Risk Management Strategies in KFC: A Business Research Report

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HI6008 BUSINESS RESEARCH
ASSESSMENT 2- Risk Management strategies in KFC
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Table of Contents
1. Introduction
2. Project Objective
3. Project Scope
4. Literature Review
Risk associated with fast food outlets
Reasons to minimise the risk
Strategies and activities to minimise the risk
5. Research Questions/Hypothesis
6. Research Design and Methodology
7. Research Limitations
8. Time Schedule
9. Conclusion
10. Reference List
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1. Introduction
Risk management is basically considered as the prioritization; evaluation as well as identification
of risk which is being followed by the economical as well as the coordinated application of
resources to control minimize or monitor the impact or probability of the various unfortunate
events and also to make an increase in the opportunities. In each and every business association,
there is the involvement of risk which needs to be minimised so as to attain growth. In this
report, there will be a discussion in regards to the topic of ‘Risk management strategies in
KFC’. Kentucky Fried Chicken (KFC) is the second largest fast food outlet in the world. They
are having 17,000 restaurants and more in around 115 nations and give services to around 12
million customers. In this assignment, there will be a description of the objectives and aim of the
project along with the literature review where there will be a description of the views of different
authors regarding risk management strategies in the fast food industry.
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2. Project Objective
Fast food is good in taste and is convenient for the individuals who do not want to or do not have
time to cook at home. There is a continuous increase in the craze of fast food among individuals.
The main aim related with this project is to find out risk management strategies which are being
carried out by KFC to make a reduction in risk (Menapace et. al., 2012). With the high base of
customers in the fast food industry, there are different objectives which need to be achieved.
Some of the major objectives are defined as follows:
 To analyse various risks related to fast food outlets
 To determine the need for minimising the risk
 To evaluate various strategies and activities to reduce risk
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3. Project Scope
Fast foods are such type of foods which are being served in a fast manner by street vendors and
restaurants. There is a large chain of fast food restaurants in Australia and KFC is the one among
them. The organisation is famous for the fried chicken which is provided. This report will
discuss various risk management strategies which are used by KFC in order to reduce risk and
for the better understanding of the topic, the official site of the KFC has been visited to gather
information. Apart from this, to carry out a literature review, different articles and journals have
been collected.
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4. Literature Review
Risk associated with fast food outlets
According to Wieland and Marcus Wallenbur (2012), the main thing which is associated with the
fast out outlets like KFC is the issues related to health. Instead of the tasty food which is
provided by the fast food outlets, many people tend to avoid it as it gives harm to the health of a
person. Apart from this it can also be said that there are many individuals who do not have
proper understanding in relation with the procedures and practices which are there in the fast
food outlets keeps on delivering negative things and image of the fast food outlets without
having proper research which becomes an issues for such outlets as it make decrease in profit
and success. As per the viewpoint of Menapace et. al. (2012), it is true consuming a high amount
of fast food in comparison with a balanced diet can be very harmful to the customers. Other than
this, there are many incidents also which took place in past related with the accidents of KFC
employees because of the improper environment at the place of the kitchen but it does not signify
that KFC’s food cannot be consumed.
Diabat et. al. (2012), said that KFC does not just make delivery of good fried chicken, there are
some other options also which are liked by customers. Various control activities are also there
which are carried out by the company in order to solve different issues and risk and also for the
welfare of the community, employees and customers. It has also been said by Bachev (2013),
that franchises such as KFC are very beneficial for the economic growth of the nation. In
addition with it, as the part of the KFC is also a part of the corporate social responsibility
programs and have its involvement in social welfare programs and activities.
Ghadge et. al. (2012), said that there are numerous risks which are having an association with the
fast food outlets. The major concern for fast food outlets is related to the safety of food.
Personnel of the outlet are being trained in regards to the safety of food but there is the
possibility that he may not take concerns related to food safety in a serious manner. There can be
issues regarding the foodborne illness because of food which is contaminated previously. Bosona
and Gebresenbet (2013), explained said there are also risks related to a fire. There are lots and
lots of cooking in restaurants or fast food outlets with the use of high temperature. Whenever
there is fire, high risks are there as the outlet is full of the customers. Although the majority of
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the staff of cooking are experienced and trained with the fire-related works and there are several
safety equipments in the outlets.
Rutsaert et. al. (2013), defined that major risk in association with the fast food outlets like KFC
is related with the customers, operations and employees in the society or locality where they
make operations. From the starting of the operations, acknowledgement of such risks are being
done by organisation and made implementation of different activities as well as strategies for
minimising such risks.
Reasons to minimise the risk
The main priority with each and every fast food outlet or business is the customers which
supports them to make profit or success in the market in a proper manner. If less risk will be
there with the business then more and more customers will get attracted and this is the only
reason why there is the need to minimise risk. Dabbene et. al. (2014), the first priority for the
business association is its customers. KFC is giving services to many customers all over the
world. In Australia, it is giving services to around 2 million customers and the company is taking
various new steps so as to maintain the level of nutrition and freshness in the food which is being
served.
As per Green Jr et. al. (2012), in the food industry risk management is having the great
significance as the risk may result in various issues related with the productivity and growth of
the business. When the food business does not follow all the policies then the health of the
customers could be on risk as the food product’s mismanagement may give several illness
outbreaks. The risk is such a thing which is being faced by the business on the daily basis.
Whether internally or externally, there are numerous things which can give threat to the
productivity of the business at any point Green Jr et. al. (2012), says that comprehensive risk
management strategies in the business do not just improve its livelihood but also make an
increase in the business's profitability. If no proper plan will be there then food business may
have high financial losses. Leaders of the food industry must protect their business from different
kinds of potential risks which are having a relation with a world full of technology and
competition. With a large number of procedure having their presence online, a growing food
industry stores the majority of financial and personal data digitally.
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Strategies and activities to minimise the risk
Rutsaert et. al. (2013), explains that in order to attain high growth and success there is the need
to carry out several activities and strategies which will support in minimising risk associated with
the business. The first and most significant step regarding risk management is to assess the
current state. Proper information must be gathered by the business regarding the suspect of the
risk and what steps should be taken in order to reduce it. Discussion regarding the current state
will support in a better manner to make the formulation of the accurate plan in relation with the
business. From that point, a business must start implementing the accurate strategy. After this, a
plan must be communicated to all the employees of the business and also to all the related
parties. It must be ensured by the leaders of the business that all the risk policies, as well as the
new procedures, are available with the old and new employees. After completing the plan of risk
management, a companywide meeting must be done and field should be opened up for
clarifications and questions.
According to Diabat et. al. (2012), improvement in the internal functions of management is being
considered as the best manner to tackle risks related to potential business. By making
optimisation of the accounting process to track warehouse and inventory, use of software like
ABM for business management can support well in reducing risk. In relation to the KFC, they
provided customers with the nutritious and good food which is being considered as their
foremost and first priority. They also take care of their employees in an effective manner and
support them to make growth. Apart from this, with the support of various activities related to
the corporate social responsibility, KFC has been supporting well to make to make improvement
in the locality's status in which they are making operations.
As per Bosona and Gebresenbet (2013), there is also a risk related with the high consumption of
water and in order to make a reduction in it, implementation of various water-saving measures
have been done by the KFC which makes a reduction in the consumption of the water by around
35%. Apart from this in order to make a reduction in risk, proper training must also be given to
the employees regarding workplace safety, customer service, procedures of safety and alcohol
serving. There must also be proper protection of technology with the support of security cameras
and antiviruses. All these factors will be very supportive in risk minimisation.
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5. Research Questions/Hypothesis
In order to carry out the research in an appropriate manner, there is a need for some research
questions which must be answered in a proper manner. Some of the research questions which are
being explained here can be defined as follows:
Primary Question
 What are the various strategies which can be carried out to minimise risk?
Secondary Questions
 What are the different types of risk in the fast food industry?
 What is the need to minimise risk?
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6. Research Design and Methodology
Qualitative research: It is also known as exploratory research and is being considered as the
observation method to collect non-numerical data. As per this research, there is the description of
concepts, characteristics, meaning, symbols and description of the topic (Neuman, 2013).
Quantitative research: This kind of research is the empirical investigation in relation to the
observable phenomena through computational, mathematical and statistical techniques.
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7. Research Limitations
When research is being done, there are various limitations which take place and become a
hindrance in the presentation of the outcomes. In this research, the major limitation is in regards
to the time. In less time, more information needs to be collected due to which there may be an
impact on the reliability and validity of the results (Taylor et. al. 2015).
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8. Time Schedule
Activities Duration
Selection of topic 1 day
Resource gathering 2 days
Data collection 3 days
Data analysis 4 days
Findings 2 days
Conclusion 2 days
Submission 1 day
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