Internal Analysis of McDonald’s Essay

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The strengths and weaknesses of McDonalds can be illustrated with the help of the Internal Factor Evaluation (IFE) Matrix. This tool helps to identify the core competencies or problems of the organization. This following table will illustrate the extent to which east strength and weakness is important for this company and its performance.

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IFE Matrix of McDonalds

StrengthsWeightRatingWeighted Score
International recognition of their brand20%40.80
International presence of this corporation15%40.60
Training methods ensuring that the employees of a company can be replaced10%30.30
Well-developed supply chain9%20.18
Weaknesses
Inability to retain employees18%20.36
Poor customer service18 %30.36
Limited choice of meals and beverages10%20.20
Total1002.80

On the whole, this analysis shows that the brand is one of the main strengths of McDonalds since it is recognized in countries that may have different cultures or languages (Kurtz 2010, p. 484). This is probably the core asset of this corporation. Secondly, this organization has a well-developed supply chain that enables the company to keep its prices low (Kurtz 2010, p. 484).

Furthermore, this organization uses training methods that ensure that employees can easily substitute one another in the workplace (Leidner 2002, p. 17). Therefore, high turnover does not threaten their performance. In turn, the main weaknesses of this corporation are related to their inability to retain workers. The majority of these people work for them only on a part-time basis. Not all of them want to stay in McDonalds for a long time.

Additionally, one should note that McDonalds frequently faces lawsuit from their customers (Miller, & Cross 2012, p. 338). In particular, they people can blame the company for not warn them about the health risk of fast-food meals (Miller, & Cross 2012, p. 338). Secondly, some guests criticize the customer service of this organization (Miller, & Cross 2012, p. 338).

These are the main strengths and weaknesses of this corporation and the management should find ways of improving these aspects of performance if they do not want to lose their leading positions in the fast-food industry.

When discussing the strategies of McDonald’s one can take the so-called resource-based approach. According to it, the competitive advantage of an organization can be acquired and retained provided that a company has a set of valuable resources that cannot be easily replicated by other firms (Phadtare 2011, p. 180).

This model emphasizes organizational, human, or physical resources of a business (Phadtare 2011, p. 180). There are several things that are important for competitive position of this corporation. In particular, one can speak about its brand that is easily recognized at an international level. The brand of this corporation can be viewed as organizational resource of McDonald’s. For a long time, it has been the source of their competitive advantage.

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Currently, this company extends its operations by letting franchisees to open fast-food restaurants that bear the name of McDonald’s. Their supply chain enables them to open new restaurants relatively quickly. This efficiency of operations is another thing that ensures competitive advantage of McDonald’s, especially when the corporation attempts to enter foreign markets.

On the whole, this organization creates values by providing customers with fast and cheap food (Verkatachalam & Sellappan 2011, p. 5). The core competency of this fast-food company lies in its ability to serve a great number of visitors within a shortest possible time. This ability can be viewed as organizational resource of the corporation.

As it has been mentioned before, the employees in McDonald’s restaurant are trained to substitute one another. Therefore, the performance of a fast-food restaurant will not decline provided that one of its employees chooses to live. Thus, their HR strategies also give them some advantage over other firms.

When positioning themselves the company emphasizes such aspects as price of their products and the efficiency of their services. Their fast-food restaurants are described as those places where a person can easily get tasty food within the shortest time. This element of positioning is present even when the company operates in foreign countries. Thus, one can say that the major competencies of McDonald’s enable this company to achieve financial and organizational success.

References

Kurtz, D 2010, Contemporary Marketing, Cengage Learning, New York.

Leidner R 2002, Fast-food work in the United States. In Royle, T & Towers, B (eds.), Labor relations in the global fast food industry, Routledge, New York, pp. 7-27.

Miller, R & Cross, F 2012, The Legal Environment Today: Business in Its Ethical, Regulatory, E-Commerce, and Global Setting, Cengage Learning, New York.

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Phadtare, M 2011, Strategic Management Concepts and Cases, PHI Learning Pvt. Ltd, New York.

Verkatachalam, T & Sellappan, C 2011, Business Process, PHI Learning Pvt. Ltd, London.

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