(Tiểu luận) usiness ethics group assignment group 6 ethical case study of kfc

NATIONAL ECONOMICS UNIVERSITY Advanced Educational Program -*** - BUSINESS ETHICS GROUP ASSIGNMENT GROUP ETHICAL CASE STUDY OF KFC Lecturer: Dr Nguyen Bich Ngoc Class: Advanced Accounting 63 Students: Cao Minh Huyen - 11219702 Dao Thi Phuong Lien - 11213042 Nguyen Phuong Nga - 11219239 Nguyen Phuong Mai - 11213683 Hanoi, 2023 TABLE OF CONTENTS I INTRODUCTION II ABOUT KFC History of KFC Core Values of KFC 3 KFC’s Ethical Responsibilities III CASE 1: KFC’S 2017 DILEMMA Background of The Dilemma KFC's Initial Action KFC's Final Decision Effect of The Decision on Major Stakeholders .9 KFC's Two Options 10 KFC's Achievements 11 IV CASE 2: CHICKEN ABUSE 12 Chicken Welfare .12 Consequences 14 V KFC's Efforts 14 OTHER ISSUES .15 Unfair Labor Practices 15 Environmental Concerns 16 KFC's Business Ethics Issue in Vietnam .17 VI OUR POINT OF VIEWS 19 VII RECOMMENDATION .20 VIII CONCLUSION 22 IX REFERENCES 23 This is a preview Do you want full access? 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Log in I INTRODUCTION Kentucky Fried Chicken, commonly known as KFC, is a fast-food chain that was founded in 1952 by Colonel Harland Sanders KFC is known for its signature dish, fried chicken, and has since expanded its menu to include a variety of other fast-food items The company operates in over 140 countries worldwide, making it one of the largest fast-food chains in the world Despite its global reach and popularity, KFC has faced numerous ethical issues in recent years that have brought its business practices into question One of the most significant concerns is acting against animals KFC has also faced several dilemmas and other business ethics scandals These issues have led to public scrutiny and criticism of the company's business ethics, and have eroded customer trust in the brand Nevertheless, KFC has been and continues to adapt and innovate to address these concerns and maintain its position as a leading player in the fast-food industry This document discusses KFC, a company that provides an excellent case study for exploring the challenges and opportunities involved in promoting ethical conduct in business II ABOUT KFC History of KFC KFC (Kentucky Fried Chicken) was founded by Colonel Harland Sanders, an early developer of the fast food industry, in Corbin, Kentucky It is the world's fourth-largest restaurant chain after McDonald's, Subway, and Starbucks, with 26,934 KFC restaurants in over 145 countries and territories around the world (Yum! Brands company, 2021) KFC offers variable dishes such as fried chicken, fried potatop, sandwiches, hamburger, and other products marketed under various labels During the Great Depression, Harland Sanders started selling fried chicken from his roadside shack in Corbin, Kentucky In 1939, The Colonel created the 11-ingredient secret recipe for Kentucky Fried Chicken, and in 1952, he signed up his first franchisee By promoting chicken in the fast-food sector, KFC helped to diversify the market by starting a competition to the burger's dominance KFC is a private corporation with an estimated 800,000 workers In the United States, the corporation has a sizable market share in fast-food chicken franchises, accounting for 10.6% of total industry revenue (IBISWorld - Industry Market Research, Reports, & Statistics) According to the Yum! Brands 2021 annual report, KFC's annual revenue is $31.365 billion Core Values of KFC There are three key house rules at KFC: ● ● Be your best self Make a difference ● Have fun Service Values “At KFC, we have a passion for food and serve it with pride.” KFC makes sure to satisfy every customer and serve them as friends so that everyone leaves happy “Our food is always craveable We are the original fried chicken experts, and everything we celebrates our passion for serving fingerlickin’ good food.” KFC always takes pride in its food and recipes because of its uniqueness, which helps them stand out from other fast food chains They are committed to using high-quality chicken and food freshly prepared by skilled chefs KFC’s Ethical Responsibilities The special feature of the KFC Group is the way they deliver on their mission They make a sure promise that they will make an effort, and they definitely will Unlike the future vision, KFC wants and will many things for the people who influence their business, such as customers, partners, and employees Some of the missions that some KFC franchise companies around the world have launched are: • “To be the leader in western style quick service restaurants through friendly service, good quality food and clean atmosphere” • “To maximize profitability, improve shareholder value and deliver sustainable growth year after year” • “You keep employees longer, they are happier, and they work better for you” This is a preview Do you want full access? 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Log in 3.1 Employee KFC establishes a higher minimum wage for its employees and ensures that all employees receive a competitive salary commensurate with the effort they put in to fulfill their assigned tasks and responsibilities KFC's culture is built on the spirit of "How we win together" to be successful and united to reach out This helps motivate all members to work together to build a growing company that satisfies customers and makes each member feel proud to work at KFC KFC believes in its employees and that each employee can make a difference, so the company always listens to and respects every member's contribution The company also helps its employees develop their careers and develop a working environment that makes it easier for employees to have a work-life balance Besides, KFC also regularly supports everyone to have the conditions to realize their full potential At KFC Vietnam; every job always starts with the question, "What to to achieve results?" Therefore, creative ideas are inspired by each individual who works with responsibility, ability, and enthusiasm to promote collective strength Incentive Policy For Employees Employees working at KFC are given a membership card for each person, when buying goods, they will receive a 10% discount at the coffee shop partnered with KFC and a 20% discount when buying food at the store • • Participating in accident insurance 24/24 A clear and open career path to becoming a restaurant manager • Working in a dynamic environment, helping employees develop communication, problem-solving, and work management skills 3.2 Ingredient and Suppliers All products and services throughout the supply chain are sourced ethically and through sustainable methods The company applies ethical labor practices to its supply chain partners, including using certified products that meet fair trade standards KFC puts quality first and commits: strictly complying with regulations on food hygiene The chicken ingredients used by this company are not raised with stimulants Especially during the "sensitive" time of avian flu, KFC has applied many positive measures, ensuring that when necessary, it will use reserved chicken to ensure the quality of the ingredients The type of oil used by KFC stores today is especially concerned with the health of customers So they changed soybean oils to reduce the risk of obesity as well as cardiovascular problems In addition, the stores also use specialized test paper to check the condition of metamorphosis in the oil KFC Vietnam only chooses reputable and quality raw material suppliers, affirming the quality of its products with quarantine certificates 3.3 Environment In addition to complying with basic environmental laws, the company is actively undertaking initiatives to reduce its carbon footprint and investing heavily in being environmentally conscious In December 2008, KFC's products were switched to modern microwave ovens and limited frying to create environmentally friendly products that are beneficial to consumers' health and improve the company's high reputation with customers 3.4 Related Parties All stakeholders, including suppliers, employees, and distributors, are treated with respect and fairness Despite being a franchise corporation, KFC still tries to manage and supervise all of its business partners All restaurants bearing the KFC name must be clear about their obligations, responsibilities, capabilities, motivations, and future The business philosophy is to show the way ahead, helping managers and employees understand each other's ways of working, and that they have the same goal, so that work goes smoothly, and misunderstandings are avoided Customer retention is another important goal of KFC, which is achieved by increasing the quality of products and services The company has put quality at the heart of its work, and its employees are trained to provide unsurpassed customer service Periodic surveys are held to solicit customer opinions, and the collected data is then used to further improve the quality of products and services according to customer expectations KFC focus on creating satisfaction, bringing beneficial values to all subjects that affect the company's operations, and wanting and desiring to be recognized Their responsibilities to the market and society are as follows: • Providing customers with fast and delicious food, served in a friendly environment, to attract smart, knowledgeable customers around the world • Maximize profits, increase shareholder value, and deliver steady company growth year after year • Recruit, develop, stimulate, reward, and retain employees with exceptional ability, providing them with favorable working conditions, and good leadership Performance and work-based pay, highly attractive benefits program, opportunities for advancement, and high levels of job security diabetes, and many, many others - are exacerbated by the consumption of products of animal origin, and can actually be avoided by creating more humane processes for utilizing animals in the food chain Consequences The problem affects the animals which are subjected to cruel treatment during the process of breeding for being consumed for food production at KFC It also affects advocates of animal rights movements who are perturbed by the cruel conditions to which these animals are exposed Customers of KFC are also impacted directly by the problem because the harmful effects of consumption of this source of food on human health are incurred by these consumers Since the case of animal abuse was explored to the world, KFC faced the toughest challenge where it heated up public awareness towards animal welfare Animal abuse cases occurred and a huge ruckus by the public has caused the corporation to lose its reputations, turnover, and profit because of the law stated by PETA The case also affected the business all over the world since after the incident, stakeholders’ expectations and demands regarding the standardized guidelines of animal treatment also increased Animal welfare is no longer an abstract issue and now more than ever people understand the importance of improving the lives of chickens,” said Tracey Jones, global director of food business at Compassion in World Farming KFC's Efforts KFC has developed a series of plans to overcome the problems When receiving a little pressure from PETA, KFC Canada agreed to a historic new animal welfare plan that they became the first major restaurant chain ever in the whole world to purchase all of its meat exclusively from controlled-atmosphere killing (CAK) slaughterhouses and dramatically the lives and deaths of millions of chickens 14