American Society for Nutrition - Assignment Example

American Society for Nutrition Introduction McDonald’s is known for its food service retailing style format that delivers this service in more than 121 countries over 31 thousand restaurants, serving more than 50 million consumers every single day. McDonald’s has been able to establish as a recognized global brand by employing a collaborated strategic operation throughout the world. The organizational strategic initiatives along with constructive planning have helped the company to build up a successful brand (1 McDonald’s Corporation, 2010). Figure 1 (2 Daily Finance, 2010). Till 2008, the net sales have shown increase and in 2009 it has declined. There has been increase in the operating income in 2009 even though the sales decreased. The equity earnings have increased by $ 57.1 million in 2009. This shows although there have been decrease in sales, equity earnings and net income, still the company is performing better in the market. The stakeholders are getting better return from the company. Customer Service Charters McDonald’s strategy is to deliver high level of service, quality and cleanliness to all the consumers in all of the McDonald’s restaurants. The strategy developed is to monitor persistently on the feedbacks by the consumers and act according to the feedbacks. For this purpose the employees are trained with tools and resources to handle all the issues of the consumers to improve the service and the quality. Even technology is applied in this process to acquire repeat business from the consumers (3 McDonald’s Corporation, 2008). Code of Practice The Board of Directors and the other employees are well versed with the objectives and responsibilities with the organization in delivering high quality service and food to all the consumers in every restaurant. They maintain the confidential data and are obliged to follow the code of practice developed by McDonald’s (4 McDonald’s Corporation, 2010). Social Commitment McDonald’s has joined in with World Wildlife Fund (WWF) to address certain issues regarding the wild life. The company has recognized Cargill, a Minnesota based company dealing with food and agriculture for the welfare and environmental efforts (5 Mc Donald’s Corporation, 2010). Comments from Management CEO Jim Cantalupo announced that “he will give himself eighteen months to turn the company’s brand back around” (13 Cabell, 2010). Within the time frame, Jim Cantalupo re-established brand uniqueness and developed new menu items to satisfy consumers especially for health conscious consumers. Mission and Vision McDonald’s mission and vision is “the world's best quick service restaurant experience. Being the best means providing outstanding quality, service, cleanliness, and value, so that we make every customer in every restaurant smile” (6 Mc Donald’s Corporation, 2006). Aligning Mission and Vision with Strategy They have developed strategy and feedback system to enhance the consumers with proper employee training and application of technical devices. And they have been successful in aligning to their mission and vision statement. McDonald’s also has been successful in expanding more stores in different locations. And they have focused upon the sales to generate more revenues from the existing stores. SWOT Analysis & Current Positioning Strategy Strength McDonald’s is a global brand with diversified geographic presence and has strong supply chain capabilities with large scale of operations in many countries. The strong brand helps to attract more consumers to the restaurant and provides its acceptability in the new market. Weakness The fluctuating operating profits and net profits are the weaknesses of the company. This will turn out to decrease the confidence level of the investors. This is a negative impact upon the market. Every investor has certain amount of expectations and confidence from the company. This decrease in confidence level will have negative impact in the financial performance of the company in the long run. Opportunity There is a potential opportunity in the franchisee operated restaurants. There are markets where it needs to enter directly or through the franchise model. The new product development is an added benefit that provides opportunity in the market. In the category of beverage market too, there is huge growth that McDonald’s can trap. The conversion of company operated restaurants to franchisee and developing license structuring will increase the overall profitability of the company. To expand the revenue base, the company has an opportunity in beverage category that is expected to grow in the future market. Threats The shifting of prices of commodities is a threat that affects the pricing policy in different parts of the operations. The food safety and food borne illness concerns in recent times have become a threat as consumers are more health conscious. Current Positioning Strategy and Spending on Time & Money McDonald’s has focused upon opening more restaurants and has succeeded in doing so, but increase in sales was not up to the expectation. Therefore, the focus is now on increasing sales in the existing restaurants and reducing capital expenditure allocated to generate cash for the shareholders. In this strategic approach, Mc Donald’s has been successful in increasing the sales and is still growing (7 Han, 2008). The company aimed in opening more restaurants and was also successful but the sales were not achieved at the expected level. The cost was high and to reduce it and increase the cash flow, they have focused upon increasing the sales (7 Han, 2008). (2) The fast food environment has been affected due to the obesity epidemic. This has become a public health concern and consumers are more conscious in consuming healthier foods rather than unhealthy foods. This has become the biggest menace in the food industry in developing the segment of health conscious food items that will maintain the old consumers and generate more new consumers (8 American Journal of Clinical Nutrition, 2005). Short & Long Term Objectives McDonald’s objective is to provide quality foods and beverages, choice of developing such items with the help of a team consisting of registered dietitians and trusted suppliers, delivering different kinds of nutrition products for different categories of people like kids and adults among others. The objective is to provide healthy food and beverage with exceptional quality, service and hygiene worth to consumers. The epidemic of obesity has compelled McDonald’s to research and develop new products. These objectives will help to sustain and grow in the new health business environment (9 McDonald’s Corporation, 2010). The consumers’ demands are changing as they are more health conscious and they look forward to items that are healthy for their fitness. To meet the demands of the consumers, new objectives have been developed to provide a healthy nutrition food and beverage in a clean and healthy environment. This is possible with the help of product that has been developed for this category of consumers. High Quality cuisine strategy has been the most preferred strategic option for McDonald’s. For this purpose, the company has provided the nutrition chart from where the consumers can identify and make a choice in the diet pattern. Figure 2 (10 McDonald’s Corporation, 2010). Figure 3 (10 McDonald’s Corporation, 2010). This launch provides valuable information and help in making the consumers opt for right health nutritious food. KPI The KPI (Key Performing Indicators) of McDonald’s in short run as well as for long run are “sustainable supply chain and nutrition and well-being” (11 McDonald’s, Corporation, 2010). From the KPI’s it is evident that McDonald’s has been successful in achieving the objectives and mission and vision for the past few years. The KPI’s of McDonald’s for the past few years have been provided below: Figure 4 (11 Mc Donald’s, Corporation, 2010). Figure 5 (11 Mc Donald’s Corporation, 2010). From Figure 4, it is noted that the sustainable supply chain management has been able to provide a healthy diet with proper nutrition to the entire restaurant chain in different countries. This shows the level of commitment that the company has towards building a culture of health conscious food consumption environment. The development process is still going on in the achievement of the commitment towards the society. This is an ongoing process and the level gets higher as consumers become more conscious. From Figure 5, it is noticed that there has been an average increase in the items for healthy and nutritional foods that shows the company is trying to achieve the objectives that have been committed. Ethical & Legal The consumption pattern has changed and they are more into health conscious products and it is not only the company that is generating the culture but also the consumers. The process is bilateral and in this process the company is ethically doing the right thing. Keeping the consumer at the central point and developing the healthy nutritious food help the consumers to prevent obesity. The company is delivering this service for the betterment of the people and trying to control the unhealthy eating habits. There are no issues of being ethically and legally wrong. Resources and Finances The company has been able to deliver the resources with the help of sustainable supply chain management and nutrition & well-being, offering menu choice that are presented in Figure 4 & Figure 5. The financial figures that have been presented in Figure 1, show the capacity of delivering the resource through proper channels to all its consumers at different places. McDonald’s provide adequate training and motivation to the employees to develop the culture and provide the healthy services and food to every consumer. McDonald’s value chain is strong enough as they focus more on the consumers’ requirement and then develop the products and introduce innovative products that are appreciated by the consumers globally. Through the developed models the company has been efficient enough to reduce the costs and manage the financial performance. (3) The changing environment of consumer consumption pattern has made McDonald’s to focus upon the strategy of product development. To minimize the risk, McDonald’s has innovative product development option that produces according to the consumers demand and feedback. The company has developed systematic feedback system which provides an easy access to data and gets the consumers’ wants and desire for various products (12 McDonald’s Corporation, 2010). McDonald’s have introduced a healthy range of menu items especially for the kids. They have introduced healthy salads that are available in variety of choices. ‘Wholesome Choices’ included in the McDonald’s menu, is prepared for the young consumers to make them healthier and feel good. It has been designed with the help Julia Braun, McDonald’s (US) nutrition and labeling manager (12 Mc Donald’s Corporation, 2010). This product is designed to challenge the problem of obesity which contains healthy items with lesser calories. This is done to attract the youngsters mostly as they are more cautious about their health (12 Mc Donald’s Corporation, 2010). In order to attract the market, the product contains high health items like fruits, wheat grains and many more items that are good for health and can prevent obesity. McDonald’s has been successful in promoting the products in this category. The advertisement of 4- piece chicken Mc Nuggets happy meal with apple dippers provides the information of low-fat involvement that is less than the government recommendation presented by the USDHHS (U.S. Department of Health & Human Services) & USDA (U.S. Department of Agriculture) (12 Mc Donald’s Corporation, 2010). The company has started focusing upon the sales rather than on expansion of stores to increase the level of sales. So, the promotional activities have picked up and mostly, health conscious foods are promoted to attract more consumers, as demand for these items have increased in recent times. The promotion of the products are legal and ethical as government has also taken initiative and provides guidelines for prevention of obesity by developing more health conscious foods. The USDHHS and the USDA have provided the guidelines and are seeking help from all the restaurants in delivering healthy food items. Not only the restaurants but also the government initiatives as well as the consumers are demanding healthy foods. The challenge in promoting this product is great as people akin to more junk food items. They prefer to have these foods as the key meal which hampers the health. This is not the main meal for the day but still people consume it. As consumers are aware about the health and its related issues, the demand is increasing for the healthy food items. The important part is to provide information and guidance that will help in generating awareness and choice of food. This strategy has been already adopted by McDonald’s to promote healthy foods. The market is highly competitive and other chain restaurants are also providing the health conscious food items. The intense competition is the threat to the health category of food items. At national level too, there is huge competition in the healthy food segment. In the highly competitive environment, McDonald’s strategy should focus towards the promotional activities and awareness activities with proper information providing facilities in all restaurants. This will help the consumers to have a choice in nutrition diet and avail option for different foods in the same category. This will help McDonald’s get more consumers’ attraction and they will be attracted to the restaurants. Conclusion As information generates awareness and makes people more conscious, this strategy will help in developing more business and loyal consumers in the long run. McDonald’s has been successful in running the business with the innovative product development that is designed as per consumers’ expectations. The innovative product development strategy of McDonald’s had been able to tap the new market opportunity and it has generated value for the consumers as well as for the stakeholders. The KPI’s has helped the company to develop and increase their growth in the potential laden global markets. References 8 American Journal of Clinical Nutrition, 2005. Solutions to obesity: perspectives from the food industry. American Society for Nutrition. [Online] Available at: http://www.ajcn.org/content/82/1/259S.full [Accessed November 22, 2010]. 13 Cabell, A.K., 2010. Are we still lovin’it. McDonald’s. [Online] Available at: http://www.brandchannel.com/features_effect.asp?pf_id=190 [Accessed November 22, 2010]. 2 Daily Finance, 2010. McDonalds Corp Income Statement. McDonalds Corp Mcd. [Online] Available at: http://www.dailyfinance.com/financials/mcdonald-s-corporation/mcd/nys/income-statement [Accessed November 22, 2010]. 7 Han, J., 2008. The Business Strategy of McDonald’s. International Journal of Business and Management. [Online] Available at: http://www.ccsenet.org/journal/index.php/ijbm/article/view/905/878 [Accessed November 22, 2010]. 1 McDonald’s Corporation, 2010. About McDonald’s. McDonald’s India. [Online] Available at: http://www.mcdonaldsindia.com/aboutus.html [Accessed November 22, 2010]. 3 McDonald’s Corporation, 2008. Customer Services at McDonald’s. Introduction. [Online] Available at: http://www.mcdonalds.co.uk/static/pdf/aboutus/education/mcd_customer_services.pdf [Accessed November 22, 2010]. 4 McDonald’s Corporation, 2010. Code of Conduct for the Board of Directors. Investors. [Online] Available at: http://www.aboutmcdonalds.com/mcd/investors/corporate_governance/director_code_of_conduct.html [Accessed November 22, 2010]. 5 McDonald’s Corporation, 2010. Values In Practice. Corporate Responsibility. [Online] Available at: http://www.aboutmcdonalds.com/mcd/csr.html [Accessed November 22, 2010]. 6 McDonald’s Corporation, 2006. McDonald's Vision Statement. Statement. [Online] Available at: http://www.samples-help.org.uk/mission-statements/mcdonald-vision-statement.htm [Accessed November 22, 2010]. 9 McDonald’s Corporation, 2010. It’s All about Delicious Choices. Nutrition. [Online] Available at: http://www.mcdonalds.com/us/en/food/food_quality/nutrition_choices.html [Accessed November 22, 2010]. 10 McDonald’s Corporation, 2010. Nutrition Information for McDonald's Happy Meals. Happy Meals Nutrition. [Online] Available at: http://nutrition.mcdonalds.com/nutritionexchange/Happy_Meals_Nutrition_List.pdf [Accessed November 22, 2010]. 11 McDonald’s Corporation, 2010. McDonald’s Key Performance Indicator Summary1: Measuring Performance. Values in Practice Report. [Online] Available at: http://www.aboutmcdonalds.com/mcd/csr/report/overview/key_performance_indicators.html [Accessed November 22, 2010]. 12 McDonald’s Corporation, 2010. Food to Feel Good About. Meet our Experts. [Online] Available at: http://www.mcdonalds.com/us/en/food/food_quality/nutrition_choices/kids_nutrition/food_to_feel_goodabout.html [Accessed November 22, 2010]. Bibliography Kotler, P & Lee, N. 2008. Corporate Social Responsibility: Doing the Most Good for Your Company and Your Cause. Wiley-India. Read More