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Jollibee Foods Corporation (a):

By devilmor01 Feb 04, 2012 549 Words
Protected by his office air conditioner from Manila’s
humid August air, in mid-1997, Manolo P. (“Noli”)
Tingzon pondered an analysis of demographic trends
in California. As the new head of Jollibee’s International Division, he wondered if a Philippine hamburger
chain could appeal to mainstream American
consumers or whether the chain’s proposed US
operations could succeed by focusing on recent
immigrants and Philippine expatriates. On the other
side of the Pacific, a possible store opening in the
Kowloon district of Hong Kong raised other issues for
Tingzon. While Jollibee was established in the region,
local managers were urging the company to adjust its
menu, change its operations, and refocus its marketing
on ethnic Chinese customers. Finally, he wondered
whether entering the nearly virgin fast food territory
of Papua New Guinea would position Jollibee to dominate
an emerging market—or simply stretch his
recently-slimmed division’s resources too far.
With only a few weeks of experience in his new
company, Noli Tingzon knew that he would have to
weigh these decisions carefully. Not only would they
shape the direction of Jollibee’s future internalization
strategy, they would also help him establish his own
authority and credibility within the organization.
Company History
Started in 1975 as an ice cream parlor owned and run
by the Chinese-Filipino Tan family, Jollibee had diversified into sandwiches after company President Tony
Tan Caktiong (better known as TTC) realized that
events triggered by the 1977 oil crisis would double
the price of ice cream. The Tans’ hamburger, made to
a home-style Philippine recipe developed by Tony’s
chef father, quickly became a customer favorite. A
year later, with five stores in metropolitan Manila, the
family incorporated as Jollibee Foods Corporation.
The company’s name came from TTC’s vision of
employees working happily and efficiently, like bees
in a hive. Reflecting a pervasive courtesy in the company,
everyone addressed each other by first names
prefaced by the honorific “Sir” or “Ma’am,” whether addressing a superior or subordinate. Friendliness
pervaded the organization and become one of the
“Five Fs” that summed up Jollibee’s philosophy. The
others were flavorful food, a fun atmosphere, flexibility
in catering to customer needs, and a focus on
families (children flocked to the company’s bee mascot
whenever it appeared in public). Key to Jollibee’s
ability to offer all of these to customers at an affordable
price was a well developed operations management
capability. A senior manager explained:
It is not easy to deliver quality food and service consistently and efficiently. Behind all that fun and
friendly environment that the customer experiences is
a well oiled machine that keeps close tabs on our dayto-
day operations. It’s one of our key success factors.
Jollibee expanded quickly throughout the Philippines,
financing all growth internally until 1993.
(Exhibit 1 shows growth in sales and outlets.) Tan
family members occupied several key positions particularly
in the vital operations functions, but
brought in professional managers to supplement
their expertise. “The heads of marketing and finance
have always been outsiders,” TTC noted. (Exhibit 2
shows a 1997 organization chart.) Many franchisees
were also members or friends of the Tan family.
34 Chapter 1 Expanding Abroad: Motivations, Means, and Mentalities Case 1-2 Jollibee Foods Corporation (A):
International Expansion

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