Organisational Responses to Responsible Business Drivers - Essay Example

ORGANISATIONAL RESPONSES TO RESPONSIBLE BUSINESS DRIVERS By Location Organisational Responses to Responsible Business Drivers Introduction In the recent past, it has been noticed that many business organisations have been striving to adopt corporate sustainability despite the fact that it was initially branded as an enemy of business growth and profitability. Corporate sustainability refers to a business approach, where an organisation adopts “green” operations so that they can create long term value to their stakeholder. Sustainability of a company is determined by their operation in economic, ecological, and social environments. For an organization to attain corporate sustainability, it is important for them to consider the three dimensions, their effects, and their possible relations to each other. The aim of this project will be looking at the challenges that McDonald’s has been facing regarding corporate sustainability and the various actions that they have taken as an organization to make sure that their corporate responsibility is enhanced. McDonald’s is one of the most known fast food restaurants globally. McDonald’s has outlets in more than 100 countries. However, their headquarters is in the United States of America. Among other things, the restaurant is popular for its hamburger. However, it should be noted that they also sell products such as French fries, cheeseburgers, chicken, soft drinks, desserts, fish, milkshakes, salad, smoothies, and wraps. Contextual information There are a number of sustainability challenges that are faced by McDonald’s. One of the sustainability challenges that the company faces is the amount of water that is usually needed to produce beef. About 15,500 cubic meters are usually needed to produce a kilogram of beef. Apart from the water, they will also need 36 kilograms of roughage and 6.5 kilograms of grain just to produce a kilogram of beef. Given the fact: that hamburger is their main product, this trend can be rather alarming (Porter 2008, p. 407). Given the level of competition in this industry, the company has to rely on cheap labour and beef in order to remain competitive. Depending on cheap labour and beef makes it very hard for them to be sustainable. For instance, in most cases the cheaper beef is always not verified. Sometimes, depending on cheap labour might deny an organization the chance of having highly motivated and satisfied employees. Another sustainability challenge that the organization faces is brought about by the effect that consumption of fast food has on human beings. The high growth of obesity cases in the US is always associated with poor eating habits. One of the most commonly mentioned and observed poor eating habits are the US is the consumption of fast food. However, this is something that companies such as McDonald’s are fully responsible for. Excessive consumption of fast food is also believed to be the root cause of the increase in some health conditions such as type 2 Diabetes, Atherosclerosis, Liver damage, and Cardiovascular diseases. Some of the substances used in processing these products can also lead to addiction. It has also been confirmed that excessive consumption of processed product is not healthy. These are some of the things that make it very hard for McDonald’s to be completely sustainable. This is because if they had to do so, then they would have to stop selling almost all their products. However, there a number of actions that McDonald’s aims at taking in order to overcome the challenges that have been discussed herein. According to McDonald’s chief sustainability officer, Bob Langert, the company is aiming at having their beef supplied by verified sources by the year 2016. This will make sure that the beef that they use in producing their hamburgers will be of good quality. They not only do this with the beef, but also with the other products that they sell such as coffee and fish. They have not been able to do much on the wages of their employees, though there is a very important development that involved the introduction of medical cover for their employees’ family members. This was aimed at making sure that there is an increase in the level of satisfaction despite the fact that the company was not able to increase wages due to price sensitivity of the fast food market. There are a number of things that McDonald’s has done in order to encourage their customers to eat healthy. For instance, the company introduced a more sustainable alternative to their menu. These alternatives include cheeseburger, desert, milk, and vegetable burger. These products have less calorie content as compared to the products that were traditionally produced by this company. McDonald’s has also avoided using of processed beverages in the advertisement of Happy Meals but instead use milk in order to make sure that their customers are not encourage to excessively consume products that might be of negative effect to their health. Milk is a much healthier option to carbonated soda. Evaluate the organisation’s approach to Sustainable products and Sustainable supply chain management Sustainable products McDonald’s has also made sure that they introduce a variety of sustainable food products to their menu apart from the fact that the chain of restaurants was originally known for the production of fast food which were associated to high calories. This was meant to make sure that the company does not offer their customers only food products that have harmful effect on their health. In the year 2013 McDonald’s pledged to give their customers 100% sustainable coffee, fish, palm oil (Lang &Barling 2012, P. 318). This means that the company pledged to offer these products in their natural from so that they could make sure that the customers who consume them are protected from health problems that are associated to processed food products (Esposito 2012). This was a step toward reducing the effect that the food sold by the company lead to health complications such as obesity. McDonald’s also has a recycled fibre-based packaging policy which makes sure that their products are packaged in materials that are of minimal effect to the environment. This kind of packaging materials is usually of 100% sustainability. The 100% sustainability comes from the fact that the packaging materials are usually made using certified recyclable materials which means that such materials are not left lying in the environment (Verghese, Lewis & Fitzpatrick 2012, P. 123). This also means that they do not contribute to further felling of trees to produce packaging materials. These materials also discourage the use of polythene packaging material whose production and use poses some risks to the environment. In the case of McDonald’s, the policy is even more sustainable because the company encourages optimizing packaging by designing packaging materials that can carry a number of items. The use of fibre-based packaging policy also enables the company to use packaging materials with viable end life. Burger King uses paperboard "clamshell" containers produced by Union Packaging which are much greener compared to the Styrofoam made clamshell style box that they previously used. However, McDonald’s policy is greener because it encourages 100% sustainability. The introduction of the happy meals was also another positive step towards sustainability of the company. The happy meals are always accompanied with fruits, vegetables, or dairy options that have low fat content (Hill & Jones 2009, P. 178). This is in response to the public perception that the products that the company produce are all calorie filled or processed thus having a harmful effect to the people that consume them. Their emphasis is on the fact that when fast food is taken responsibly, they might not have the numerous health effects that they are always associated to. The “Happy Meal” program, is aimed at giving customers a whole meal with all the aspects that are required in a balance diet instead of focussing of foods such as hamburger that will only contribute to obesity and other calorie related health complications. The Burger Kings also have an offer dubbed “Burger King healthier Kids” which comes with raft macaroni and cheese, chocolate milk, and apples to put emphasis on health. McDonald’s has also strived to make sure that the nutrient content of their products is enhanced. For instance, in most of the outlets, the vegetable content of wraps has been increased of the past couple of years. The vegetable content of McWrap is believed to be between 40-60 grams. The addition is aimed at increasing the nutritional value of McWraps. McDonald’s also offers smoothies that are made from pureed fruits and juices. For most of the outlets, seasonal fresh fruits are always included in the menu. Therefore, the fruits that are available in the menu will depend on the geographical location of the outlet and the season (Xu2014, P. 1016). Nevertheless, it is clearly notable that the company has strived to make sure that they add nutritional value to their products and even introducing more nutritional option to the menu just as it has been illustrated herein. This is a simple indication that the company is evolving from their traditional image that was mostly associated with fast food and high calorie content food products. Despite the fact that they have these emphasis there are additional products such as bean burgers that some competitors have been able to introduces to their menus that McDonalds restaurants have not been able to introduce. McDonald’s has always made sure that they limit the effect of their waste products to the environment either through reduction, recycling, and reusing. For instance, all their restaurants have sophisticated stock control and ordering systems that make sure that they only order needed stock (Leal Filho & Kovaleva, 2015, p. 114). The packaging’ materials for outsourced muffins and buns are usually taken back to the producers for reuse. They recycle their cooking oil to make biodiesel that fuels more than 40% of their fleet (Daven & Klein 2008, p. 234). Sustainable supply chain management McDonald’s has always made sure that they only form a partnership with the most sustainable suppliers. For instance, they have always made sure that they work with suppliers who have ensured proper working condition for their employees. Despite the fact that the company depends on beef as their, main raw material the company do not in any way associate with suppliers whose treatment to animals is inhumane. Further, the company is working to make sure that any supplies of beef that they get will be from verified suppliers by the year 2016. This will be aimed at making sure that whatever they get will be of the highest possible quality possible. These standards will eventually reflect on the quality and safety of the products that they avail to their customers. This is something that Burger king has not done with some of their suppliers being caught in scandals such as supplying horse meat. The verification of supplies will not only apply to beef, but also to other animal products such as eggs, fish, chicken, pork, and mils. The end result of these developments will be that the company will be able to give their customers the assurance of the quality, safety of any products that they sell to them (Hamprecht et al. 2005, p. 10). Martin-Brower Company LLC, which is one of the main suppliers of McDonald’s makes their supplies three or two times in a week. This is done so through the corporation with McDonald’s who make sure that they have effective storage facilities, which makes it unnecessary from the suppliers to make the deliveries on a daily basis. This saves the suppliers on the transportation, making their operations more sustainable. Martin-Brower Company LLC also uses a single truck with huge storage capacity to supply McDonald’s restaurants in a given geographical area. This reduces the cost of transportation and also reduces the rate of carbon emission as compared to using a number of trucks. Before the trucks leave the Martin-Brower Company LLC premises, they usually communicate with McDonald’s restaurants so that they can expect the deliveries to be made at a certain time (Goldberg &Yagan 2007, P. 9). This helps in saving time because by the time the trucks arrive at the restaurantsthereare always employees waiting to receive and take them to their respective places of storage (Kashmanian & Moore 2014, p. 35). The giving of notice has also enabled the company to reduce the period of time that the supply trucks have to spend on their parking lots. This is the kind of model that McDonald’s tends to adopt with most of their suppliers. They also encourage their franchises all over the world to adopt the same model to enhance the sustainability of their supplies. On the other side Burger King has a system that enables them to make procurements on both national and local levels, with orders being made once there is foreseen need. Some of the suppliers such as Cargill have been awarded for being highly sustainable suppliers. Awarding suppliers for sustainability can be seen as a way through which McDonald’s aim at making sure that their suppliers enhance their sustainability levels. McDonald’s is dedicated to making sure that their suppliers do not involve in any kind of activity that might cause harm to the government. For those activities that have an obvious negative effect, McDonald’s wants to make sure that the effects are minimized as much as possible. Cargill has increased their anola per acre in response to McDonald’s need for high-oleic canola oil. Cargill has also established a palm oil teaching institute in Indonesia so that they can enhance the production of palm oil in Indonesia. The institution is the first one of its type in Indonesia. Cargill has also made sure that the use renewable energy at their chicken farms so that they reduce the energy intake of their productions. The collaboration of Cargill with World Wildlife Fund has enabled them to enhance corn production while at the same time discouraging the use of land that is environmentally sensitive in the north-eastern region of China. These are some of the initiatives that led to Cargill being awarded for sustainable supplying by McDonald’s. This seems to be a good way of encouraging Cargill and other suppliers to enhance sustainability in their operations. What makes McDonalds different from other competitors such as Burger Kings is the fact that they encourage their suppliers to embrace sustainability through rewarding them. Burger King on the other hand tries to enhance sustainability of their supply chains by dripping the unsustainable suppliers such as Sinar Mas palm oil production and opting for more sustainable ones. Bibliography Daven, JI & Klein, RN 2008, Progress in waste management research, Nova Science Publishers, New York. 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