Taco Bell Corp Case Solution

1. Identify a number of factors that led to Taco Bell success in the early 1990s?

During 1983-1988 Taco Bell established direction for the fast food restaurant and introduced the concept of incremental redesign. During early 1990s, Taco Bell introduced various organizational changes such as K-minus, FACT, Value Pricing, Speed of Service (SOS) and Total Automation of Computer Operations (TACO). K-minus strategy included outsourcing most of the prep work, to save time and reduce cost. This helped managers and employees to concentrate more on the management side of the business, e.g. customer satisfaction. The purpose of FACT was to conduct surveys of customers’ likes and dislikes. This was helpful in understanding the consumer mind and identifying the exact requirements of the customers. Furthermore, through the value pricing strategy, Taco Bell implemented a high/low pricing strategy designed to attract customers with a particularly low-priced item and then tempt customers to switch to a higher priced selection. This led to overall positive results in all franchisees’ restaurants. The idea of Speed of Service (SOS) was to curtail waiting time for customers in restaurants. It was successful in achieving its purpose of getting the fast food back on the conventional fast track.