Introduction
In the context of a marketplace setting, most businesses nowadays, particularly multinational ones, are looking for better conditions outside their home countries. Their activities are spread throughout numerous countries to take advantage of the overseas markets. Many of the least favorable elements for a company’s long-term existence, such as drastic tax cuts, cause the firms, in some cases, to undergo a complete organizational shift from their home market to another country (King, 2017). Organizational goods and processes may have to alter due to changes in the market. For organizations experiencing organizational transformation, having access to essential assets such as mass facilities and labor is also a major consideration, as these assets are critical for the success of their new environment. It is evident in the United States as accounted for by Burger King’s move to Canada from its initial American environment. Therefore, this research paper will examine Burger King’s decision to relocate from the United States to Canada, examining the reasons for the relocation, the problems it faced, and whether or not the transfer was a success.
King Burger Discussion and the Products Sold
People who like eating Burger are certain to have interacted with Burger King at least once, which is most renowned for its delicious burgers. Since its founding in 1953, Burger King (BK) has maintained a successful global strategy, evidenced in its more than 14,000 locations in over 100 countries (Kelso, 2019). Established in 1954 by founders David Edgerton and James McLamore, Burger King is America’s second-largest fast-food restaurant known for its flame-broiled hamburgers (Kelso, 2019). Since BK is responsible for supplying more than two million burgers each year to over fifteen million consumers daily, the company’s global appeal is understandable. Since its beginnings in the ’60s, Burger King has been a symbol of franchising in the food business because of its early success. BK’s has become one of the world’s best and most popular restaurant chains. It has competed fairly with McDonald’s, making its move to Canada an important one in the market.
Issues Expected after the Move to Canada
The international fast-food company relocated its headquarters to Canada after merging with the Canadian coffee-and-doughnut chain Tim Hortons. Because of the merger, a parent company would be established in Canada; yet, the organization’s primary offices would remain in the foreign country, which is the reason for the relocation (Kim & Kim, 2018). The fact that the amalgamated Canadian company was chosen to serve as the organization’s headquarters, however, meant that all of the company’s business operations had to be moved to the new environment and market. From the international market perspective, all other distribution channels would be supervised, concerns would be addressed, and organizational decisions would be made (Musonera, 2019). Doing things in this manner clarifies that the company was transitioning to a new environment.
Reasons for Moving to Canada
The fact that Burger King is one of the most iconic brands in the United States raises the question of why the company would make the bold decision to relocate its headquarters from Miami to Ontario in Canada. The conventional wisdom holds that businesses ought to take their sweet time amassing the resources essential to meeting the demands and requirements of internationalization before attempting to do so (Harrington et al., 2017). However, the modern period that we are in makes it possible for businesses to enter global markets and actively encourages them. As a result, quick movement is documented as enterprises seek to maximize their profits.
There is the need for leaders to employ the following concepts and strategies to ensure the change process is successful. First, there is a need to tune into the environment. For instance, leaders need to establish a consumer feedback collection points system and use them to inform their business (Cameron & Green, 2019). Secondly, the prevailing organizational wisdom should be challenged. It is essential to encourage people to think in a kaleidoscopic manner. Send them to distant locations, have them switch careers, and form interdisciplinary project teams to encourage people to examine their beliefs. Lastly, a compelling aspiration should be communicated to the organization. The purpose of this is not only to paint a picture of what might be; instead, it is an encouragement to grow and develop so that we become something more significant.
BK decided to relocate to Canada because they would no longer be required to pay taxes to the government of the United States. It would have to switch to the tax rate in Canada, which was much lower than the rate in the United States. Therefore, the company decided to relocate to Canada to avoid the high tax rates that resulted in lower profits for the business and put its continued existence in jeopardy as it fought with other enormous fast-food chains. In addition, the change was probably made to reduce Burger King’s tax obligations (King, 2017). It is accomplished by establishing a parent business in Canada, which then lends money to an American subsidiary of the parent firm. The loan repayment takes the form of interest on the loan, which is then deducted from the taxpayer’s taxable income. In the long run, there would be a clear reduction in the amount of tax paid on Burger King’s domestic earnings and those in other international countries. It is clear from this that the organization’s primary objective was to reduce its costs while simultaneously pursuing growth in global markets.
Relocation Challenges
Burger King’s loss of American customers due to its move to Canada was one of the most serious obstacles. Burger King’s faithful customers in the United States were outraged by the company’s decision to relocate to a foreign country. It was expected that the corporation would pay its fair share of taxes to show its commitment to the country. As a result, the company anticipated that some of its long-time consumers might defect to one of the nation’s other fast-food chains. In addition, the backlash from Obama’s criticism of tax inversions shifted customers’ loyalty, resulting in difficulty (Musonera, 2019). In addition, transitioning to a new country’s corporate culture proved a challenge when moving to Canada. As a result of the company’s corporate offices moving, Burger King’s executives had to relocate to oversee the company’s operations in the new site. Managing the company in a foreign setting and managing a merged company that they had less experience with would be difficult for the executives.
The macro or remote environment of Burger King was also directly impacted by the economic realities of the time. There have been shifts and tendencies in the economy, both of which impact the performance of businesses (King & Food, 2022). Expanding international trade agreements (an opportunity), economic stability in the United States (another opportunity), and rapid economic growth in developing markets are the primary economic external factors that affected Burger King (opportunity)
Goleman’s Six Leadership styles
Goleman’s six leadership styles would be appropriate for Burger King’s move to Canada, given the importance of leadership in the management of enterprises. Authoritative, coaching, democratic, pacesetting, affiliative, and coercive are the six styles of emotional leadership outlined by Daniel Goleman (Goleman, 2018). Every leadership style has its unique effect on the group it is trying to guide, leading to unique outcomes. For instance, democratic leadership is leadership that emphasizes teamwork and recognizes the significance of contributions from all members of the group (Chamorro-Premuzic & Yearsley, 2017). The leader who employs this approach ought to rely on direct listening, which is great for being used in situations in which the leader needs the workforce or team to go on board with the concepts of the corporation. As a result, the most efficient use would be to incorporate it into the process of consolidating before ultimately relocating to Canada.
Following the finalization of choice to relocate, affiliative leadership will emerge. Goleman’s type of leadership seeks to bring people together by fostering harmony within the team. It is an excellent choice when there is tension or potential for conflict. Moving is a stressful period in which a person in an affiliation position is necessary to step up and take leadership (Goleman, 2018). In tandem with this is the practice of coercive leadership, in which an autocratic approach is adopted. The leadership is exceptional in times of crisis and works well to kick-start rapid change. The use of punishments and stringent control is typical in style to guarantee the achievement of efficacy.
After the company has moved to the new location and the workforce has become acclimated to the business culture of the new nation, authoritative leadership is a suitable position to fill. As the group works toward a common objective, the tone inspires its members to keep moving forward. This kind of leadership is required at this juncture, particularly in terms of the leader releasing a visionary plan so that the two merging companies can comprehend how and where the merger is going. Alongside the leadership coaching, this is the point at which the goals of the people and those of the firm are integrated (Vasilescu, 2019). As the two merging organizations get to know each other and their shared goals, it is essential that rapport and trust be built. This helps the team stay motivated and focused on the work. In addition, coaching leadership has the potential to cultivate mentoring and coaching relationships, which would assist Burger King’s employees in acquiring skills that they would put to use in the new partnership (Harrington et al., 2017). Finally, the pacesetting leadership style emerges, emphasizing performance and succeeding in accomplishing the goals that have been established. This step is taken after ensuring that the process is operating as intended and shifting attention to performance.
Conclusion
Burger King’s relocation to Canada proved fruitful, as seen by the tremendous expansion after the transfer. It is a direct result of the ambitions to further develop the organization by putting up over a hundred more restaurants, representing an increase in market share equivalent to 25 percent. The expansion will be located adjacent to the currently existing one hundred and ten Burger King restaurants in the neighborhood. Since the transfer, it has been documented that Burger King has more than doubled its footprint in countries all over the world. Because of this, it can be deduced that the relocation was beneficial to the company. As a result, Burger King reduced its expenses and increased its presence in international markets to handle the high tax issue.
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