Yum! Tunes Culture For Breakthrough Results
November 2, 2009 4 Comments
Yum! Brands (owners of brands like KFC, Pizza Hut and Taco Bell) identified three key initiatives across its brands: 1) selling more healthy items; 2) offering a greater variety of drinks; and 3) changing menus according to the time of day. But the company was not in a position to take on these bold initiatives. According to an article in the Economist:
The main obstacle to such ideas was Yum!’s corporate culture, in which different brands and operations in different countries had little to do with one another, slowing the spread of new initiatives.
When Yum!’s CEO Dave Novack visited its very successful Chinese organization, he noticed employees using terms such as “future back vision”, “bold request” and “action versus activity” which had created “a healthy dissatisfaction with the status quo.” It turns out that many of these ideas came from John O’Keeffe, a management consultant.
That’s why the company engaged O’Keeffe on what Novack calls the “biggest culture-change initiative in the world today.” O’Keeffe helped create Yum!’s “Achieving Breakthrough Results” program which was designed to be passed down from manager to subordinates across the company — starting with the company’s top 200 executives.
My take: Kudos to Novack for recognizing that Yum!’s culture is a critical element of the company’s performance. He’s clearly practicing the first of my 6 New Management Imperatives: “Invest in culture as a corporate asset. ”
While CEOs can push some change into their organizations, corporate cultures determine the effectiveness of those efforts. In some cases, a corporate culture will accelerate results while in others it will dampen or even block the results.
If corporate culture is hampering your company’s performance, then it’s time to address the issue. Rather than continuing to waste money and time on partially successful initiatives, you should make the long-term investment in improving your corporate culture.
The bottom line: Figure out if your culture is an asset or an obstacle.
About Bruce Temkin, CCXP
Another great post Bruce. Couldn’t agree with you more. Although I will say I doubt that Novack will be successful in his attempt at influencing the culture change necessary to take Yum into the future. Chain CEO’s simply don’t have the experiential IQ to pull it off, no matter how many O’Keeffe’s they hire. I hope I’m wrong but I don’t see any evidence of it yet, especially after the KFC fiasco’s.
Jeffrey: Thanks for sharing your thoughts. It will defintiely take a lot from Novack. Hopefully for Yum! he has (as you mention) the experiential IQ to pull it off.
Especially since not one initiative is focused on increasing value for or in the guest experience.
I have to say that the quantity value Box meals at 4.99, the $.79,$89,$99 value menu, and theres always a third special its a quality item featured at a lower cost to the consumer. Where is it cheaper???