Business Strategy and Competitive Advantage.

Organizational Profile for _______McDonald’s____________________

P.1 Organizational Description: What are your key organizational characteristics? Describe your organization’s operating environments and your key relationships with residents, stakeholders, suppliers, and partners. 

Within your response, include answers to the following questions: 

a. ORGANIZATIONAL ENVIRONMENT 

1. What is the organization’s environment: urban, suburban, rural, etc.? 

Urban.

2. What are your organization’s main product or service offerings? What is the relative importance of each to your organizational success (e.g., skilled nursing, subacute, assisted living, etc.)? 

As a food service company, McDonald’s product portfolio mainly includes food and beverage products and supporting services, such as Restaurants, Kiosks, McDonald’s mobile apps, Postmates website and app, and others. (Pauline Meyer, 2020). On the McDonald’s website, McDonald’s stated that part of its success is due to its commitment to customer well-being. In order to satisfy health-conscious customers, McDonald’s began to add high-quality options to the menu. With the nutritional information known to the customer on the menu item, the customer can calculate the calorie and fat content to make a better choice. (Althea Thompson, 2017). With kiosks, drive-through services and newly implemented table services, McDonald’s sales have grown steadily. Overall, the development of McDonald’s services continues to benefit the company.

3. What is the organization’s MISSION/VISION statement (verbatim) and the specific methods used to communicate it across the organization? What are your organization’s CORE COMPETENCIES and their relationship to your MISSION? 

McDonald’s corporate mission is “to be our customers’ favorite place and way to eat and drink.” (Pauline Meyer, 2019)

McDonald’s corporate vision is “to move with velocity to drive profitable growth and become an even better McDonald’s serving more customers delicious food each day around the world.” ((Pauline Meyer, 2019)

McDonald’s uses multiple channels of communication to ensure that all information is delivered to employees. This includes the use of print, online, and other forms of technology, such as video conferencing. As a magazine, MDUK is an important communication tool for the company. (Viola Lloyd, 2008). It is seen as a quick and enjoyable reading, conveying key messages in an interesting, young, and modern style.

The best core competence of McDonald’s is the ability to standardize its food service and delivery processes. After considering local tastes and exceptions, the taste and appearance of each McDonald’s product is the same, regardless of its location or branch. Since customers always know what they will get when ordering a Big Mac or Chicken McNuggets, they trust the brand. This kind of trust continues to drive McDonald’s success.

4. What is the organization’s WORKFORCE profile? Identify your KEY WORKFORCE groups by department and function. You may use a table to provide your response. 

5. What are the organization’s major equipment and technologies (for example, computers, manufacturing equipment transfer equipment, alarm devices, Wii systems, WiFi, etc.)? 

McDonald’s is taking revolutionary technological initiatives to make their “future experience” dreams come true. The implementation of self-service through self-service kiosks, mobile ordering and payment systems is conducive to McDonald’s image as a “restaurant of the future”. WI-FI hotspots are installed in most restaurants around the world. This model is designed to bring more young people and technical staff to the restaurant. The technology used throughout the company is the ACS system. Including mainframe and medium server support, network operations, and engineering and data center facility management. McDonald’s uses OLAP (online analytical processing: manipulation of information to support decision-making). The data warehouse (the logical collection of information from many different databases) uses software from McDonald’s ACS, Teradata, MicroStrategy, and Oracle. McDonald’s uses supercomputers, workstations, PDAs and electronic payment devices. (Mcdonald’s Technology, 2010).

6. What is the regulatory environment under which the organization operates? What are the KEY bodies of regulation related to health care delivery, occupational health and safety, physical plant, payment, and reimbursement regulations? 

Any controlled environment is referred to as a regulated environment. Rules specify which conditions a corporation must meet to produce valid results or commodities of a certain standard of quality. To put it another way, adhering to any regulated environment entails ensuring that each data operation can be replicated afterwards. Financing, insurance, delivery, and payment are the four fundamental components. Financing is used to pay for health insurance. Buyers of health insurance are protected from catastrophic risks by insurance. People can access services covered by their health insurance policies thanks to the delivery of health care.

b. ORGANIZATIONAL RELATIONSHIPS 

1. What are the organization’s principal STAKEHOLDER groups? Include CUSTOMERS and other groups most affected by the organization’s services, actions, and success. What are the differences in requirements and expectations among STAKEHOLDER groups? In addition to RESIDENTS, identify up to three other principal STAKEHOLDERS in the first column of the table below. In the second column, identify the important requirements that each of these principal STAKEHOLDER groups has of the organization. In the third column, identify the PROCESSES that your organization uses to learn of these important STAKEHOLDER requirements. Your responses should be complete and clear.

2. What are the KEY types of suppliers of goods and services, including other health care providers? What are your KEY mechanisms for communicating with suppliers? 

• Manufacturers and vendors
• Wholesalers and distributors
• Independent and trade show reps
• Importers

3. From the above, what are the most important types of suppliers of goods and services? 

Wholesalers and distributors are the most important types of suppliers of goods and services, because when you work with manufacturers and suppliers, you are cooperating with the source of the supply chain. Research, develop and produce the products you buy. In fact, sourcing materials from manufacturers means that you don’t have to pay any additional costs for handling and storing products.

4. What are the limitations, special business relationships, or special requirements that may exist with some or all suppliers and partners?

Any business partners and suppliers should maintain loyalty and trust. Regardless of the industry, you will find that any of these types of suppliers operate in its market. When you are looking for the right supplier for your organization, you are looking at your needs and which supplier type best meets those needs.

5. What are the organizational structures and KEY management links to the parent company if the applicant organization is owned by a parent organization? Respond “N/A” if the applicant is not owned by a parent organization.

Parent company is functional, divisional, autarchy, and matrix structures are the four types of organizational structures.

A parent company is one that owns a controlling stake in another company and hence has operational control over it. Depending on the amount of managerial authority granted to subsidiary managers, parent corporations can be hands-on or hands-off owners of their subsidiaries, but they will always have some active influence. A parent company is a single firm that owns a controlling stake in another firm or firms.

Parent corporations are formed when subsidiaries are spun off or carve out, or when they are acquired or merged.

On their financial statements and for tax purposes, parent corporations must account for their subsidiaries properly.

P.2 Organizational Situation: What is your organization’s strategic situation? Describe your organization’s competitive environment, key strategic challenges and advantages, and your system for performance improvement. 

Within your response, include answers to the following questions: 

a. COMPETITIVE ENVIRONMENT 

1. What is the organization’s position (relative size) within the local market environment? Include numbers and types of competitors. 

McDonalds is one of the most famous brands in the world. As a quick-service restaurant, McDonald’s faces direct competition from restaurants such as KFC, Subway, Wendy’s, and Burger King. Other famous fast food restaurants and specialty fast food restaurants that challenge McDonald’s include Starbucks, Pizza Hut, pizza pizza, Popeyes and Dairy Queen.

2. What are the principal factors that determine competitive success in the local market? 

3. What are your key available sources of competitive and COMPARATIVE DATA from within the long-term care profession? What limitations, if any, are there in your ability to obtain this data? 

Articles containing in the newspapers, the magazines are a source of information to see the planning of the competitors for the future. Research in professional marketing like focus groups and questionnaires provides information about the competition. The other sources of information are the observation of developing a competitive and industry analysis.

b. STRATEGIC CONTEXT 

1. What are at least two major STRATEGIC CHALLENGES or ADVANTAGES for the organization (e.g., entry into new markets or SEGMENTS, relationships or partnerships with Preferred Provider Networks, preparing for different expectations of the next generation of residents, human resource recruitment and retention, new alliances with suppliers, physicians, or other partners; introduction of new technologies, changes in the health care environment that impact the organization’s delivery of services, changes in strategy, or other challenges or advantages)? 

McDonald’s competitive advantage is based on the following points:

• Cheat prices is McDonald’s main competitive advantage. The company is engaged in an extensive utilization of economies of scale to achieve the cost advantage.
• True to ‘fast food’ format of its restaurants, McDonald’s is famous for the speed of customer service without compromising the quality of the service.
• Universality of the taste to a great extent represents another base of McDonald’s competitive advantage. Big Mac tastes almost all over the world due to the use of the same ingredients in the same quantities and application of the standardized ways of cooking around the globe. Such a consistence in taste has positive implications on consumer loyalty.

It is important to note that McDonald’s competitive advantage based on costs can be difficult to sustain in long-term perspective, since new competitors may emerge with access to cheaper resources.

2. What is(are) the reason(s) why it is important that the organization address these STRATEGIC CHALLENGES or ADVANTAGES? 

1.     Standardization strategy: Anywhere the company operates, it offers identical food products such as McFlurry, McNuggets, McChicken, Happy Meal or Filet-O-Fish. The plan provides the company with a strong image. The strategy is a time and money saver for McDonald’s as it helped build economies of scale.

2.     Adaptation strategy: The strategy can be compared to localization. With this strategy, McDonald’s adapts to the needs of the consumers as required by the cultures of specific countries.

Adaptation works very well for McDonald’s. The strategy enables the fast food chain to have a wider reach worldwide. The strategy does require higher communication and production costs.

Aside from the winning strategies, the company’s marketing mix is likewise flexible, to tailor it to the local market requirements in terms of location of distribution, promotions plans and pricing.

References.

Thompson Althea. (2017, September 26). Key Success Factors of McDonald’s. bizfluent.com. Retrieved from com/list-7427367-key-success-factors-mcdonald-s.html”>https://bizfluent.com/list-7427367-key-success-factors-mcdonald-s.html

Pauline Meyer. (2020, September 20). McDonald’s Marketing Mix (4Ps) Analysis. Panmore Institute. Retrieved from http://panmore.com/mcdonalds-marketing-mix-4ps-analysis

McDonald’s. (2019, October 20). McDonald’s: Product or Service? Retrieved from https://mcdonald551991527.wordpress.com/2019/10/20/mcdonalds-product-or-service/

Pauline Meyer. (2020, September 20). McDonald’s Mission Statement & Vision Statement (An Analysis). Panmore Institute. Retrieved from http://panmore.com/mcdonalds-vision-statement-mission-statement-analysis

Viola Lloyd. (2008, January 24). Communication – we’re loving it! Retrieved from https://www.thehrdirector.com/features/branding/mcdonalds_communication/

Rahul A., Mary K. Pratt. (n.d.) core competency (core competencies). Retrieved from https://searchcio.techtarget.com/definition/core-competency

Mcdonald’s Technology. (2010, May 31). Mcdonald’s Technology. Retrieved from https://mcdonaldsteam3.blogspot.com/2010/05/mcdonalds-corp.html

Nathaniel S. (2017, February 5). McDonald’s Stakeholders: A CSR Analysis. Panmore Institute. Retrieved from http://panmore.com/mcdonalds-stakeholders-csr-analysis

Joe David. (2020, January 10). Competitors of McDonald’s (Competitor analysis of McDonald’s). Retrieved from https://howandwhat.net/competitors-mcdonalds-competitor-analysis-mcdonalds/

John D. (2016, February 8). McDonalds Business Strategy and Competitive Advantage. Retrieved from https://research-methodology.net/mcdonalds-business-strategy/

Bernadine R. (2019, January 4). McDonald’s International Strategy: Adapting Around the World. Retrieved from https://www.daytranslations.com/blog/mcdonalds-international-strategy-adapting-around-the-world/