The Kentucky Fried Chicken Firm’s Risk Management

Paper Info
Page count 5
Word count 2163
Read time 10 min
Topic Business
Type Report
Language 🇺🇸 US

Kentucky Fried Chicken Firm's

Executive Summary

Risk management is the process of identifying, analyzing, assessing, and controlling threats to an organization’s capital earnings. Risk management is important as it enables a company’s success (Corporate Finance Institute, n.d). “Effective risk management means attempting to control future outcomes as much as possible by acting proactively rather than reactively.” Risk management is vital in any company or business as it seeks to ensure that the company and the leadership of this company are aware of the threats that could occur and how they should handle them.

Kentucky Fried Chicken (KFC) is an American fast-food chain that is the second largest global after McDonald’s. KFC has since seized to expand its footprint globally from its first start-up. This report aims to assess the different types of risks that threaten the existence of KFC as global merchandise. A study by (Kaplan & Mikes 2012)” rules-based risk management will not diminish either the likelihood or the impact of a disaster.” Risks such as legal liabilities, technological issues, strategic management errors and financial uncertainties, and political and environmental threats are examples of risks that businesses face. The report contains the findings collected after thorough research conducted; some of the findings were: there was a supply problem which led to an overall operational problem. The report adopted methodology tools which were the use of secondary data such as the use of books, research reports, journals, and the Internet.

There are several risk approaches that can be used to assess the negative factors that affect a business. Political threats can be assessed by looking at the probability that political conditions, events, and decisions will affect the business. An example is the measures put in for foreign investors in other countries. The assessment of the economic risk that KFC can face concerns establishing where the macroeconomic conditions of a nation will negatively affect the investment made. The social risks can be evaluated by looking at people’s perception of the organization. Operational threats are usually assessed by looking at the system risks in the organization, external event risks, and legal and compliance risks. In order to establish the technological risks, it is necessary to check out the cloud computing and the company’s data storage.

Environmental risks can be assessed by figuring out the environmental risks that a business is likely to face, such as waste, supply chain inefficiencies, and climatic change. Finally, the legal risks are evaluated through understanding how laws apply to the business. The business scored a risk score of 52%. It is a fair score for the business, postulating that the business experiences medium-level risk capacity. Recommendations can be made to ensure that KFC is able to manage risks that come up within the different risk categories that it is likely to face. Recommendations include building the supplier base stages such as trader evaluations, negotiations, and contracting to ensure that the company follows the laws imposed in the nations they are based on.

Introduction and Business Overview

The purpose of the risk management plan entails helping identify risks and deal with them as they arise, to assess, developing responses and developing a contingency plan. Kentucky Fried Chicken (KFC) is an American fast-food restaurant chain that operates globally. KFC was founded by entrepreneur colonel Harland Sanders in Louisville, Kentucky (Uddin, 2020). The colonel began operating from the roadside at the time when the US was facing a great depression. At the time, a hamburger was the most common and favored fast food. This was Colonel’s biggest competition rival in the Fast-food industry.

In fact, KFC is mostly known for its crispy and flavorful fried chicken, which is the central ingredient in all main dishes. The company managed to keep the secret of its products’ unique taste throughout all its existence. KFC has been operating since it was founded by Colonel Sanders in 1952, when the first franchise was opened in Utah. KFC has more than 48 thousand restaurants in over one hundred and forty-five countries with more than one million workers (Craft, n.d.). The fast-food restaurant chain gives 1.5 million of workplaces for people around the globe irrespectively of their nationality, race, or gender (KFC, 2019).

Stakeholder Discussion

KFC’s organizational structure is remotely influenced by the perspectives and opinions of stakeholders. They are people who have financial or other interests in the company and may affect its policies as well as be affected by them. As a rule, the stakeholders are divided by their interest in company’s success and their influence on enterprises’ decisions (Business Communication Skills for Managers, n.d.) Shareholders are referred to as those who own shares of capital in a company with equity. They have the responsibility of creating a good and safe environment for employees, offering them wages as a reward (Stein, 2018). Customers are people who buy goods and services from the company. They are critical stakeholders because they create the need for the business to exist. Customers from the demand for the company’s goods and services influence its profits (Kokemuller, n.d.). Employees are the primary stakeholders of the business, as their major tasks concern the creation, selling, and distribution of products and services (World Economic Forum, 2021b). Employees constitute the link between the business and the customers. In addition to the three most typical ones, we should also remember such economic subjects as the state, the regulators, the public, and the media, which passively observe the actions of the company. These examples are the most significant for the company, because they show a different type of influence on its activities and can both hinder and accelerate the development of the project (Table 2.1).

Stakeholder List
Table 2.1: Stakeholder List

At the same time, the following figure shows us a more detailed representation of the cumulative interests and influence of shareholders on the company (Figure 2.2).

Stakeholder Interest/Influence
Figure 2.2: Stakeholder Interest/Influence

Business Philosophy

In fact, corporative philosophy is a set of principles and beliefs that a company uses to decide how to handle different areas of operation. A business philosophy outlines the business’s purpose and its goals (How to Create a Business Philosophy, n.d.). The core elements in this section are based on the overall business objectives and purposes and reflect the direction and motivation to operate within the market. The business philosophy is reflected in daily operations as well as in strategic plans aimed at developing certain aspects of doing business. Every employee at all echelons of the company should know by heart and apply his or her workforce only if it will bring the expected result for the company, as laid down in the corporate’s vision.

Business Name

Kentucky Fried Chicken Firm's

Business Vision

KFC’s vision statement seeks to meet its future business conditions that it will incorporate for the smooth running of the business while still ensuring customers’ satisfaction and providing quality foods and services (KFC, 2019).

Business Mission

KFC sees its main aim as providing people with high-quality and tasty food prepared with fresh ingredients. In short, the company’s mission may be formulated the following way: “to serve finger-lickin’ good food to all our customers!” (Yum!, 2).This statement shows the employees and the customers that the company values them and does its best to satisfy their needs and meet their demands in terms of service.

Business Organizational Chart

As described in the following figure, the 6-level structure of the company is simple, which allows you to respond quickly and efficiently, distributing responsibility to the most important areas and solving problems locally (Figure 3.1). The most significant personalities are the company’s CEO that represents management board and general manager Dyke Leverages that is responsible for the lower company’s structure with average-level managers and their assistants.

Business Organizational Chart
Figure 3.1: Business Organizational Chart

Business SWOT Diagram

One of the most common types of comprehensive business analysis is the SWOT analysis, which allows you to determine the 4 main focuses of interest. On the one hand, the data provided provides information on the current situation, which can be found in the strengths and weaknesses sections. On the other hand, this type of analysis projects the company’s opportunities in the future under opportunities and threats (Figure 3.2).

SWOT Diagram
Figure 3.2: SWOT Diagram

Business Risk Register

In fact, risk provision methodology is majorly based on the systematic analysis of the risks that surround the company’s activities (Frue, 2019). Each product factor is exposed to a certain risk, which must be measured in its relative risk and the necessary decisions must be taken to prevent problems related to this risk (Table 4.1).

General Risks Provisions
Table 4.1: General Risks Provisions

Business Policy and Procedure Examples

Business policies and procedures are significant in the operations of any business to help in achieving success. These act as guidelines that help an organization achieve its set objectives and goals. Goals and objectives are necessary requirements that aid shareholders in measuring the progress of the business (World Economic Forum, 2021a). Shareholders and managers may also use them to establish whether the business is operating according to the set goals influencing the direction of the business.

Capital participants also set the specific procedures that the employees of the company are required to follow for efficient service delivery and to make quality products for the customers. These goals and policies lay out the employees’ needs and are also key in measuring progress. KFC has usually strategized by using the push and pull method in its product delivery method to draw in customers towards its products. The goal of push marketing is to bring and show the products of a particular company to the customer, and this form of marketing is more proactive and purpose-oriented (Radd Interactive, 2020). At the same time, crispy fried chicken production gave the business its ability to gain customers’ interest without using severe and explicit advertising strategies. Consequently, the price for customers’ attraction is lowered due to the company’s influential business policy.

The trade secret that KFC uses to make its fried chicken that is only known to the company and its employees is a business strategy and procedure that has helped it stay up on top as the most preferred fast food of all time. KFC has adopted the seven P’s that help in its day-to-day activities and business prosperity. They include people, product, price, promotion, place, packaging, and positioning (Bhasin, 2017). These factors have been the core base for the success of the enterprise over the years.

Risk Radar

Risk radar is database software that assists managers in identifying, evaluating, prioritizing according to rank, and transmitting information regarding risks the project may possess. The database enables project managers to delete and add risks during the ongoing project activities. It helps in eliminating activities that may not align with the project goals and may be under performing (The Risk Radar and the View of Risk, n.d.). Apart from that, the managers can generate both short-term and long-term risk reports by disserting information from the software and sharing it with other project members.

The model allows to rank risks according to their preference of occurrence. It may help managers prioritize the risks and be able to plan accordingly. It is a kind of mitigation measure that helps reduce the occurrence and effect of the risk on the project’s development. The risk radar also comes in handy during the project’s inception in the budgeting of funds required to undertake the project and is also useful for emergency planning. Low levels of risk are those the effects of which may not be as adverse and may not necessarily stop the project (The Risk Radar and the View of Risk, n.d.). Middle-level risks require the attention of members, with their effects manageable. High-level risks require utmost attention since their effects are adverse and may change the course of the project (Figure 4.2).

Figure 4.2: Risk Rating, KFC

No. Risk Rating
1 Location 4
2 Competitive landscape 2
3 Compliance 3
4 Social media presence 1
5 Products & services 3
6 Business cultural environment 3
7 Financial performance 7
8 Environmental footprint 5
9 Training 4
8 Gender equality ratio 8
9 R&D 8
10 Governance 4
Total Risk Score 52
KFC Risk Radar
Figure 4.3: KFC Risk Radar

Report Conclusion

A risk plan is a document that gives an overview of the business or a company that helps them identify the risks that are likely to occur and evaluate and plan for all risks. The report has covered areas of stakeholder analysis, the business philosophy overview, top risk affecting the business, the risk management policies and procedures, and risk radar. The business scored a risk ratio of 52 percent. This was an average score that included the top ten risks that were identified. Gender equity ratio and R and D were the highest-ranked risks scoring an 8. Social media presence did not pose a great risk for the business. Recommendations include revising the business’s recruitment policies and their adjustment to ensure they consider both genders equally, increasing their marketing aggressiveness, and offering more products to accommodate all customers.

Risk Percentage Measurement
Figure 4.4: Risk Percentage Measurement


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Cite this paper


NerdyBro. (2023, April 4). The Kentucky Fried Chicken Firm's Risk Management. Retrieved from


NerdyBro. (2023, April 4). The Kentucky Fried Chicken Firm's Risk Management.

Work Cited

"The Kentucky Fried Chicken Firm's Risk Management." NerdyBro, 4 Apr. 2023,


NerdyBro. (2023) 'The Kentucky Fried Chicken Firm's Risk Management'. 4 April.


NerdyBro. 2023. "The Kentucky Fried Chicken Firm's Risk Management." April 4, 2023.

1. NerdyBro. "The Kentucky Fried Chicken Firm's Risk Management." April 4, 2023.


NerdyBro. "The Kentucky Fried Chicken Firm's Risk Management." April 4, 2023.


NerdyBro. 2023. "The Kentucky Fried Chicken Firm's Risk Management." April 4, 2023.

1. NerdyBro. "The Kentucky Fried Chicken Firm's Risk Management." April 4, 2023.


NerdyBro. "The Kentucky Fried Chicken Firm's Risk Management." April 4, 2023.