Strategy Part 5

Strategy 4

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Part I: Internal Environmental Scan

Mission, vision, and values

McDonald’s has a mission of becoming a burger company which is progressive and provides contemporary customer experience. The desire for the company to make sure that the needs of the customers are taken good care of is what drives it. The vision of the company is to become the global organization that provides quick services which are in line with the needs of the customers (Meyer, 2017). It is apparent that the mission and vision statements of McDonald’s are in line with its strategies. McDonald’s believes in the value of having a good relationship with the customers, and that is only established through services which are outstanding. The company has the desire to reach different types of customers in the world and provide contemporary experience, and this aspect is present in its strategy to make sure that it reaches as many customers as possible by opening outlets in different parts of the world.

Strategy clarification

McDonalds’ is an organization that makes sure that its services and products are in line with the needs of the customers. When it comes to the value proposition, McDonald’s has made sure to have a wide variety of products, and that makes sure that customers who come to the restaurants are diverse because they know that what they need is available at the restaurant (Meyer, 2017). When it comes to the aspect of the market position, the interviewee confirmed that the company had positioned its products in the market in a way that people from different walks of life can afford. The company covers the low-income earners, the medium income earners, and middle class. Having different outlets in different parts of the world has worked perfectly as a competitive advantage for McDonald’s.

Cultural assessment

McDonald’s believes in the culture of assisting the employees to attain their goals. The culture has made the company successful though there is a barrier of directly impacting the lives of the employees (Meyer, 2017). The company has failed to motivate the employees enough as far as their salaries and payments are concerned. However, when it comes to giving the employees the power to take control, the company has done a tremendous job.

Value chain analysis

McDonald’s restaurants are owned by the company, and at the same time, they are operated by independent franchisees. The company uses this strategy to make sure that it reaches a wide variety of customers and also works with local investors to increase the market share. However, the company still retains the right to the brand, and it receives a specific percentage of the franchisees (Meyer, 2017). When it comes to marketing, a universal advertisement is made by the company where it assumes the total cost. The competitive disadvantage is evident in the case of franchisees. Some of the franchisees might deviate from the mission and vision of the company, and the effect might be on the whole company.

Summary of findings

It is apparent that the mission and vision of McDonald’s have been accompanied by a strategy that helps the company to attain its goals. The company has put in measures and strategies which attract more customers than most of the competitors (Meyer, 2017). The culture and the value chain supply help the company to meet the needs of the customers.

Part II: SWOT Analysis

Strengths

1. Friendly prices

McDonald’s is one of the restaurants which have a strong brand and have products which accommodate the low-income earners as far as price is concerned (Krull, 2010). The prices act as strength because they attract more customers who feel like other restaurants charge more than they can afford.

2. Global presence

McDonald’s has different outlets in more than 120 nations. Because the company covers a bigger market share, it has the advantage of reaching more customers than most of its competitors.

Weakness

1. Scandals

McDonald’s has been involved in a scandal that almost damaged its reputation. The company was accused of tampering with the expiry dates of meat and at the same time selling rotten meat (Krull, 2010). The scandals are a weakness because the company is in the food industry where it is expected only to sell products which are fit for human consumption.

2. Public relations

The issue of underpaid employees has affected the reputation of the company, and that is likely to force the customers out (Krull, 2010). At the same time, there have been complaints of the complicated menu, and that has played to the disadvantage of the company putting it in a position where it would likely lose the customers to the competitors.

Opportunities

1. Growing markets

The cultures of eating fast food and in restaurants are growing, and this comes along with the growth of the markets. Tourism is growing as well, and it affects the hotel industry (Krull, 2010). Also, there are nations which need the services of some of the advanced organizations because their local investors have not established restaurants which fit a global level. Because McDonald’s is a global organization, it has the opportunity to utilize such opportunities and make more profits.

2. Low cost of labor

Cost of labor in some of the developing nations is low, and that means that organizations which invest in such nations benefit (Krull, 2010). The company has an opportunity to extend its business to such nations, and by doing so, it will increase its profits.

Threats

1. Government’s regulations

Some governments have plans of regulating the local food industries. Government regulations are likely to affect the company negatively. At the same time, there are governments which believe in protecting the local markets (Krull, 2010). When a government starts protecting the local markets, it does so by discouraging the international organizations. Because MacDonald’s is an international organization, it is likely to be affected by the move by the governments to protect the local investors.

2. Commodity price increase

Markets are different in different countries. When the raw materials of a specific nation where the company invests increase, the company is exposed to high costs, and that affects the business negatively (Krull, 2010).

Part III: Balanced Strategic Scorecard

a) Financial

Regarding finances, McDonald’s is listed as one of the successful organizations. The success of an organization can be seen it its net worth or the price of a share. The price of a share at McDonald’s is $117 and that only means that the company is doing well in the financial markets (Whitten, 2017). In 2017, the shareholders earned $1.70 per share, and it is the same year that the price of shares went to the highest level they have ever been (Caplinger, 2016). The company collected $6.05 billion in revenue (Whitten, 2017). Therefore, looking at the figures, it is apparent that McDonald's has been making financial progress and that means that its strategies are successful.

b) Customer (external stakeholder)

Looking at the number of the customers that McDonald’s serve in a day, it is no doubt that the company is successful. In just one day, McDonald’s serves more than 69 million customers in its different outlets (Whitten, 2017). The number is huge, and that only shows that the company has been able to convince most of the customers to buy from the company. The relationship between success and the number of customers comes in because an organization has to have strategies which attract customer and therefore if they work, then the company is successful.

c) Learning and growth

Learning is a continuous process at McDonald’s. The reason why the company has a menu which is different and unique from other companies is because it promotes learning and growth among the employees (Whitten, 2017). McDonald’s provides the employees with all resources they need to grow. The company is still opening outlets in different parts of the world, and that shows that growth will never stop at McDonald’s.

d) Internal process

The leadership at McDonald’s has made it easier for the employees to showcase their talents. This has been made possible through initiatives by the company to empower the employees to come up with outstanding menu and recipes. The culture at the company is friendly, and McDonald’s has only been involved in a few issues. With this in mind, it is apparent that the strategy of the company is successful.

References

Caplinger, D. (2016). How Much Is McDonald's Really Worth? Retrieved from https://www.fool.com/investing/2016/09/07/how-much-is-mcdonalds-really worth.aspx

Krull, R. (2010). McDonald's: Strengths, Weaknesses, Opportunities, Threats. Retrieved from https://www.fool.com/investing/general/2010/08/25/mcdonalds-strengths-weaknesses opportunities-threa.aspx

Meyer, P. (2017). McDonald’s Vision Statement & Mission Statement Analysis. Retrieved from http://panmore.com/mcdonalds-vision-statement-mission-statement-analysis

Whitten, S. (2017). Bet on pricier burgers pays off, sending McDonald's shares to all-time high. Retrieved from https://www.cnbc.com/2017/07/25/mcdonalds-earnings-q2 2017.html