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I would like to know what strategy formulation model is used in a franchiser-franchisee relationship. In other words, in a franchise like KFC, which [strategy formulation] model is used?
Does that model apply in a parent-subsidiary relationship (group of companies)?Kind Regards
SimonThe strategy of KFC is to produce cheap, standardised food internationally. The method it has chosen to expand is franchising, rather than taking over existing competitors or wholly owning outlets, so franchising can be thought of as a method of implementation.
Deciding whether to have subsidiaries, divisions or to keep everything in one company is also, predominantly, a matter of realising/implementing a strategy.
Morning Mr/Ms Garrett
Thank you for that clarification- franchising and acquiring a controlling interest in another company is a way of realizing/ implementing a strategy.
So is it safe to say that KFC in that example has adopted a rational model which aided it to come up with such a strategic action?
Also, what model then would be used by a franchisee (the person who buys KFC as a franchise)? Does it even matter for them to choose a model?
We don’t know what model KFC used, but the franchise solution fits in with the implementation stage.
I don’t think many individual franchisees use a model. They need help and a strong brand. It’s just a business opportunity.
Some franchisees have a strategy to acquire many franchises, eg all in a city, but they still might not have much say in how the franchise is run.
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