The Current Position of the McDonalds - Case Study Example

Abstract The assignment describes a complete overview of production process of McDonald. The paper aims to describe the current position of the McDonald. The later describes the production process used by the firm, a detail description is given to show that how the firm work and how they are managing cost and time. Moreover, the paper also describes that how they are managing risk and quality of their restaurants. The firm is using the queuing process and trying to sue the best supply chain management system to supply the product at right time at right place. Production Process and technology used by McDonald Introduction McDonald is the world famous food chain situated all over the world. It is based in USA but working all over the world with 54 customers that are deal daily by its chains. It came into existence in May 15, 1940 and now the firm has 31,000 locations worldwide. The yearly revenue of the firm is 22.78 American dollars and has 465,000 employees working for the firm. The firm production can be divided broadly into three main categories, the accessing of raw material, production of finished good, packaging and distribution of the food and other materials. Below the research is conducted showing the production process of McDonald. Production management process of McDonald This assignment aims to discuss the production system of the McDonald with respect to the latest techniques and technologies which are used by the firm in 2007. I have presented the type of process that is used in the McDonald and planning function of the firm. Furthermore, different steps are shown that incur in the McDonald production system. In line with this, the use of quality management system is provided that is directly affecting the quality of McDonald firms. Queuing process The McDonald is the queuing process1 of providing fast food in which high volume of the same product is manufactured repeatedly. It differs from the other major manufacturing process. There is narrow range of the same product is manufactured in which variety is achieved by assemble-to-order strategy. The production lots and the customer groups are handled in queuing in which the flow pattern is jumbled. It is a linear process in which high volume of the product is required with the standard product manufacturing. The vertical integration is high in the McDonald as three major activities are performed by it; gathering food and packaging, delivering to customer and the treatment of customers. The major benefit of the McDonald is that it requires less resource flexibility. When the volume of food that are needed to prepare is high then there is no utilization of resources in effective manner is required. Almost customer involvement in McDonald is nil as they required more quality product. More capital intensity is required as there is more fixed cost that occurs on the operations from packing the order to delivering it to the customer. As the technology advances and affects greatly on the McDonald therefore, less labour intensity is required by the firm. Better queuing system McDonald can enhance its queuing system by developing new ways that can minimize the time taken by in the delivery. The multiple queuing systems should be adopted by the firm in busy season in which the firm should lunch different queues for different product line. This will keep the track of delivery of food in better ways. Fro instance, the Mac Burger should be deal in separate queue so that the delivery process for each food type should increase. Moreover, the queue for the food delivery and for the payment should be separated. Moreover, they should announce a better technological advancement on which the delivery order number should be given so that customer can know when his turn will come. Therefore, a better technological system with better services can enhance the firms overall productivity level. Productivity improvement approaches Planning projects for queuing The planning of projects within a McDonald need different steps to accumulate a better productivity processes in the future. These planning project steps in the McDonald matter a lot, as they not only ease the whole process but also help the company to keep a chain of work within different departments and thus trying to reduce much of the cost and time. These planning steps that were used in the production management of the food preparing requires steps as 1. Defining the work breakdown structure within the queue 2. Diagramming the network 3. Developing the schedule to attend the queue 4. Analyzing the cost-time trade-offs and 5. Assessing the risk Defining the work breakdown structure in queuing system The work breakdown structure is important for the firms where different works or different steps involved in delivering the customer are divided. Especially this work breakdown structure helps in the busy season. The work break down structure involves employees to divide the operation of delivering the product to the customer. In this few employees serve at the counter where as few employees work as the backbone of these employees. The employees working on the counter took the order pass them to the employees packaging food. Moreover, a new strategy is also seen that the employee that used to take the order, the same employee packed and deliver it to the customers. The electronic machines and new technologies are used in which it is whose that whose turn is to get the order. The customer has to take coupon number and the customer has to wait for few minutes till the order is ready to deliver. The work breakdown is actually the breakdown of the activities that helps the company to know deeply into the activities and to know that where the problem is occurring. The task ownership is provided to the employees to complete their respective task. This work breakdown includes managing the food product, supplying the food at time, preparing process of the material is broken into different small task accomplished by the specialist of each task, packaging process of the material and last step involves different small task associated with the delivery and distribution process. Diagramming the Network The method of networking actually forms a relationship between the different task of the work to provide efficiency and higher productivity in the end with the help of Nodes and Arcs2. The network design is used by the company with the help of arcs and nodes. The arcs represent he activities and the nodes represent the events that took place in the McDonald. Usually in the McDonald the network that specially used by the company are the precedence relationship. According to precedence relationship a sequence is determined by the company to undertake activities in a way that it specifies that an activity cannot start unless the preceding activity has been completed. This is because the distribution step cannot take place in the McDonald until the preparing and packaging activity doesn’t complete. As soon as the preparation of food and packaging activity closes, the process of delivery starts in the McDonald. Usually the preceding activities happened in the McDonald where the next activity can not start until the preceding activity doesn’t finish. Therefore, a networking is required to prevent the large delays of the work that a cause a huge cost on the firm. The networking of the activities within the McDonald matters a lot as it identify and organize the whole data and identify the interrelationship between activities. This networking provides a forum to the company of different function which enables them to know the different activities taking place in the McDonald. This also enables the company to know the completion time of each step that is useful in future planning of the company. Moreover, the use of networking in the McDonald enables the company to trade-off between the time and cost in different activities. Developing the Schedule Higher the uncertainty higher will be the risk. As in preceding network formation, the company can know the time of each task taken by the employee’s. This helps him/her to organize a better schedule task for the future to reduce the uncertainty level. Critical time path of each and single activity is measured by the McDonald to develop a better schedule for the future. The time estimation in completing different task can be noticed by the company using statistical tools or learning curve models. This helps the company to know the activity slack of the project. The activity slack enables the company to know the maximum time delay that an activity can take without delaying the entire project. Generally the McDonald in its firm uses the technique of earliest start and earliest finish times or latest start and latest finish times. These time measurement techniques required by the company to establish a better schedule for the firm in the near future to reduce the level of uncertainty. Analyzing the cost-time trade-offs The total cost that occurs on the preparation of the food is sub-categorized as indirect cost, direct cost and plenty cost. The direct cost includes the material, labour and direct overhead cost that incur during the production. The indirect cost of the McDonald is the administrative cost, operating cost and indirect overhead. Other than these cost the third and most important type of cost is the penalty cost that incur when a process delays and causes a huge cost on the firm. Usually when the firms holding activities in a way that one activity did not start until the preceding activity didn’t finish than in that case the time is the important factor that helps in reducing the cost. The company must consider the crashing, to reduce overall preparation cost and total time taken by the whole process. The crash time will provide a crash cost to the firm that lowers the overall cost of the firm. Different techniques are introduced by the business executives that help in finding the minimum cost schedule by the firm. These schedules are used by the company to minimize their total cost. Burger King Company, based in United States ensures their minimum cost by reducing much of their time in preparation of food. Assessing the Risk Risk is the factor that produce hurdle in not reaching to a define project. The risk associated with the McDonald includes the delay of an activity, higher cost of an activity and other issues in the firm. The risk is lowered by the firm by adopting the risk management techniques. Quality management system in McDonald Total quality management is the set of your management, polices and rules that are resulting high degree of quality in totality. It is actually delivering of product and service to your customer, beyond their expectations. Quality management is the enhancement of the traditional process and the way that we use in different processes. The tools used by the McDonald for the quality management is given below: 1. Benchmarking is a technique through which a company can measure itself against best industrial practices, used in all manufacturing and service organizations. It is actually using the experiences of others. 2. Information Technology is a major tool in all organization as without it improvement is not possible. It usually helps in launching TQM in your organization. 3. Quality function deployment is another TQM tool, which is use to fulfill beyond the customer expectations. It is actually refer to the voice of customer. Conclusion The success of McDonald is not only in its quality food but also the production process which enables them to deliver the fast food at right time. Their productivity processes are fast and that is the reason that customer get their order within few minutes. The productivity improvement process is due to the task division of the employees and the processes they have adopt in delivering the product. The overall performance of the McDonald shows that the whole firm has adopt a better productivity performance system that enables them to serve in better way in busy season also. The success of the McDonald not only lies in the quality product but also in the fastest delivery process. References Ian Brooks, Jamie Weatherston, Grahan Wilkinson (April 2004) “The International Business Enviornment” First Edition. Lee J. Krajewski and Larry P. Ritzman (2003) “Operations Management” Sixth Edition Read More