A Campaign against KFC Corporation

Central Issue: The main problem is the philosophical question of animals’ rights. PETA suggests that animals should possess basic moral rights while KFC Corporation rejects this claim.

Recommended Course of Action:

It seems that chicken-related corporation, such as KFC, and others should introduce more humane technologies. At the same time, PETA should use more ethical methods for advocating its corresponding standards. It is inadmissible to violate people’s privacy or be involved in other illegal or unethical behavior. PETA should rely on persuasion and logical arguments. The main target audience should be the consumers rather than KFC managers.

Basis for Recommendation:

Although the ideas advocating animals’ rights seem to be appealing to the civilized country, they should be promoted adequately. KFC Corporation does not adopt the existing technologies due to its cruelty. It is motivated exclusively by the profit considerations. Due to the fact that the lower costs allow obtaining higher revenues, the corporation tries to minimize its average costs. Therefore, some PETA’s actions cannot be effective because they do not address the essence of profit calculations. Moreover, it is reasonable to address consumer preferences. If the majority of consumers were aware of inhumane practices, they would shift their demands to those companies that demonstrate better treatment of chickens. In this way, the only possible response of KFC Corporation will be introducing new and more responsible technologies. Thus, the ultimate objective can be achieved without any additional external pressure on KFC managers and personnel.

Reasonable Alternatives:

1. Continue violating privacy rights of KFC managers. PETA’s activists could continue increasing psychological pressure on KFC managers. They could appeal both to their ethical standards and monetary considerations. They may implement these strategies not only to the top-managers, but to the managers of all levels. This alternative is rejected because all the corporate managers have to primarily orient to profit-and-loss considerations. Even if the managers accepted the ethical standards of animals’ rights promoted by PETA’s activists, they could not adopt business decisions that would negatively affect the company’s profitability and market positions.
2. Implementing even more provocative public campaigns. PETA’s activists are often involved in provocative actions, including using Playboy women or demonstrating chickens with blood. They could continue using this mode of behavior in order to attract the additional public attention to the problem. This alternative is rejected because it is incorrect to promote ethical behavior (respecting animals’ rights) through unethical and immoral actions. This alternative cannot be accepted on moral grounds.
3. Using logical arguments while communicating with KFC managers without any privacy or other legal violations. This style is morally acceptable since it respects the rights and positions of all people. Both parties can communicate with one another and arrive at some mutually beneficial conclusions. This alternative is rejected because it is ineffective in the long run. The corporation’s managers will adjust their strategies to the needs of the consumers, and their personal position will not have a radical impact on the situation.
4. PETA may abandon all its attempts to actively influence the situation and organize seminars only for those people who already support the idea of animals’ rights. They may further develop the theoretical basis for advocating their position. This alternative is rejected since it will not lead to the radical changes in the industry. The current status-quo will remain. Even if the developed arguments are correct but they are not supported by a considerable number of the consumers, the producers will not implement the needed reforms. Therefore, PETA cannot be transformed into a pure theoretical organization as well as abandon any practical issues and programs.

Significant Factors:

1. Consumer preferences.
2. The expected revenues.
3. The average costs of production.
4. Competitive strategies.
5. The structure of production.
6. Ethical standards adopted by corporations.
7. PETA’s further strategies.
8. The philosophical debate over animals’ rights.

Discussion:

Significant Factor # 1: Consumer preferences

Consumer preferences are the main aspect that will influence the further dynamics of this industry. Due to the fact that the commercial companies are always oriented to the needs of the consumers, they will have to adopt those strategies that correspond to the consumer needs in the best possible way. The following two major alternatives are possible.

First, the consumers may not demonstrate the desire to pay higher prices for the humane technologies. Even if they accepted animals’ rights at a theoretical level, they could be unwilling to pay higher prices. Under this scenario, no radical changes will occur regardless of PETA’s efforts. Second, if the consumers demonstrate their willingness to pay for more humane technologies, corresponding innovations may occur in the near future. All companies from this industry will have to adjust their production processes accordingly. It may lead to the radical improvement of the production process.

Significant Factor # 2: The expected revenues

The expected corporations’ revenues are closely related to the structure of the consumer preferences and the level of their demand. All commercial companies try to maximize their revenues and profits. For this reason, they make corresponding projections on the level of revenue that may be obtained under different scenarios. Corporations consider both objective factors (technologies, supply chains, etc.) and subjective ones (consumer preferences, their expectations, etc).

Business people will assess the rationality of implementing new and more humane technologies from the perspective of their influence on the expected revenues. If this impact is strongly positive, these innovations are possible, and they may even exceed the existing industry standards (for example, KFC Corporation has introduced technologies that substantially exceed the minimally acceptable level). Otherwise (if the impact is neutral), the companies may not be highly open to innovations.

Significant Factor # 3: The average costs of production

All commercial companies also cannot neglect the impact of costs and their dynamics on profitability. Due to the fact that the profits are calculated as a difference between total revenues and costs, the managers try to achieve the situation when the rate of revenue growth exceeds that of costs. If this objective is achieved, the company’s profits tend to increase.

Therefore, KFC Corporation and other companies are also concerned with the dynamics of their costs associated with more ethical production of chickens. They will compare the dynamics of their costs (that necessarily increase) with the expected revenues. Thus, the revenues should not merely increase but rise to such a degree that will cover these additional costs. Both revenues and costs constitute an important part of profit-and-loss calculations.

Significant Factor # 4: Competitive strategies

All corporations orient not only to the needs and preferences of the consumers, but also to the strategies of their competitors. The consumers always select the optimal option from a set of available alternatives. Even if the company does not meet all consumer preferences exactly, but other competitors demonstrate even less efficient operations, the competitive positions of a given company can be strong. All organizations try to predict the most plausible actions of their competitors and develop the most effective responses.

Thus, if the competitors try to expand their market shares, KFC Corporation also has to adopt more “aggressive” marketing strategies in order to maintain its current market positions. Moreover, the companies have to orient not only to the current competitors’ actions but their most plausible future ones. If their assessment is correct, they will expand their market shares and profitability. Otherwise, their competitive positions may weaken.

Significant Factor #5: The structure of production

At the present moment, KFC Corporation purchases its chickens from other producers. However, this structure of production can be changed if the corporation’s managers comprehend other available alternatives. For example, the corporation could produce these chickens without any additional assistance. Although it may lead to higher expenses, it will also be appreciated by the corporation’s customers.

As any changes in the corporate production structure are associated with considerable costs and investments, KFC Corporation can rely on this strategy only if it suggests that consumer preferences are stable. In other words, only if the consumers continue to demonstrate their willingness to pay for more ethical production processes, the corporation may change its structure of production and implement the required innovations. The main function of the structure of production in the industry is to optimize the amount of average total costs.

Significant Factor #6: Ethical standards adopted by corporations

At the same time, corporations do not merely reflect automatically the needs and preferences of their consumers. They also influence their habits and choices through their corporate philosophies. Since consumer preferences are subject to change, they consider all available information including those principles and values adopted by corporations. If they appeal to the consumers, they may change their behavior patterns.

Modern corporations cannot neglect ethical standards. They should orient at least to those ethical issues that are directly related to their industries and production processes. For example, KFC Corporation cannot remain neutral regarding the question whether animals should have some rights. In this way, the corporation may outline its position and demonstrate respect to the consumer needs. If the consumers notice that the corporation shares their beliefs and worldviews, they can wait for a certain period of time needed for the implementation of reforms. Otherwise, they will shift their demand to other companies that are more responsive to their ethical preferences.

Significant Factor #7: PETA’s further strategies

PETA is also non-neutral to the future dynamics of this situation. As it substantially affects the perception of the problem by the consumers and corporation’s managers, the strategies selected by PETA will influence the most plausible situation in the industry. If PETA continues to use unethical means to promote its ideas, the consumers may become more critical to its messages. They may even abandon the idea of animals’ rights. In this case, the situation in the industry may only deteriorate.

If PETA continues to violate privacy rights of KFC managers, numerous lawsuits may follow. Consequently, the fundamental problems of animals’ rights will not be resolved. Only if PETA can change consumer preferences in an ethical way, the situation may improve. Corporations will have to adjust their strategies, and animals’ rights will be generally recognized.

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Significant Factor #8: The philosophical debate over animals’ rights

The general philosophical debate over animals’ rights can also have some impact on the situation in the industry. The majority of people do not formulate their value judgments independently but orient to the dominant views expressed by the experts in their fields. Therefore, the results of the philosophical debate over this issue may have some practical implications. The following two scenarios are possible. If the advocates of animals’ rights can prove their position, then this view will become dominant. All corporations in the industry will have to adopt more responsible production processes. If it is proven that animals have no moral rights, then the consumers may become indifferent to the mode of production used by corporations. Since the companies may try to minimize their costs, they will return to their previous production methods.