Jollibee Foods Corp. Case Study

[pic 1]

Isidoro Achar Masri 132786

Jollibee Foods Corp. (A): International Expansion

Overview and Objectives: This case traces the international expansion of Jollibee Foods Corporation, a Philippine based fast food company led by entrepreneur Tony Tan Caktiong (TTC) that is expanding within Asia, and now beyond. It opens with a trigger issue focused on three investment decisions facing the international division’s new general manager, Noli Tingzon. He has opportunities to expand into Papua New Guinea (PNG), Hong Kong or the US, and recognizes that his decision on which project to back will probably shape the broader strategic agenda and organizational model that the company’s international operations will follow.

Suggested Questions:

1. How was Jollibee able to build its dominant position in fast food in the Philippines? What sources of competitive advantage was it able to develop against McDonald’s in its home market?

Jollibee was able to dominate in the Philippine market because it was able to identify the domestic preferences plus they had a better understanding of the cultural needs for a fast food company, while McDonald’s only had the foreign company charm and had not really convinces Philippines with the only beef tasting patty.

Jollibee had First Mover Advantage over McDonald’s plus it had a tacit knowledge advantage over the competition regarding the local culture.

2. How would you evaluate Tony Kitchner’s effectiveness as the first head of Jollibee’s international division? Does his broad strategic thrust make sense? How effectively did he develop the organization to implement his priorities?

Tony Kitchner’s approach to the international expansion I think was well designed although very simplified at first, through the expansion and the development on foreign markets Kitchner realized that it wasn’t as easy as he thought it would be. Going abroad is in itself as hard of a challenge as knowing all the regulations and preferences in the each domestic market, for that reason

[pic 2]

Isidoro Achar Masri 132786

Kitchners approach to create a more of a global image for Jollibee made sense although without underestimating that a local and family environment was the main reason for the Philippine’s food chain victory over a giant like McDonald’s in the Philippines. But in the long term Kitcner was proved wrong, although many of his initiatives were still working, the long term financial look of the company was bad. Kitchner wanted to grow to increase revenue for Jollibee but he didn’t account for the enormous financial stress that the company was suffering due to its international division. In my opinion he only focused on growth but he didn’t assure that it was a sustainable growth. Kitchner never really understood the organizational culture in jollibee ́s.