Colonel's secret recipe in new, safer vault at KFC

LOUISVILLE, Ky. – Colonel Sanders' handwritten recipe for fried chicken was back in its Kentucky home Tuesday after five months in hiding while KFC upgraded security around its top corporate secret.
Nothing went afoul when the recipe was returned from an undisclosed location to KFC's headquarters late Monday in a lockbox handcuffed to the wrist of a security consultant.
KFC President Roger Eaton was visibly relieved when the door to a new electronic safe was shut with the single sheet of yellowing paper stashed inside. "Mission accomplished," he said.
"It was very nerve wracking," Eaton said later of the recipe's hiatus from a vault where it has been kept for decades. "I don't want to be the only president who's lost the recipe."
KFC is a subsidiary of Louisville-based Yum Brands Inc., which also owns Taco Bell, Pizza Hut, Long John Silver's and A&W All-American Food.
The recipe lays out a mix of 11 herbs and spices that coat the chain's Original Recipe chicken, including exact amounts for each ingredient. It is written in pencil and signed by Harland Sanders.
The iconic recipe is now protected by an array of high-tech security gadgets, including motion detectors and cameras that allow guards to monitor the vault around the clock.
"It's like an onion of security — many layers," said security expert Bo Dietl, who brought the recipe back to the building.
Thick concrete blocks encapsulate the vault, situated near office cubicles, that is connected to a backup generator to keep the security system operating in times of power outages.
"I can guarantee you, once it's in there, it will be safe," Dietl assured Eaton.
The recipe is such a tightly held secret that not even Eaton knows its full contents. Only two company executives at any time have access to the recipe. KFC won't release their names or titles, and it uses multiple suppliers who produce and blend the ingredients but know only a part of the entire contents.
"We've very comfortable with the security," Eaton said. "I don't think anyone can break into it."
Just how valuable is the recipe?
Thomas P. Hustad, professor of marketing at Indiana University's Kelley School of Business, said the recipe "goes to the core of the identity of the brand." The recipe, along with the man who created it, conjure images for the chain that help set it apart in the minds of customers, he said.
"I would say that the heritage value is just as high for this secret recipe as the stories around the Coke formula," Hustad said by phone Tuesday. "I guess I'd put the two of those at the top of the pyramid."
Dietl said the security measures he installed replaced an "antiquated" system. For years, the recipe was kept in a filing cabinet equipped with two combination locks in the vault.
"The colonel could have used a pry bar to open that thing up," Dietl said.
Sanders developed the formula in 1940 at his restaurant in southeastern Kentucky and used it to launch the KFC chain in the early 1950s. Sanders died in 1980, but his likeness is still central to KFC's marketing.
KFC had 15,580 locations worldwide at the end of 2008, including 5,253 in the U.S.
The chain is hoping to revive sluggish U.S. sales with the launch of a value menu and an April rollout of a new grilled chicken product aimed at health-conscious consumers.

China drought leaves 4 million without water

BEIJING - China declared an emergency Thursday in eight provinces suffering a serious drought that has left nearly 4 million people without proper drinking water and is threatening millions of acres of crops.

The Office of State Flood Control and Drought Relief posted a notice on its Web site declaring the situation a level-two emergency on the country's four-level scale. It called it a drought "rarely seen in history."

Uneven distribution of water
China suffers from an uneven distribution of its water resources. Weather patterns in the arid north and flood-prone south cost the government tens of millions of dollars in lost productivity each year.

The latest drought began in November and has affected 24 million acres of crops, one-third of them seriously, Xinhua said. Most of the hardest-hit provinces were in northern China, with several in the east.

In recent days, news broadcasts have shown dry, cracked farm fields and crops withering in the ground.

Wheat-growing areas threatened
Almost half of the wheat-growing areas in the eight provinces — Hebei, Shanxi, Anhui, Jiangsu, Henan, Shandong, Shaanxi and Gansu — were threatened, Xinhua said, while nearly 4 million people lacked proper drinking water.

The official China Daily newspaper, citing meteorological authorities in Henan, said it was the worst drought in Henan since 1951 and that the province, a major supplier of winter wheat, had gone 105 consecutive days without rain.

But some relief may be in sight. Weather forecasts call for rain and snow in some of the stricken areas beginning Saturday.

Pranks involving electronic road signs stir worry

COLLINSVILLE, Ill. – Pranksters in at least three states are messing with electronic road signs meant to warn motorists of possible traffic problems by putting drivers on notice about Nazi zombies and raptors. And highway safety officials aren't amused.
The latest breach came Tuesday during the morning rush hour near Collinsville, Ill., where hackers changed a sign along southbound Interstate 255 to read, "DAILY LANE CLOSURES DUE TO ZOMBIES."
A day earlier in Indiana's Hamilton County, the electronic message on a board in Carmel's construction zone warned drivers of "RAPTORS AHEAD — CAUTION."
And signs in Austin, Texas, recently flashed: "NAZI ZOMBIES! RUN!!!" and "ZOMBIES IN AREA! RUN."
Officials in Illinois are concerned the rewritten signs distract motorists from heeding legitimate hazards down the road. The hacked sign on Tuesday originally warned drivers of crews replacing guardrails.
"We understood it was a hoax, but at the same time those boards are there for a reason," said Joe Gasaway, an Illinois Department of Transportation supervisory field engineer. "We don't want (drivers) being distracted by a funny sign."
Authorities haven't figured out how pranksters access the signs. Gasaway believes the Illinois sign was changed remotely, and Austin Public Works spokeswoman Sara Hartley suspected the hackers there cut a padlock to get into the signs' computers.
Some Web sites, such as Jalopnik.com, have published tutorials titled "How to Hack an Electronic Road Sign" as a way to alert security holes to traffic-safety officials. Jalopnik urges its readership of 2.6 million a month not to put its lesson to practice.
"Hacking generally is about showing where there are holes in security systems, and I think this is a great example of that," the site's editor-in-chief, Ray Wert, told The Associated Press by telephone Wednesday. "I'm sure there are all sorts of ways to use that information in a way that's inappropriate, but we're trying to make clear this is an issue that needs to be confronted by traffic safety and transportation officials."
Wert said he had no immediate plans to take down Jalopnik's how-to guide.
In Illinois, tampering with an official traffic control device is a misdemeanor punishable by up to a $250 fine — half what a culprit might have to pay in Texas if caught. If convicted in Indiana, a culprit faces up to a year in jail and $5,000 in fines.

Japan's Panasonic to cut 15,000 jobs, shut 27 plants world wide

TOKYO – Panasonic Corp. said Wednesday it will slash as many as 15,000 jobs and shut 27 plants worldwide, joining a slew of major Japanese companies announcing deep cuts as the global slowdown batters the world's second-largest economy.

The world's largest maker of plasma display TVs also announced a net loss for the October-December quarter and lowered its forecast for the fiscal year through March to a net loss of 380 billion yen ($4.2 billion), its first annual loss in six years.

Panasonic blamed the dismal results on the global slowdown set off by the U.S. financial crisis, the rapid surge of the yen and sudden price drops. Sales slid in a wide range of products, including flat-panel TVs, DVD recorders, microwaves, lamps and semiconductors, it said.

The Osaka-based manufacturer plans to cut the jobs — half of which will come in Japan — by the end of March 2010. They amount to about 5 percent of its 300,000-strong global work force.

Panasonic also will shutter 14 overseas plants and 13 plants in Japan by the end of March to adjust production and cut costs, company spokesman Akira Kadota said. The company said it has 230 production sites around the world but declined to give a regional breakdown.

"The company's business conditions have worsened particularly since last October, due mainly to the rapid appreciation of the yen, sluggish consumer spending worldwide and ever intensified price competition," it said in a statement.

Koya Tabata, electronics analyst with Credit Suisse in Tokyo, said Panasonic's decision to reshape its operations and speed up job cuts was positive, resulting in 300 billion yen in cost savings for the fiscal year through March 2010.

He also commended the company's relatively quick efforts to adjust inventory and reduce investments to boost profitability in coming months.

"But risks remain," Tabata said. "Panasonic is still expecting a serious sales decline to continue."

Panasonic reported a 63.1 billion yen ($709 million) loss for the fiscal third quarter, down from a 115.2 billion yen profit the same quarter the previous year.

Quarterly sales dropped 20 percent to 1.880 trillion yen from 2.345 trillion, with overseas sales decreasing 29 percent, and Japanese sales down 10 percent.

The last time Panasonic reported an annual loss was for the fiscal year ended March 2002, when a global electronics slump and massive restructuring costs contributed to 431 billion yen in red ink.

Since then, the company has been shedding money-losing businesses and focusing on key products such as plasma display TVs to turn itself around.

The company, formerly named Matsushita Electric Industrial Co. after its founder, also lowered its sales forecast for the fiscal year ending March 31, to 7.75 trillion yen from an earlier 8.5 trillion yen.

Panasonic will delay by a half year starting production at two Japan plants — one for plasma panel TVs to July 2010, and another for liquid crystal display TVs until January 2010, in response to slipping demand for flat-panel TVs, it said.

The latest restructuring measures will cost an additional 190 billion yen on top of the 155 billion yen Panasonic has already announced for the fiscal year through March.

Rival Japanese manufacturer Sony Corp. is forecasting a 150 billion yen net loss for the fiscal year through March. The last and only time Sony reported a loss — the fiscal year ending March 1995 — the red ink came from one-time losses in its movie division, marred by box office flops and lax cost controls.

Hitachi Ltd., NEC Corp. and Toshiba Corp. are also all forecasting big losses for the fiscal year.

Panasonic shares rose 1 percent to 1,092 yen. Earnings were announced after trading ended.