HRTM3203 – Individual Assignment
McDonalds Business Report
COMPANY STRUCTURE
McDonalds is one of the biggest food chain in the world. The company serves more than 50 million customers everyday. This would not be possible without the strong company foundation that has a good company structure.
Don Thompson, President and Chief Executive Officer – Don has been working with McDonalds for 23 years. He has helped the company drive its business using global strategic innovation throughout the organization (aboutmcdonalds.com).
Tim Fenton (COO), Jose Armario (EVP), Peter Bensen (CFO), Bridget Coffing (CCO), and Richard Floersch (CHRO) are among the other executives that handle the company’s worldwide operation.
MISSION STATEMENT
McDonalds’ mission is to be the customers’ favorite place as well as way to eat and drink (aboutmcdonalds.com). The company’s worldwide operations are aligned around the global strategy, which is called the Plan to Win. This strategy centres on an excellent customer service – Products, People, Price, Place and Promotion. The company is also committed to continuous improvement when it comes to operations as well as enhancing the customer service experience.
COMPANY LEADERSHIP
The company’s leadership is one of the most effective in terms of strategy. In fact, McDonalds has a leadership Philosophy saying that the company’s future success requires good leadership. It applies not only in management roles, but it applies to all levels of the organization (businessweek.com). Thus, the company expects their every employee to live the company’s values and exhibit leadership, regardless of position they hold. The McDonalds leadership philosophy and strategy has been proven to be effective based on the company’s popularity and demand.
CURRENT COMPETITIVE ADVANTAGE
McDonalds Corporation’s competitive advantages made the company the leading food chain in the world. There are 4 major competitive advantages that the company constantly use and these are:
- Provisioning Strategies – The Company is concern about the major multinational firms and correspond to the raw materials production with an objective of meeting the processing industries’ needs.
- Marketing Strategy – This is the process in which allows the organization to use its limited resources for greater opportunities in order to increase the total sales as well as to attain a sustainable competitiveness.
- Rationalization Strategies – The Company is intended to lower its production prices, through establishment of subsidiary workshops especially in low-wage countries.
- Techno-Financial Strategies – Multinational companies such as McDonalds Corporation hire independent companies for minor tasks such as knowledge in management and licenses.
CURRENT COMPETITIVE DISADVANTAGE
McDonalds also focuses on their product innovation and company expansion. In order the achieve this, the company developed their product innovation strategies including the purchasing of cooking system that costs the company $420 Million (Zirnhlet, 2006). IN addition, the company might have forced the franchisees to invest an additional $18,000 up to $100,000 just for the kitchen upgrades. Therefore, such financial investment might lead to further issues between them and their franchisees. If this type of product innovation conflict will continuously happen in the near future, this could be a potential competitive disadvantage of the company.
MCDONALDS SWOT ANALYSIS
Strengths – McDonalds has been in the business for more than five decades and was given the title in 2005 as the Best Place to Work for Minorities (Friesner, 2014). The company has established a strong and effective marketing strategy. McDonalds is present in almost every country around the world.
Weaknesses – Their testing for pizza product did not go well that leaves the company to be incompetent among other pizza companies. High employee turnover that makes the company spends more costs for training new employees.
Opportunities – Many people are now looking into healthier food. McDonalds could have the opportunity to introduce healthier version of their products. The company could also provide additional food options such as allergen-free products such as peanut-free and gluten-free.
Threats – Major competitors such as Burger King, KFC, Taco Bell, and any mid-range restaurants that have the potential to reach their status. These are also well-established companies that have the ability to entice the same target market, as McDonalds has (Friesner, 2014).
RECOMMENDATIONS
McDonalds has a very powerful brand name. The company also has good strategies in terms of marketing. As a recommendation, the company must continue to focus on their strengths in order to develop a stronger company. Thus, the weaknesses must be corrected using different solving approach, if the existing ones are not as effective. Additionally the opportunities of the company must also be addressed using innovative marketing skills of their top executives in order to provide more than just a delicious meal.
CONCLUSION
Being one of the most popular brands in the world, McDonalds was able to prove its competitive advantage when it comes to food industry. There is no doubt that this company has a unique model in terms of overall organizational management that made to the top. The company’s leadership strategy goes along with its company mission statement. Thus, McDonalds Corporation is able to surpass their current competitive disadvantage making their company brand name a trade mark of successful organization.
References
Bloomberg Business Week. (n.d.). Twenty Best Companies for Leadership: McDonald's - BusinessWeek. Retrieved July 8, 2014, from http://images.businessweek.com/ss/10/02/0216_best_places_for_leadership/10.htm
Friesner, T. (2014, May 8). McDonalds SWOT - Marketing Teacher. Retrieved July 8, 2014, from http://www.marketingteacher.com/mcdonalds-swot/
MacDonald's strategy - The golden arches. (n.d.). Retrieved July 8, 2014, from http://thegoldenarches.e-monsite.com/pages/macdonald-s-strategy.html
McDonalds Corporation. (n.d.). McDonald's Corporate Leadership : AboutMcDonalds.com. Retrieved July 8, 2014, from http://www.aboutmcdonalds.com/mcd/our_company/leadership.html
Zirnhelt, A. (2006). Student Excellence in Writing. Retrieved July 8, 2014, from http://www.salisbury.edu/wac/excellence/zirnhelt/zirnhelt.htm
