Last Updated Apr 20, 2010 11:07 AM EDT
By anyone's measure, this was a bad couple of years. So what did Novak do? He focused on two things. The first was Yum's multi-brand strategy, offering different fast-food options side by side, in the same location. With KFC, Taco Bell, Pizza Hut and Long John Silver's Fish'n'Chips in its portfolio, Yum could offer more choice under one roof, reducing real estate costs and increasing revenue. It was a model his rivals found hard to copy.
But on top of this, Novak took on a challenge that left his peers gaping. For years it had been a lamentable but unchallenged orthodoxy that the staff turnover rate in the Quick Service Restaurant (QSR) sector was high -- 200 percent high. Everyone hated it but accepted it as one of the unmovable features of the industry. Until Novak decided to halve it. In the midst of a recession, law suits, chicken blood, and screaming rock stars, Novak attacked the costliest part of his business. And by 2005, he had brought that previously unmovable number down to 100 percent. It was an achievement no one thought was possible and everyone struggled to emulate.
Now, I don't like fast food. I don't eat KFC, I don't think I've ever eaten at Taco Bell, and I'm not a fan of Pizza Hut. But I'm awestruck by Novak's bravura. In the midst of such turmoil, many a CEO would have had their hands full just fire fighting. But that isn't what Novak did. He focused. Offered a handful of gold-plated excuses, he rejected them all, built revenue, and was able -- for the first time in the company's history -- to start paying a dividend. I may not like the food but I have to admire the focus.
So here's my challenge to you: In the midst of a unique global economic downturn, are you using recession as an excuse? Or are you able, despite the despondency and turbulence that surrounds you, to focus on big goals and achieve them?