Discussion 2 Using “The Seven-S Framework” from pages 58-59 to examine a firm with which you are familiar and address how the firm stacks up in respect to the “qualities of excellence” list on page 59. Does alignment with this list help explain why the firm is currently successful or unsuccessful (use any metric you think is appropriate to judge success)? “According to their theory of organizational strengths and weaknesses, there are seven attributes (seven S’s) or basic levers that management can manipulate to steer large and complex organizations to excellence… 1.
Strategy—the extent to which an organization has a logical sense of the actions it must take to gain sustainable competitive advantage over the competition, improve its position in relation to customers, and allocate resources to high-return activities. ” (Marcus, 2011, p. 58) Yum states that their strategy is “Our ability to make a positive difference in the lives of people throughout the world is virtually unlimited, and it starts with a clear focus and commitment to getting better. We have chosen to leverage our clear strengths: our expertise – we like to call it know- how – and our people. ” [ (Serving the World: Yum!
Brands 2008 corporate responsibility report, 2008, p. 11) ] Beyond the focus on expertise and people, Yum Brands uses strategy to determine which neighborhoods to build in and which of the company’s brands to build there. The company also uses the neighborhood social structure and demography to determine whether they should build a single brand store or a combination store. Yum Brands also owns two other brands, Long John Silver’s and A&W but divested most of the stores in these brands to allocate their resources in improving and expanding the higher-return brands of KFC, Taco Bell, and Pizza Hut. 2. Structure—the extent to which an organization has a coherent form for dividing labor, allocating responsibilities, coordinating tasks, and ensuring accountability…3. Systems—the extent to which an organization has explicit descriptions in place to show how processes work and tasks are accomplished in critical areas such as capital budgeting, manufacturing, customer and supplier relations, accounting and performance measurement, and carrying out mergers and acquisitions. ” (Marcus, 2011, p. 58) “In October 1997, Yum! Brands was spun off from PepsiCo as Tricon Global Restaurants, Inc.
At that moment we established a singular goal from which we’ve never wavered: To be the best in the world at building great brands and running great restaurants. ” [ (Serving the World: Yum! Brands 2008 corporate responsibility report, 2008, p. 8) ] The structure was already established for the division of labor, allocating responsibilities, and the coordinating tasks for the different restaurants. Yum had to ensure that different stores had accountability for their specific store and they report to Yum Brands accurately.
The individual stores followed the same day to day operations and followed the same systems as they did before the acquisition and the combination stores built after the acquisition had to adjust for operating two different stores inside one location. Yum issues each store a budget for food and supplies but keeps control of capital budgeting, accounting, and carrying out mergers and acquisitions. Every task that each employee is responsible for is written in the handbooks.
There are signs hanging with directions on how to do almost everything and there are checklists for each layer of management in each store to use to ensure everything is done correctly. These checklists go up the chain to corporate to ensure everyone knows the strengths and weaknesses of each of the individual stores below them, ensuring accountability. “4. Style—the degree to which there is tangible evidence that the time, attention, and behavior of management and employees actually are devoted to, and aligned with, the organization’s real strategic needs (not just lip service but real action)…5.
Staffing—the degree to which management and employee expertise and experience match the jobs that have to be carried out, the extent to which the personalities in place are capable of working together, and the degree to which there is sufficient diversity among staff to allow opposing and dissenting voices to be heard. ” (Marcus, 2011, p. 58) The style and staffing I placed together because every level is engaged with the other levels and all levels are customer focused. The company prefers to keep employees and promote from within.
Many of the people working in the corporate offices have also worked in the stores and are fully trained in many of the low level jobs. “Our focus on Customer Mania starts with our hiring philosophy – to take what our company stands for and use that to find the kind of people who have a strong chance of being happy, productive and successful working here. Because we have a consistent set of values, a well-defined and unique culture, and a clear mission for our business, we have the understanding and tools to make this philosophy work well.
We call this “Smart with Heart,” and we use it to hire for every position within our system – hourly team members in our restaurants and accountants alike. ” [ (Serving the World: Yum! Brands 2008 corporate responsibility report, 2008, p. 22) ] Yum wants every restaurant they own to focus on the same thing, the customer. “7. Shared values—the extent to which there is unity of purpose behind a common vision and culture that is taking the organization to where it should be going. ” (Marcus, 2011, p. 59) “6.
Skills—the extent to which an organization as a whole, as opposed to its employees, has the capabilities not only to compete in existing businesses but also to develop new businesses and generate corporate growth. ” (Marcus, 2011, p. 58) The company as a whole has generated growth and is changing how many people decide which of the fast food restaurants they will spend their money at. They are designing stores around ensuring that the customer has choices and that they are pleased with the quality of the products and service they receive for that money.
They are developing different menus to accommodate for healthier diets and for those that desire to try something different. “The qualities of excellence that arose from the blending of these elements were: 1. A bias for action, 2. Closeness to the customer, 3. Autonomy and entrepreneurship, 4. Productivity through people, 5. Hands-on and value-driven operations, 6. A willingness to stick to the knitting, 7. A simple form and lean staff, and 8. Simultaneous loose-tight properties. [ (Marcus, 2011, p. 59) ] Yum Brands has proven to be successful at the blending of the elements that are qualities of excellence. Many of these are established just through their style and the way they hire staff. Everyone knows that the customer is the complete focus of everything that they do. This establishes closeness to the customer, productivity through people, hands-on and value-driven operations, simple form and lean staff, and simultaneous loose-tight properties. The Company has given every employee the right to act to assist customers and has a policy for handling unhappy customers that ensures that action can be taken.
Reference Marcus, A. A. (2011). Management strategy: Achieving sustained competitive advantage (2nd ed. ). New York: McGraw-Hill Irwin. Serving the World: Yum! Brands 2008 corporate responsibility report. (2008). Retrieved 11 14, 2012, from Yum: http://www. yum. com/responsibility/pdf/yum08csrrpt. pdf