2. Weaknesses : There is lot of food quality issues arising in the organization management
system. They are unable to manage their franchisees (Zalengera, C.and et-al. 2014)
3. Opportunities : There is a huge scope of expanding their business in the target market.
They experimenting to launch vegetarian products into their menus.
4. Threats : Continuously changing the eating habits of the customers is a huge threat
which they facing currently. Prices of the raw material is too high for the organization. It
has to compete with its competitors who are existing in the market.
1.3 Identifying potential improvements for KFC by using Ansoff's growth matrix
KFC has taken various steps for bringing improvement in context of their existing
business. It considers strategy of Market penetration, Market development strategy,
Diversification and then strategy of Market development.
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Market Penetration strategy : It has started penetrating from Brazil and Argentina.
Usually this strategy helps in increasing the sales of the product which is currently existing in the
market. It has gained leadership locally along with the major corporate sector which are having
experience of many years in the given specific market share of the product which is currently
penetrating. There are various ways by which manager can generate more ways for getting
growth with context of strategies of intensive growth (Simoneaux and Stroud, 2011).
Market development strategy : Usually it has generated different market in various
countries for achieving great success by launching innovative product and it also helps in
maintaining the existing product's reputation. The menu has been customised and for décor and
appearance its has raised very high its goals with great success in China. The main strategy
which has developed its market that is localization and for different foreign countries rather than
USA.
Product Development strategy : KFC has launched various new products in context for
developing their products with proper customer satisfaction. Those new products attract each and
every customer generating their sales in highly unexpected manner. The products which are
already existing in market are leading in market but for not remaining complacent there should
be presence of innovation for attaining their goals for competing in foreign countries or market.
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Diversification strategy : With respect to diversification, all the opportunities which are
produced must be grabbed in perfect time in market. Each and every aspect of strategy of
localisation has been touched by different operations with context of promoting and marketing
for the supply chain and even for distribution. For diversification KFC has included menu of
vegetable in their portfolio. It has given 1st preference for raising the level of objectives with
respect to performance as comparing it from performance of previous level of company. The
special emphasis has been given by KFC is all strategy are united for taking company at its best.
TASK 2
2.1 Reviewing the effectiveness of business
Business effectiveness refers to all the goals and objectives are attained or not with
reference to their standards. The problems which are targeted are solved or not. As effectiveness
is determined as outcome which is with quality and all tasks are covered fully by both employees
and even their manager as well. For improving business effectiveness there is requirement of
conducting reviews of regular performance of both managers and employees for identifying the
technique and methods are producing outcome in very effective manner (Bellin, 2017).
Review of effectiveness of areas of business such as :
Products / services : In the terms of product review, KFC is offering different products
like Fries, Zinger burger, Zing Kong, Veggie feast etc. the company is leading from support of
localisation but it should be able to improve more services according to globalisation. As it has
started customisation by it should give more quality service.
Marketing : KFC has its promotions to various countries especially in UK it has
promoted a lot with various billboards, pamphlets and many other promotion strategy but for
achieving good reach it should have better promotion strategies in countries like India because it
has huge target in developing country.
Sales : in the brand of Chicken KFC is recognized by population, Half of the market
share is covered by KFC. It has created difficulties for its competitors like Chicken Planet,
Subway and all who are entering in this present business sector. For generating more sales it has
to develop its market in all developing countries with their customized product according to
taste.
Finances : KFC profit margin is upto 25% of sales. It receives the cost on the technique
of base value. The cost of item is expensive according to business sector portion and it will be
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increasingly good to all related items. For managing its finance KFC should use different
financial tools which will be giving benefit to organisation.
Staffing : Staffing is very essential concept for dealing with customer, as local and very
highly qualified staff has been appointed because they can deal with customer in more
appropriate manner and it will help in increasing sales and revenue along with this.
Business image : The business image of KFC has grown somewhat out to date and it is
depicting the consumer attractiveness so for increasing they are working on building better
business image.
Record keeping : The KFC is operating from years so it has managed and given access
to all the records on time (Parsa and van der Rest, 2017).
2.2 Developing plans for improving business
Business plan refers to a written document which helps in describing business in detailed
manner and how they will attain the goals and objectives in viewpoint of marketing, financial
and operational as well. Forecasting is very important aspect for planning of enterprise and even
for formulating strategy. KFC business plan consists of all potential customers as KFC sponser
different sports teams and commercials which are entertaining (Employee developmet plan,
2018). There brand will be advertised by television and radio because in the present era it is most
popular form of communication. They are also using coupons with several discount offers.
In the terms of Business plan KFC has done STP analysis which is segmentation, target
and positioning in very appropriate manner. They have chosen segment in various groups of
customer according to diverse demands, behaviour and taste as well. They have set target for the
market of metropolitan areas of the country and sub urban areas and in context of positioning
there product has been recognised by as a unique product which no other person is giving. With
the reference of role and responsibilities of staff and management they appoint the staff who is
highly qualified and local because they can deal with customer very easily and it will also help in
controlling the cost of organisation (Business effectiveness, 2016).
TASK 3
3.1 Skills of management and staff
With the perspective of current skill in management and staff there are three major types
of skills that is technical skills, operational skills and managerial skills. All the skills are essential
in each organization and especially in KFC they play lead role in achieving success. With the
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context of technical skills it refers to the knowledge and capability for performing the task which
are specialized. The food chain of KFC has major requirement of technical skills as it follows
franchise system and for communicating orders of customer from chef also in very effective
manner for coordinating the efforts. For analysing the feedback of customer there is requirement
of data analysis, computer programming and for analysing it properly technical skills are
necessary. All the aspect such as computer languages, knowledge of advanced algorithms are
included in technical skills (Hameed and Waheed, 2011).
Managerial skills refer as most challenging job, for attaining these skills there is
requirement of some special skills which is required in each and every organization. In
managerial skills it consists of three major skills that are conceptual, human relations and
technical skills. In management of KFC there is need of all skills at all the levels of management.
The more conceptual skills are required by top level management and less technical skills. But
the low level managers of KFC needs more technical skills and less conceptual skills about food
chain. In each and every level human relations plays very essential role for management.
Operational skills refers to skills in the context of operations of the business, and in
context of KFC operations such as promoting, advertising, managing finance, service to
customer etc (Operations Management, 2018). The skills who increase the efficiency of these
operations such as decision making, data entry skills, data processing skills, delegation, team
work, stress tolerance, adaptability etc.
3.2 Justifying plan and development for skills of management and staff
Creating plans for developing of management and staff it can be classified in five steps :
 Considering business goals
 communicate to employees
 Recognising potential vs readiness
 Considering training and development
 creating pre and post plan
Considering business goals : while setting objectives' requirement of development
according to organization needs of business. There should be proper classification in long term
and short term aspect. All the candidate of internal organisation should be developed for bridging
gap between employee skill set and requirement of future.
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Communicate to employees : there should be proper communication between employees
and management because skill level is always increasing day by day. There is possibility that
employees might have some significant plans for development.
Recognising potential vs readiness : there is always difference between potential and
readiness, so it is most appropriate way for recognising nature of its potential and readiness. In
KFC employee in chef department has potential to be burger chef but he is not ready to be that
chef in certain situation (Taylor, 2012).
Considering all types of training and development there is implementation of method for
acquiring new talent. It should not be expensive but have certain benefit to business. There are
numerous developmental programs such as formal class training and online courses for
expanding talents.
Creating pre and post plan : After identifying the opportunity, there should be presence of
creating plan with goals which are very specific and achievable. In reference of vague objectives,
employees progress cannot be measurable. So for measuring it management should see the
outcome before training and after training, the variation should be observed and if it is positive
find ways for bringing more efficient and if it is negative then ways for making it positive.
Thus, KFC should try this plan for bringing its business with more profit margin and its
employees are valuable asset to the organization so they should work more on them for accuracy
in products (Fotiadis, Vassiliadis and Piper, 2014).
CONCLUSION
From the above report it has been concluded that business health check is mandatory for
achieving target and to know financial position in industry. It has been summed up by following
business effective plan which has to be followed for efficiency in organisation.
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REFERENCES
Books and Journals
ACHOLA, M.A., 2016. FRANCHISING AS A MARKET ENTRY STRATEGY BY KENTUCKY
FRIED CHICKEN INTO KENYA (Doctoral dissertation, SCHOOL OF BUSINESS,
UNIVERSITY OF NAIROBI).
Bellin, H., 2017. A Useful Toolbox for Marketing Channel Managers. Journal of Marketing
Channels. 24(3-4). pp.204-207.
E. Dobbs, M., 2014. Guidelines for applying Porter's five forces framework: a set of industry
analysis templates. Competitiveness Review. 24(1). pp.32-45.
Fotiadis, A. K., Vassiliadis, C. A. and Piper, L. A., 2014. Measuring dimensions of business
effectiveness in Greek rural tourism areas. Journal of Hospitality Marketing &
Management. 23(1). pp.21-48.
Hameed, A. and Waheed, A., 2011. Employee development and its affect on employee
performance a conceptual framework. International journal of business and social
science. 2(13).
Newton, P., 2014. What is the PESTLE Analysis?.
Parsa, H. G. and van der Rest, J. P., 2017. 20 Business Failure in the US Restaurant
Industry. Turnaround Management and Bankruptcy: A Research Companion. 69. p.388.
Shuailing, L. I. and Zhi, Y. U., 2015. KFC development in Chinese market–based on the social
responsibility and ethics. International Business and Management. 10(3). pp.142-146.
Simoneaux, S. L. and Stroud, C. L., 2011. SWOT analysis: The annual check-up for a
business. Journal of Pension Benefits: Issues in Administration. 18(3). pp.75-78.
Taylor, E. C., 2012, January. Competitive improvement planning: using ansoff's matrix with
abell's model to inform the strategic management process. In Allied Academies
International Conference. Academy of Strategic Management. Proceedings (Vol. 11, No.
1, p. 21). Jordan Whitney Enterprises, Inc.
Zalengera, C. and et. al. 2014. Overview of the Malawi energy situation and A PESTLE analysis
for sustainable development of renewable energy. Renewable and Sustainable Energy
Reviews. 38. pp.335-347.
ONLINE
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Business effectiveness. 2016. [Online]. Available through :<https://jgamarketing.com/difference-
effectiveness-efficiency-business/>.
Employee developmet plan. 2018. [Online]. Available through
:<https://www.insperity.com/blog/5-steps-to-creating-employee-development-plans-that-
truly-work/>.
Operations Management. 2018. [Online]. Available through
:<http://recmanagement.com/200802gc04.php>.
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