The Best Hamburger Fast-Food Chain - Coursework Example

McDonalds Enterprise Resource Planning McDonalds Enterprise Resource Planning Introduction The renowned McDonalds Corporation is the largest chain of fast food restaurants in the world. It majorly deals with hamburger. It is an international company with the headquarters in Oak Brook, Illinois, United States and roofed under its headquarters complex, The McDonalds Plaza. The company operates in 119 countries through 35,000 outlets. It serves an estimate of 68 million customers daily. McDonalds Corporation began in 1940 as a restaurant that serves barbecue. The first operators of the corporation were Maurice and Richard McDonald (Monk & Wagner, 2009). They later recognized their company as a hamburger stand, using principles of production line. McDonald has faced many challenges in the industry, but has overcome such challenges through the enterprise planning and to date, they still stand as the best hamburger fast food chain of restaurants. Product and Services McDonald belongs to the food and hospitality industry. It offers high quality food products that it servers worldwide. Even though they specialize in fast food, people can also take main meals from the enterprises. Given that, the industry the company operates in and the scale of its size and customer rage that includes tourists as well, some bigger branches of the corporation provide accommodation services. The food products offered in the McDonald’s outlets are spread through breakfast, lunch and supper. However, their food primary provisions are hamburgers, chicken, cheeseburgers, French fries, pizza, salads, vegetables, sandwiches, milk shakes, soft drinks and desserts. Product Value to the Customers McDonalds’ mission is to serve the customers at the best from the way they eat and drink. The McDonald’s products provide utility to the customers through food satisfaction. Many individuals who work in the urban areas can hardly afford making it back home for lunch while others, especially the single persons, do not prefer cooking at home. McDonalds caters for such persons. This satisfaction is extended to tourist customers who could prefer McDonald’s products. They could also provide accommodation services to the customers who are away from home. They provide vegetarian items alongside other food products to meet all their customers’ expectations. Enterprise Size, Locations and Employees The Corporation is huge in size given the many branches it has that serve trough a huge market share across the globe. It has branches in 119 countries with around 35,000 outlets that it operates in and dominates as far as fast food companies are concerned. It has employees throughout the world in the countries it operates and the there is no disparity in the demographic distribution of the employees in terms of gender. Employees must be of working age depending in the country of operation; they are both men and women. Competitive Arena McDonalds operates in the food industry and experiences competition from food companies. However, the corporation specializes in fast food and, therefore, experience a more stiffer competition from fast food companies throughout the local and international market arena such as Burger King, Chicken inn, Galitos, Pizza Hut, Dunkin Doughnuts, Nandos and Taco Bell. Organizational Structure The organizational structure that best fit McDonalds Corporation is the Functional Organizational structure. This structure involves grouping together individuals with similar tasks together and allocating a set of working group systems to various company branches. The functional organizational structure would ensure effectiveness in McDonald’s operations (Monk & Wagner, 2009). Fig I: Functional Organizational Structure Chart Source Ruppert and Matteson (2015) Effectiveness of the Structure in the Competitive Arena The Functional Organizational Structure the McDonalds use supports it in the competitive arena. This is because the company operates in the world market and needs groups that take up whole management tasks throughout the various branches across the globe. The structure supports by ensuring that each working individuals are grouped accordingly and assigned across the globe. In this manner, the company can vividly observe its operations through all the branches without major mistakes and errors but fulfilling the competitive needs of its decentralized system. Alignment of Managerial Characteristics The characteristics of management in McDonalds functional organizational structure aligns with the discussed in many ways. In functional structure, managers of different sectors or departments will be grouped together especially when they are performing in different countries. Workers of the same task are established in unit offices and sets of these unites that make up a whole functioning management system is assigned tasks in different branches. The management in this case supports decentralization that characterizes McDonalds Corporation enterprise resource planning. Information Technology McDonalds has a high-level information system that ensures effective communication and flow of products from the company to the customers given that the company also offers delivery services, to meet customer satisfaction ultimately. The schematic structure of information system the company has adopted produces high competitive advantage for the company. Technology is incorporated in this trend to enhance efficiency. For instance, a telephone call would sense the customer’s identity and automatically recognize locations in terms of address in case of a regular customer (Monk & Wagner, 2009). The system records what the item and quantity as described by the customer’s order. It offers commands that provide quick responses to the customer. The system computes and calculates the price of the item, and even generates receipt. Customer can as well be served manually but the adoption of this technology enhances sales because it gives room for comfort by being flexible to customers. Since it makes more sales daily, this information system also caters for the channel for obtaining raw materials to enable supply keep abreast to the requirements of demand. Fig II: Schematic for McDonalds Information system Source Ruppert and Matteson (2015) Marketing Considerations Marketing forecasts are very crucial aspects of marketing that McDonalds considers with utmost attention. It could terribly fail in the global marketing when the forecasts are overlooked. To develop master production schedules, factors affecting marketing are studied in the local and global trends to determine prospectus speculations. Measures for effective marketing can be put in practice after proper forecasting. Fig III: McDonalds Framework for Marketing Forecasts Source (Ruppert & Matteson, 2015). To develop marketing forcasts, one has to consider the relevant needed elements like market share, sales, marketing costs and competitie reactions. it is also necessary to consider a product life-circle, degree of industry regulation and the state of the economy before engagin in the productio of the forecasts. After conducting research and place all data and consoderationd under succint scruitism, and establishing that the product can perform well in the market, maketing of the forecasts can then be initiated. The actuals are already established or popular in the market. They meed marketing to attract new customers and keep the old ones, creation of customer referrals and instilling customer loyalty. Actuals marketing are normally far easier and cheaper than forcast marketing. Purchasing and Inventory Management Inventory management is important to McDonalds as it helps the company meet the customers’ demands, and keep the company running, to avoid financial risks, to get lead-time, to meet emergency requirements and to get price discounts. The primary objective of McDonalds is to make profits while at the same time, attaining customers’ satisfaction. Without proper inventory management, the company can easily run at a loss. The raw materials needed for the creation of the products should be in the inventory; the products should meet the customers’ demands and sales must result into profit after computation. These are why the company must keep inventory entries accurately and sufficiently. When the company is making purchasing of raw materials, the inventory records helps in the decision-making processes. Cost of production and prospective returns of are key aspects to consider if the company has to make larger profit margins. The profit estimation is attained by the difference between the achieved revenue and the cost incurred for producing the products. However, when computing the ratios and differences, quality of the products must never be subject to compromise. There are management tools that the company puts into practice to oversee the company making huge turnovers. For example, when purchasing the raw products in bulk, the company reduces the costs through the principles associated with marginal advantage. The availability of proper marketing and entrepreneurial skills enhances sales, which can also influence the purchasing and inventory management procedures. In addition, such purchases imply economies of scale that attracts benefits like price discounts and after sales services like transportation. Fig IV: McDonalds Inventory Trends for the Last 5 Years as Portrayed buy Revenue Source: Ruppert and Matteson (2015) Sales and Operations Planning Fig V: McDonald Year-to-Date Global comparable Sales (2014) Source: Ruppert and Matteson (2015) The McDonald Co. has a sales and operations plan that enhances the supply chain and the profitability of the company. This plan’s main objective is to put resources into work in a manner that synchronizes supply to keep abreast with the demand. Sales and operations planning involve a holistic consideration of supply demand and other production factors. In the sales and purchasing planning, the arrangements consider the raw products, the finished products and the capital required for production. The persons involved are the customers, who are available globally, the suppliers and the employees who take their time to involve in the production. McDonalds Co. is supplied raw materials by local producers of the area of their operation as long as they meet the company’s hygiene and exact product standard in terms of social, environmental, agrochemical and animal welfare policies. For instance, Lopez Foods has been supplying McDonalds Co. with beef for 25 years. Finally, the business has numerous sales marketing representatives and managers located in the various areas of its operation and quality assurance personnel that ensure high product competitiveness in the market. So far, the S & OP planning has been effective, which explains the company’s success and positive feedbacks in the market. Scheduling McDonalds Corporation scheduling techniques differs from every country and location of operation to another. This is because then company experiences different market and operational forces in various areas. Availability of raw products, supply and demand forces and governmental policies of the country of operation are some of the factors that influence the company scheduling. The concept applies to all factors of production, labor inclusive. Scheduling enhances the process of production and is performed to increase the profit margin by cutting the cost of production. McDonalds Corporation utilizes numerous. When the company schedules, it ensures materials required in the production are in place to minimize occurrences where demand exceeds supply, which would result in shortage; hence, customer dissatisfaction. Labor is a vital factor of production in this industry and is scheduled in time to avoid last-minute inconveniences. In addition, the utilization of machinery is crucial in the production of McDonalds’ products such as bakeries for the production of burgers. The restaurant has schedules and arrangements that ensure the machines are well functioning constantly (Monk & Wagner, 2009). The matrices used are increasing profitability by reducing costs of production, conducting research to adopt techniques aimed at improving customer quality and practicing or employing recommended management tools to observe customer satisfaction. Material Requirements and Planning The Material Requirements Planning (MRP) is the process of integrating all the business activities, information and strategies of communication inclusive, to properly relate or correlate with sales forecast, inventory sales forecast and material bills to enhance a company’s productivity. The McDonalds’ material requirement panning ensures that has constant and sufficient supply of factors and materials of production that consistently meet the demand and forecasted production. The company integrates the inventory management system and the production to attain optimum production of quality and high quality foods and beverages. McDonalds reports and records its operations and experiences. In this way, it is able to learn from the historical experiences, which channels the decision-making processes. The company has a computer software back up that contains crucial information regarding to the company’s operations, hence, helping the company to accurately forecast. The company is cognizant of the market trends in every season and interprets the changes of demand, supply and other business operational forces, which helps the management in making informed and decisive choices. McDonalds operates in the international market with many outlets. These operations are made manageably by the company’s MRP. The company has constant supply of raw materials and even though the production normally fluctuates depending on the area of operations, there are no recorded production halts because of inadequate materials for production. Managing the Enterprise McDonalds applies modern management approaches to keep abreast with the ever-changing trends of the contemporary world. These are changing times and business managements have to change as well in order to maintain the competitive advantage. Managing supply, demand and service that meets customer satisfaction is a sure way of driving the company to success. McDonalds uses the workflow automated management approach to handle its production and sales operations. It has invested in automated machinery that also enhances the employee productivity (Monk & Wagner, 2009). Given that the company has an international reputation and millions of customers worldwide, it is hard to meet customer satisfaction when conventional production methods are used. Therefore, McDonalds has invested in relevant machinery that adds to production efficiency. The company also uses automated teller machines to dispense some products such as drinks and burgers directly to the customers in. However, the company also uses sales persons who take orders and handle the customers especially when they arese4rved while seated. In this approach, McDonalds utilizes the use of computer software technology to aid this management system. The software automates the process; it is encoded to take set calibrations that deliver required products in right quantities. Enterprise Education and Training McDonalds has adopted a system that educates and trains employees on the matters of food safety and production, time management, market situations and customer service (McDonalds, 2015). The primary needs for these programs are employee motivation and customer satisfaction. Some of the practices the company has adopted in this essence include orientation, education, training and experience. Orientation The employees need to understand the company’s sales and operations. In this context, the employees become cognizant of the company’s mission and vision statements, which they conform to adequately. McDonalds conducts employee orientation to familiarize them with the company’s traditions, cultures and policies. It is important for the employees to understand and work under the company’s believes, values and acceptable code of conducts, which makes orientation a vital step of the company’s management. Education Education equips the McDonalds employees with the fundamental base and theoretical framework of operations. It promotes good behavioral nature of the employees as well as inculcating awareness and understanding that the company requires of a trusted employee. Training Training the employees is a step McDonalds take to motivate the employees both intrinsically and extrinsically (McDonalds, 2015). Additionally, training enhances the employees’ productivity as it equips them with the skills to undertake the tasks in an efficient and effective manner. Training also enhances personal, career and professional growth. Experience It is true that with proper and consistent practice, perfection is inculcated. McDonalds Co. values its long-serving employees, who have the experience to execute most tasks efficiently without straining. The more experienced employees are usually more productive than the new ones. Moreover, they understand the company’s operations better – a quality that renders them as role models to other employees. References McDonalds. (2015). Training and Education. Retrieved on 2015 June 3 from http://www.mcdonalds.com/us/en/careers/training_education.html Monk, E. F., & Wagner, B. J. (2009). Concepts in enterprise resource planning. Australia: Course Technology Cengage Learning. Ruppert, D., & Matteson, D. S. (2015). Statistics and data analysis for financial engineering: With R examples. Mankato, MN: Creative Education. Read More