Quality Management at Kentucky Fried Chicken

Author(s): Uday M. Apte and Charles C. Reynolds

Source: Interfaces , May - Jun., 1995, Vol. 25, No. 3 (May - Jun., 1995), pp. 6-21
Published by: INFORMS

Stable URL: https://www.jstor.org/stable/25062008

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 Quality Management at Kentucky Fried
Chicken
Uday M. Apte Cox School of Business
Southern Methodist University
Dallas, Texas 75275-0333

Charles C. Reynolds KFC National Management Company

5605 North MacArthur Boulevard, No. 650
Irving, Texas 75038

Kentucky Fried Chicken (KFC) Corporation, a member of the

quick-service restaurant industry, uses a sophisticated program
to manage the quality of service it offers to its customers. In the
last quarter of 1989, the south central division of KFC launched
a test program in four Oklahoma City restaurants to improve
the speed of service at its drive-through-window operation. It
proved extremely successful. The restaurants cut service time
by more than half while improving labor productivity. They
also dramatically outperformed other restaurants in the division
in profits, sales growth, and growth in customer transactions.
The improved processes in the test restaurants have served as
benchmarks for other KFC restaurants aiming for continuous
process improvement, while the reduced service time now
serves as the revised specification in KFC's quality measure
ment and management program.
era ted sales of over $3 billion while serv
Kentucky Fried
ration, USA, Chicken
is a member of the Pep (KFC) Corpo ing over 600 million customers. KFC has
sico family of quick-service restaurants. Es several basic types of restaurants; the most
tablished in 1952, the KFC system consists common type being a dine-in restaurant
of 2,000 company-owned and over 3,000 with a customer seating area that includes
franchised restaurants. In 1992, KFC gen a condiment bar and a drive-through
Copyright Co 1995, Institute for Operations Research INDUSTRIES?AGRICULTURE/ FOOD
and the Management Sciences PRODUCTION/SCHEDULING?WORK STUDIES
0091-2102/95/2503/0006S01.25
This paper was refereed.

INTERFACES 25: 3 May-June 1995 (pp. 6-21)

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KENTUCKY FRIED CHICKEN
window (DTW) designed for drive
through customers.
The quick-service restaurant industry is
one of the most competitive and saturated
industries in the United States. Growth in
market share for one company generally
comes only at the expense of some other
company's market share. The competitive
pressure that restaurants in this industry
face also means that to simply hold on to
its current customer base, a quick-service
restaurant must offer consistent, high
quality service. Moreover, improving ser
vice quality can also mean improved pro
ductivity, leading to lower costs and higher
profitability.
Recognizing the importance of managing
service quality, KFC became, in late 1970s,
an early adopter of a quality management
program.
KFC's Quality Management Program
Managing quality in a manufacturing
company revolves around understanding
customer expectations, defining product
specifications based on these expectations,
and subsequently ensuring that the prod
ucts being manufactured (that is, the out
come of the manufacturing process) con
form to the design specifications. In this
context, the detailed specifications of a
manufacturing process, although of great
relevance to the success of the internal op
erations of the company, are of no direct
interest to the customer. In contrast, man
aging quality in service businesses, al
though similar in spirit, is somewhat dif
ferent and is more challenging because of
certain characteristics inherent to service
operations. These include the intangibility
of service outcome in some cases and the
presence and participation of customers in
May-June 1995 7
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the creation of most services. Service cus
tomers generally care about the service
outcome and about the way a service pro
cess is executed. Consequently, quality
management in services revolves around
managing both of these factors (Apte,
Karmarkar, and Pitbladdo [1994] discuss
the measurement and management of ser
vice quality in detail). For example, KFC's
management needs to control not only the
taste, temperature, and appearance of the
fried chicken, but also the courtesy and the
speed of service it offers to its customers.
Quality management at KFC recognizes
this fundamental dichotomy by using two
complementary programs for measuring
quality: ( 1 ) The quality, service, and clean
liness (QSC) program for judging the qual
ity of service outcomes from the perspec
tive of a customer, and ( 2 ) the operations
facility review (OFR) program for measur
ing a restaurant's process implementation
performance against KFC's process specifi
cations. The results of these two quality
measurement programs are incorporated
into "Today's KFC restaurant quality pe
riod report," a quarterly report prepared
for senior management at KFC.
To understand customer expectations
and to measure the company's perfor
mance against that of its competitors, KFC
regularly uses the following customer- and
market-oriented surveys to manage its ser
vice quality. The results of these surveys
are also incorporated in the quarterly qual
ity report.
KFC hires a professional interviewing
service to survey customers on their
impressions of product and service quality.
It also periodically hires a consulting firm
to identify important service attributes and
APTE, REYNOLDS

their relative importance to the customers
of a quick-service restaurant. It uses the
understanding of customer expectations it
gains in designing and continually revising
its quality measurement schemes.
KFC receives customer complaints via
complaint cards available at all KFC res
taurants and through letters and phone
calls from customers. A KFC representative
responds to each customer complaint by
letter or phone. KFC also monitors and
tracks the number and the types of com
plaints different restaurants receive.
KFC regularly uses market tracker sur
veys to measure its performance on key
customer service attributes compared to
that of its competitors (such as Mc
Donald's and Wendy's). The customer ser
vice attributes it tracks include speed of
service, mispacks, courtesy, product qual
ity, and value for money spent.
The quarterly quality report plays an im
portant role in KFCs quality management
program. Providing data on customer ex
pectations and KFCs performance allows
management to take immediate corrective
actions. KFCs quality management pro the operations facility review (OFR) is to
gram also emphasizes continuous improve help KFC to ensure nationally consistent,
ment of processes, employee empower high operating standards and performance
ment, and training of employees in the use
of quality management tools and
techniques.
Quality, Service, Cleanliness (QSC)
Program
KFC implemented the QSC program in
1977. This program is designed to measure
and evaluate quality at each KFC restau
rant, company owned or franchised, from
the viewpoint of a customer. "Mystery
shoppers," independent individuals con
tracted by KFC, evaluate the quality, ser
vice, and cleanliness of each restaurant.
Mystery shoppers are well trained to use
the standard QSC form (Figure 1) so that
they perform each evaluation in an objec
tive, accurate, and consistent manner. KFC
revises and updates the form frequently to
ensure that it reflects the ever-changing
customer expectations, as revealed in the
surveys.
Mystery shoppers conduct a QSC evalu
ation of each restaurant twice a month.
However, restaurant general managers use
a shortened version of the same form, the
"QSC alert form," to conduct daily self
evaluations of their restaurants. It helps
managers to take immediate improvement
actions, such as instructing and helping
employees to perform their jobs in the
right way. It also helps managers to incul
cate an awareness of customer expectations
among restaurant employees.
Operations Facility Review
Customers expect consistent and high
quality products and services in all KFC
restaurants. Hence, operational excellence
is critical to KFC's success. The objective of
in all its restaurants through the use of a
standardized evaluation program. The OFR
evaluation program measures a restau
rant's performance against KFC's operating
standards (Figure 1).
The OFR program parallels the QSC
program except that the OFR evaluators
are KFC employees. KFC trains the OFR
evaluators rigorously to ensure that they
perform all evaluations in an objective, ac
curate, and consistent manner. Restaurant
general managers are required to complete

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KENTUCKY FRIED CHICKEN

QSC Evaluation Form

Service Quality (50 Points)
o Service time (total and window time)
o Attentive, energetic, warm, and courteous service
o Professional appearance, including wearing a uniform
o Accuracy of order taking and filling (no missing or extra items)
o Helpful, suggestive selling
Product Quality (30 Points)
The following criteria are measured for all products?chicken products (original recipe, crispy, hot
wings, etc.), cold and hot side items (such as cole slaw, potato salad, French fries, biscuits, etc.)
and beverages:
o Standard temperature
o Absence of visible shortening and proper breading of chicken
o Color, texture, overall appearance
o Proper filling and closing of containers

Cleanliness (20 Points)

o Clean entrance doors and windows
o Clean and well-supplied rest rooms
o Clean and neat service counter and surrounding area
o Clean and neat customer seating area
o Neat exterior, well-maintained landscaping
Operations Facility Review Form
Product/Process Quality (44 Points)
Evaluate each product using the following criteria:
o Quality standards for ingredients used
o Storage and handling of ingredients
o Cooking procedures; time, temperatures, cleanliness, etc.
o Hold time

Facilities (16 Points)

Clean, neat, and well-maintained facilities (interior and exterior) and fixtures

Customer Viewpoint?Service and Product Quality (15 Points)

Selected items from QSC form: service time, courtesy, order taking and filling accuracy, product
temperature, and appearance
Sanitation/Operations (15 Points)
o Procedures used and frequency of cleaning processes for kitchen, service counters, seating
areas, and rest rooms
o Equipment clean, well maintained, and in good working order
Critical Issues
o Presence of rodents, cockroaches, other insects
o Cross contamination potential due to faulty procedures or equipment
o Spoiled, reprocessed, or unapproved products being sold
o Employee(s) with communicable disease

Figure 1: Kentucky Fried Chicken uses two quality management instruments, the QSC
evaluation form and the operational facility review form.

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APTE, REYNOLDS
OFR evaluations for their own restaurants vantage over the double drive-through or
at least once a week. Managers must also other major quick service restaurants that
run training programs for restaurant em used drive-through as a major portion of
ployees and maintain facilities, equipment, their business. KFC could lose market
and premises in accordance with KFCs share.
operating standards. Slow service could also have a ruinous
Drive-through-Window Test impact on product innovation activity. KFC
As a part of its major responsibilities, the might introduce new products, but if cus
senior management of KFCs South Cen tomers had to wait too long to get these
tral division (roughly the Texas and Okla products, they were not likely to come
homa area ) routinely evaluates the divi back to KFC to try these products again.
sion's financial and operating performance The real dilemma here was that the com
compared to that of other divisions and its pany might think that customers were
competitors. In the fourth quarter of 1989, turned off by the new products, when in
it became apparent that KFC restaurants in fact it was the slow service that turned
the division were experiencing serious them off.
problems. The profit margin had eroded KFC, therefore, set a dramatic improve
from 16 to eight percent. KFCs perfor ment in DTW speed of service as its pri
mance on key customer attributes, as re mary goal for restaurants in the division.
vealed by the QSC, OFR, and market The critical question was, could this really
tracker surveys, was also suffering. For ex be done? The perceived wisdom in the
ample, KFC was being ranked in the bot company was that the DTW operation had
tom half of the quick-service restaurant in been fine-tuned over many years, and
dustry in the categories of ( 1 ) speed of ser hence, cutting down on service time was
vice and (2) value for money spent. nearly impossible. However, Chuck
From historical sales data, KFC knew Reynolds, then regional manager, sought a
that roughly 50 percent of its sales volume way to reduce service time by conducting a
was contributed by the drive-through test at a few restaurants.
window (DTW) operation. Slow service, as Organizing the Test at Oklahoma City
perceived by customers, was a particularly After some analysis and discussion,
critical problem for DTW, since speed of Reynolds chose four KFC-owned restau
service is unquestionably the most impor rants in Oklahoma City as sites for the
tant dimension of service quality for a DTW test. These restaurants were known
quick-service restaurant. The division was for their good operations, motivated man
also experiencing a high level of competi agers, and for low turnover among man
tive pressure from new double drive agement. Oklahoma City was an isolated
through hamburger operators, such as Ral market in the region in the sense that these
ly's and Checkers. This competitive pres restaurants did not participate in any mar
sure combined with the slowness of service keting cooperative. This factor combined
spelled trouble. with KFCs ownership meant that KFC had
KFC had no marketable competitive ad total control over the marketing (advertis

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KENTUCKY FRIED CHICKEN

ing and promotion) activities at the restau
rants. This ensured that any improvements
in financial and market performance real
ized during the test would emanate solely
from improving speed of service and other
operational changes, and not from adver
tising and promotion programs. Before
starting the test, Reynolds secured permis
sion from the president of domestic opera
tions and the vice-president of operations
at the regional level to insure that no inter
nal obstacles (such as the marketing de
partment introducing a new promotion
program in the region or the industrial en
gineering department insisting on intro
ducing new procedures and equipment in
the midst of the test) would prevent the
test from being successful.
After choosing the test restaurants,
Reynolds formed the DTW test team. This
team, led by Reynolds, included the mar
ket manager, four restaurant general man
agers, the training manager, a maintenance
coordinator, and an operations specialist
from operation services. As a result of their
participation in the "quality foundation
workshop," all team members were well
versed in quality management concepts,
such as the nature of variability and
Deming's "plan-do-check-act" methodol
ogy. They were also knowledgeable in
data-collection techniques and problem
solving tools and techniques, such as
Pareto charts, fishbone diagrams, flow
charts, and statistical process-control
charts. Through self-guided quality man
agement training programs that relied on
videos and books, the team members were
also exposed to the teachings of Shigeo
Shingo [1987, 1988a, 1988b], a noted Jap rants. Everyone in the division considered
anese quality management guru. Although this goal unrealistic, but Reynolds believed
Shingo, formerly a manufacturing engineer
at Toyota, is primarily known for dramatic
reduction in machine setup time through
waste reduction, for zero quality control
through poka-yoke (or mistake-proof
methods), and for process improvement
techniques in manufacturing, his methods
have been found to be equally useful in
the service arena. Their knowledge of
quality-management concepts, tools, and
techniques proved very useful to the team
members during the test as they systemati
cally analyzed data, generated ideas for
improvements, and implemented them in
their individual restaurants.
Test Team in Action
The first meeting of the team in Okla
homa City was chaired by Reynolds. It
was devoted mainly to a discussion of the
problems facing KFC, the importance of
improving drive-through operation, the
need for the test, and the test's potential
benefit to their individual restaurants and
to the company. The discussion helped
raise the team members' commitment to
the fundamental goal of improving the
speed of service at DTW. During the meet
ing, Reynolds charged the team members
with responsibility for finding and imple
menting ways to continuously improve
DTW speed of service, and in return, he
promised to fully back them up in their ac
tions.
Based on the benchmark data for com
petitors' service times gathered through
market tracker surveys, Reynolds and the
team decided to reduce service time at
drive-through windows from over two
minutes to 60 seconds at all the test restau

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APTE, REYNOLDS
that only by setting a somewhat unrealistic
goal with a shared vision could people rise
to the occasion and meet or even beat the
goal. In addition to setting the ultimate
project goal of dramatically improving
window service time, the team also speci
fied several subgoals:
?To acknowledge customers within three
seconds of their arrival at the speaker;
?To fill customer orders within 60 sec
onds of their arrival at the drive-through
window; and
?To serve customers within a total aver
age service time of less than 1.5 minutes.
The test team decided to start the project
by developing good baseline information
on average service times, as experienced by
customers, in all stages of DTW operation
(Figure 2). The team needed to measure
the time a customer spends at the menu
board placing the order, the time a cus
tomer takes to drive from the menu board
to the drive-through window, including
waiting time in a queue, if any, and finally
the time a customer "hangs" (waits) at the
window to get the order, make payment,
and drive away. The team needed a good
timing device. It had to have three fea
tures?a trigger mechanism that could
sense the presence of a customer's car at a
given point in the driveway; a device to
display the current window hang time to
DTW employees; and an ability to count
cars, to compute various service time aver
ages, and to print these averages. The team
located a suitable computerized timer,
made by US Computer Systems of Cincin
nati, Ohio. KFC purchased four such tim
ers, at a cost of about $1,500 each, and in
stalled them in the four test restaurants.
The team ran the timers in all four restau
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58%
- 40% 4
31%
11%
Menu Board Travel Window
Time Time Hang Time
Drive-Through-Window Transaction
Figure 2: The Pareto chart shows the r
amounts of time a customer spends in th
components of total service time in DT
eration: menu board time (from a cust
arrival at the menu board until the ord
been given); travel time from menu bo
window (including waiting in a queue,
any); and window hang time (from a c
er's arrival at the window to the custom
departure). The team disregarded the t
customer sometimes spends waiting in
queue leading to the menu board becau
the infrequency of the event and
measurement problems.
rants for two weeks to generate base
information on various service times.
Armed with service-time information
team met again to prepare and analyz
Pareto chart of the components of to
service time (Figure 2). With about
cent of total service time in the DTW
ation accounted for by window hang
the team's greatest challenge and opp
nity to improve speed of service lay
proving window hang time.
Having established the current ave
window-hang time for each restauran
team discussed what the short-term
dow-hang-time goals should be. Fol
Reynolds' suggestion, the team settle
step-wise reduction in service time w
10-percent reduction at each step. Th
KENTUCKY FRIED CHICKEN
the current window hang time for a res
taurant was 122 seconds, they asked the
restaurant to reduce the time by 12 sec
onds, setting a hang-time goal of 110 sec
onds. Reynolds suggested this conservative
10-percent reduction rule because, during
some unrelated previous experiments,
Reynolds had noticed that when targeted
improvement gaps were too large, restau
rant employees became frustrated by their
inability to close those gaps quickly. These
prior experiments had invariably failed;
improvements made, if any, were short
lived; and the restaurant performance sim
ply fell back to its former level. This time,
all four restaurant general managers
agreed that a 10-percent improvement at
each step was not too big a gap, and that
their employees could meet this goal. It
was important that the DTW employees
experienced early success so that they
could build their self-confidence to make
continuous improvement towards the ulti
mate goal of 60 seconds window hang
time.
Improving the DTW Processes
In the same meeting in which it devel
oped the Pareto chart, the team also brain
stormed to generate ideas for reducing
hang time. Using Shigeo Shingo's process
improvement methods, the team devel
oped several general rules for eliminating
unnecessary motion and thereby reducing
window hang time:
?Take no more than two steps to get
what is needed to fill a customer's order.
?Do not bend over to get anything
needed to fill a customer's order.
?Do not lift anything up that is needed to
fill a customer's order.
?Reach up and pull things down that are
May-June 1995 13
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needed to fill a customer's order.
The team members also needed addi
tional specific ideas to implement in their
restaurants. From the fundamentals of
quality management, they knew that the
DTW employees were the best sources of
specific improvement ideas. To tap this
source, they decided to motivate their em
ployees and make it simple for them to
generate and implement innovative ideas
for improvement. For that reason the team
decided to form in each restaurant a team
of experienced DTW employees (called the
restaurant team). The restaurant teams,
under the leadership of test team mem
bers, were responsible for generating pro
cess improvement ideas and for imple
menting them in individual restaurants.
The test team decided to introduce a
"blocker log" in which DTW employees
could record "blockers," underlying causes
of delays. The blocker log was a simple $2
spiral binder with a pen attached. When
ever they could not fill a customer order
within the target window hang time, a
buzzer on the timer would go off signaling
DTW employees to identify the blocker
and write it down in the blocker log. In
many cases, the blocker was obvious,
while in others DTW employees held im
promptu discussions to figure out what the
blocker was.
The team systematically analyzed the
reasons recorded in the blocker logs every
two weeks. The team used Pareto charts
and fishbone diagrams to identify the
most frequent and important blockers.
They challenged and encouraged the DTW
employees to generate solutions for elimi
nating or reducing the frequency of impor
tant blockers. The managers implemented
APTE, REYNOLDS

selected solutions, and then the whole pro solved the headset problem by instituting a
cedure was repeated.
In one of the early meetings, the team
developed a fishbone chart (Figure 3)
identifying three key causes of slow ser
vice: problems with headsets, out-of
product condition, and poor equipment
layout. With the help of restaurant teams
and DTW employees, the team members
developed and implemented plans for
solving each of these problems in each of
the four restaurants. For example, they
procedure for testing all headsets regularly
to ensure that they worked properly, and
by ordering and stocking adequate supplies
of frequently needed batteries and replace
ment belts.
The four restaurants repeated this pro
cess for about 10 months until they
achieved the major goal of 60 seconds
window hang time. The following are
some of the major changes they made to
operational procedures and facilities,

Equipment

-No headsets and

headsets not working*

Poor equipment Inadequate staffing

layout*
No order-display
monitors

Service delay
at DTW
Too many types of Menu-board clarity
packaging boxes

Item pricing/Time spent in

Low sales items counting change

Packing errors

No best-practice
standards

Methods

Figure 3: The DTW test team used the blocker log to construct this fishbone chart during its
second brainstorming session when it analyzed the causes of delay at drive-through-window
operations of the four test restaurants. It then classified the causes and plotted them. Next it
determined the most important causes based on the frequency of their occurrence and the im
pact of each cause. The team identified three major causes (*). The test team and the restaurant
teams generated solutions for eliminating these causes and implemented them in the test
restaurants.

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KENTUCKY FRIED CHICKEN
categorized under the lessons learned in
the test:
( 1 ) They rationalized process flow and
improved equipment layout to eliminate
wasted motion and to reduce service time.
The employees of each restaurant totally
reorganized their drive-through areas, put
ting products, condiments, bags, boxes,
cups, and salads in more convenient loca
tions. They positioned each item along the
pack line according to its demand level.
High demand products were made easily
accessible to the packers and were also
placed in the display packing system to be
more visible to the cooks and the DTW
leaders so that they could replenish those
just in time. Changing the orientation of
the display packing system from its origi
nal position parallel to the window to per
pendicular, at an average cost of about
$7,000, turned out to be a simple but very
powerful idea. It streamlined the move
ment of products from the kitchen to the
packing area to the window. Moreover, it
reduced the number of steps a packer took
from about six to two and saved precious
time and effort in packing each order. The
restaurants also bought some additional
equipment. For example, they installed
"pack monitors" that were connected to
the order-taking system. These pack moni
tors were instrumental in accurately and
quickly informing packers of the specific
contents of every order while the order
was being taken and entered into the sys
tem by the window person. Finally, the
restaurant moved its equipment (coolers,
warming cabinets, cup dispensers, and so
forth) around to make walking through
and servicing the drive-through area much
easier.
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( 2 ) They changed the product mix and
specifications. The restaurants streamlined
their menus to eliminate the "out-of
product" blocker. They eliminated a num
ber of slow-moving items, such as French
fries, Kentucky nuggets, and sandwiches.
At one restaurant, this alone reduced aver
age window hang time by as much as 20
seconds. They replaced multiple desserts
The profit margin had eroded
from 16 to eight percent.
with a single dessert item. The team tested
"even-dollar pricing" for the big-pack
items on the menu board. For example,
they priced a 10-piece (chicken) meal at
$11.18 so that inclusive of tax it totalled to
$12.00. Both the customer and the cashier
saved a lot of effort and time counting
change. The even-dollar items averaged 15
to 20 seconds less at the window.
( 3 ) Many small process improvements
ultimately added up to a large improve
ment. The restaurants implemented a
number of process improvement ideas.
Each idea may have had only a tiny im
pact on service time. However, collectively,
these ideas had a large impact. For exam
ple, the restaurants eliminated redundant
packaging boxes so that packers needed
only one or two standard boxes to pack
any order. Thus, packers could focus on
packing orders in the shortest possible time
without worrying about whether they were
using the proper box.
(4) They used headsets to create cus
tomer focus and to convert serial activities
into parallel ones. The use of headsets by
all DTW employees allowed them to per
APTE, REYNOLDS
form their jobs while simultaneously lis
tening to customer orders. For example,
the headset allowed a packer to begin
packing as soon as a customer placed an
order, instead of waiting for the order
taker to relay the completed order. This
also helped improve order accuracy. Con
verting serial activities into parallel ones in
this manner proved very useful in reduc
ing the window hang time. By listening to
customer orders cooks better understood
the demand patterns for different products
and could more effectively adjust produc
tion quantities and timings.
(5) Given the customer's participation
in the service process, the customer should
be given clear instructions on what he or
she is supposed to do. One simple idea
was to install clear signs, such as an order
here sign at the drive-through menu board
speaker. This reduced customer confusion
and thereby the time spent at the menu
board. Another idea was to rearrange the
menu board to improve its clarity so that
customers could place orders faster and
more easily.
( 6 ) The restaurants used the timer as a
focal point for motivating team members.
The DTW timer was perhaps the single
most important tool in improving the
speed of service. The timer served as a
constant reminder to the DTW employees
that the customers were waiting. Once
each customer departed, the timer dis
played both the window hang time for
that customer as well as the average win
dow hang time since the beginning of that
day. Serving as a scorecard and as a focal
point for motivation, the timer helped each quirement for all employees working in
restaurant's DTW leader set a pace during
rush times.
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(7) They created an environment con
ducive to problem-solving, established
simple procedures so that employees could
suggest improvements, and acted immedi
ately on suggestions. In addition to making
the blocker log available, Reynolds and the
team strived to create a nonthreatening en
vironment and to encourage DTW employ
ees to come up with ideas for improving
the process. They implemented several of
these ideas; some worked, others did not.
Converting serial activities into
parallel ones proved very
useful.
But the team made it a point to encourage
employees to try anything that seemed
reasonable. The team monitored the im
pact of implemented changes closely so
that it could discontinue whatever change
didn't seem to work. One of the important
rules the team followed was to act immedi
ately on employee suggestions, that is, to
decide quickly if it would implement a
suggestion and, if so, to implement it im
mediately. This created an unprecedented
level of excitement and enthusiasm among
DTW employees.
( 8 ) Rigorous training and motivating
employees through individual or team in
centives were keys to process improve
ment. Prior to the test, employees were
simply assigned to DTW without receiving
any special training in how to work effec
tively and efficiently in the DTW area. The
team made specific DTW training a re
that area. Productivity and camaraderie
improved noticeably. The team recognized
KENTUCKY FRIED CHICKEN

that several resources, cooks and restau
rant equipment, for example, were shared
by both the DTW area and the front coun
ter area serving the dine-in customers.
Consequently, actions of the front counter
employees influenced the performance of
the DTW area. To achieve the test goals,
all employees in the restaurant had to con
tribute to its success. Some restaurants
used games and awards to get all their em
(10) The team always kept an eye on
the competition. Through the use of mar
ket tracker surveys, the team regularly
conducted service-time studies on immedi
ate competitors within the test area. The
only way to remain competitive was to set
suitably aggressive service-time targets.
The restaurant general managers contin
ually sent notes to Reynolds outlining their
success stories and sometimes even their

ployees involved in the DTW test. For ex failures. They also sent timer tapes from all
ample, if the DTW employees hit the target the restaurants each week. Reynolds en
window hang time, all the restaurant em tered the window-hang-time results for the
ployees, and not just the DTW employees, individual test restaurants into a PC-based
were rewarded for their performance. software package that generated process
These rewards included specially printed control charts, such as X-bar and R-bar
T-shirts, gift certificates, and pizza parties. charts (Figure 4). The main reason for
The rewards proved powerful in strength choosing this software package was that it
ening the pride that DTW employees took was easy to use and had attractive graphics
in improving their speed of service while that the team could interpret easily. As the
also improving the morale of the entire restaurants gradually implemented process
restaurant team. improvement ideas, the team expected the
( 9 ) The restaurants made process im window hang time to decline steadily.
provement a way of life for managers. The Hence, by definition, the system was not
compensation of restaurant general man expected to be in a stable state while the
agers is tied to the performance of their in DTW test was in progress. Therefore, the
dividual restaurants. As the test pro
gressed, operational performance began to Slow service could have a
improve noticeably, and the general man
agers became increasingly committed to ruinous impact on product
the idea of continuous improvement. They innovation activity.
assumed ownership of the test, and they
started to identify so closely with the goal team did not use the X-bar chart during
of reducing service time that it became in the test for statistical process control per se
grained in their thinking. Interestingly, the but used it mainly to ensure that the trend
language of restaurant general managers line for window hang time was a declining
changed. Even during casual conversa one. On the other hand, the team used the
tions, they talked in terms of speed-of R-bar chart in the traditional manner to
service times. For example, they would say ensure that the range, that is, the variabil
that they had had a 48-second day or a ity, of the system was under control and
40-second lunch hour. was not increasing. The charts allowed all

May-June 1995 17

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APTE, REYNOLDS

Figure 4: The DTW test team used statistical process control charts for monitoring trends in
average window hang time and for controlling its variability at the four test restaurants. These
charts were produced in week 43. They were drawn using window-hang-time data for the 23
weeks ending in week 42, the last week of test, for one of the test restaurants. The X-bar chart
is essentially a plot of the average window hang time. Of critical importance in this chart are
the upper and lower control limits (UCL and LCL), which are computed on the basis of a 99
percent confidence interval for sample data. In using a control chart, one generally considers a
process to be stable (in control) if most data points fall between the UCL and LCL lines. Given
declining hang time, that is, instability of the system, we mainly used the X-bar chart during
the test to ensure that the hang time was declining steadily. Hang time for the given restau
rant has steadily improved starting in week 33, coinciding with the introduction of incentives
and games for DTW employees in that restaurant. The R-bar chart plots the average of the
range (that is, the difference between the longest and the shortest time) for window hang
times within each sample. In the chart below, the range for window hang times has consis
tently stayed between UCL and LCL, indicating that the range, or the variability, of the
process is in "control" with a 99-percent confidence level.

restaurant general managers to quickly see
the trends in their performance and
whether they were improving over time.
Every week, Reynolds put the control
charts for the previous week for all the res how fast they were at the drive-through
taurants together and sent them to all the
restaurant teams so that everyone could
see everyone else's performance. Reynolds
made it a practice to send the team and the
restaurant employees immediate positive
feedback to ensure a competitive environ
ment and their enthusiasm and excitement.
He attached short complimentary notes to
the control charts indicating that a given
idea had apparently improved service
speed in a given restaurant for the pre
vious week.
As the test progressed, the window hang
time improved steadily. The tempo in
creased and the excitement grew. One res
taurant team got so excited that they vid
eotaped their drive-through window in ac
tion, with a timer running, to demonstrate
window service, and they sent that tape to
the president of KFC in Louisville, Ken
tucky. Such pride in doing the job right
had rarely been exhibited before in the his
tory of KFC. The president of KFC person
ally called the restaurant to congratulate
the manager and the restaurant team for
their speed-of-service initiatives and ac
complishments. The company subse
quently recognized the manager as the dis
trict's restaurant manager of the year dur
ing the yearly regional performance
recognition seminar. And it honored the
restaurant team with a dinner at the res

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KENTUCKY FRIED CHICKEN

Compared to the rest of the district and

Figure 5: Drive-through-window-service time
shows a steady improvement. Average win tions for the test restaurants increased by
dow hang time was computed for the four 29.5 percent while the transactions for the
test restaurants together during the DTW test.
The average window hang time declined
from the initial average of 125 seconds to 60
seconds at the end of the 42-week test period.
taurant of its choice.
Over a period of 42 weeks, the team was 0.5 percent and one percent respectively.
able to reduce average window hang time (3) They improved productivity. Labor
from the initial 125 seconds to the goal of
60 seconds (Figure 5). With a total im
provement of 65 seconds, the window
hang time was cut by more than half!
The Results
The team achieved the seemingly impos
sible goal of 60 seconds window hang
time. The restaurants did not advertise this
speed-of-service improvement, but the
customers certainly found out, for business
grew significantly. Though it was not an
explicit goal of the test, the labor produc
tivity showed substantial improvement
with obvious implications for cost perfor
mance. As a result, the profit margin in
creased from about eight percent before
the test to about nine percent after the test.
The QSC and OFR scores for the test res
taurants went up and their performance on
the key customer attributes in the market
tracker survey showed across-the-board
improvement. As expected, the speed of
service category showed dramatic im
provement.
the division, the four test restaurants sub
stantially improved their overall perfor
mance during 1991 as compared to their
overall performance in 1990:
( 1 ) They increased customer transac
tions. The annual DTW customer transac
district and the division decreased by three
percent and one percent respectively.
(2) They achieved higher sales growth.
The DTW sales volume at the test restau
rants grew by 17.5 percent while the sales
for the district and the division declined by
productivity as measured in DTW transac
tions per team labor hour for the test res
taurants increased by 12.3 percent while
the productivity for the district and the di
vision declined by 0.4 percent and three
percent in the same time-frame. It is also
interesting to note that the total DTW la
bor hours, that is, the number of employ
ees in the DTW area, were not reduced in
any of the test restaurants.
Looking at these improvements, one
may ask, was this simply a Hawthorne ef
fect? (That is, were these improvements a
result of all the attention the team gave the
DTW employees and not a result of var
ious operational improvements?) KFC has
replicated the operational changes imple
mented in the test at other restaurants and
has seen a similar persisting improvement
in speed of service and labor productivity.
The answer to that question is no, it is not
a Hawthorne effect. The improved perfor
mance has come primarily from the quality
management program, or more specifically,

May-June 1995 19
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APTE, REYNOLDS
from various operational improvements. In
fact, with further operational improve
ments made since the test, KFC has now
reduced the average window hang time to
about 30 seconds.
After successfully concluding the test,
KFC managers decided to gradually roll
out the speed-of-service program to other
KFC-owned restaurants in the division.
They asked some team members to visit
other restaurants to explain the actions
that had led to such dramatic improvement
in the speed of service at their own DTW
operations. Not surprisingly, other restau
rant general managers quickly understood
the program's benefits and some voluntar
ily decided to join the program. With some
team members as coaches, KFC set up a
training session for those that signed on to
the program. KFC bought and installed
computerized timers and made various
other operational improvements in the res
taurants that signed on to the program. As
the team members shared the key lessons
from the DTW test, this new batch of res
taurants learned quickly. What took the
team 60 to 90 days to learn and under
stand was explained to these restaurant
general managers in just a few days. They
made modest improvements in service
time almost immediately starting with the
first week. This next batch of restaurants
reached the goal of 60 seconds in less than
half the time taken by the Oklahoma DTW
test team. These findings suggest that a
thorough benchmarking study of the best
in-class processes could have quickly un
covered many improvement ideas and
would have jump-started the test. But the
test predated the popularization of the
benchmarking concept as we know it to
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day, and hence, for that reason, the team
did not explicitly undertake benchmarking.
Subsequent to the divisional roll out,
KFC implemented the DTW speed-of
service program nationwide. In the past
two years, managers and employees at all
2,000 KFC-owned restaurants have been
trained to improve speed of service at both
the drive-through window and the front
counter. Senior managers at KFC monitor
the program through QSC and OFR evalu
ations. Moreover, all restaurant managers
are tracking speed-of-service performance
on a "real time" basis, taking corrective ac
tions immediately as necessary. In this
task, the restaurants now use a new, pro
prietary cash register system called MERIT
that has a built-in internal timing device
for measuring service time from the mo
ment an order is entered until it is served.
It measures service time for both the drive
through window and the front counter.
Restaurants also use a separate window
timer to track the window hang time.
KFC has also introduced the program on
a voluntary basis to over 3,000 franchised
KFC restaurants. Currently, over 1,300
franchised restaurants have signed on to
the program, implementing such improve
ment ideas as the use of headsets, chang
Everyone considered this goal
unrealistic.
ing equipment layout, and training DTW
employees. KFC has adopted the 60
second window hang time as the process
specification in its quality measurement
program throughout the nation.
In summary, quality management at
KENTUCKY FRIED CHICKEN

KFC rests on the rigorousness of the OFR ing speed of service at the critical drive
and QSC programs to continually assess through point of sale, this team was able
the quality of both service processes and not only improve customer service but also
outcomes. These measurements are further to improve the financial position of the
used to improve the underlying processes units involved. Transactions increased al
for achieving better overall performance. most 30 percent in these stores versus
KFC strives to change its detailed specifica three percent in the rest of the market and
tions as the needs of the marketplace sales outpaced the nontest markets by over
evolve and industry practices change. As 17 percent all while reducing window ser
confirmed by its experience with the DTW vice time from over 120 seconds to 60 sec
speed-of-service test, the notions of pro onds?clearly a win for both the consum
cess focus and continuous improvement ers and the company.
through empowering its employees are the "In addition to being the model for the
foundations of the ongoing quality man company's current drive-through service
agement program at Kentucky Fried time standard, this process has also been
Chicken. adopted in over 1,300 of our franchised
References restaurants as well."
Apte, U. M.; Karmarkar, U. S.; and Pitbladdo,
R. 1994, "Quality management in services:
Analysis and applications/7 working paper
94-09-01, Cox School of Business, Southern
Methodist University, Dallas, Texas, forth
coming in Practice of Quality Management,
eds. U. Karmarkar and P. Lederer, Harvard
Business School Press, Cambridge, Massachu
setts.
Shingo, Shigeo 1987, The Sayings of Shigeo
Shingo: Key Strategies for Plant Improvement,
translated by A. P. Dillon, Productivity Press,
Cambridge, Massachusetts.
Shingo, Shigeo 1988a, Non-Stock Production:
The Shingo System for Continuous Improve
ment, Productivity Press, Cambridge, Massa
chusetts.
Shingo, Shigeo 1988b, The SMED System, video,
translated by A. P. Dillon, Productivity Press,
Cambridge, Massachusetts.

Starlette Johnson, Finance Director, KFC,

writes, "The drive-through-window
(DTW) test in Oklahoma City served as
the foundation for the company's current
60-second drive-through service time goal
established in 1992.
"By focusing the OKC team on improv

May-June 1995 21
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