Yum China Case

1. What are the challenges that Yum had to overcome in China to build its position?
 Without support from local government in the early days.
 Building a team based in China and with experiences
 Deal with the difference of attitude toward meals between Chinese and the westerns
 Third-party supplies did not exist in the early days.

2. What are the key success factors for Yum China? Analyze the factors in terms of its business model, operations, and leadership.
 Business model: Joint venture partners and franchisees in the early days when the government did not allow foreign companies to operate without a local partner, and changed to company-owned units when the government began allowing wholly owned foreign enterprises.
 Operations: Stable and high-quality sources supply chain; Fast expansion of stores and development of products; Innovation
 Leadership: Learning organization

3. Why do Chinese KFCs have a high level of variety in menu? How can they support it? Does it make sense?
 Because food is culture in China -at the very heart of society, Yum added many kinds of food to the menu to cater to Chinese customers.
 Customized its menu with localized items include spicy chicken dished and local dishes.
 Yes, more variety made more people have lunch in groups to KFC. And make people view KFC a good place that is clean with lots of neatly dressed, smiling staff and many dining options.

4. (1) How did Yum succeed while so many other Western companies have failed?
 Well localized, with lengthy menu to meet local culture
 Building supply chain
 Flexible business modal
(2) Why was KFC able to do this while McDonald’s did not?
McDonald’s insisted on its own business operation modal, and was not willing to change in China market.

5. Sam doesn’t want to make the same mistakes that fast food restaurants have made in the West. (1) What are those mistakes? (2) How does “New Fast Food” address them?
(1) Making people think fast food