These core competencies are the focus of the recommendations given to McDonald's for the resolution of the described problems. By striving to improve their core competencies, McDonald's will be able to improve the customer service they offer to customers considerably as well as to satisfy their customers better Hammer & Stanton, 1999()
Improving production consistency
The big secret behind the success of McDonald's is that the company has long strived to embrace innovation and striving to achieve consistency in the operations of its outlets. Since the "Made for you" production process has been tested and assured to be a workable process for McDonald's this should be implemented on a storewide basis despite the huge upfront expenses to be incurred by the company. These upfront expenses will be compensated by the huge returns and improvements in quality of customer service that come from the company's use of this new production system Hall, Rosenthal, & Wade, 1993.
This will enable McDonald's to accommodate customized orders as a source of sustained competitive advantage as well as to reduce the service wait time to bring McDonald's to be a chief organization in terms of speed of service to consumers. This "Made for you" production system will also enable McDonald's to serve their consumers with greater flexibility by creating a standardized production system which ensures efficiency and consistency across all McDonald's branches.
Consumer targeting strategies
McDonald's target clients have been adults and the youth who the company has made significant to their product range. However, over the years, it has emerged that other younger consumers are beginning to appreciate McDonald's products from the early ages of 9 to 10 years. Thus it is recommended that McDonald's introduces play pens for children of these ages and even for the younger ones in order to create a larger target audience. McDonald's will also benefit from this by being able to accommodate families in their stores thus considerably increasing their target market.
Reevaluation of the company's...
McDonald's already has most of these items figured out, however, the company needs to generate a broader expression of the organization's aspirations in order to identify the critical tasks which it needs to implement in order to achieve these choices. One of the major strategic choices is the inclusion of the younger population as a target audience for McDonald's in order to draw in a larger target audience. Secondly, as argued by Stalk, Evans, and Shulman (1992)
, McDonald's objectives, vision, mission and critical tasks will need to be reevaluated in order to create a new definition of the strategic context of McDonalds to identify new critical tasks and create a new vision that generates a comprehensive assessment of the strategic choices available to the organization.
Conclusion
McDonald's has had a long run and successful operations strategy that has involved innovation and experimentation but the lack of consistency in McDonald's has led the company to lose significant competitive advantage against its fierce rivals. The company benefits from its rich history which the company has had over the years and which have greatly supported the company's growth. The company has also faced changes in consumer taste which they have failed to accommodate by allowing greater flexibility to consumers through allowing them to place customized orders without having to wait for too long. The system that McDonald's had been using for many years allowed for customized orders though these customers had to wait for longer than the customers who requested regular orders.
McDonald's has also had to battle with negative publicity from health rights advocates and consumer activists who have tried to portray the company in a negative image as the leading cause of obesity, diabetes, and heart attacks in the country. The company has, however, worked hard to turn this bad image round to become a good image and this has enabled the company to remain competitive and profitable even during the economic recession.
By the company focusing on their core competencies which are the quality and speed of their service alongside their friendly pricing, the company can be able to gain competitive advantage. These core competencies should be the major focus of the company's strategic choices and critical tasks and will also guide the creation of the company's vision, mission, goals and objectives all which will guide the company towards success.
References
Hall, G., Rosenthal, J., &…
References
Hall, G., Rosenthal, J., & Wade, J. (1993). How to make reengineering really work. Harvard Business Review, November-December, 119-131.
Hammer, M., & Stanton, S. (1999). How process enterprises really work. Harvard Business Review, November-December, 108-120.
Prahalad, C.K., & Hamel, G. (1990). The core competence of the corporation. Harvard Business Review, 79-91.
Stalk, G., Evans, P., & Shulman, L.E. (1992). Competing on capabilities: The new rules of corporate strategy. Harvard Business Review, March-April, 57-69.
As such, there are relatively few substitute goods (other types of foods are more expensive and, as a result, cannot be considered as substitute goods), the level of necessity is high (fast food is, for many of the poorer communities, the only source of food and, because of this, people are willing to pay a higher price without changing their volume of consumption), but also because of habits: people who
Human Resource Management McDonald’s Corporation is one of America’s biggest fast food and burger chains, involved in franchising and operating restaurant chains all over the world. Given its immense operational base, the company has been subdivided into four segments, which are as follows: the U.S. segment; High Growth Market segment; Lead global market segment; and Corporate and Foundational Market segment. The first division is in charge of handling fast food outlets
McDonalds also places strong emphasis on marketing to children, including the use of playgrounds in its restaurants. As a result, McDonalds is able to maintain some pricing power over its customers and to attract customers to its restaurants despite strong competition from a wide number of sources. Issues and Challenges: McDonald's operates in a number of mature markets, where growth is slow. Growth is now focused not only on overseas
Mcdonalds Customers Customer Relations at McDonald's McDonald's is a company that has increasingly come to face a dilemma regarding its relationship with its primary customer base. The fast-food giant is incomparably successful, having achieved a singular dominance in its sector and having likewise established an enviable brand recognition on a global basis. And yet, in terms of customer relations, the company is struggling today to achieve a positive resolution to its public
McDonalds In the last 30 years, developing markets have shown the potential for fast food restaurants to realize increasing profit margins. This is because markets such as China provide them with the capacity to offer unique products and experiences to customers. However, specific concepts must be integrated with each other to effectively connect with them. In the case of McDonalds, they are facing considerable challenges and opportunities in China. (Allon, 2012)
The bottom line is that by seeking to create operational efficiencies through process improvement, the company has been able to continually become more profitable and grow more efficiently than its competitors. Appendix A: McDonald's Financial Analysis McDonald's Corporation Ratio Analysis Profitability Ratios ROA % (Net) ROE % (Net) ROI % (Operating) EBITDA Margin % Calculated Tax Rate % Revenue per Employee Liquidity Indicators Quick Ratio Current Ratio Net Current Assets % TA Debt Management LT Debt to Equity Total Debt to Equity Interest Coverage Asset Management Total Asset
