PC 3-56 Corporate Strategies time. So attractive was the coimpensation package r

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PC 3-56 Corporate Strategies time. So attractive was the coimpensation package ratio of 20 to 1 people applied for every end, B-KFC hired those applicants who were graduates, could speak some English, did not ve associate professors at the country's universities opening, In KFC in China The Very First Western Restaurant Chain Yum's KFC brand was the first foreign quick-servicgraduabes, work experience, taurant chain to enter China On 12 November 19,o the Brst KFC in China was officially opened at Beijing willingness to Oianmen, within walking distance of Tiananmen. In 2002, KPC opened the first ever drive-through restaurant in the 1,000th KFC resta with Local Culture From the beginning, KFC hired elites from na (Beijingl onlyawtrane was opened A Management Team Familiar of 2005, the Yuen China Division (including Mainland China, Thailand and KFC Taiwan, based in Shanghai, rmported directly to n and other Asian countries-some 5e Yum headquarter instead of to its intermational division. decades of experiences in the QSR industry, and most a deep understanding of the language, culture, habits andand neflecting China's market size, unique strength and im portances.h From 1987 to 2005, the number of KFC outlets grew by 50% annually, growth which was con- customs of China. As many of the management team bers were associated with Taiwan, they were n sidered exponential outside its parent market in the US, particularly in a country known for its culinary sophistica- Other than the top management team which tion developed over thousands of years. Toda y, KFC is the composed of almost all overseas Chinese, KFC was ken e nestaturant brand in China. Yum on developing local talent from day one. The restaurants in nearly 500 paid well to hire highly educated and motivated China has more than 2,300 KFC cities in Mainland China (Q3 2008)2 staff, and used its training system to develop those staf into future restaurant managers or even district managers. were university graduates, some from top schools. This strategy paid off when the company decided to expand a gressively after 10 years in China. Joseph Han, Operating general 80% of China KFC's district general managers by ut Initial Stage-Replication with Localisation in Mind In 1987 KFC set up a int venture, BKFC with Beijing Animal Production Company and Beijing Board Vice President of Yum! Brands in greater China from Tourism Board to 2003, described KFC China's people strategy order to gain access to better product supply and F&B; China, KFC understands the importance of people's talent.... In the United States, in the fast foord management authority. Sim Kay Soon, a Singaporean who 19 had held area manager and training officer positions within KFC system since the 1980s, was appointed to be its the first Chains, it is ery dfficult to hire very high-quality general manager, nesponsible for day-to-day operations Positions below (and including) assistant managers were all held by Chinese nationals. The company started u ing local food ingredients from day one. Chicken was people, especially on the cook labour side. So in China KFC built very aggressive talent recruitment projects It went to unicersities to hire university students. KFC hired management trainees with very qualificed univer y grauates... There are a total of 22 branch offices purchased from Beijing Animal Production, and potatoes, for Yum! Brands in China and the general managers cabbage and carrots were all purchased locally. However cooking equipment was mostly imported, such as blenders, are now already 90% lo alised. Those people actually. 20 years ago, started at the restaurants as the cook per- som, or as a management trainee. This talent pool has heating racks and even cash registers The first Beijing outlet represented KFC's largest become their great asset for the future development. restaurant worldwide with 1,400 square metres of space an o spf during Time of crisis space for B-KFC staff. Only four months after opening, the Beijing restaurant had become the highest-selling single KFC store in the world KFC chose to put down roots in big eastern cities along the coast in the 1980s and to go west in the 1990s. Like many The response to B-KFC's recruitment was over- foreign enterprises, KFC's expansion route was from east to whelming as the base salary offered was set at 140 RMB west, from cities to towns, and blanketed China with wider per month, about 40% more than could be earned by coverage by linking outlet presence in cities and towns

Explanation / Answer

Strategic recommendation for KFC in china is to go for ownership rather than franchising as its model is complex and if it goes for ownership it can gain close control over every aspect of the company. This type of model permits centralized purchase leading to reduction in cost and increase in profits

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