Posted On June 20, 2009

     Business Jihad Journey with KFC to Shanghai, (March 24-28, 2009).
From left, Benjamin Jerome (KFC Cambodia), Nelky Goh (KFC Brunei),
T.H.Lim (KFC Malaysia), Ahamad Mohammad (Deputy Chairman),
Muhammad Ali (Chairman), Jamaludin Md Ali (Managing Director),
                 S.K.Wong (President, KFC and Pizza Hut Malaysia),
Lawrence Ding (Pizza Hut Malaysia) and Michael Gian (KFC & Pizza Hut Singapore)

BUSINESS JIHAD DEMANDS BUSINESS PERFORMANCE

The initial idea to dedicate JCorp’s business achievements and all its corporate resources, assets and wealth to the Business Jihad cause was expressed early in the 1980s. The first initiative was made when JCorp first introduced and translated into real practice its “Intrapreneuring” concept.

The connection between “Intrapreneuring” and Business Jihad will be duly explained, Insya Allah, in a special Business Jihad Journey article later. Suffice it to say at this juncture that JCorp had resorted to intrapreneuring in order to offer an alternative to privatisation that was mooted as public policy then.

I have always been steadfast in my belief, and so have most of my colleagues, that the privatisation policy had its pitfalls, and that to privatise JCorp’s companies and assets would have made the pursuit of a Jihad cause impossible. Privatisation would vest ownership in individual and private hands and thus JCorp would have lost the opportunity to build a Waqaf Corporation.

In any event, the fundamental premise of Business Jihad is business success and high performance. Top performance must be the highest priority and this JCorp had set out to achieve without any compromise.

Alhamdulillah, JCorp was able to record business successes and corporate growth and expansion ever since, constraints, crises and many business failures notwithstanding. (For those interested on having a closer look at the impact of economic crisis on JCorp can go to Blog Article under heading: “Global Crisis, Business Jihad and JCorp’s Turnaround”).

JCorp has since grown from strength to strength over the past of more than two decades - and at an extremely fast pace too. This fast pace of growth and expansion was achieved after a lot of hard work, smart strategising, tenacity and determination in growing businesses - a few of them painstakingly, from scratch and zero base. Alhamdulillah, several businesses started from humble beginnings have today become RM billion listed companies, as well as national or niche market leaders.

THE VENTURE INTO KFC

JCorp had also not hesitated to seize business opprtunities as and when they arise. The strongest and fastest growth have actually been the result of a formidable track record of highly successful acquisitions, takeovers, and joint ventures over the years.

One of JCorp’s most remarkable and high-profiled acquisitions that was also one of Malaysia’s landmarks in corporate ownership shift was the acquisition of KFC Holdings (Malaysia) Bhd and QSR Brands Bhd that took place throughout 2006-2007. It was a hard-fought acquisition, initiated through JCorp listed subsidiary, Kulim (Malaysia) Bhd.

Though unintended when JCorp first came into the picture, KFC’s acquisition became highly confrontational and hostile all the way, to include an array of high-profiled litigation, legal challenges and court battles! Unsurprisingly, the long, bloody and protracted “corporate war” had also brought tremendous mass media attention in its wake.

JCorp’s and Kulim’s ultimate success in acquiring KFC Holdings (Malaysia) Bhd brought the Group into its first venture into the big business of Foods and Restaurants. Foods, after all, is the largest business globally, in terms of market size.

A HALAL VENTURE

In terms of Business Jihad this success had offered JCorp an extraordinary opportunity that was absolutely unexpected, making it possible for JCorp to quantum leap its economic value adding and wealth creation capabilities on a sustainable basis. Significantly, it also brought JCorp directly to the forefront into a business that emphasizes Halal as a key success factor, especially in the context of a market dominated by Muslim consumers.

JCorp was also quick to recognize the power of global brands such as KFC and Pizza Hut, and the invaluable access these brands provide to top global companies with world-wide reach and networks and world-class methods and business knowhow. We were also extremely pleased to quickly avail ourselves to all the skills, expertise, networks and proven capabilities prevalent among top managers and all the great people who had dedicated life-long careers towards building KFC, Pizza Hut and Ayamas into top-of-the-mind brands in Malaysia and regionally as well.

After all, KFC and Pizza Hut had not become No 1 in Malaysia and the Asean region for nothing!

All these assets, resources, outstanding track record and tremendous business reach, when combined with JCorp’s own corporate capabilities and its Business Jihad’s spiritual energy, resulted in the creation of a new, highly empowering driving force to elevate KFC, Pizza Hut and Ayamas to new levels of achievements.

And this is exactly what had actually happened!

STELLAR PERFORMANCE AND MARKET RECOGNITION

Even in spite of crises and the general economic slowdown, people at KFC Holdings (Malaysia) Bhd, for example, though challenged, are today more confident about their job security and career enrichment prospects. Once their energies were released, and everyone empowered, all the businesses involved had recorded stellar results and record-breaking growth performance.

One of the best measures of business success is through a rating made by the market itself. To illustrate KFC’s singular success, its share price and market capitalization were among the best performing at end 2008. KFC Holdings (Malaysia) Bhd was the top performer out of the only two counters listed on the Malaysian Bourse’s Composite Index that rose at 2008 year end, bucking the general market trend when all others went south!

KFC: Business + Jihad = Sustainable High Performance

We have indeed not looked back since!

I was extremely privileged when for the first time I was able to participate in an annual gathering of Asia-wide KFC and Pizza Hut franchisees held in Shanghai between 24-28 March, 2009. It was in the company of senior colleagues from Kulim, KFC and Pizza Hut as well as selected top performers from among Restaurant Managers all over the Group.

This was an occasion to celebrate success with all the passion, drama, colour, excitement and exhiliration. Such celebrations are famous and well known hallmarks of the KFC and Pizza Hut corporate culture, and the atmosphere was simply electric and visibly empowering!

I was indeed extremely proud, on this occasion, to be called upstage to represent all my colleagues to receive, on behalf of KFC Holdings (Malaysia) Bhd, the coveted “Tiger Award” for 2008 from YUM International (Asia) given away by CEO Mr Art Rautio.

As a matter of fact this was the second year running that KFC Holdings (Malaysia) Bhd had won the top Award, as it had previously also taken home the Asian Tiger for 2007! Alhamdulillah, KFC Holdings (Malaysia) Bhd had been able to beat its own track record, as well as be ahead of all other outstanding teams throughout the Asian region, for two years running since JCorp-Kulim’s takeover.

We have indeed arrived, and we have hit the ground running! The citation that came with the Asian Tiger Award stated it all:

“The KFC Franchisee of the Year Award:

This KFC market recorded 2 straight years of double digit System Sales Growth driven by both positive Same Store Sales and Transactions Growth (SSSG & SSTG) on top of adding 69 net new units over a 2 year period. In 2008, it achieved an outstanding System Sales Growth of 24%, with SSSG of 15% and SSTG of 6%.

This market leads the way in building the KFC brand with its consumer insights driven marketing, and world class 360 execution, bringing the Finger Licking Good experience to life for our customers.

In order to stamp its market leadership position further, this franchisee has made tremendous strides in expanding its portfolio of Freestanding Drive-Thru units. It is also one of our lead markets which has introduced our “KFC Bucket Attitude” design to Asia with resounding success.

The franchisee of the year award for KFC goes for the 2nd consecutive year to KFC Malaysia!”

MY HEARTIEST CONGRATULATIONS TO ALL OUR COLLEAGUES AT KFC MALAYSIA FOR SUCH OUTSTANDING PERFORMANCE.

WE ARE INDEED PROUD THAT ALL OF YOU HAVE NOT COMPROMISED ON THE BASIC PREMISE OF BUSINESS JIHAD, NAMELY TOP BUSINESS PERFORMANCE AND SUSTAINING ECONOMIC VALUE ADDED AND WEALTH CREATION FOR SOCIETY!

Alhamdulillah!

Muhammad Ali Hashim
20th June, 2009

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(See Business Jihad Journey # 2, Part 2: “With KFC to Prague, From Asia To The World Stage” in the next posting)