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Yum!: Brands Innovations and Commercialization

Innovations’ commercialisation has always been perceived as a critical prerequisite for the successful operating of a firm. Many companies’ practices and policies in this regard seem to prove such a statement. It might be relevant to investigate the experience of a notable enterprise in the mentioned theme’s framework. Yum! Brands might be considered as one of the most substantial and influential actors in the global fast-food market. It contains the following recognised brands – KFC, Pizza Hut and Taco Bell. It seems reasonable to assume that the company has developed a significant system of commercialising its innovations. This report will discuss this system, identifying the crucial factors of its success, as well as provide recommendations on how to improve the mentioned commercialisation activities.

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Commercialisation System

The primary objective of innovation is to create added value for both consumers and companies. Firms carry out various types of innovative activities, including the development of new goods and services, the introduction of new processes, as well as the effectiveness of organisational and marketing activities. Successful implementation of innovation gives the company plenty of competitive advantages, one of which is the ability to create or assign values ​​that other companies in this field do not yet possess. For successful innovation, a company must develop a strategy that will successfully commercialise this innovation. The crucial objective of this strategy should be the development of a model for searching, adapting and implementing innovations. It will create a steady flow of changes that provide competitive advantages and achieving the strategic goals of the firm.

The company tends to follow a classic model of commercialising innovation with unique and significant approaches. The initial stage of the process is idea generation for which the Management Planning and Development Committee is responsible; it organises and governs the firm’s crowdsourcing activities. For instance, in 2019, “KFC launched the KFC Innovations Lab to turn new “ground-breaking ideas into a reality” and crowdfunding support for the ideas” (Sweeney, 2019, para. 1). What is more, Yum constantly collects its employees’ feedback on how the working process can be improved and what innovations they can suggest.

The following stage is idea screening, which is also an essential step as it allows reducing costs in the future. Such an analysis is also conducted by Management Planning and Development Committee that reports to the Board of Directors whether an innovation has necessary potential (Yum! Brands, 2013). After this innovation is approved, the process of concept development and testing takes place. The firm’s subsidiaries provide their concepts with a solid rationale to the mentioned Committee that allows further tests. The latter usually implies surveys and short-period tries in some properties.

Then, there is marketing strategy development, and it seems that Yum! Brands has created a significant system in this regard. “In total, Yum! Brands are available in about 130 countries, making it the biggest chain of fast foods companies in the world” (Bhasin, 2019, para. 7). Such global coverage requires a thorough and coherent perception of the situation in the industry. “The company first studies the market and analyses the consumer needs before deciding on the most appropriate distribution channels” (Bhasin, 2019, para. 7). The result is that Yum! Brands attends all desired market segments. Furthermore, the firm pays a lot of attention to its promotion activities. For instance, it continuously conducts advertising campaigns, as well as provide numerous discounts that lure customers.

Business analysis is conducted mostly by the subsidiaries’ accounting committees as it implies a review of sales, costs and profit predictions. These committees report to their boards of directors that, in turn, report to the Committee. The latter assesses possible expenses and profits for the product or service. The financial side of the issue should be approached thoroughly and consistently to avoid any errors (Yum! Brands, 2013). Such a policy allows the company to demonstrate transparent accountability, which strengthens its reputation in the market.

After all the mentioned stages are passed, the firm starts developing its new product or service. This step requires substantial investments; thus, all the above tests and assessments should be error-free. It should be mentioned that Yum! Brands tends to adhere to the best sustainable practices in its products’ life cycle (Yum! Brands, 2019). For instance, according to Yum! Brands (2019, para. 16), the firm “started exploring how to reduce greenhouse gas (GHG) emissions by setting science-based targets.” At this stage, the company communicates with customers and staff intensively in order to get feedback from stakeholders.

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The next step is test marketing that means that a product or service is being tested in real market settings. It should be mentioned that firms may skip this stage sometimes to adapt to changing conditions in the industry (Barone, 2020), but Yum is not among them. Test marketing provides it with the opportunity to assess products and their marketing program as a whole – starting from advertisement and ending with budget levels. For example, “it took three years and 45 prototypes to launch Doritos Locos Tacos, which sold 100 million in the product’s first 10 weeks” (Morrison, 2013, para. 4). As turned out later, it was the most successful launch of a product in Taco Bell’s history.

Finally, commercialisation of innovation occurs – it involves the introduction of a new product or service into the market. This stage is to deal with the issues of when and where to launch, as well as whether the rollout is an appropriate and rational action. This final introduction may become too expensive for the company if it is not undertaken in a timely manner. The firm is to take into account many aspects such as market competition, inflation rates, and overall industry state of affairs. Thus, it might be summarised that successful new product development is to be customer-centred, team-based and systematic, as well as spend resources reasonably.

Example of Successful Commercialisation

The static lightboxes with the menu were replaced with dynamic content with a visual demonstration of dishes, advertising and information about special promotions. The technologies used in the KFC and Pizza Hut restaurants allow the company’s management to receive a new tool for communication with the consumer. All panels are connected to a remote server and can be controlled from anywhere in real-time, even in the off state. Data can be loaded in advance, which greatly simplifies system maintenance. Thus, information on prices, assortment and promotions are always under control throughout the network.

The introduction of technology has received positive ratings from service specialists as it meets all the requirements of the restaurant business. Among other things, a convenient and important innovation was the ability to make changes in real-time. The technological solution of the digital menu has allowed interacting with customers more effectively. Ease and simplicity of content management gave the opportunity to convey information to clients more accurately and efficiently. Now, Yum! Brands has a single platform for communication with visitors. Samsung’s unique display and digital content management solution contributes not only to costs optimisation but also to an emphasis on modernity in the positioning of the firm’s restaurants.

Thanks to this innovation, efficiency is improved in the product, technological and functional sense. Product quality has increased due to the timely preparation of all lines and workers and compliance with standards established at the properties of the entire network. In the technological sense, labour productivity is improved because of the reduction of losses that could take place due to the disorganisation of the working process. In a functional sense, management effectiveness is increased, as each employee knows what and when he or she must do.


After the provided discussion, it seems apparent that the company has a significant operations system related to the commercialisation of innovations. Nevertheless, a number of improvements might be suggested; first, the firm could intensify its promotion activities. Yum pays attention to advertising, but given the recognised brand and reputation, it does not seem to promote its products insistently. Hence, the initial recommendation refers to the stage of marketing strategy development – to increase promotion via social media.

The innovation process as an independent business operation that ensures the creation of a significant idea. It brings it to implementation in the form of a product, service or technology. This process should become the core of the organisation of systemic innovations in the company. It should be highlighted as the key business idea in the founding documents. During the implementation of innovations, plenty of tasks are realised, and technologies and tools are developed. Thus, it might be rational to create the Innovation Committee to alleviate the burden of the Management Planning and Development Committee. However, it should be mentioned that innovations cannot be created exclusively by the Innovation Committee. They require active participation and exchange of information between internal departments of the company, such as a marketing and procurement department. It has direct contact with partner companies, as well as with customers, suppliers and competitors.

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Any organisation aimed at competitive existence in the market should understand that in the conditions of high dynamics of the external environment, it must continuously change. To maintain a high growth rate, firms must constantly improve their services, streamline processes and introduce the latest information technology to reduce costs. It is impossible without an appropriate organisational culture since staff acts as the main executor of innovative solutions. However, this culture is formed and changes extremely slowly; in order to establish it, an appropriate basis must be built, which can be the system of innovative activity of workers. Moreover, the staff can act not only as a performer of innovations but also as a permanent generator of changes in the field.

Personnel is the primary creative force of the firm, so its creative potential should be used to the maximum. Improving the innovative activities of staff is cost-effective; therefore, it is necessary to manage the innovative ideas of employees purposefully, as well as to stimulate them to develop and implement innovations in Yum. In order to achieve this goal, it is necessary to motivate these employees accordingly so that they formulate and implement innovative solutions that can bring a positive effect to the company. One of the efficient forms of encouraging the staff to innovate is innovation contests, organised on an ongoing basis in the firm. Participation in such a competition stimulates employees to engage in innovative activities in the future and forms such behaviour that in the long term can lead to the formation of creative organisational culture.

An important factor in stimulating the innovation activity of companies is also cooperation with leading third-party organisations. Among them are scientific and educational establishments, subjects of small and medium innovative entrepreneurship and innovative territorial clusters. To do this, ensure maximum transparency of information about the company’s investment plans and implement the principle of open innovation. Thus, the development of a mechanism for interaction between companies during the creation of innovative platforms will become a tool to improve the performance of these firms.


To conclude, the process of commercialisation of innovation was discussed referring to the practices of Yum! Brands. It was found that the company has developed a good system within the scope of the theme explored. The firm demonstrates a thorough and coherent approach at each stage of this process, which contributes to its current success. For Yum, within the scope of the issue, it was recommended to intensify advertisement, include innovativeness as a core business element in the founding documents and to create the Innovation Committee. Then, it was suggested to introduce innovation consents for employees and cooperate with companies and institutions that can contribute to the development of innovations.

Reference List

Barone, A. (2020) Marketing strategy. Web.

Bhasin, H. (2019) Marketing mix of Yum Brands – Yum Brands marketing mix. Web.

Morrison, M. (2013) ‘Sales are going loco in Taco Bell, Ad Age’s marketer of the year’, Ad Age, Web.

Sweeney, E. (2019) KFC’s crowdfunding campaign gauges interest in half-baked ideas. Web.

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Yum! Brands. (2013) Management Planning and Development Committee Charter. Web.

Yum! Brands. (2019) Our recipe for good. Web.

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