Burger King Global Operations, Essay Example

What is Burger King’s core competency? How does it relate to its chosen strategy?

Burger Kings core competency is the delivery of flamed broiled burgers with any combination or options. Burger King makes sure that the experience is different from any other food chain because they allow the customer to have their way (Manufacturing Close up Media, 2014). The Whopper is another core competency that Burger King markets as their signature product (The Food Institute Report, 2012).The main strategic advantages of Burger King are the well-publicized flamed-broil fast food restaurant. The consumers are more health conscious while demanding healthier food choices. Burger King is meeting customer health needs by offering low calories, low sodium, and choices of salads/fruit (Sifferlin,2014,para 5). They have marketed healthy options with informative calorie counter displays. The advertising of different types of salads appeals the society changes towards eating better for improved health. The low-calorie French fries attracted new customers that are seeking alternative dishes that decrease calorie intake. The additional vegetables mixture of lettuce, tomatoes, and pickles are the Burger King experience(Burger King Corp,2014).

Burger King has catered to the customers’ needs and wants of more healthy food by adding the Burger King Veggie burger which as only 16 grams of fat (Lofshult, 2006).

Another strategic advantage is allowing the customer to prepare their own hamburger the way they want it “Have it your way”. Burger King has made some strategic changes in the diet-era by adding supplementary healthy foods to the menu. These health conscious choices include different types of salads and the low calorie French fry that was been presented to the public (Cardello, 2013). Burger King has been in tune with society, consumer needs, and changing wants from customers. Burger King is brilliant at using the media to make a point about what the people want. The new slogan “Be Your Way” is a message to customers that it is okay for them to have things in life the way they want it. The slogan has perfecting time representing self-expression and choices (Choi, 2014). This is a strong bold move that delivers the same message of the old slogan but concentrating on the era of freedom of choice. This means that the paradigm shift to more healthy meals does not translate to more customers. But the deciding factor could be the difference from having a veggie burger on the menu. Burger King, Ruby Tuesday, and others jumped to fill this apparent market niche by offering healthy items. The problem was that few people actually bought these items. The restaurants soon discovered the difference between what people say they want and what they actually buy” (Dukes, 2005). The American’s wants a healthy choice which does drive change families loyalties providing a franchise provides enough options for the family. They may eat less of the healthy options does not mean the customer is not health conscious.

How would you explain how Burger King has decided to configure and coordinate its value chain? Which of Burger King’s value chain activities create the most value for the company?

In a foreign country the infrastructure is quite different than the Western United States. (Wang,2013). Burger King has mastered the art of creating a profitable value chain by developing franchises while creating their own value chain activities: resources, materials, equipment, land, and management(Farzad,2012).Burger King or McDonalds, create their own subsystems, outputs, inputs, and consumption of resources. However, in foreign countries this model does not work because they are not using the subsystems or resources already in place in Brazil or Asia (Burger King, 2014). The best example is in Asia the management of a fast food restaurant would bring in their own management teams instead of hiring management teams from Asia that understands the culture. In contrast, the building structures of an American McDonalds format would not be the same in Asia. Burger King would need to involve the local engineers to understand what type of building and shape would be conducive for the Asian customers(Chauncey,2013).  Burger Kings value chain operational must consider using the local value chains to ensure the business community.

Burger King’s gradual growth was based on the type of leadership on the management team, and had a significant impact on the value of the company. The leadership change encouraged Burger King to enter the global markets in the 1960’s. The primary goal was to expand the name and brand to foreign borders bringing about a strategic change in Burger Kings global activities. The leadership wanted global recognition and branding regardless of the language(Terry & Forrest,2008). Burger King is the best example of using visual selling of the brand to worked well in foreign countries where English was not the primary language. The Another advantage, the customers in different countries wanting Burger King fast food created a competitive advantage because they provided something different than the other fast food franchises(Burger King Investor Relations,2014). One of the disadvantages for Burger King globally is learning the taste, cultural and business trends for a specific international region. The local culture is not always very easy to navigate because of some many local variables, traditions, and languages. It has been proven that every country has its own develop taste and cultural tendencies(Kabbage,2014).

Burger King globally expanded later than its main fast food competitor. What advantages and disadvantages has this created?

The success of Burger King’s franchise in the US did not move forward globally until the new owners decided in 1960 to expand globally. The decision to expand globally has it advantage and disadvantages of coming to the market later than competitors (Burger Chef Systems Inc.,2012). The franchisees like McDonald had time to develop a solid customer based while learning valuable cultural lessons that Burger King has yet to learn. The competition has large marketing budgets and overhead(Wang,2013). Another disadvantage of entering the market late is the value chain. Burger King would have a difficult time finding the best locations, dedicated suppliers, and possible business relations because competitors are already engrained into the community.

When entering another country, discuss the advantages and disadvantages that an international restaurant company, specifically Burger King, would have in comparison with a local company in that market(Becker,2007).

Burger King learned from some of their American customs such as naming a food after a favorite American dish such as American cheese. This philosophy was utilized in the same way in Asia-Pacific fast food locations by naming the whooper “Teriyaki Angus Burger”(Manarino,2014). This is one the most beneficial operations changes that has allowed Burger King to gain markets shares in foreign regions. The family meeting place has been strength of Burger King in the community. The local football game or baseball game would bring in youths after the game. This is advantageous to Burger King because the children will determine the choice of fast food for the family(Burger King Corp,2014).

About two-thirds of Burger King’s restaurants and revenues are in its Americas region (United States and Canada) and one-third elsewhere. Should this relationship change? If so, why and how? 

The revenues from the United States regions and the all other regions are properly distributed. The two-thirds of Burger King restaurants generate revenues that allow the Burger King franchise to be financially solid at $275.1 million in third quarter(Mcgrath,2013). There have been a good mix of revenues that can compensate for non-performing financial years abroad or in the America. The economy is United States would determine the fate of Burger King, however with only two-thirds of revenue is contributed to the American Burger King Franchises is a plus. The market mix of revenues allows Burger King to survive an economic downturn in the United States and abroad(Mcgrath,2013).

The case mentions that Burger King prefers to enter countries with large numbers of youth and shopping centers. Why do you think these conditions would be advantageous?

The location of young adolescents and shopping equal profit for Burger King and other franchises have marketing to youths using nutrition, variety of meals and making their locations a meeting place. It is to the advantage for Burger King to cater to youths in the shopping mall because of the favorite place they patronize. In addition, the nutritional aspect of the marketing allows both parents and schools to promote healthy meals (Fast Food Marketing, 2013). The disadvantages are youths change with the latest trends meaning they may be loyal today but tomorrow they might not patronize Burger King.

How has Burger King’s headquarters location influenced its international expansion? Has this location strengthened or weakened its global competitive position?

One the advantages Burger King has over competitors in the global market, is they are headquartered in the Miami, Florida area. The company has a customer base of Latin American customers that they understand their taste, trends, and culture. In addition, Burger King has plethora of other foreign customers in Miami that helps them with understanding the food culture abroad. This location has allowed Burger King further brand their products with the Latin American and Caribbean customer bases (Top Franchises, 2014). The recognition of their brand has increased sales in the Latin American countries and locally. This was a definitive advantage to entering the global market with an established internationally following in Miami, Florida.

As CEO of Burger King, what tools and strategies would you use when deciding on possible future locations for the company?

The CEO Bernard Hess has publicly talked about the strategies for Burger King such as continued growth in the global market including more funds spent on development (Elicker, 2011). In addition, Burger King will spend marketing dollars on understand local customs and cultures before entering a new global market. This strategy is the most important step in Burger King growth into the future. Burger King has learned the promoting the Burger King product long before they actual enter the globally country is the best model.

What do the implications of the challenges identified in the case have for Burger King’s strategy today and in the future?

The primary challenge for Burger King will be find the right markets to enter globally. In addition, they must identify which markets to saturate and which markets are not worth setting up a store globally. Burger King should invest in research and development before considering moving to any foreign location (Elicker2011). Most important, Burger King needs to learn from others past mistakes and their own. Finally Burger King needs to be sensitive to the culture and customs when stores are located on foreign soil. In addition, the study pointed out the late entry challenge based on competitors have a built a demand for their product while Burger King is just starting however, the advantage is Burger King can concentrate of their brand without the early developmental cost.

References

Becker,N.(2007).Burger King aiming for Asian expansion. Retrieved from http://blog.euromonitor.com/2007/09/burger-king-aiming-for-asian-expansion.html

Burger Chef Systems Inc.(2012).A brief history Burger Chef Systems, Inc. Retrieved from http://jsfburgerchef.homestead.com/BurgerChefHistory.html

Burger King. (2014). Strategy and vision. Retrieved from http://investor.bk.com/conteudo_en.asp?idioma=1&conta=44&tipo=4356

Burger King Corp.(2014).Burger King celebrates the arrival of the spring season with new ‘burger fest’ menu. Retrieved fromhttp://www.bk.com/en/us/company-info/news-press/detail/burger-king-celebrates-the-arrival-of-the-spring-season-with-new-burger-fest-2890.html

Burger King Investor Relations. Investor relations. Retrieved from http://investor.bk.com/mobile/conteudo_mobile.asp?idioma=1&conta=44&tipo=44698

Cardello, H. (2013).Why healthier fries won’t help Burger King reclaim its throne. Retrieved from http://www.forbes.com/sites/forbesleadershipforum/2013/10/16/why-healthier-fries-wont-help-burger-king-reclaim-its-throne/

Chauncey,B.(2013).King meet the world. Retrieved from http://www2.qsrmagazine.com/articles/interview/112/shaufelberger-1.phtml

Choi, C. (2014).Burger King scrapping “Have it your way”. Retrieved from https://news.yahoo.com/burger-king-scrapping-way-slogan-190944964.html

Dukes, A. J. (2005). What do people want? Phi Kappa Phi Forum, 85(3), 4+. Retrieved from http://go.galegroup.com/ps/i.do?id=GALE%7CA139719289&v=2.1&u=20398_pclc&it=r&p=GPS&sw=w&asid=6c05b3442016ea4351363106fc2cba87

Elicker, M. (2011).What makes an effective leader? Burger King CEO shares his philosophy. Retrieved from http://biznews.fiu.edu/2011/12/what-makes-an-effective-leader-burger-king-ceo-shares-his-philosophy/

Fast Food Marketing. (2013).Fast food facts: Food advertising to children and teens. Retrieve http://www.fastfoodmarketing.org/media/FastFoodFACTS_report.pdf

Farzad.R.(2012,April).Burger King returns to the market: Flip,rinse,repeat. Retrieved from http://www.businessweek.com/articles/2012-04-04/burger-kings-ipo-flip-rinse-repeat

Forrest,H.&Terry,A.(2008).Wheres the beef? Why Burger King is Hungry Jacks in Australia and other complications  in building a global  franchise brand.Northwestern Journal of International Law & Business.28(2),171-213

Kabbage.(2014). How to break through the languge barrier. Retrieved from https://www.kabbage.com/blog/how-to-break-through-the-language-barrier#

Khurana, A. (2010).Marketing strategy of Burger King. Retrieved from http://www.managementparadise.com/forums/marketing-management/209220-marketing-strategy-burger-king.html

Lofshult, D. (2006, May). Whopping Burger King stats. IDEA Fitness Journal, 3(5), 79. Retrieved from r&p=GPS&sw=w&asid=29b0c4267efe2cdf3b9c4cc097f05020

Mcgrath,M.(2013). Burger King profit up whopping  cost savings. Retrieved from http://www.forbes.com/sites/maggiemcgrath/2013/10/28/burger-king-profit-up-on-whopping-cost-savings/

Manarino,M.(2014).Adventure:Nothing says spring like Burger King Japan’s Teriyaki Whoppers. Retrieved from http://www.foodbeast.com/2013/04/12/spring-has-sprung-and-its-time-for-teriyaki-whoppers/#Bfdv6bXjgxFj4idk.99

Manufacturing Close Up Media.(2014,May). Burger King restaurant updates on new slogan. Retrieve from www.closeupmedia.com

The Food Institute Report.(2012,Apr). Burger King revamps menu. Retrieved from

Top Franchise. (2013). Top Franchises: Burger King. Retrieved from http://investor.bk.com/conteudo_en.asp?idioma=1&conta=44&tipo=43566

Sifferlin,A.(2013,Sept). Food & drink have it the healthier way: Burger King reveals low-fat satisfries. Retrieved from http://healthland.time.com/2013/09/24/have-it-the-healthier-way-burger-king-reveals-low-fat-satisfries/

Wang,H.(2013).How Burger King can recover in China. Retrieved from http://www.forbes.com/sites/helenwang/2013/03/04/how-burger-king-can-recover-in-china/

Wang,H.(2013,March).Learning from Burger Kings misstep.Retrieved from http://www.chinaspeakersbureau.info/2013/03/learning-from-burger-kings-missteps-helen-wang/