Success of McDonalds - Research Paper Example

Success of McDonald’s Table of Contents Introduction 2 Impact of globalization and technology changes 2 Vision and mission statement of McDonald’s 4 Impact of stakeholders on success of McDonald’s 5 Conclusion 6 Bibliography 7 Introduction With the advent of globalization and advancement in technology, there is huge impact on the business activities of corporations at the global level. The overall success of any corporation depends on its vision, mission, stakeholders, and the level of technology it has used in its business activities so as to give maximum customer satisfaction. McDonald’s is a public corporation leading in the global foodservice retailing industry serving millions of people in 119 countries every day. The vision, mission, stakeholders, and changes in technology have a great impact on the overall success of the corporation which is discussed in the report with reference to McDonald’s. More than 65% revenue of the company is derived from its international chains and franchises[Ann11]. Impact of globalization and technology changes Globalization has critical impact on McDonald’s activities and expansion all over the world. The company has affected the eating lifestyle of people all around the world. With the advent of globalization, the company became able to expand its market, thus, increasing its revenues and sales. The corporate model of the company and its expansion symbolizes globalization in a true manner. There is variation in menus that the company offers all over the world while keeping core values and brand of the company intact and constant[Wat06]. However, any change in the local and the global economy leads to changes in the financial performance of the company. The company has aggressive international expansion, and with this it is also very sensitive towards economic slowdown in other nations. Due to its global presence, McDonald’s has to focus on individual problems of every nation’s economy in which it has its business. For instance, in the US and Europe the major markets of the company are facing economic slowdown due to which overall operations of the company are affected. Technological changes have vital impact on the operations of the corporation worldwide. In order to enhance the experience of the customers and drive increased transactions, the company adheres to implementing advanced technologies for efficiency of the labor: self-order kiosks, updating the point of sale system, and installing of hand-held order devices. All these technologies were not available in old franchises of the company of the earlier times. Technological changes are related to bringing in innovation in processes as well as products. For instance, with the advancement of the technology of touch screen and use of swipe cards for making payments, the company also announced in 2011 to make use of touch screen technology and swipe card system at their restaurants in order to increase operations efficiency and gain knowledge about the food ordering habits of its customers[Gil08]. I/O model and resource based model Industrial organization model studies the external perspective for developing strategy of the company and earns above average returns. The first step in the model is to study the industrial environment. Fast food industry is a highly fragmented industry, and new markets in developing countries support the growth of the industry. Today, there is an increasing awareness towards health, and healthy and organic food is driving attention of food lovers around the globe. McDonald’s emphasizes on three key areas: restaurant reimaging, service enhancements, and menu innovation. Thus, the organic and healthy food industry can be the attractive industry which has the potential for above average returns. The company can formulate the strategy for catering to this segment. It could be innovation in menus with more introduction of healthy and organic food targeting young people. By bringing in product innovations and enhancement of existing facilities, the company could earn above average returns. Reimaging the brand stores to look younger can also drive large customer traffic, thus, enabling to earn above average returns. The assets of the company, such as high brand recognition and industry leader, can be used for placing its healthier menu on priority of customers[Wat06]. The resource based model emphasizes on looking at internal resources of the company and using them to earn above average returns. The resources and the strengths that McDonalds’s has are increasing brand value, large scale of operations, and diversified geographic presence. The company can use its resources for new restaurant openings and in beverage markets growing all over the world. The company provides wide and extensive training programs to its employees so that they remain competitive and can serve the customers better. This resource of the company could be used to enter new developing markets of Asia with maintenance of its brand value. The brand recognition and economies of scale of the company could be used for entering other industries, such as health food industry and beverage industry[Ann11]. Vision and mission statement of McDonald’s The vision of the company is to be the best quick service restaurant in the world. The word ‘best’ denotes providing outstanding service, quality, value, and cleanliness, thus, making every customer smile. This vision statement of the company is the driving force behind its quality service to customers. The company uses state-of-the-art cooking equipment for adhering to its vision of ensuring quality and safety. The quick service and clean, comfortable, and friendly environment which is suitable for families is achieved through its strict adherence to stringent cleaning standards. Quality, cleanliness, and cost were the motto of the company from the start. This vision of the McDonald’s plays a great role in the success of the company[Val12]. The 90-second service goal of the company has come out of its vision so as to make deliveries fast. The strength in inbound logistics of the company, such as just-in-time order and delivery, quality control, economies of scale and use of corporate guidelines in every franchisee of the company, has made it successful at the global front[McD09]. Attaining all these strengths is driven by the vision of the company. In order to be the world’s best quick food service restaurant, the company has made its presence in 119 countries till today. In order to make the customer smile, the company keeps on bringing innovation in its processes and train employees for how to maintain friendly atmosphere at each of the restaurant of the company. Impact of stakeholders on success of McDonald’s All the stakeholders of the company impact its success. The company has deep connections with customers everywhere. The company’s restaurants in the US registered more than 350 million visits of customers in 2011 which depicts the success of the company. Suppliers of the company remain strongly aligned to its common goals. They provide the company with high quality and safe products every day. Employees of McDonald’s are key assets of the company since they help in maintaining friendly environment and deliver quick service to the customers. Talent and skills of employees at the company have positively affected the success of the company. They are well aligned to the company’s goals, and are loyal to their employer[McD09]. The owners/operators of the company have also significant impact on the success of the company. 80% of the restaurants of McDonalds are operated by local people. For improving operations at the worldwide level, the company makes sure that all of its restaurants undergo onsite assessments safety and quality of food, friendly and fast service, and the same kind of treatment of employees. A large number of franchises of the company that adhere to the core values of cleanliness, speed, safety, and friendly atmosphere have contributed to the success at the global level. Conclusion McDonald’s is a leading fast food corporation at the global level; it has attained success through its vision and mission. All the activities of the company revolve around its mission, and all the stakeholders have to stick to the standards of the company. Bibliography Annual Report 2011. (2011). Mcdonalds Corporation. Retrieved from http://www.aboutmcdonalds.com/content/dam/AboutMcDonalds/Investors/Investors%202012/2011%20Annual%20Report%20Final.pdf Gilbert, S. (2008). The Story of McDonald's. Mankato, MN: The Creative Company. McDonald's Corporation 2009. (2009). Mcdonalds.com. Retrieved from http://www.mcdonalds.at/presse/maps/McDCSR.pdf Values in action. (2012). Mcdonalds.com. Retrieved from http://www.mcdonalds.com/us/en/our_story/values_in_action.html Watson, J. (Ed.). (2006). Golden Arches East: McDonald's in East Asia. Stanford, CA: Stanford University Press. Read More