History of McDonald's - Research Paper Example

? HISTORY OF McDonald’s Outline Origin of McDonalds Beginning of Franchises Transformation The Founding Principles Success Factors Managerial Challenges The Menu Change Conclusion Origin of McDonalds Like most mega corporations across the world, McDonald’s draws its origin from a humble beginning that helps to underscore its growth from a small restaurant to a giant multibillion dollar corporation existing in several countries across the world. The origin of the company traces back to 1937 when Patrick McDonald opened a small restaurant next to Monrovia Airport in California (Gilbert 2009). The restaurant basically sold the conventional foods that were sold by most restaurants in those days. These included hamburgers and orange juice. The whole building was moved 40 miles to the East and established in San Bernardino in California. This was undertaken by the two sons of MacDonald, Richard and Maurice in 1940. The restaurant was subsequently renamed “MacDonald’s Farmhouse Barbeque” at that time the restaurant mostly sold barbequed products. In 1948, when the two brothers realized that most of the profits for the restaurant came from hamburgers, they focused their attention on the sale of hamburgers, French fries, shakes and such other fast foods that were selling fast in the restaurant. Carhops were therefore eliminated from the menu of MacDonald’s. The two brothers recognized the need to organize the restaurant in a manner that operated like an assembly line in order to ensure full efficiency. In 1948, the name of the restaurant was once again changed to McDonald’s and it reopened its doors on 12th December, 1948. Beginning of Franchises A major transformation in the growth of the restaurant began in 1953 when the McDonald’s brothers initiated a series of franchises. Such franchises were initially done in Phoenix, Arizona and in Downey, California. Sure enough, the latter is the oldest McDonald’s restaurant still in survival today. In a bid to enhance efficiency, the McDonald’s brothers initiated the Speedee as a sign of the efficient and quick system that had actually been devised. The growth of McDonald’s gathered much speed in the 1950s. In 1954 Ray Kroc acquired McDonald’s franchises in California and Arizona. Subsequently, Kroc opened his first and eventually the ninth restaurant in Chicago. This became the birth of McDonald’s Corporation. The name or the corporation was further renamed in 1960 to McDonald’s Corporation. In 1961, the business right of the company was transferred to Kroc upon his request to the McDonald’s brothers. Transformation The growth and success of McDonald’s as a quick food restaurant is partly attributed to the proper founding principles that have always defined the corporation to this day. Indeed, with millions of customers across the globe, it is inevitable that the corporation has a sense of definition that clearly tells it apart from the rest in the market. The basic concern for Ray Kroc was essentially the need to provide very quick service. In 1954, the McDonald’s hamburger stand in California could run a total of eight multi-mixers at a time. This quick service enabled the company to establish a brand from an early age. McDonald’s also boasts a very philanthropic principle which has always defined the corporation for years. Indeed, the organization is always much responsible towards the community within which it dwells and will always chip in to assist in development projects that benefit the community. The management is always very responsible about the issues and needs of their customers. This concern is clearly evident in the manner the corporation involves itself in projects like health, education and medical research. All the franchises of McDonald’s are always very positive in their social responsiveness and this has always assisted the communities in a very progressive manner. The Founding Principles One of the core principles that Kay Kroc instilled in the employees of McDonald’s at his time was cleanliness in operations. Indeed, the corporation is known across the world as a restaurant that serves very clean food in very healthy and clean environments. Cleanliness has always helped the organization to extend its reach across the boundaries as it serves its clients and addresses their particular needs. As Ray Kroc defined the founding principles as Quality, Service, Cleanliness & Value (Q.S.C&V), the management has always ensured that these fundamental concerns are addressed in the most appropriate way (Kroc & Anderson 1987). Without doubt, in terms of quality of service and products, it can be well argued that McDonald’s is indeed a leader in its field in offering quality. In the increasingly competitive global business environment quality is always a core priority and the basic preoccupation for most organizations. In that regard, McDonald’s is always abreast through an extensive involvement in research and development which has always assisted the organization to improve its operational services in tandem with the needs of this competitive age. In the same way, proper service is most valued at McDonald’s and through research activities over the years the corporation has managed to really improve its services beyond the conventional market standards. Throughout the entire life of McDonald’s, the management of the corporation has always stressed the importance of value for the corporation. As such, McDonald’s is basically value-driven and is steered by the will of the customers through their need to get a proper value-meal combination. In this regard, the corporation has been known across the world as value-driven and will always strive to enhance its operations in this respect. McDonald’s has always been a leader in exceptional customer care since its establishment. The corporation realized the importance of a proper customer-centric nature and how such an attitude can be a good marketing criterion in its own right. In this regard, the management is always at the forefront in advocating for the very imperatives that would enhance customer care and thereby improve the image of the corporation across the globe. A casual stroll to any McDonald’s franchise serves to confirm this very fundamental principle that has always put the corporation at the forefront and a leader in its industry. In the present age, like most global corporations, McDonald’s is concerned about environmental conservation and the need to make the environment a better place that is conducive for life and activity. The company has therefore developed a very elaborate environmental policy which declares that the corporation is always committed to protecting the environment and making the world a better place for the future generations. The leaders of the corporations are therefore required to be environmentally concerned so as to steer the realization of the corporation’s environmental policy concern. Success Factors Indeed, the success of McDonald’s at its establishment can really be attributed to several factors that come to play. Ray Kroc actually recognized the need to establish a brand for the company and was thereby very instrumental in enhancing the principles of quality and speed in the operations of the company. These fundamental values have become a driving force that attracted many customers to the restaurants. In the food industry, customer care is a very important component that determines success (Kroc & Anderson 1987). The management of McDonald’s was lucky to have realized this from the establishment of the corporation and was therefore very concerned with the need to treat their customer well. Most importantly, the decision to engage in the restaurant and especially the fast food business was a very appropriate idea given that demand for food is always available. It only increases but rarely diminishes. Therefore the decision to sell hamburger and other favorite foods was very instrumental in steering the McDonald’s from a street food joint to a global corporation in the food industry. Managerial Challenges Like any other global corporation, McDonald’s has always faced a number of managerial challenges in the course of its operations. Common challenges have always revolved around egos, emotions and the struggle for power at the organization. Most people who have worked close to the middle management claim that several challenges indeed abound. Several mistakes are always overlooked instead of being addressed and used as learning tools for future development. A lot of carelessness has also been seen in some operational areas. The management of McDonald’s has always been blamed on the low levels of motivation realized from most of the employees of the corporation. A lot of discrimination is realized in the corporation considering that it operates in diverse backgrounds. Nevertheless, the top management at the corporation is always on the move to address most of these management challenges. The Menu Change In 1954, the menu at MacDonald’s was only limited to fries, burgers and some beverages which were popular in those days (Love 2010). Over the years, the restaurant has come to incorporate a wide variety of foods on its menu in a bid to address the varied needs of its many clients. With time, meat, farm produce and dairy products were added to the menu as the corporation grew in size. Today, the restaurant chain offers so many kinds of burgers, chicken, fish, pork, fries, dairy products, juices and a host of other beverages. These products are always offered in the most appropriate flavors and have always given the restaurant a brand name. Lately, McDonald’s has realized the popularity of its beverages and is positioning itself as a strategic player in the beverage industry thereby posing a lot of competition to original player like Starbucks and Dunkin Donuts. This latest trend has seen the popularity of some of its brands like the McCafe shakes and Big Mac. The corporation is developing a new franchising method that will encourage much linkage between the individual franchises and the management of the corporation in a bid to improve service quality through research. Conclusion Therefore, the success of McDonald’s as a global brand is basically a function of several factors which have helped the corporation over the years. A strong sense of identity coupled with value-driven spirit is just the right tools the corporation has always benefited from. References Gilbert, S.(2009). The story of McDonald's. Mankato, MN: Creative Education. Kroc, R., & Anderson, R. (1987). Grinding it out: the making of McDonald's (St. Martin's pbk. ed.). New York: St. Martin's Paperbacks. Love, J. F. (2010). McDonald's: behind the arches (Rev. ed.). New York: Bantam Books. Read More