Yum Brands, Inc. (YUM), the parent company of KFC, Taco Bell and Pizza Hut is selling hundreds of its restaurants back to franchisees in order to be more nimble for market development overseas.
With each of their restaurant chains, they are reducing the number of stores they own to facilitate their new strategy of increasing equity stakes in emerging markets such as China, which offer greater returns.
Are they sending out a statement they are abandoning the U.S. market? Not at all, they say they are purely more interested in having the locations operated by those who are the best at it: their most successful franchisees, who will no doubt jump at this opportunity.
The Agile Advantage to Yum Brands is in how they are shifting their equity stake, giving them greater opportunity to establish a presence in the fast growing markets globally. In the last year, their U.S. operations have shown a slight loss of sales, indicating this is not their greatest growth market.
Agile companies are quick to recognize how to find the fertile ground for growth and restructure in order to be a leader in the new markets. Obviously, this is a significant change many organizations would be fearful to make, and this is why this bold step will give Yum Brands an Agile Advantage.
- What shifts should your business be making in order to facilitate better growth?
- Where is the fear of change holding your organization back from taking agile steps to gain market share?
- Where does your organization need to re-focus resources in order to capitalize on forthcoming opportunities?
The Agile Advantage comes with an accurate vision, the comfort in taking necessary risks, and a willingness to make change swiftly. Some may think a company based in Louisville, KY is foolish to redirect efforts half-way around the world. As long as executives of their competitors are thinking this way, Yum can continue to enjoy their Agile Advantage in the new economy.