University Assignment: KFC Risk and Crisis Management Report

This report provides a comprehensive analysis of Kentucky Fried Chicken's (KFC) risk and crisis management strategies. It begins with an executive summary and introduction to the topic, followed by an examination of key stakeholders including owners, managers, employees, customers, and various public entities. A detailed SWOT analysis is presented, highlighting KFC's strengths (global presence, loyal customer base, menu variety, secret recipe) and weaknesses (supply chain issues, franchisee management). Threats include changing consumer preferences, food quality challenges, and competition. Opportunities include expansion and menu innovation. The report then delves into internal risks (human, technological, and physical factors) and external risks (economic, natural, and political factors). A summary risk table categorizes risks, identifies affected stakeholders, and proposes control methods. The report concludes with a bibliography of cited sources.

Running Head: Kentucky Fried Chicken (KFC)
0
Kentucky Fried Chicken (KFC)
Risk and Crisis Management
Student Name:
Student University:

Kentucky Fried Chicken (KFC) 1
Executive Summary
To maintain the growth of any industry or an organization it is important to look after
the threats to the company and for that risk and crisis management is there in every industry
to deal with the threats. After knowing about the company, looking after the stakeholders
who really matter and doing the SWOT analysis and know about the internal and external
links is an important part of any company. KFC is a food industry maintains the position of
best non-veg around the globe, fighting and challenges and strong enough to stay the best
even after any questions or criticism.

Kentucky Fried Chicken (KFC) 2
Contents
Introduction................................................................................................................................2
Key Stakeholders.......................................................................................................................3
SWOT Analysis.........................................................................................................................4
Strengths.................................................................................................................................4
Weakness................................................................................................................................4
Threats....................................................................................................................................5
Opportunities..........................................................................................................................5
Internal risks...............................................................................................................................5
Human factors........................................................................................................................5
Technological factors.............................................................................................................6
Physical factors.......................................................................................................................6
External Risk..............................................................................................................................6
Economic Factors...................................................................................................................6
Natural Factors.......................................................................................................................7
Political Factors......................................................................................................................7
Summary Risk Table..................................................................................................................7
Bibliography.............................................................................................................................10

Kentucky Fried Chicken (KFC) 3
Introduction
To deal with threats of the company and to diminish it, the company applies for Risk
and Crisis Management programs. Risk management deals with the threats when any affair is
occurring and Crisis management allocate when the event is done or after the occurring of
any event. Crisis management manages the unexpected incidents and this happens without
warnings and to decrease the impact of a crisis it is important to make a plan to execute
quickly for normal working whereas Risk Management focuses on solutions to avoid risks
and is a continuous process (Willmer, 2016).
In Australia in 1968, KFC settled with a specialty in fried chicken that comes under
Yum! Brands and was located in Guildford, NSW was proud for using quality chicken and
providing local components from trusted suppliers where they provide more than 2 million
consumers and employee 34,000 people and Australia possess and exercise 50 restaurants
(Brook, 2018).
Key Stakeholders
Stakeholders and organizations are both affected by each other and can be denoted in
many ways as Primary Stakeholders and Secondary Stakeholders. Primary stakeholders are
those who are straightly forced by the actions positively or negatively of an organization and
secondary stakeholders are the ones who are not directly affected by any action taken by an
organization negatively or positively.
Key stakeholders are those who make an effort and work directly with members and
the main are owners and managers who are related to the business directly and help in
obtaining profit and picking risk of reduction with no extent of partners. As the main owner
of KFC brand is Yum!, and others can be workers, clients, delivery services, contracted
hawking companies, suppliers and contracted cleaning companies including financial publics,
media publics, government publics, citizen actions publics, local publics, general publics, and
internal publics.
Financial publics: to gain or lose money, public invests in some projects till the completion
and KFC is not working on any investment project currently.
Media publics: there can be good and bad publics where good help and bad hurt and KFC
has been affected by this many times like unhealthy foods, semifinished meat, PETA (People
for the Ethical Treatment of Animals) issue and more.

Kentucky Fried Chicken (KFC) 4
Government publics: the guidelines effect test the end results like in some countries KFC
does not have any meat contained food because of some regional ritual and so they use halal
meat. The government made these regulations so KFC is out of questions and conflicts in
those particular countries.
Citizen actions publics: sometimes consumers, organizations, environmental groups do
question KFC so the public relation department goes and interface with those groups or
people.
KFC can improve by making staff trained, to make a marketing strategy for food
chain industry to gain control, providing natural customer service and make sure that staff
does not annoy the customers and to maintain an equal standard in every country (Hoang &
Paul, 2007).
SWOT Analysis
Strengths
Strong global presence: KFC is marking its presence in the 2nd largest restaurant chain
across the globe in the category of non-veg food portion.
Loyal customer base: they have their own secret recipe which maintains the loyal champion
base with the taste and chicken crunchiness loved by the consumers.
Variety in the menu: KFC offers a diversification of food to its customers and modifies or
alters the menu and offerings on the basis of the place in which it operates.
KFC’s secret recipe: in the food industry, one of the most famous business secrets is
Sanders’ Original Recipe of “11 herbs and spices” (Lutze, 2016).
Weakness
Supply chain and distribution issues: KFC faced the problem with the distribution of the
chicken and this was a major issue which led to closing of some stores in the UK and took a
lot of marketing and logistical attempts to come out and took extra care of its supply chain for
not facing the same issue of raw materials (Freytas-Tamura & Tsang, 2018).
Managing Franchisees: for the fast food chains success, the critical issue is account
management and problems between KFC and its franchises conflicts many channels got
closed from the time of establishment.

Kentucky Fried Chicken (KFC) 5
Threats
Changing consumer food trends and preferences: change in food trends and preferences
due to the exposure of millenary where consumers prefer foods which are healthy in nature
without fats and calories, and puts additional pressure.
Food quality challenges: the challenge of facing a criticism of the quality of lubricants it
uses for cooking its food and firm laws were made for food quality in some countries.
Competition from global and local players: KFC overlook strong competition from not
only global performers but also from local competitors introducing new menu, this is the
reason that it is still not at number one and food items for growth in their market share and
customer support to defeat the competition.
Opportunities
Expansion to new Geographies: KFC need to increase market portion and income after a
change in the lifestyle of consumers, proceeds wealth and increase buying tendency by
exploring new places.
Exploring new food items in the menu: opportunity to introduce healthy foods they need to
serve to change the demands of foods and millenary needs.
No matter how much challenges KFC faces, it is always going to be the strongest in brand
equity, market position, and growth (heartofcodes, 2018).
Internal risks
Human factors
According to the consumers, KFC is bad for health which they need to avoid for
staying healthy as KFC has loads of sodium in their grilled chicken, the unhealthy element of
frying like using expired oil with a high amount of harmful components. They use some
diluted antibodies, they do not take care of personal hygiene and they affect time and
temperature abuse (Bevilacqua & Ciarapica, 2018). This is an important factor and plays an
important role as wherever in any process where people are involved, human factors are
noticed regarding health and safety (Social Tatoos, 2016).

Kentucky Fried Chicken (KFC) 6
Technological factors
These factors are for making and buying decisions and investment in innovation, and
influence barriers to entry because technology can destroy the price structure and competitive
environment in a very short time for preventing disuse in the future. KFC discover new
technologies for gaining fame in the market and monitor it how fast it is growing and gaining
revenues more than competitors and to know how other firms can easily copy the features of
KFC, how technology can help to improve the product offerings through technology and how
is the impact on costs after technology for maintaining nominal profits and includes more
factors like pace of change, research and development, and capital formation (Tomaschek,
Lanfer, Melzer, Debitz, & Buruck, 2018).
Physical factors
Physical factors can be carrying heavy goods, noise, postures, dust or high
temperature, or it can be humidity, chemicals, smoke, fumes and more which can harm
anyone internally or can injure them or some can be anyone bullying or harassing someone,
violence or the threat at the workplace increases risk factors (Vogt & Marion, 2010). In KFC,
it can be damaged by fire or breakdown of any important assets or stocks and the risks are
rise in obesity to consumers because of junk food provided, diabetes, strokes, and even your
mental health, this can cause depression too who eat excess fast food and women can have
breast cancer or there is a risk of heart disease including mood swings, anxiety and more
(Food and Health, 2017).
External Risk
KFC analyses the external risk that may affect the company externally in direction to
develop a tactical plan to overcome the risks. The company focuses on customer retention
through understanding the buying patterns and needs of the customers (Dragnic, 2014).
Following are the external risks which may affect the company:
Economic Factors
The economic factors have a great influence on KFC. When there is a recession in the
economy, KFC will have to decrease the prices to adapt to the changes. Nowadays people are
becoming more health conscious which can affect the sales of the company (Castano,
Mendez, & Galindo, 2015). The economic condition of the market depends upon the money
an individual is spending on fast food. Employment factors and exchange rates also affect the
sales of KFC. The economic fluctuations affect the company as it determines the buying

Kentucky Fried Chicken (KFC) 7
capacity of the consumers and the company faces the risk of losing customers because of
their changes in eating habits which vary from region to region also person to person
(Dragnic, 2014). There are changing economic trends of the country which affects the
company which relies on the recession and depression of the economy. The economic growth
of the country helps KFC to expand its restaurant chain (Nerson, 2015).
Natural Factors
Natural factors like climatic changes in a particular region change the eating habits of
the people which can be a threat to KFC and can influence the sales of the company. The
factors like deforestation affect the company as KFC use the packaging of paper which
contributes to deforestation and that is a major environmental issue and the company has to
bear major threat. The company produces a large number of wastes which can affect the
natural surroundings (Conroy & Emerson, 2014). Changes in the weather affect the
company’s sales as it makes difficult for the company to deliver final products to the
consumers. KFC also need to ensure the quality and goodness of the dishes in order to make
sure that the health of the consumers are not affected and the product is reaching all the
quality standards to retain the existing customers and attract the potential customers.
Political Factors
There are a number of regulations in Australia that the KFC have to comply with. The
regulations relating to hygiene and the quality of the food are the major regulations that the
company has to follow. Political factors depend upon economic stability, political stability,
taxation policies affect the company’s profits. High wage rates can increase the cost of labor
for the company and also high policies of taxation prohibit the company to make profits in
the future. The company faces challenges from the policies of the country relating to public
health (Kozubikova, Kotaskova, Dvorsky, & Kljucnikov, 2019). There are guidelines of the
country which are relating to diet and health that KFC has to follow. The government forces
the company to add healthier dishes in their menus to ensure the safety of the consumers. The
attitude of the government influences the performance of the company (Gray, Harymawan, &
Nowland, 2016).
Summary Risk Table

Kentucky Fried Chicken (KFC) 8
Risk
Category
Risk Type
(Human,
physical,
environmental,
financial, etc.)
Stakeholders
affected
Likelihood
Rating
(A,B,C,D,E)
Consequence
rating
(1,2,3,4,5)
Risk Control
Method
(Elimination,
substitution,
engineering,
administration,
process/equipment)
Internal Risk Human Risk This risk
affects the
Owner,
manager, and
employees of
the company.
Likelihood rating
is B as it will
likely affect the
company
Consequence
Rating is 3 as
it will have
consequences
on the
company
moderately.
For assessing the
human risk,
elimination method
should be used.
Internal Risk Physical Risk This risk
affects the
customers and
employees
Likelihood rating
is C as it will
possibly affect
the health of the
customers and
employees as
well.
Consequence
rating is
major as the
company can
lose their
customers if
their health is
affected.
Firstly the
elimination method
is used. If this
method does not
work then the
substitution
method is used.
External Risk Environmental
Risk
Customers are
influenced by
this risk.
Likelihood rating
is C as it will
possibly influence
the health and
buying patterns of
the customers.
Consequence
rating is
major as it
will affect the
customer
base and also
sales of the
company
This risk can be
avoided through an
engineering risk
tool as this tool can
help a company to
remove harmful
elements and
providing
environmentally
friendly products.
Internal Risk Financial Risk This risk
affects the
Owners and
managers of
the company.
The Likelihood
rating of this risk
is A as it will
certainly affect
the financial
position,
performance, and
profitability of
the company.
Consequence
rating is 5 as
this risk
severely
affects the
company’s
profitability
and sales
revenue.
This risk can be
controlled through
Administrative
control by making
a suitable plan to
avoid financial
risk.
External Risk Political Risk This risk
affects the
owners and
managers of
The Likelihood
rating of this risk
is C as it possibly
affects the
Consequence
rating is 3 as
the risk has
moderate
For this risk,
elimination method
can be used
controlling the

Kentucky Fried Chicken (KFC) 9
the company. company and
company’s
policies.
consequences
and can be
easily
assessed.
risk.
External Risk Economic Risk This risk
affects
customers and
managers as
well.
The Likelihood
rating of this risk
is B as it will
likely affect the
sales of the
company.
Consequence
rating is
moderate.
Elimination and
substitution
method can be
used
simultaneously for
coping this risk.
*A – Almost Certain, B – Likely, C – Possible, D – Unlikely, E – Rare
*1 – Insignificant, 2 – Minor, 3 – Moderate, 4 – Major, 5 – Severe
Conclusion
To be concluded, in every business there is a risk and there is a special risk management
department to know about the threats and work on it for no further problems in the growth of
the organization. To manage, it is important to know about the strengths, weaknesses,
opportunities, and threats of the company and the internal risks which can affect employees
and organization both and external risks of competitors, market environment and more. After
knowing about how these risks affect stakeholders who are the major part of any growth in
the business, the management takes a step to deal with it. KFC has many competitors in the
market and has a lot of risks by them but still, they are strong enough to maintain their
growth and position in the market.

Kentucky Fried Chicken (KFC) 10
Bibliography
Bevilacqua, M., & Ciarapica, F. E. (2018). Human factor risk management in the process
industry: A case study. Reliability Engineering & System Safety, 169, 149-159.
Brook, B. (2018, April 25). KFC’s first Australian menu released as fast food chain
celebrates 50 years down under. Retrieved from news.com.au:
https://www.news.com.au/lifestyle/food/restaurants-bars/kfcs-first-australian-menu-
released-as-fast-food-chain-celebrates-50-years-since-first-store-opened-down-
under/news-story/b995b725ab0341576f261e033cb92099
Food and Health. (2017, October 19). Fast Food Health Risks That Will Shock You. Retrieved
from Food Revolution: https://foodrevolution.org/blog/food-and-health/fast-food-
health-risks/
Freytas-Tamura, K. d., & Tsang, A. (2018, February 20). KFC Has a Problem in Britain: Not
Enough Chicken. Retrieved from The New York Times:
https://www.nytimes.com/2018/02/20/world/europe/kfc-chicken-uk-shortage.html
heartofcodes. (2018, November 9). SWOT Analysis of KFC | KFC’s SWOT Analysis.
Retrieved from Heart of Codes: http://heartofcodes.com/swot-analysis-of-kfc/
Hoang, & Paul. (2007). Business etiquette and cultural awareness: Paul Hoang looks at how
an understanding and appreciation of cultural diversity can help firms to be more
successful in the global business environment. (External Influences). Business Review
(UK), 13(3), 24-26. Retrieved from Business Review (UK).

Kentucky Fried Chicken (KFC) 11
Lutze, T. (2016, August 26). We put the KFC ‘secret’ recipe to the test. Retrieved from
news.com.au: https://www.news.com.au/lifestyle/food/eat/we-put-the-kfc-secret-
recipe-to-the-test/news-story/e9d92234f90f62eaa8810814f57ac172
Social Tatoos. (2016, September 5). Is KFC bad for your health: What researchers say.
Retrieved from Blasting News: https://uk.blastingnews.com/health/2016/09/is-kfc-
bad-for-your-health-what-researchers-say-001100237.html
Tomaschek, A., Lanfer, S., Melzer, M., Debitz, U., & Buruck, G. (2018). Measuring work-
related psychosocial and physical risk factors using workplace observations: a
validation study of the “Healthy Workplace Screening”. Safety Science, 101, 197-208.
Vogt, & Marion. (2010, March 7). Physical and psychosocial risk factors at the workplace.
Retrieved from Eurofound:
https://www.eurofound.europa.eu/publications/article/2010/physical-and-
psychosocial-risk-factors-at-the-workplace
Willmer, J. (2016, September 27). Crisis Management Versus Risk Management: Do You
Know the Difference? Retrieved from Pro Bono Australia:
https://probonoaustralia.com.au/news/2016/09/crisis-management-versus-risk-
management-know-difference/
Castano, M., Mendez, M.-T., & Galindo, M.-A. (2015). The effect of social, cultural, and
economic factors on entrepreneurship. Journal of Business Research, 68(7), 1496-
1500.
Conroy, S., & Emerson, T. (2014). A tale of trade-offs: The impact of macroeconomic factors
on environmental concern. Journal of Environmental Management, 145, 88.
Dragnic, D. (2014). Impact of internal and external factors on the performance of fast-
growing small and meduim businesses/Utjecaj unutarnjih i vanjskih cimbenika na
uspjesnost brzorastucih malih i srednjih poslovnih subjekata. Management: Journal of
Contemporary Management Issues, 19(1), 119.
Gray, S., Harymawan, I., & Nowland, J. (2016). Political and government connections on
corporate boards in Australia: Good for business? Australian Journal of Management,
41(1), 3-26.