Success Strategies for the Restaurant Brand International

 

Success Strategies for the Restaurant Brand International

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Success Strategies for the Restaurant Brand International

Introduction

As a result of the competition in the hotel and restaurant market, there is need for the Restaurant Brand International to come up with great strategies that will ensure that it emerges the best in the industry. These strategies must bring sustainability and assist in attracting more customers to the hotels, and this will consequently result in huge revenues for the company and accolades in global recognition. A plan that focuses on both the Red and Blue ocean strategies is very vital in this scheme. That is because the program will play a significant role in ensuring that the company has a competitive advantage and also, brings up the necessary elements that will see the creation of a relatively more stable Red Ocean strategy.

Company Description

Falling under the list of one of the best globally renown quick service restaurant, the Restaurant Brand International has close to 23000 locations all over the world and also multiple of them in the United States (Resturant Brand International, 2016). After the merger between the Tim Horton company and the Burger Kings, the restaurant was able to see the restaurant grow into a global sensation.

Multiple Key Environmental variables impact the situation of the RBI restaurant.

Primary Environmental Factors

The variables have been determined after carrying out a thorough SWOT and PESTLE analysis to establish what will be the real situation in the future of the company. These factors are some of the major contributors to the success of the restaurant and the determinants of whether it will beat the competition from other businesses or succumb to it. The Restaurant Brand International needs to first establish these factors before coming up with a strategy and an implementation plan (Elearn, 2008). Some of the primary factors that affect the restaurant include both the external and internal factors.

The competition getting experienced from other restaurants is one of the major external factors that is a major focus on the developing of a new strategy. That consists of both international and local brands that have been on the rise globally. Policies from the state that have both positive and negative impacts are also external factors that may attribute to the success of the company (Elearn, 2008). The strategy to be established needs to focus on how the restaurant will cope with these policies to ensure that they do not affect its success in the market. Other factors to be considered during the strategizing of the plan include social, cultural factors influencing the hotel, economic factors and any other internal factors that may have either a positive or adverse effect on the growth of the restaurant.

Other factors that need to get addressed during the planning and implementation of the strategy include the political atmosphere of some countries, especially those in the war-torn areas such as the middle east cases of Syria and Iran. Technological factors are also of concern since there is a great shift in the paradigm of ways of carrying out activities of a restaurant due to the digitalization of most of these. That is one of the primary considerations of the restaurant to ensure that it keep up with the latest technological trends and consequently ensure that it remains on point in the competition.

Product and Service Analysis

RBI provides fast food services in the main cities and towns around the world, where it consists of two fast food restaurants, Burger Kings and Tim Horton, who merged to form the company and already have an established QSR. The company also acquired Popeye Chicken, another joint dealing mostly with the sale of Chicken though which operates independently. RBI has a competitive advantage in the market as the management focuses on corporate social responsibility, where the company looks forward in positively impacting the lives of people in the communities and encourages an environment that has a real perception of the enterprise.

RBI promotes core values especially in its production of food to ensure that the clients are satisfied, it ensures there are responsible sourcing and the right environment that would see to it that customers, suppliers and any other stakeholders involved are satisfied. The company also has a competitive advantage in the market in that it encourages a better relationship between its brand and the clients to ensure that the staff members and other stakeholders are conversant with their role and purpose in ensuring that the organization maintains its objectives and values in service delivery. The organization also has a strong mission statement, where its greatest aim is to ensure sustainability of the restaurants to make sure that there is the provision of quality, fast foods which are of higher nutritional value (Resturant Brand International, 2016).

Current Market Assessment

The fast food industry faces fierce competition from likes of Mc Donald’s and Dunkin Donuts who are in the same field of providing fast food services and also have a strong international brand name and recognition (Resturant Brand International, 2016). These foods have proven to be raising the competition bar, where innovations and change of technology in the service delivery are changing with time. If the company applies no regular change of strategy and innovation plans, then there is a possibility that the customers will be attracted to these other companies. The competition provides a threat in that new entries in the market, may be relatively cheaper and as a result snatching the regular clients and that will pose a threat to the company and hence the need for getting a new strategy in place.

Current Company Identity Analysis

Restaurant Brand International, being one of the biggest brands international, has some strengths and weaknesses that it has acquired over time. As a result of the merger between the Burger King and Tim Horton, RBI was able to get a relatively stronger market and hence saw a rise in the number of customers. The Brand name of the company is great, and therefore there is no need for thorough marketing to make the brand conversant. The fact that many people are aware of the products offered by the RBI is a strength which is used by the company in ensuring that there are increased sales and that the revenue of the company grows. RBI also has a strength in that it still gets benefits from the Tim Hortons and Burger King clients over time. The market force of RBI is also relatively stronger and commands an extensive customer base, where Burger King alone has a following in over 79 countries, and the same applies to Tim Hortons which has a huge market especially in Canada, Europe, and Gulf countries. RBI also has a strength in that its capital intensity is relatively lesser (Resturant Brand International, 2016).

The biggest challenges currently affecting RBI, include fierce competition from other fast food providers especially from globally renown brands such as KFC, McDonald’s, Subways and dominos. This Competition is one of the hugest challenges facing the company and hence the management has to develop strategies that will help come up with innovations so as to have a healthy competition and emerge the best so as to attract more customers and as a result increase the revenues of the organization. RBI also faces a challenge of high pricing of raw materials and also low quality of the same from the suppliers. The pricing and the quality may consequently affect the customers indirectly since they may complain about the pricing and also change their joints if the quality of the foods is substandard.

Proposed Business Plan

Given the threats and potential loss of customers as a result of strategies from other companies, there is a need for the entire Restaurant Brand International to come up with strategies that will ensure that it outdoes the competition and emerges as the overall winner. There is need first to have a critical assessment of the red and blue ocean strategies that may be adopted. However, in this case, there will need first to consider a solid Red Ocean strategy, to have a fast implementation that will see the company stabilize. That will give a chance for consideration of the Blue Ocean strategy since the opportunities at that time will be enabling.

The Red Ocean strategy will require RBI to outperform all the rivaling companies so as to get a greater share of the customers and ensure that it reaches their demand. Emerging the best in the competition will increase the prospects for more profits and growth of the company (Siddique & Shukla, 2016).

That will be first by analyzing and identifying the strengths of each competitor. For example, Mc Donald’s is a significant threat and could potentially snatch customers from both Burger King and Tim Horton due to its new mobile capabilities, where it has developed an application for accessing its products quickly. Starbuck has also established a strong leadership in the mobile commerce as a result of a change in paradigm. After identifying all these factors from the competition, it will hence be crucial for the company to adapt a better system I term of the mobile application and overall commerce, that will outdo the other companies and o e that will see to it that the clients stick to the company’s food joints (Strategy, 2015). The strategy will also encourage snatching of customers from other joints, and consequently, the company will stabilize and the revenue collected will grow tremendously as a result.

The red ocean strategy will also entail identifying the weakness of the competition. For example, fast food joint such as KFC gets marred by several flaws such as the use of unhealthy fats and calories on its products and a problem in the management of its franchises. Others such as Sub Way and Papa Johns have a weakness in their brand value as compared to the joints owned by the RBI. That should be used as an advantage to ensure that the privilege of having a strong brand value is used to the benefit of the RBI brands to attract more customers and ensure dominance in the market.

As much as MC Donald’s as one of the greatest competition for RBI joints, it also has several weaknesses that could be easily be taken advantage of. The company has had the bad publicity of late due to the public perception of it having unhealthy food which is loaded with salt, sugar, and fat. Many customers globally have complained of the same, and the issue has sparked debate internationally on the quality of their foods. RBI joints could, therefore, have this to their advantage and ensure that the quality of the foods they provide to the customers is superb so that they may not only retain the regular clients but also attract new ones and hence beat the competition and increase the revenuer they collect. As a result, the growth of the company will improve, and many people globally will appreciate the brand (Siddique & Shukla, 2016).

Another weakness that has been identified from the competition especially McDonald’s is the high employee turnover, where most of the jobs have become low skilled and low paying resulting to a high turnover of the staff members. The service delivery and the customer care is hence not the best, and this could be used by RBI brands to beat them in the provision of services. RBI management should ensure that all the staff members are well trained and skilled to handle the clients in the best ways to see to it that they will feel happy in returning to the joints and becoming regular customers.

The strategy will also entail analyzing the new competitors getting into the market, to identify what their strengths and weaknesses are and what innovations and techniques they have introduced to the market, so as to counter them and ensure that the company remains on top of the competition. By identifying what the new competitors are up to, it will be relatively easier to deliver a service that the competition can’t match (Strategy, 2015). That will entail lowering the prices that will attract the customers without compromising the quality of the foods and services.

To beat the competition, it would also be appropriate if possible to have more mergers and acquisitions with other related companies so as to strengthen the potential of the company about the enterprise. However, the M&A activities should be approached with caution and strategically to ensure that any proposed subsidiary will contribute to the IRB strategy and objectives. By either merging or acquiring more companies, RBI would have the advantage of having additional skills and knowledge and hence quickly thrashing the other competition. M&A would also ensure that the enterprise accesses a wider customer base and as a result increase the market share (Vargas-Hernández, J.G., & Martínez, 2016). It would also see to it that the range of products and services getting offered are diversified and that the business would hence have longer prospects. Through merger and acquisition, RBI would reduce the costs it incurs and also increase its purchasing power. Consequently, competition would get reduced since it would have additional intellectual property and the products and services will be relatively affordable to the clients hence a higher attraction an increased revenue (Kim & Mauborgne, 2014).

The additional international expansion would also ensure the growth of the company. RBI could enhance the number of the fast food joints to cover other untapped continents and countries. An example of this is KFC which has expanded its base to include not only Europe and America but also Africa, where it has multiple joints in countries like South Africa, Kenya, and Nigeria, which were new markets. International expansion would ensure that the company offers services unavailable in certain parts of the globe but which are I high demand. That would provide an establishment of a new base of eager clients, in an environment which will not face an immediate threat of competition. International expansion would also ensure relatively greater exposure globally and as a result, a larger global footprint, since the brand will be recognized worldwide (Elearn, 2008). Consequently, this development in future will also be a factor that facilitates more expansion, which is ideal for the objective of the company. By entering more overseas markets, the brand will rejuvenate and have a tremendous growth that will see it top in the competition.

Structural Execution Steps

In the implementation of the strategy, the mechanistic organization will be the most efficient as compared to the organic one. That is because the structure entails highly centralized authority and procedures and practices that get formalized. By use of this organization, RBI management will ensure specialization of the functions (Ross, Weill, & Robertson, 2006). It will also be relatively easier and simpler to organize the approach, though the rapid change in this method will be somewhat challenging as compared to the organic organization.

In a mechanic organization, RBI will be required to have a structure that will hold tight control and one which will encourage implementation of rules and also have a clear chain of demand to delegate responsibilities and powers in the entire organization. The advantages of this structure are that the employees will work separately and harder to ensure that the implementation of the strategies gets achieved. However, the structure may have a disadvantage I that the approach will face the challenge of having rapid changes as compared to that of an organic approach (Cojohari, 2010). RBI management will have a responsibility of overseeing all the departments and stake holders involved in ensuring that the implementation of the strategy is a success. That will be possible by having regular checkups and briefing to make sure that there is a structural flexibility.

Leadership Analysis

The organizational structure at the RBI has three key features;

1.    Global centralization, which consists of the core management team which is responsible for making core decisions for the global organization. The centralization of the body ensures that the administration of the company is sufficient and that there is an enhanced business performance. The centralized team consists of a body of the board of directors who are of different diversity and who guide the rest of the company.
2.    Functional groups-  These are groups which are engaged in ensuring that they carry out functions that provide the span of the enterprise. The group consists of the human resource, legal and IT departments which see to it that all the features that play a major part in the decision making are well carried out.

iii.    Geographical Divisions – This is the team responsible for manning up the concrete joints around the globe, with each having an executive vice president to oversee the activities.

In the long term, there will be no need to change the CEO, who is currently Tim Hortons. However, implementation of the strategic plan must be his main aim and objective and must play the role of leadership in ensuring that the implementation is valid and that the RBI beats the competition to emerge as the global sensation in the fast food industry (Resturant Brand International, 2016).

Resource Allocation Priorities and Financial Impact

To ensure that the plan is a success, there will be the need for the board to allocate more funding in the improvement of potential areas of interests such as the IT department which will play a significant role in ensuring that the application and any other area of interest have been tackled. Training and development of the human resource will also require additional funding, to make sure that the staff members get advanced training that will see them become the best in the market so as to attract more clients to the joints (Elearn, 2008). By doing so, there will be both positive short term and long term impacts regarding revenue collection, global recognition and positioning in the competitive field. Costs will also with time get reduced as a result of digitizing elements within the various departments of the company.

Final Analysis and Conclusion

If the strategic plan is fully adapted and all the factors remain constant, there will be more than 80% chances for the success of the company. RBI should, therefore, ensure that all the necessary plans get followed to the latter, the funding is also made to the appropriate departments and that all the staff members and the stakeholders take the responsibility of playing their roles to ensure that the objectives and the goals of the company are achieved.  In conclusion, RBI can turn out to be very successful and the best brand globally and have a higher ground than its competitors by ensuring that all the factors get taken into consideration, and all the necessary changes needed to get implemented.

 

References

Cojohari, N. (2010). The competitive advantage of strategic alliances.

Elearn. (2008). Business Environment:Management Extra. Routledge.

Kim, W., & Mauborgne, R. ( 2014). Blue ocean strategy, expanded edition: How to create uncontested market space and make the competition irrelevant. Harvard business review Press.

Resturant Brand International. (2016). About Us:2016 Sustainability Framework. Retrieved from Resturant Brand International: http://www.rbi.com/About-Us

Ross, J., Weill, P., & Robertson, D. ( 2006). Enterprise architecture as strategy: Creating a foundation for business execution. Harvard Business Press.

Siddique, A., & Shukla, A. (2016). An Analytical Study of Red Ocean and Blue Ocean Strategy with Special Reference to Indian Premier League Twenty-20 Cricket.

Strategy, B. (2015). Blue Ocean Strategy.

Vargas-Hernández, J.G., & Martínez, M. ( 2016). Mergers and Acquisitions Strategies for Market Penetration in New Countries. The Case of Alsea Group. Regional Science Inquiry,, 8(2), pp.55-64.