Corporate Social Responsibility of KFC with Focus on Human Rights - Case Study Example

Running Header: CSR of KFC, focus on human rights Student’s Name: Instructor’s Name: Course Name & Code: Date of Submission: CSR of KFC, focus on human rights Introduction Business is seen as the cornerstone of prosperity in the society. This is because companies tend to create resources that improve social development as well as introducing schemes that benefit the welfare if the society. It is apparent that the role of business in society is evolving. This study shows the role of business in society and shows how companies, through their commercial activities contribute to the development of the society. This brings a distinction between civic involvement and corporate social responsibility. Civic involvement involves companies activities meant for cultivating and safeguarding their relationships with their stakeholders. Corporate social responsibility involves voluntary work that outdoes the demands of national legislation and includes environmental, social issues and human rights (Feltus et al. 2009). CSR also involves provision of housing, health care and education as other activities that most businessmen engage in for the need of the society (Ramon 2010, 67). Firms in the global market have also devoted available resources to the community for example, through the provision of social amenities in order to achieve long run interests for example through increase in profits. The strategy practiced by firms also helps to build a good reputation thus attracting desirable employees to the organisation (Andrew 2008, 90). Other worthwhile effects of using social responsibility are to reduce wage bill or sabotage. The above study examines and critique on human rights of the Kentucky Fried Chicken (KFC) company’s performance with regard to fulfilling the social needs within the society. This will involve highlighting the areas of achievement and those that require improvement. Main body According to Doug (2007, 57) KFC is a company in the line of offering meat products and has a chain of fast food restaurants based in Louisville, Kentucky in U.S. the company begun in 1997 emerging form PepsiCo and sells chicken pieces, salads and sandwiches. The company has various chains for example in India the target group includes urban people aged between 15 and 45. The people also include those that have busy lifestyle and are influenced by the western culture. KFC competitors include Mc Donald’s which occupies about 33 percent, Dominos Pizza Café’ occupies 10 percent of the, market share and others have about 15 percent. The major key success factors include location and the number of outlets. The other factor include extensive menu price service, ambience taste and quality standards. According to Jenifer (45), KFC mission statement is “To sell food in a fast, friendly environment that appeal to pride conscious, health minded consumers”. The vision statement of the company is “to put a yum on people’s faces around the world, satisfying customers every time they eat our food and doing it better than any other restaurant company. The company’s past performance is characterised with provision of good tasting recipe, brand recognition, global experience and people. These factors have enabled the company to gain its competitive advantage. The long-term objectives include expansion into all major urban cities therefore achieving market leadership. The other objective is to introduce multi brand innovation and enabling the company to become top brand in the fast food industry market leader in terms of employee welfare and customer satisfaction. The company’s financial objectives include having a strong cash generation and returns increasing the profit margin. This is to be achieved through improved operations and reduced overhead costs. The company plays various roles to the society for example through the provision of quality food, excellent service and restaurant cleanliness. This is important as the company ensures attainment of all customers needs. Porter (September 12, 2008) explain that the company plans to achieve market development, concentric diversification, creation of a great working atmosphere, developing a healthier menu and evaluate countries basing on the attractiveness and effectiveness. The company also hopes to attract new markets and overcome various barriers for example language, law and better understanding of customers needs. The long-term objectives also include staying close to the mission, keep innovating and coming up with new improved items, following the trends in the market for example introducing new items where customers will like to try. Ritzer (2004, 64) shows the company also hopes to keep an excellent image for example through proper treatment of employees and keeping good control over other franchises to ensure better procedures are followed. The company hopes to watch over possible competitors and examine whether mergers and acquisitions are available. According to Christian (2007, 126) competitors such as Mc Donalds have taken a bigger share in Boston and this has enable KFC to formulate strategies of regaining the loss of market share. KFC also has to work on cost and differentiation strategy for example by the use of competitive forces such as economies of scale, bargaining power, and brand recognition. The goals of KFC include building an organisation devoted to excellence. The second goal is delivering superior quality and value of products. The third goal to customers is to maintain commitment of innovation for growth improvement and being a leader in the market. The company also aims at generating superior financial returns in order to benefit its shareholders and employees (Fry et al. 2002, 94-106). Corporate social responsibility could mean corporate giving, community involvement, community development or corporate social marketing. The above titles mean a commitment to improve the well being of a society through open business practices or by offering contributions that help a community as whole. The activities carried out are not mandatory but voluntary practices meant to describe a business as socially responsible. Social responsibility enables an organisation be part of sustainable economic development. This is will be achieved by interrupting with community families, employees and the entire society and enabling these communities improve their standard of living (William and David 2010, 97). The other theory that influences the corporate social responsibility is the stakeholders’ theory which broadly represents various components of corporate responsibility. The discussion of this theory contrast especially where many people believe that the reason for involving a business in social responsibility is to increase stakeholders’ profits. Milton Friedman’s shows that the reason for participating in social responsibility is to increase profits but this has raised issues since more benefits are achieved through CSR. Stakeholders include any individual who may affect or is affected by the many activities carried out in a firm. The benefits achieved by stakeholders are therefore more than maximisation of profits to stakeholders (Brand 2007, 47). Stakeholders’ theory assumes that in order to maximise business potential managers should aim at having a broader view about every stakeholder’s interest. This is important as managers become aware of the various strategies to employ in order to become competitive for example if it is in a global market. The theory also shows how the business activities affect various stakeholders in the firm for example the employees, suppliers or financiers. According to Feltus et al. (2009, 29), every firm should try to fit in a general stakeholder map that consists of stakeholders with specific needs for example financial community, activist groups, unions or trade associations can fit well as specific stakeholders. According to Bulleit (2009, 52) rational managers will therefore have to consider the impact on all the specific stakeholders before making decisions. The other contrast of Friedman’s view of maximisation of profits is that if the business only aims at profits then it overlooks the stakeholders’ needs. The stakeholders’ theory therefore suggests it is unwise for managers to overlook other specific stakeholders while making decisions as this would not be ethical. Pitts et al. (2009, 87) shows KFC is a reliable and accountable corporate citizen and committed to the communities. This is enhanced by working closely with everybody who is in one way integral to the success of the business. These include stakeholders such as suppliers, the government, employees and the shareholders. The company believes that there is an indisputable connection between sustainable activities and business outcomes. Sustainability and reliability is therefore an outcome of responsible businesses, development of people and most importantly helping the communities thrive (Subhabrata 2007, 90). It also involves how the communities around the company perceive it to be. This is done in dedication of the business effort to always serve a higher cause since at the end of business success, the most important thing will not be how much the company got but how much the company gave out in return (Chris 2009, 165). This is corporate social responsibility where the company aims at observing areas such as the community, the marketplace, the workplace and the environment. KFC CSR aims at strengthening local communities, promoting equal opportunities at the working environment, developing people’s efforts and enhancing customers’ wellbeing and comfort (Webb April 23, 2000). In corporate social responsibility, KFC has participated in formal activities for example in helping the disabled children and young adults in AmRest’s home town of Wroclaw. Jennifer (April 21, 2004) puts it that in this mission, KFC employees learned a great deal about the community for example in providing for various special groups. This was through spending time to know each other, playing games and working closely with their therapists to help in rehabilitation activities. KFC treated the children with chicken wings to make them have a wonderful experience of the food offered by the company. The company is therefore as good as the people working for it and offers both internal and external human capital development programmes. KFC utilizes every opportunity to enhance the quality of lives of the communities around them. This is for example by building environmentally caring culture for their stakeholders from all walks of life. To the environment, KFC aims at recognizing and being responsible in the maintaining a better environment for every stakeholder and the community. This is for example by undertaking the management of waste. The company set up Ayamas Port Klang in 1988 for the treatment of discharge waste water according to the DOE standard of discharge (David September 14, 2003). The plant has significantly helped in the reduction of costs. KFC also introduced another waste treatment facility in Johor which began in 2008. The facility uses sequential batch reactor process for treating final discharge waste water. Fields (2002, 142-145) shows in 2008, KFC also organised the National Champs Challenge in Penang. This was to represent the best of the best restaurants managers. KFC emerged the winner and represented Malaysia at the regional Champs Challenge. In representing the community, KFC walked for charity to help Malaysia in support for hunger relief period in 2008. The walk for life raised RM 1 million from the sale of wristbands and other donations. This walk involved about 1200 employees of KFC. Conclusion In examining the human rights of the company’s performance with regard to fulfilling social needs within the society, KFC achieves the above through various factors. One is by encouraging new and innovative ideas since these are major factors of competitive growth. The company also rewards results and not simple efforts. This enables the employees to ensure effective servicing. It also dedicates to continuous growth in sales, profit and increase in size of the business. Finally the company aims at working as a team. References Andrew, C. 2008. The oxford handbook of Corporate social responsibility. California: Oxford University Press Inc. Brand, Strategy. 2007. 10 key things to know about CSR. London: Springer. Bulleit, Jim. 2009. "KFC's Secret Recipe Returns Home". Louisville weekly. Chris, Mallin. 2009. Corporate social responsibility: a case study approach. California: Edward Elgar Publishing. Christian, Bacher. 2007. Corporate Social Responsibility. Michigan: GRIN Verlag. David, Montgomery. 2003. Small But Mighty Rights Group Tries Gentler Approach. 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Subhabrata, Bobby. 2007. Corporate social responsibility: the good, the bad and the ugly. Michigan: Edward Elgar Publishing. Webb, H. 2000. "Power to the People". QSR Magazine. April 23. William, Werther and David, Chandler. 2010. Strategic Corporate Social Responsibility: Stakeholders in a global Environment. London: SAGE Publications. Read More