KFC Case Study
When KFC decided to expand into the Japanese market, the company hired Loy Weston to head up the venture even though he lacked fast-food experience. Weston did however, posses a great entrepreneurial spirit that had garnished him success in the past. For this reason the company felt that Weston would be the best choice for starting the new venture in Japan.
In the beginning Weston showed great insight. For instance, he hired a Japanese national to help him break the ice in the Japanese market. Second, he was smart enough to realize that Tokyo should be the focus of attention. Third, the strategy of open one store and making it successful before moving on to the next ensured that his talents were not spread to thin. Finally, he was smart enough to change the menu so that it catered directly to his target market.
When KFC was bought out however, the new U.S. based management team demanded more control over their overseas operations. Weston was faced with several choices: resist these attempts, comply halfway, or establish better lines of communication so that both the needs and wants of headquarters and well as his own were understood.
Weston chose to fight the new corporate mandates at every turn. Instead of trying to work with the new management team to create a win-win situation, he chose a path of resistance, which turned a tense situation into a volatile one.
The executives at KFC also made an error in not visiting the overseas stores and trying to understand Weston’s position before issuing new demands. Both sides failed to open good lines of communication, which could have saved both a lot of frustration. In any situation where new management or policies are established in the middle of an existing process, the type and quantity of communication will always determine the success or failure of the venture from that day forward.