KFC-Japan history from the beginning gives a good picture of the different existing ways of managing subsidiaries. Lessons learned from successive managers can help us to identify what is the best way of seizing external opportunities in a given situation.
The dilemmas KFC is facing at the different stages of her history which can be represented with the three stages theory describes well the organizational and operational challenges usually faced by a “transnational” company.
Each appointed manager represents a specific way of managing subsidiaries or a stage of the “three stages theory”. At the beginnings, each country manager was on his own to make a success of his venture, and most had to learn the business form scratch.
The success of this new firm depends of the top management. It was a long term strategy based on adaptation to a different culture, especially for recipes.
The architecture which was a plus in America has been misunderstood in
Japan: the result was not really good because there were no client.
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I.1.3 U.S. operations: Emerging Problems
With the beginning of the economic crises, it was now necessary to build a system to gain control. That was the first point. The second point was a Merger with Heublein’s international group in Farmington.
In spite of this new organisation they were still many problems:
- subsidiaries managers uncooperative
- problem with information flow
- no common view of subsidiaries functioning
- self-using funds by country manager
I.2 Lurching towards Mid-1970s
I.2.1 KFC Japan Shaky Beginnings
- Weston ask for fund to Heublein
From a fast-food industry to a fashion industry.
KFC JAPAN developed a new marketing vision based on the “American way of life” :
- new implementation of stores
- because of high rent and limited spaces : new standards for KFC JAPAN
- adaptation to Japanese taste
- new design in products
- adjusting prices
The successful result of this politic was to increase the number of stores
I.2.2 U.S.operations facing difficulties
At the same time US company has to face up to difficulties:
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