What has KFC’s changes got to do with the IT world and specialists?

Big is beautiful, right? I’m sure that’s what the board of KFC thought when they moved their UK logistics from Bidvest to DHL and made a significant saving. But economies of scale do not guarantee increased performance. In fact, for KFC the opposite would seem to be true.

KFC DHL and Bidvest chicken logistics issues

Changing to a cheaper supplier

KFC has recently changed their UK logistics from Bidvest to DHL. Don’t get me wrong, Bidvest are not small, they are part of the BFS group and in 2014/2015 had revenue of £2.36bn. However, unlike DHL, Bidvest are specialists. They specialise in servicing the catering industry. This specialism seems to have served them well over the years, but specialist partners often attract a higher cost than a non-specialist. In the case of Bidvest, the extra cost seemed to have been paying for right infrastructure to provide the service. Bidvest provided KFC logistics from six centres. When the contract moved to DHL, the logistics were supplied from a single location. And although the exact causes of the recent KFC chicken supply problem may never be known to the general public, many have cited that significant issues at the solitary were the cause of the misery.

KFC is not unlike many IT enterprises

Customers who have complex systems often supported by a high number of specialist partners. There is always the desire to streamline and cut down the number of partners. Fewer partners doing more could perhaps lead to economies of scale. But what about specialism? What will it mean for your enterprise when experts are replaced by generalist?

Working in a specialist IT consultancy

Working at Centiq allows me to provide real value to my customers. As a specialist within in-memory platforms, Centiq can offer services and solutions that are only possible through years of working with and truly understanding these complex systems. General IT teams, just do not have the required exposure to provide the same levels of insight as specialists do. But, as a result, specialism comes at a premium.

What price do you put on specialism? And what do you lose when you choose a cheaper alternative?

(Image from Stick PNG)