Pizza Hut Case
...whole new delivery system. More than likely, it was an aspect of the business he wasn’t trained to take on. The specific problem, I feel, goes back to the saying “Do one thing well, instead of doing a lot of things average.” My thoughts are if you are going to attack the delivery business, it ought to be done with maximum efforts and maximum capabilities. Regarding this problem, they had no possibility of going into it with full efforts and capabilities. My fourth and final problem I encountered was the company’s forcing legal rights and forcing delivery upon franchisees. From the beginning, with any company, I feel that once you start forcing your understudies to implement plans and efforts a certain way, you are going to run into resistance. Which in turn, that resistance could mount into a really huge battle between franchise and company. I’m not sure this problem can ever be avoided within corporations, but the way it is handled, can be. From my readings, I think the company forcing this on the franchisees didn’t get as ugly as it could have. My problem with it isn’t so much the arguing that comes from it, but more so the confusion in communication and confusion of implementing such a policy. If the franchisees are not receptive of the idea, it becomes an immediate extra effort to put something into place between two parties. In conclusion of assessing the problems of Pizza Hut, the main problem was the indecisiveness of management. They weren’t prepared to adapt to the changing marketplace, and when the marketplace changed, they were in extreme disarray as what actions to take. You can focus on the “cannibalization” of their image as being a problem, or the problem of whether to have a central computerized system or not. You can look at only eat-ins, only delivery, or a combination of both as the problem, or even my last point of forcing franchises to implement policies, but the real problem was the company’s inability to properly analyze the market and adapt to it. In analyzing the facts, they are simple to me. Numbers do not lie. The market interest for delivery was huge. The growth potential in that area alone was enough to consider a major company overhaul in terms of what they wanted to attack. The company’s strength was the name they established as a pizza company. They were fearful of delivery diminishing their “image”, instead of using it to their advantage. Pizza Hut had established themselves as a great pizza restaurant and did not want to be viewed as delivery also. One of Pizza Hut’s weaknesses was their inability to cooperate between franchises and the cooperation. A lot of time and effort was spent trying to make the two exist together, instead of focusing on where the company needed to be headed to, as a whole. The market was changing right before their eyes, but yet they spent their whole time and efforts internally, whether that be the delivery systems used, legalities forced on franchises, or eat-in only, delivery incorporation ideas. Once again they overlooked the customer and the customer’s needs. As stated before, numbers don’t lie. Pizza Hut’s current marketing program at the time was to establish premium pizza, at a premium price, presented in a premium setting. While consumed with keeping that image, the market place was changing. Pizza consumption was now drifting away from dine-in towards delivery. Pizza Hut was slow in recognizing this change. The problem that Pizza Hut faced was when, how, and if they wanted to implement delivery. Where would they be now if they hadn’t taken it on… my thoughts are, out of the market. I think the demand was that huge for delivery at the time, that if they hadn’t taken part, it would have ruined them. My conclusion of drawing meaningful conclusions of the analyzed facts is: Pizza Hut, in terms of time and efforts, cut it close in joining this current market shift towards delivery. My next issue is to address recommended solutions and state my conclusions and consequences of these solutions. Pizza Hut worried way too much about their image, that was the first problem I addressed. My solution to this was obvious in my report, put the image on the back burner and attack the delivery business...