Reference no: EM132958515

Chicken Licken founder, George Sombonos, was the son of a poor Greek tea-room owner. In 1972, his father bought him an airline ticket to the US on condition he went to see his aunt in Greece on his way home. This trip was the catalyst for George's dream. It set him on the road to developing the number-one, SA homegrown, quick-service restaurant business and the largest fried chicken franchise outside of the United States.

There he found the spice he was searching for. Back at home, Sombonos mixed the spice recipe under his bed and swapped it for the existing chicken coating recipe at his father's roadhouse. Sales increased and the turnover shot up from R25 000 a month to R200 000 a month over a four-year period. In 1975, Sombonos started serving black people in their cars even though it was in contravention of apartheid legislation. He said: "I felt I was giving them back their dignity." When his father queried it, his grandfather said: "Leave him - you just count the money." This move earned George the loyalty of the millions of customers who made him what he is today. "Even Winnie Mandela and Tokyo Sexwale used to come to our restaurant. So it was a logical step, at that time, to expand our business to black areas," says Sombonos. In January 1981, Sombonos formed a company called Golden Fried Chicken, which was to be the new name until a waiter came up with a better one - Chicken Licken - which cost only R300 to register. It is a logo that is worth millions today.

In a desperate effort to develop further, he gave away the first franchises, which were in Soweto and Alexandra. In 1985, he started to sell franchises at R3 000, but helped every franchisee to get going by giving him R15 000 worth of equipment and stock and didn't charge royalties for the first four months. "As a result, I didn't make much money," he says, "but we were expanding nicely and by then we had 21 stores." Chicken Licken has since grown to 250 stores. Ten of them are company owned of which six are the most successful of the 250. It sells 100 000 birds a week and was the first fast food restaurant to introduce Hot Wings, selling millions each month. "The country's demography has changed in the last 16 years," he says. "People who previously lived in the townships have started to migrate to more affluent areas.

To retain the patronage of this new middle-class, we had to move our shops along with them to the suburbs. 2 However, despite the brand's success and positive image, there are still some traditionally white shopping centres, like Sandton City, where the management still carry deep-rooted prejudices. I am just waiting for Liberty Life to become black empowered, and then a black man at the helm won't say we are too black," says Sombonos. So what makes this man so successful, even in recessionary times? His modest answer is having the ability to read the market, perseverance and never giving up on your dream. But he has another ace up his sleeve: training. People who work for Chicken Licken don't leave the way they came in. They become skilled. Sombonos says they have built a culture of profit share.

These means on-target bonuses for all staff right down to the chip fryers, who can be frequently heard asking their managers: "How much of the daily takings have we made today?" Asked when he intends to retire. He jokingly replies, "I am not going to retire - this business and I are like death do us part." His succession plan is his daughter, Chantal, who is now 32. "I also have great people, most of whom are under 40. I put aside 15% of profits for the heads of department each year. I am still going to be working for at least another five years and by then; they will all be highly skilled," Sombonos says proudly.

Question

Discuss the concept and the 3 categories of high-performance work systems with reference to the case study