Chick-fil-A is known for their famous Chick-fil-A sandwich, but also for their private, family –controlled ownership structure, philosophy on management and biblical principles. Chick-fil-A uses the differentiation strategy to set them apart from other fast-food chains. Chick-fil-A mission was “To glorify God by being faithful steward of all that is entrusted to us and to have a positive attitude influence on all who come in contact with Chick-fil-A”, and to be “America’s best quick-serve restaurant.” One of their strategies they use to set them apart was focusing on people. This strategy included interview process, golden rule, consistent management, and loyalty and relationship.
When it came to focusing on people. Mr. Cathy would stress over loyalty & relationship by stating that he would rather sacrifice growth and profit and focus more on a personal relationship. This strategy was based off his Golden Rule, which revolved around being closed on Sundays, holidays, and shortening hours. Mr. Cathy believed that Sundays were for worshiping the Lord and as for holidays and short hours were for his operators and employees to spend time with their love ones. He believed in being very loyal to his operators and treating them as they wished to be treated and in return.
By doing so Chick-fil-A provides consistent management and ends up with a chance of low turnover rates and also by making sure that other Chick-fil-A chain restaurants were trained up on their knowledge management. This course helped manage people and their knowledge in the organization. These strategies have help Chick-fil-A build a customer base and receive plenty of awards for customer service. These factors play a role as well in their interview process. When it comes to hiring operators Chick-fil-A believes in carefully screening each candidate and going through a yearlong interview process. Also including in their business track records, religious standing, and community involvement which helps promotes Chick-fil-A to the community.
As for other differentiation strategy Chick-fil-A, uses that are important to them are first, their company structure. Chick-fil-A is structured by having low debt and a being privately owned. Second, are their requirements for franchises meaning having a startup fee of $5,000, which allowed them to receive 15% annual sales revenue and a 50% of the net profit. Third, is their marketing and corporate service responsibilities approach and use of cows. Chick-fil-A marketing strategy consist of low advertising, not giving customer any frequent-buyer card, but have customer register through their website to win free meals and of course cow appreciation day. Customers would dress up in a cow suite and would receive a free meal as well. Last, was their succession planning, since Chick-fil-A has a strong family involvement there is a 30% chance that will go to the second generation, 12% to the third and 3% to the fourth.
As for controversy, it was not until July of 2012 when Dan Cathy made a statement saying that he stands for the biblical meaning of marriage. This statement came off as criticism towards gay couples and their marriages. The statement that was made had so much volume that gay right supporters came out to boycott. It also made people start to question the extent of ownership and their views affecting and causing long-term viability meaning their company culture. Chick-fil-A also received support from Arkansas Governor Mike Huckabee by holding Chick-fil-A appreciation day on August 1, 2012. Customers came out to show their support and waiting in line for hours to be served.
Due to the controversy Chick-fil-A, market share went up 0.6% and their awareness went by 6.5%. I believe in order for Chick-fil-A to continue stand apart from other fast-food restaurants they should have incorporated many other voices across all business units when dealing with media exposure. It is okay for them to stand strong and firm in their beliefs on family and marriage, but they should not judge someone else or criticize them for wanting to be different.
If their strategy is about focusing on the people, they should show more focus on attracting more ethnicity and low household income to eat at Chick-fil-A and be a part of their restaurant. They should also take the time to get to know the gay community and have an understanding of their beliefs as well. They do not have to agree with everything but can come to some kind of agreement or support towards gay rights. By doing so this can help increased their sales even more and continue to set them apart from other fast-food restaurants.
Courtney from Study Moose
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