Jollibee – Pride of the Philippines

Jollibee revolutionized fast food in the Philippines under the visionary leadership of Tony Tan Caktiong (Tony). For detailed information on history and growth of Jollibee read at http://en.wikipedia.org/wiki/Jollibee . Jollibee the restaurant, popular for its fried chicken, spaghetti and hamburgers has become one of the biggest fast-food chains in the world with 1,804 stores worldwide and total sales of more than US$1 billion as of December 2008.

A case study discussion on Jollibee happened on 10 Nov 2010 at Tasmac. The presenting group smartly attired set the pace with an impressive Philipino greeting – Magandang umaga po! (Good morning to all of you). The highlights of the analysis are covered in this post.

Ravi, Nisha, Karan, Jasmin & Vishal

The Jollibee is a classic example of how a small local company dug-in and thwarted the giant MNC McDonalds from gaining supremacy in the Philippines. Jollibee exploited local advantage of its home country and did not hesitate to copy its competitor McDonald’s few winning attributes. In fact Tony Tan himself drew inspiration from the popularity of McDonald.

Strategic Intent

An ideal objective for Jollibee in Philippines would be ‘Lead McDonald’ – akin to a strategic intent to channelize organize wide effort and hold the main competitor at bay.

Jollibee Mascot

It is evident that the Jollibee mascot concept was inspired from McDonalds clown character ‘Ronald McDonald’ and local and foreign children books. A mascot or a Logo is a powerful intangible strategic device that represents the company’s core identity. In case of Jollibee the human-like bee – symbolises the sweetness of honey and lighthearted happy spirit of the Philipino.

Success factors

(a)    Customer focus: Was a KRA on which employees were evaluated. Jollibee’s mission statement “To serve great tasting food, bringing the joy of eating to everyone” projects this image powerfully.

(b)   Advertisement: Extensive reach through print and electronic media. A unique combination of national-level campaigns handled centrally and local promotions managed by individual stores. The theme included a niche associated with children.

(c)    Values: Jollibee’s sustainability emanates from its powerfully enshrined values – “Always customer first, excellence through teamwork, spirit of family and fun, frugality, honesty and integrity, humility”.

(d)   Value chain: In the Philippines at the downstream end franchise partners (50% outlets) were supported and strengthened – being the customer face. The franchise partners true to Jollibee’s values were treated like family members. On the upstream end were the three Jollibee Commissary Systems, ensuring the manufacture and distribution of safe and high- quality food to all its outlets in the most cost-efficient manner is made possible. It operates 24/7.

(e)   Beyond profit motive: Many social causes were taken up faithfully such as medical assistance to the underprivileged and for hearing impaired children. Collection of toys and story books for children and housing projects for the poor. All such initiatives and more turned Jollibee into a national level icon. Environmental concerns reflect in their operations and disposal of waste.

(f)     Leadership and employee engagement: Tony Tan Caktiong’s maintained his entrepreneurial fervour and zeal even after the company grew large in size. To speed-up market response MBWA (management by walking around) was done through regular visits to stores. He himself tested the implementation of decisions taken at the board-level to take

Tony Tan Caktiong- Man Behind The Bee

account of possible hitches.

This encouraged employees to give suggestions and ideas to the boss directly – thus generating innovations. All managers followed suit and upward-downward flow of communication improved.

Tony took pride in serving the employees through a culture of family bonds and belonging.

(g)    Core competencies: Apart from marketing its organizational culture can be identified as Jollibee’s key core competencies. Its organizational culture is the alchemy of many attributes of Jollibee the main being its values. And therefore not easily copied by its competitors.

Strategies for overseas expansion

Underlying Tony’s strong moves and success in the home country Philippines were his global aspirations. He hoped to generate half the revenues from overseas.  It first entered California where the Philipino population was more than 25%.

Jollibee followed an approach of brand acquisitions to stimulate customer interest – among JFC’s popular brands are Jollibee, Chowking, Greenwich, Red Ribbon, Manong Pepe’s and Delifrance. Jollibee has a strong cash flow and can acquire more brands.

In 2001 the company‘s initial foray into China failed. It shut its first outlet there after four years. And China is seen as an important strategic market. India with its large fast food consumer base could well be another target.

Summing up

As Jollibee’s strategy of adopting the Philipino recipes were not meeting with success they may retain its strategy of using its Philippine brands in areas where there are large concentrations of overseas Filipinos and buying local brands (and strengthen them) in markets such as China and other countries, where it does not have that advantage.

Jollibee India entry

We find the fast food joints like McDonalds, Dominos Pizza and others thronging with customers. But these operate on a focused menu. Is the Indian consumer adventurous enough to prefer an authentic Jollibee Philipino cuisine?  Or prefer to stick to the common menu that they have become used to.

Thank you!