VRIO Framework of KFC
VRIO framework use to find out the core competencies or sustainable competitive advantages which are helping firm to operate profitably in long term. For KFC, we try to find out its competitive advantage where we used four key components which help to identify in what KFC have competitive advantage compare to its competitors.
Resources Valuable Rare Inimitable Exploited by the Organization
Experience X X
Location X X
Price X X
Advertisement X X X
Through the use of VRIO framework we have found that brand value and the recipe of making food in KFC are its competitive advantages. The reason behind these-
Brand: The ...view middle of the document...
Because, the recipe is a trade secret it has been rare with and very much inimitable. And because it is so valuable the organization has exploited the recipe but very slightly, by introducing new menu items.
Value Chain of KFC
Fig.: KFC’s Value Chain
Porter Value Chain Analysis of KFC:
In our value chain analysis we broke down the total service provided by KFC in several set of value creating activities and found out in which stages KFC add value through exceeds the cost of the activities, thereby resulting in a profit margin for KFC.
• The primary value chain activities are:
Inbound logistics: Chicken, buns, bread, oil, flour, spices, vegetables, corn flour, potato and other raw materials.
Operations: Cleaning, mixing raw materials with herbs and spices, Storing, etc.
Outbound Logistics: [the warehousing and distribution of finished goods- but what I shud write not sure]
Marketing & Sales: Promoting offerings product through billboards, posters, low price offers, etc.
Service: KFC provides after sales service by serving their foods to customers.
Inbound logistics and operatios, these two stages, are the key primary activities which give KFC the cost advantage with superior quality. By doing so, these stages ensure KFC’s profitability.
Procurement: Transcom Foods Limited has obtained the franchise rights of KFC. The franchise agreement provides for buying approved equipment, service ware and the cooking recipes from KFC approved suppliers, i.e. In Bangladesh, BRAC Poultry is the key supplier for KFC’s chicken but flour is exported from a company named Mitsides. With centralized distribution of food purchasing and ware provider, this gives KFC a great strength as quality could be ensured. Cost control is achieved as KFC purchases their supplies in bulk directly.
Technology & Systems Development: There is such no product technology or research and developments...