Tim Hortons: The challenge of expansion When visiting Canada whether for business or pleasure, one never fails

to notice and experience Tim Hortons. It is the fourth largest publicly-traded quick service restaurant chain in North America based on market capitalism and the largest in Canada (Tim Hortons, 2011). Despite the global economic crisis, Tim Hortons has been doing well and has ambitions to expand south, seeing U.S. as prime growth opportunity. This expansion has its own challenges, for even though Tim Hortons is a brand name in Canada, it has to fight for recognition in USA against similar businesses such as Starbucks and Dunkin Donuts that are part of the U.S. culture. The Tim Hortons chain was founded in 1964 in Hamilton, Ontario. The chains focus on top-quality, always fresh product, value, great service and community leadership has allowed it to grow into the largest quick service restaurant chain in Canada specializing in always fresh coffee, baked goods and home-style lunches. The chains biggest drawing card remains its legendary Tim Hortons coffee. The special blendes also available in cans are Tim Hortons hot chocolate and English Toffee and French Vanilla cappuccinos, so guests can also enjoy these great tasting products at home. In addition to its regular stand-alone restaurants, Tim Hortons locations can also be found in shopping malls, highway outlets, universities and hospitals, providing prominent visibility for the chain. Most standard Tim Hortons locations offer 24-hour drive-thru service, catering to consumers on the go. Combo unit locations, which house both a Tim Hortons and Wendys, offer guests the convenience of both restaurants under one roof. In 1995 Tim Hortons merged with Wendys International, Inc., giving new focus and impetus to the expansion of the Tim Hortons concept in the United States. Tim Hortons locations can presently be found in Michigan, Maine, Connecticut, Ohio, West Virginia, Kentucky, Pennsylvania, Rhode Island, Massachusetts and New York, with responsible expansion continuing in these core markets. The Canadian operation is 95% franchise owned and operated, and plans in the U.S. call for the same key strategy to be implemented as expansion progresses. Tim Hortons has been expanding in the North Eastern United States where it serves population of 70 million people double that of Canada (Eric Lam Oct. 26, 2011. Financial Post Trading Desk U.S. expansion key to Tim Hortons growth. In March 2006, Tim Hortons completed an initial public offering of the company and was fully spun off as a separate company as of September 29, 2006. Tim Hortons trades on the NYSE and TSX (THI).The challenge for Tim Hortons in the U.S. expansion is how to translate its runaway appeal to the U.S. consumers. This expansion has faced fierce resistance by other food service giants such as Dunkin Donuts, which has contributed to the company closing down 36 locations, mostly in the New England region (Tilak, 2011). Tim Hortons culture and structural organization. Organizational culture refers to the dominant ways of doing things in an organization (Mills, Helms Mills, Forshaw, Bratton, 2007, 571). Culture is viewed from many different perspectives and is affected by many things within an organization. Tim Hortons culture is imposed by the leadership. The mission statement is to deliver superior quality products and services for our customers and communities through leadership (Tim Hortons, 2011). Trevor Witty illustrates his correlation with Tim Hortons mission statement: I think that the experience Ive had here at Tim Hortons starts by having a great boss. My Restaurant Owner has instilled training and confidence within me (Tim Hortons, 2011).Through observations, Trevor Wittys statement is true. Employees were not heavily monitored and managers were not heavily troubled by their superior staff. In some occasions managers broke up conversations between the younger staff but overall, their performance was strong (Personal Observation, November 2011). According to Mills, organizational structure is the formal patterns of work relationships that coordinate organizational activities according to strategy, technology and environment (et al. Mills, 2007, 455). Tim Hortons has established itself as one of Canadas largest food services with over three thousand stores nationwide (Tim Hortons, 2011); they achieved their success by operating structurally by function. Their executive team at head office ranges from Executive Chairman, President and Chief Executive Officer to Chief Operations Officer, Canada (Tim Hortons, 2011). Departments such as Distribution, Finance and Taxation, Information Technology, Marketing are just some of the subdivisions that compose Tim Hortons (Tim Hortons, 2011). Translating and maintaining Tim Hortons culture in the U.S. market Mintzberg introduces four dimensions that influence the structure of Tim Hortons, Developing the notion of volatility and uncertainty, Mintzberg identifies four distinct dimensions of organizational environments that

influence the type of structure most appropriate to a particular situation: (1) stability, (2) complexity, (3) market diversity, and (4) hostility (et al. Mills, 2007,475). Tim Hortons has proven to have a stable environmental structure. In the past they have made minor changes as oppose to constant changes; these changes include the payment system and the slight expansion of menu and locations. In a time when Starbucks is closing 600 stores in the U.S. Tim Hortons is pushing its expansion fueled by cheap real estate and cash money that comes from its successful business practice (Tice, 2010). Tim Hortons Corporation is a complex organization. There are many environmental factors as mentioned above that Tim Hortons has to adhere to in order to satisfy their environmental and customer needs. It has renamed its shops as Tim Hortons Caf & Bake Shop, thus taking its brand name beyond the doughnut shop concept (Tice, 2010).According to the Tim Horton website, Tim Hortons has 3,871 system wide restaurants, including 3,225 in Canada and 645 in the United States (Tim Hortons, 2011). The wide range of locations is a large contribution to the markets diversity of customers that consume their products; these products mainly consisting of coffee, doughnuts, sandwiches, and soup. The U.S expansion is moving in an upscale direction by promoting items such as pomegranate-cheese Danish rather than simple donuts names (Tice, 2010). Tim Hortons has a hostile environment of competition especially because it is placed in the quick service restaurant industry category. These restaurant owners compete with many factors according to the Tim Hortons website, some being competition with international, regional, and local organizations, primarily through the quality, variety, and value perception of food products offered (Tim Hortons, 2011). The chain is using its rebrand strategy as a way to avoid frontal clashes with other local powerhouses such as Dunkin Donuts (Tice, 2010). Another contributing factor to the U.S. expansion strategy is the values, beliefs and slogans that are embedded in Tim Hortons organizational culture. Tim Hortons values the advancement and growth within individual firms, satisfying guests, finding new opportunities, being fair and ethical to all workers, and being a strong team in which communication is integral (Tim Hortons,2011). These values are seen in the actual work setting of Tim Hortons. Guests are generally satisfied when they leave and workers are typically treated fairly and have strong communication between team members (Personal Observation, November 2011). Tim Hortons beliefs are that they have the best quality products, customer satisfaction rates and teamwork (Tim Hortons,2011). In 2010, 97% of Tim Hortons employees were proud to work for the company (TimHortons, 2011). The employees themselves truly believe that they have the best of all the above factors and that they use teamwork to achieve their combined goals. Slogans are phrases that are developed to give customers and employees a particular view of the organization (Cormack,2008). The popular slogan that Tim Hortons uses is Always Fresh, Always There (Cormack,2008). The Always Fresh slogan implies that their products are top quality (Cormack, 2008).The Always There implies that they are reliable and a part of our everyday lives (Cormack,2008). Always Fresh is posted everywhere in Tim Hortons which gives the customer the impression that anything that they purchase will be guaranteed fresh. To get the American customers used to its products and name, Tim Hortons has used its proven successful strategy in teaming up with local brands such as Cold Stone creamery in stores in 10states (Tice, 2010) Conclusion Tim Hortons continues to rapidly grow locally and internationally. The introduction of Tim Hortons into the United States shows that their firm is expanding and creating a bigger name for themselves not only in Canada but worldwide. With the expansion come new challenges and opportunities. The biggest challenge to Tim Hortons or any other organization is to maintain its values and translate them to different environments created as a result of the organizational growth outside its native boundaries