Operational strategies and product differentiation in McDonald's and Hardee's

McDonald's And Hardees

In a recent visit to two competing fast food franchise restaurants, McDonald's and Hardees, there were many different operational processes that were identified. For example, McDonald's has a more diversified menu that caters to more consumers while Hardees by contrast seems to utilize more of a niche strategy. Both operations seem fairly efficient and effective towards the operational goals that they seem to promote. I think they are both offering the products that they should be. McDonalds has a larger menu and Hardees has more of a targeted niche.

Each organization utilizes technology to meet their operational objectives and operates efficiently based on these objectives. Between the two operations, McDonald's seem to have the technological edge however and their operations are streamlined through a dedication to operational excellence that uses advanced technological systems as a foundation for its business functions. McDonalds must be more efficient to offer the more comprehensive product mix in a timely manner relative to Hardees however. Yet Hardees could be deemed more effective because they have exploited a premium burger niche. This paper will compare and contrast some of the differences that were identified in these two organizations. Each organization should focus on supply chain management and mass customization.

Product Lineup

McDonalds and Hardees offer very different product mixes. McDonald's have a more comprehensive menu offering that can be divided into the following categories (McDonalds, N.d.):

Burgers and Sandwiches

Chicken and Fish

Breakfast

Salads

Snacks and Sides

Desserts and Shakes

McCafe

McDonald's has been the subject of much criticism in the last decade for the quality of its food in terms of its nutritional value. McDonald's has proactively defended their reputation in the past by opening libel suits against people who have tried to publish activist literature that points out some of the negative aspects to the food they serve and the way the company operates. It is clear from its current product mix that McDonald's has taken steps to improve its nutritional stance in its product mix and offers many products that are healthier than previous generations of product mixes such as salads and fresh fruit. McDonalds has attempted to improve their health quality by making their menu's more kid friendly, expanding the menu nutritionally, as well as increasing the access to nutrition (Nunez, 2011).

Hardees by contrast focus on a "restaurant-style" burger which serves as the focus of its product mix. The company offers a little over twenty different styles of charbroiled burgers which are the focal point of the product mix. The company boasts its premium "six dollar" burger that is made from one hundred percent Black Angus. This burger is touted as a more sit down restaurant that is available in the traditional franchised fast food format. Hardees has continued to develop this strategy and offers a wide range of different products that focus on this specific niche. McDonald's previously had tried to compete in the gourmet burger niche however had relatively mixed success. As one critique explained when McDonald's eventually took their Angus burger off the menu (Wong, 2013):

"You can't be the premium and the discount product place. [McDonald's] had to make a choice and they chose to be a discount product place," Puzder says. "It really leaves the premium, sit-down, restaurant-quality burger at a fast food joint to us."

This left open the door for Hardees (and Carl's Jr.) to continue to develop the premium burger niche.

Facility Design and Seasonality

It was identified that McDonald's uses more of a technological-based operational design than Hardees. This undoubtedly stems from the fact that the organization offers a more comprehensive product mix and specializes in efficiency. Hardees by contrast focuses more on a specific target market that is not more concerned with the product appeal than efficient operations. For example, for customers that are visiting a Hardees or Carl's Jr. location for a premium burger are more likely willing to wait longer for this product and have less of a concern for the speed of delivery. It is likely that both organizations will see an increase in demand over the next couple months followed by a slower demand in January and February.

Seasonality of demand is also a concern to both locations. During the holiday season it is likely that both businesses will see a diminished demand for their products. Seasonal demand affects the restaurant industry but it does so differently for different types of operations. One analysis showed that 61% of restaurants notice a decline in patrons during a seasonal holiday or major event, according to Blue Sky Local and this decline in patrons or business can be as much as 20% due to the fact that customers are less likely to eat out, mostly due to spending time with family and preparing meals at home; however, in some instances, fast food or quick food restaurants can thrive while dine-in restaurants suffer (Higuera, N.d.). Thus both businesses should focus on seasonal items that can help increase their demand throughout the holiday season over the next three months and into the beginning of the year.