Executive summary
It is apparent that Macdonald’s operation and supply chains have enabled the company to gain competitive advantage in the global market. Recent survey reports demonstrated that the company has strived towards developing sustainable and dynamic strategies in order to boost its operation hence remaining top among its competitors in the dynamic business environment. This paper discusses how McDonald’s operation and chain management has given the company a competitive and sustainable edge.
Introduction
Research has revealed that consumption of foodstuff has become a common practice that has gained acceptability in society. Therefore, companies like McDonald have embraced the use of sustainable practices to boost their operations especially through the use of supply chains (Vignali 2001, p. 97). Since it is one of the vastest food service shops, the company has numerous franchised restaurants in several parts of the world.
This has enabled the company to align its human resource and customer’s needs. For instance, McDonald has improved its operational management within the supply chains. This is one of the factors that have elevated its operations to a sustainable edge (Vignali 2001, p. 99). In other words, the company has developed a strong alignment between its franchisees and the suppliers making it possible to deliver great and relevant services to customers.
McDonald’s operations are fashioned in a manner that they use franchisees to reach out the international market. From a careful review of history, there are more than 10,000 franchise shops that are managed and operated within and outside the United States. Notably, the company has been able to have direct contact with local consumers especially through franchise operation (Vignali 2001, p. 109).
Moreover, the establishment of numerous chains in different parts of the world has enabled the company to reach out for large number of people than any other company dealing with foodstuff. For instance, evidence has revealed that the company has established a maximum of 20,000 restaurants in more than 100 states all over the world. Needless to say, 80% of these restaurants are franchises (Bryman 2003, p. 155). Therefore, developing a global marketing strategy is one of the issues that have positioned the company at a sustainable edge.
It is important to note that most of the organizational operations such as supplying and production of consumable products by the company are geared towards satisfying customers’ needs (Withiam 1997, p. 68). For this reason, the company’s operations are characterized by promotional campaigns, even distribution and production of standardized products for the sake of end users (Vignali 2001, p. 110).
Moreover, within the operations and supply chains, the company has employed a marketing mix strategy that acts as the principle foundation through which marketing plan is laid. More attention has been paid on the four concepts namely price, products, place and promotion (Withiam 1997, p 68). Additionally, there are numerous variables that have been incorporated in the marketing mix. These include people, process and physical location which are collectively known as the 7ps (Rainbird 2004, p.335).
According to Withiam (1997, p 68), supply chains have been perceived to be the most appropriate tools for broadening the demand for produced goods by the company. In addition, the supply chains ensure that the company is able to transact effectively and meet customers’ needs. For this reason, supply chains add value to the operations of the company. In fact, Rainbird (2004, p.331) refers to the supply chains as value catalysts.
At McDonald, the supply chains are deliberately created to ensure purposeful management and hence they help to transform the organizational potential into reality. It is important to note that the company has embraced the use of supply chain to reduce operational costs, reward consumers and boost efficiencies (Rainbird 2004, p.334). This has largely helped to elevate the reputation of the company on a global scale.
As a matter of fact, supply chains increase organization dominance within the market and hence triggers the management to fix impending challenges with the aim of increasing effectiveness in its operations. Consequently, this has made it possible for the company to achieve long term goals. Besides, Lashley (1995, p.29) elucidates that supply chain highly influences organizational operations and also triggers strategic thinking.
For example, McDonald Company has increased its productivity in order to ensure constant supply within the chains (Vignali 2001, p. 111). it calls for the management team to think rationally and come up with effective means of increasing the production ratio in order to achieve the set goals. Notably, increase in supply of foodstuffs through franchised restaurants has made the organization to become reliable.
In this case, customers gain confidence with the company’s goods since they are made available at their disposal. This is one of the factors that have enabled McDonald to gain popularity and acceptance hence heightening its operational sustainability edge (Bryman 2003, p. 155).
Withiam (1997, p 68) elucidates that future existence of business is highly dependent on the loyalty of end users. In this case, loyalty can be achieved by enhancing good quality and timely services to customers. There are numerous ways that McDonald has employed to boost customer loyalty in its operations and processes within supply chains (Lashley 1995, p.29).
For instance, reduction of prices has enabled customers to prefer their products to those from other companies. Therefore, it is definite that customer-oriented logistic has become an acceptable concept in the organization (Vignali 2001, p. 111). Needless to say, most organizations produce goods but they are not able to reach for consumers effectively in remote places.
For this reason, customers do not get a chance to utilize such goods or even note their existence. Hence, supply chain helps to reach out for large number of consumers who do not have to incur extra costs to get these products. Therefore, since McDonald has managed to access various parts of the world, this has boosted the popularity of its goods and hence elevated its sustainability edge (Withiam 1997, p 68).
For numerous decades, McDonald’s has been able to integrate its business processes through the supply chains. This has made it possible to provide service, products, information and also impact value to customers. Supply chains also enhance coordination whereby the flow of goods is regulated by suppliers and distributed evenly to end users. Additionally, establishment of numerous chains helps to distribute the company’s goods and services in different regions, a factor that increases the market share (Lashley 1995, p.29).
To recap it all, McDonald is a company that deals with foodstuffs. The company is one of the largest restaurants in the USA and has numerous franchised cafes all over the world. It has developed strategic operations and supply chains which has enabled it to heighten its sustainability edge amid competitors. For example, the company has numerous franchised restaurants all over the world making it possible to increase the sale volume.
The company has also established numerous supply chains in more that 100 countries all over the world. This has made it possible to distribute goods evenly to satisfy its end users. Notably, strong alignment of franchised restaurants and supply chains has made it possible for the organizational operations to satisfactorily meet the needs of customers. There are other crucial variables that have been a major focus for the company. These include quality, price, product, location, people and the physical environment.
References
Bryman, A 2003, “McDonald’s as a Disneyized Institution: Global implications”. The American Behavioral Scientist, vol. 47 no. 2, pp. 154-167.
Lashley, C 1995, “Empowerment through delayering: A pilot study at McDonald’s”. International Journal of Contemporary Hospitality Management, vol. 7 no. 2, pp. 29-35.
Rainbird, M 2004, “Demand and supply chains: The value catalyst”. International Journal of Physical Distribution & Logistics Management vol. 34 no. 3, pp. 230-250.
Vignali, C 2001, “McDonald’s: “think global, act local” – the marketing mix”, British Food Journal, vol. 103 no. 2, pp. 97-111.
Withiam, G 1997, “McDonald’s: Hamburger purveyor to the world”. Cornell Hotel and Restaurant Administration Quarterly vol. 38 no. 3, pp. 68-69.