McDonald's Evaluation - Case Study Example

Name Class International organisation structures and business communications 2100 Global ecommerce 1400 Contents 1.0 Introduction 2 1.1 Strengths, weaknesses and suitability of different international organisational structures for different types of business 3 1.1.1Bureaucracy 3 1.1.2 Bureaucracy/ centralised structure at McDonalds 4 1.1.3Matrix structure 5 1.1.4 Flat organisation structure 6 1.1.5 Hierarchical structure 7 2.1 Features if an international communications strategy 8 2.2 Apply business writing conventions for a range of international 9 2.3 Explain methods of internal and external international business communications 10 2.4 Use of spreadsheets and databases for international business purposes 11 3.1 Explain the difference between global e-commerce and e-business 12 3.2 Advantages, disadvantages and use of international social networking and internet media for business purposes 13 3.3 Explain how to use digital tools for international marketing purposes 15 4.0 Recommendations and Conclusion 16 Reference 18 1.0 Introduction McDonalds is a global fast food chain that operates through company outlets and franchises. The organisation has a presence in over 100 countries globally. McDonalds offers a uniform menu in all outlets with little variations to suit geographical differences. The company products include Big Mac, Cheese Burgers, French Fries and Wraps among others. The company depends on a large target of customers both young and old. The company serves more than 70million customers daily. McDonalds employs more than 440,000 employees globally (McDonalds, 2013). The company plans are based on enhancing the close relationship with the customers through excellent service. The company aims to use technology and move from mass marketing to mass personalisation. 1.1 Strengths, weaknesses and suitability of different international organisational structures for different types of business There are different types of organisation structures. An organisation structure acts as a link between the company strategy and its implementation of action plan .it’s the specification of jobs carried out in an organisation and the way in which they relate to each other. Organisations use charts to depict the structure they are using. McDonalds have an organisation structure that helps them achieve their strategy. There are various forms of organisational structure which includes; hierarchical, flat, matrix and bureaucratic (Harris & Raviv, 2002). This section will look at each of the organisation structure access its strength, weakness and suitability to different organisations. It will also discuss the organisation structure used at McDonalds and its suitability. 1.1.1Bureaucracy This structure uses standardisation of work processes. There is limited decentralisation in the organisation. In this type of organisation, there are high levels of specialisation and decisions are centralised (Harris & Raviv, 2002). The organisation uses a narrow span of management and many levels exist in the organisation chain. Bureaucratic organisations use a lot of support staff. This type of organisation structure has been mostly used in schools, public institutions and automobile manufacturers. The main goal of this type of structure is to attain high level of efficiency. This is the organisation structure used at McDonalds. The structure enables McDonalds to maintain standardisation in all their outlets globally (Ritzer, 2002). 1.1.2 Bureaucracy/ centralised structure at McDonalds MacDonalds have all their practices centralised at the headquarters. All outlets have to follow the set steps by the headquarters while making purchases or preparing their menu. The company have all the advertising handled at the corporate level. When making local advertising, the retailer has to get approval from the regional manager (Shu-Ju, 2007). All activities done at McDonalds which includes cleaning, painting and floor polishing have to follow set procedures. Through the use of bureaucracy, McDonalds have been able to attain efficiency, predictability and calculability. The structure fits McDonalds since food preparation is a routinized procedure that requires standards. The rules and standardisation set by McDonalds eliminate conflicts (Ritzer, 2002). 1.1.2.1Strengths The business owners have the command and control of the entire organisation. The organisation takes a short time to make strategic decision. There are few people involved in making decisions. The organisation can maintain standardisation and other best business practices in all areas of operations. There is high efficiency and effectiveness. 1.1.2.2Weakness The bureaucratic organisation experiences low creativity and innovation. The employees ideas are not well utilised. A bureaucratic structure can lead to low job satisfaction and an increase in employee turnover rates. There are rigid controls which make it hard for the organisation to adapt to changes in the environment. 1.1.3Matrix structure This is one of the most typical organisation structures (Harris & Raviv, 2002). It’s a project based management style where reporting is done to the top management. This structure involves reporting lines and employees have supervisors. The work arrangement under matrix structure is both permanent and temporary. There is a cross transfer of information and employees can be transferred to the organisation. There is extensive administration due to the complex nature of matrix structure. This structure is used in technology companies especially those engaging in software development. Also, companies such as Nike use matrix structure. 1.1.3.1Strengths Well suited for large corporations. The capability to leverage large amount of resources through a lean organisation. Capacities can be utilised by the entire organisation. Leads to strong communication due to lateral communication channels. High integration and communication among different departments. The structure fosters innovation and is fast responsive to changes in business environment. The organisation can avoid job duplication and leads to effective utilisation of corporate resources. 1.1.3.2Weakness There are several commands chains that lead to ambiguity. This type of organisation requires extensive management. Due to unclear authority and roles, there are high chances of resistance. Unclear roles and responsibilities in a matrix structure may lead to hampered decision-making. 1.1.4 Flat organisation structure A flat organisation structure involves a short chain of command. Flat organisation structure is also referred as a horizontal organisation. In this type of organisation, there are few or no levels of management. The structure is less bureaucratic and employees are involved in decision-making. There is a high flow of information between management and employees (Harris & Raviv, 2002). It’s most used in innovative organisations such as Apple Inc. 1.1.4.1 Strengths There is a high flow of information leading to better communication at all levels. Communication in these organisations is more reliable and faster. Due to few levels between managers and employees, the organisation is highly flexible. Flat organisation structure leads to a high response in an organisation. This makes it possible for an organisation to take advantage of new opportunities and avoid business threats. Flat structures lead to shared organisation goals in an organisation. This is due to the inclusive nature of flat structures. Due to high level of flexibility, decision-making is easier. Employees can make prompt decisions. 1.1.4.2Weakness Flat organisations may experience lose control due to few managers and many subordinates. Flat structures may not work in organisations dealing with complex activities. There are chances in service consistency since each employee handle situations differently. 1.1.5 Hierarchical structure This involves a structure where an organisation has several ranks. Each level is above the other. There is an authority based chain of command. In a traditional hierarchy, there are senior managers who comprise the board of directors. They establish the strategy for the entire organisation. This form of structure is utilised in large organisations and public companies (Mihm, Loch, Wilkinson & Huberman, 2010). 1.1.5.1 Strengths There are clear authority and responsibility. The organisation promotion path is well organised. This type of structure enhances employee loyalty to their departments. There is an effective use of management. 1.1.5.2 Weakness The hierarchical structure can lead to bureaucracy making it hard to respond fast to changes. There is poor communication flow in the organisation. Decision-making can take long time This form of structure can lead to interdepartmental rivalry that is counterproductive. 1.2 Influence of organisational behaviour on an international organisation’s structures, culture and performance An organisation structure gives a mechanism to coordinate and control activities in an organisation. Organisation behaviour involves knowledge of how workers interact with organisations (Nahavandi, Denhardt, Denhardt, & Aristigueta, 2014). Organisation culture acts as an information processing and behaviour control mechanism. In an organisation, organisation culture is based on beliefs, rituals and symbols. Organisation culture guides decision-making and performance. Thus, organisation culture guides their behaviour (Robbins & Judge, 2013). At McDonalds, both organisation culture and structure guides strategic behaviour. The mechanistic structure used reduces uncertainty at McDonalds. Organisation culture at McDonalds reduces uncertainty in a situation where there is no face to face communication. When management makes a decision at the headquarters, the organisation culture helps the employees to implement it with less ambiguity. There is a link between organisation behaviour, culture and its structure (Nahavandi et al., 2014). McDonald’s structure is mechanistic where high stability is preferred. Most of the tasks are routine making the structure work. This form of structure have shaped McDonalds Corporation employees’ behaviours and influenced culture (Brown & Harvey, 2011). Employees’ works based on specified job descriptions. For the employee to survive at McDonalds, they have to obey management decisions. The low level of uncertainty is encouraged through rules and regulations. The structural mechanisms are used to control employees’ behaviour. 2.1 Features if an international communications strategy Due to globalised business, multinationals are expected to communicate across cultures (Verbeke, 2013). The rise of modern communication technologies has made communication easier. Organisations are required to come up with unique messages that appeal diverse markets. MacDonalds have a very effective international communication strategy. This is through use of modern technologies which includes social media and other new media channels to address different market segments (Locker & Kienzler, 2012). The features of international communication strategy used by McDonalds are; Determining the goal- in the company business strategy, goal determination is the first step. Target audience profile- McDonalds segments their customers into age, attitudes, location, dietary practices and eating behaviours. Message-The message is developed based on the issue being addressed and the target audience. This involves developing a message that fits the target audience characteristics. Select communication channels-McDonalds uses different channels of communication. There is use of posters, TV adverts, public relations, internet, social media and other new media channels. Activities and materials- this includes the materials and activities that are used in international communication such as sponsorship of events. 2.2 Apply business writing conventions for a range of international Business writing is supposed to be straightforward and should avoid being excessively formal. There is a need to refrain from using personal pronouns. For example, McDonalds Corporation business writing uses “we” instead of “I” when talking about the organisation. The language used in international business writing is sensitive to offensive interpretations. This is due to the fact that the organisation is operating in different geographical regions with varied cultures. To avoid communication problems, there is a need to adhere to cultures guidelines. International letters are expected to be concise. For example, they always use active voice (Cleland, 2014). For example instead of writing, “this strategic report was…” it’s written, “We prepared this strategic report...” this is evident in McDonalds Corporation annual report globally (McDonalds, 2013). When the business letter is expected to persuade, use of logos, pathos and ethos is required. Logos involves evidence and reasons. Pathos involves the use of value and emotional appeals and is very useful when engaging in multicultural communication. Ethos involves being able to establish accurately and effectively organisation personality when writing. International business writing involves being able to establish a goodwill to the readers. It includes the use of positive phrasings, ethical concerns and litigation concerns (Cleland, 2014). To ensure readers’ time is saved, the international business letters are written using appropriate format and enhanced readability (Walters & McNamara, 2014). 2.3 Explain methods of internal and external international business communications Internal international business communication takes place among members of the organisation globally. The participants in this form of communication must be working in with the organisation. For example, McDonalds Corporation management in USA may send an internal memo to all franchises globally. Through the use of emails, McDonalds can email executives in different countries. The internet has made it possible to conduct teleconferencing that makes it easy to carry out conferences with members located in different countries (Locker & Kienzler, 2012). External communication involves exchange of information between the organisation and other stakeholders such as community, individuals, government and other groups. External communication is carried out using different methods such as telephones, social media, internet, newspapers and company annual reports (Locker & Kienzler, 2012). With new technology, it is easy to disseminate information to stakeholders. MacDonalds have a presence on social sites such as Facebook and Twitter. This makes it easy to pass information. The company website provides an avenue for external communication. McDonalds Corporation website can be assessed by public for any information. In their areas of operation, the company tailors the website to match local market language and culture (Shu-Ju, 2007). 2.4 Use of spreadsheets and databases for international business purposes Spreadsheets enable organisations to generate financial transactions and also carry out forecasts. This makes them a core international business tool. Spreadsheets have a role in supporting information management in vital business processes. Through spreadsheets, it becomes possible to transfer data in IT systems. The auditors are supposed to ensure that the spreadsheets are accurate. The most common spreadsheets are Microsoft Excel (Pemberton & Robson, 2000). In international business settings, spreadsheets are segmented into two categories. The categories are modelling and operational. When being used for modelling activities, spreadsheets are utilised as calculators to help in complex processes such as mergers and acquisitions. In operational processes, spreadsheets are used as business programmes to process static and changing data (Pemberton & Robson, 2000). They are used in inventories and storage of confidential information. Spreadsheets are valuable to errors, fraud and have poor transparency in an organisation. To eliminate these risks, technology has been utilised. There is used of professional software to enhance transparency and speed. Organisations are increasingly using technology to store and retrieve data from their database. In organisations such as MacDonalds, employees are expected to be computer literate. Those working in the data processing sections have knowledge in data management and integrity. The company is expected to adhere to data protection act. This involves handling consumer data with integrity. The organisation is expected to follow rules on data protection principles. This involves striking a balanced between the individual right to privacy and business use of data (Hoffer, 2004). McDonalds have been one of the most ethical organisations through handling the employees’ data in an ethical manner. This is based on McDonalds Corporation’s privacy policy. 3.1 Explain the difference between global e-commerce and e-business E-commerce and e-business are important components in global business strategies. E-commerce and e-business are distinct concepts in a business environment. E-commerce involves any business transaction where the parties engaging do not use physical exchanges but utilise electronic exchanges (Chaffey, 2007). E-commerce involves buying and selling over the internet or nay transaction carried out through a computer-mediated network (Mahadevan, 2000). E-business involves the use of ICT to enhance the business. It involves transforming organisation processes to enhance consumer value through the use of technology. This involves enhancing production processes; customer-focused processes and international management (Chaffey, 2007). McDonalds uses e-commerce in their online food purchase and delivery system. Customers can browse through online menu and place their orders. This allows the consumer to pay for their food online using a credit card that is delivered to them. At the moment, McDonalds is among the industry leaders in e-commerce. In e-business, McDonalds Corporation’s production services are enhanced through technology. This includes the company procurement and control of production processes. Use of electronic marketing and social media is highly utilised by McDonalds. The company also offers customer service through their interactive website. Extensive use of technology is applied internal management processes (Moth, 2013). This involves video conferencing, recruitment and electronic publishing of materials. 3.2 Advantages, disadvantages and use of international social networking and internet media for business purposes Social networking sites have become a vital tool for modern business. Business are using social sites to market their products and communicate with customers. For international business social media have become a business imperative. Over 70% of organisations operating in the global market have social media presence (Kaplan & Haenlein, 2010). Research shows that most organisations use social media to enhance consumer relationship. The ability to identify opportunities in social media has been a major factor that determines success. 3.2.1 Advantages McDonalds Facebook page have millions of likes and followers. The company is in all social sites such as Facebook, Twitter, Pinterest and Google+. McDonalds Corporation uses social media for marketing purposes, promote a brand and enhance consumer relationship. The company constantly retweets the customers that make them have a sense of belonging to the organisation (Evans, 2010). The company keeps on updating their social sites. At the moment, McDonalds is the top restaurant in social media use. Social media have become a vital tool for customer engagement (Berthon, Pitt, Plangger & Shapiro, 2012). Customer relationship management (CRM) strategy have been embedded in social media. Through social media marketing, McDonalds can announce new products through social sites (Moth, 2013). Consumers can ask questions regarding the products and also prices. Social media helps the company to advertising their products and availability (Evans, 2010). Through social media customer have more control of the relationship. Organisations have been embracing social CRM where business facilitates collaboration with customers through dialogue. Search engine optimisation is a technique that helps as a website to rank higher in search results. This makes a business website more visible to prospect customers. Search engine optimisation can be used as a marketing tool. Most consumers look for business through search engines. This makes SEO a major avenue where business can increase visit to their sites. SEO helps to increase business visibility on-line (Berthon, Pitt, Plangger & Shapiro, 2012). MacDonalds have been able to optimise their site making it more visible. This is through the use of keywords and site optimisation strategies. Once a prospect customer search for any keyword such as Hamburger, they are highly likely to have McDonalds Corporation website as one of their results. Search engine optimisation can be enhanced by social media. Having a well-ranked social media profile such as McDonalds makes the company have greater online visibility (Moth, 2013). Social media involves low costs. The majority of social media sites involve no fee to access them and post information (Evans, 2010). This is a great advantage for the business to reach customers at no cost. Those interested in the organisation information voluntarily follow them. Through the use of advertisements on social media such as pay for click, it becomes possible to reach the right target audience. Social media sites provide a viral information channel. The information posted on social sites can reach a wide audience in a short period (Berthon, Pitt, Plangger & Shapiro, 2012). 3.2.2 Disadvantages Social sites require constant updating that requires time and effort. This makes it vital for the organisation to look for a person with social media knowledge and experience. Social media may work against an organisation in an event of a scandal (Berthon, Pitt, Plangger & Shapiro, 2012). Negative information about an organisation spreads fast when posted on their social media site. Disgruntled customers may tarnish the organisation name through social sites. When social media is used ineffectively, they can lead to reputational damage. Employees can lead to damage of the company image through the inappropriate use of social media (Evans, 2010). Through social media, the organisation loses control of the relationship with the customer. This makes the traditional CRM ineffective. The customer drives the conversation in the social sites. 3.3 Explain how to use digital tools for international marketing purposes The main digital tools for international marketing are social networks, content distribution tools, review and snap ratings and social bookmarking sites. In social sites, Facebook is the most popular for marketers. A business has to decide whether to use Facebook as a branding tool, marketing tool or both (Chaffey, Smith & Smith, 2012). When using Facebook for business, one has to use both engagement and marketing. Engagement involves making posts that which the page followers will be engaged in through likes and comments. The page will then post the company products. There is a need to balance engagement with marketing. To succeed in social sites, it’s important to use and make simple and short posts. Timing is also important in social sites; this involves posting messages when most of the target customers are online (Stokes, 2011). Twitter can be used for international marketing. This is through having a strategy for marketing. The messages posted on Twitter should be engaging as the respondent challenge or support the conversation. An organisation using Twitter should be ready to respond to tweet response. In Twitter, failure to respond may lead to failure of the strategy (Chaffey, Smith & Smith, 2012). Twitter have 140 characters, this implies that tweets should be short and to the point. Organisation can use hashtags to organise content. The same procedure applies to social channels such as Google+. The company should enhance their use of Google search since it contributes to SEO (Stokes, 2011). YouTube have evolved to become a marketing tool for business. Sharing videos is a great way in which an organisation can advertise their products. The channel is free for upload of videos. An organisation using YouTube for marketing must make the channel depict their business. The company can use settings to enhance YouTube appearance to reflect company colours. Organisation is then supposed to drive people to their channel. This may involve using social media to direct the consumers to the video. The video should be simple to comprehend and present what the organisation is offering (Chaffey, Smith & Smith, 2012). Despite being an advertisement, the video is supposed to be entertaining. 4.0 Recommendations and Conclusion McDonalds have been able to achieve great success in the fast food industry through their mechanised structure. Despite the fact that the organisation has benefited a lot from the mechanised structure, it would be advisable to empower the employee to enhance innovation. Employees who are experienced should be allowed to take part in decision-making which can lead to enhanced motivation. Reduction of bureaucracy in the organisation will enable the organisation to adapt fast to changes in an environment. This can be justified by the fact that McDonalds took too long to adjust their menu despite criticism of being unhealthy. If the company had allowed more empowerment to employees, they would have averted the risk. Delegation of tasks to the subordinate should be encouraged; this will be a step towards creating an empowered workforce. McDonalds should ensure that their marketing communications strategy can recognise different cultures. This should be portrayed in all their marketing campaigns to ensure that there is no misunderstanding. A successful case of international marketing campaign has been evidenced in McDonalds Corporation expansion to France where they have thrived. The “American way” used by MacDonalds have proved not to work in different countries. Ethical data handling is a very sensitive issue for business. MacDonalds must continue ensuring that they safeguard consumer data and uses it ethically. The business should balance consumer privacy and organisation data use. This will help the organisation to avoid legal issues. The business should continue taking advantage offered by e-commerce and e-business. This is through enhancing their use of technologies for business. While utilising social media, a business should ensure that they utilise it correctly. Social sites can ruin business reputation. Employees should not post their personal agendas on company social sites. The social site should only be handled by an experienced professional. McDonalds have to embrace social CRM. This will enable them to have a close relationship with their customers by leveraging their social site presence. A successful case of social CRM is IBM. Enhancing use of digital tools for marketing is a major opportunity to gain maximum benefit from internet marketing. Reference Berthon, P. R., Pitt, L. 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