Mcdonalds case study strategic management
A business activity is a whole process that involves various functions. For a company to be complete, the different sectors or functional units of that business activity must be well directed. The functional groups must work hand in hand for a successful business to be achieved. Management is the process of ensuring that all the relevant units of the business activity are well coordinated and that the primary goal of that business is achieved. A business activity is made up of various functional units that should work hand in hand to yield the required outcome. A company that is well coordinated and managed reduces wastages and output is maximized. There are various functional units in most organization namely: Finance; research and development, marketing function, manufacturing function and human resource function among others depending on the operations of the business (Jones & Brazzel, 2012). The following essay, I will use the McDonald’s restaurant as the organization of my choice.
McDonald’s is in the food industry, and it is one of largest restaurant operator in the world currently. It is still expanding its quick service restaurants where it is serving tens of millions of customers daily globally (McDonald’s, 2016). Its main advantage that puts it ahead of the rest of the restaurant is the way it manages its resources; both the human and the financial resources. An organization such as this must be well equipped in employing the best managerial practices that are available to achieve the required output. It therefore utilizes all the functional units listed with proper coordination so that customers are well satisfied with their product. It has a well coordination between the research and development, finance, marketing and human resources among other units which all contribute to its great success. The central importance of well coordinating the various departments of the restaurant is to increase sales, promote efficiency and above all to operate profitably so as to sustain themselves.
Mcdonald's Business Strategy Research and Development
As the name suggests, the central role of this functional unit is to implement new methods of running and operating the business better. The restaurant is always involved in ensuring that are active. They, therefore, work hand in hand with the rest of the stakeholders who are the customers and suppliers so as to be well informed of the required improvements to the business to be the best regarding quality. Competition is thriving in the restaurant industry, and such participation is necessary so that the restaurant can know what to do at a given particular time. Research is done through collecting views from the customers whom they highly regard as vital to give information on delivering quality services to the market. Research that is done by the restaurant targets various performance areas such as quality of the service and product, service, cleanliness and value of their product (Murugan, 2007). From the research the restaurant is at the best position to understand what the customers want from the restaurant chain. The best example that resulted from the R&D program was the introduction of the new ‘McCafe’ specialty coffee menu in 2008. The new product was meant to cater for the busy business people who take coffee in the mornings and to entice the existing customers to use the product too.
Mcdonalds marketing strategy
In most industries such as the restaurant and food industry, marketing is vital in achieving the required organization targets. Branding makes a business unique, and it is how the customers can associate with the group. In McDonald’s, the marketing department is responsible for creating the best logo and also to represent it to various customers globally (GREGORY, 2017). The marketing function is in charge of coming up with the right marketing mix that will be used by the organization. The marketing function is that is well utilized to identify the customer needs and to devise ways that the required of the clients can be well satisfied. Marketing exists mostly in an organization due to competition. By creating loyal consumers, an organization can increase its market share and know which advertising and promotion methods that they should use to achieve the required standards of attracting the customers. Marketing opens the commercial outlets and increases the number of customers to the restaurant. The department must work hand in hand with the rest to achieve the best outcomes overall in the organization.
Human resource planning of Mcdonalds
People must be well managed since they make the chain of restaurants to increase its sales and promote quality. Quality, service and value management that are best always stems from the way the employees are employed and trained. At McDonald’s there is a standard way of retaining and training the workforce. The role of the manager of this functional unit is to ensure that that uniformity is achieved in all the franchises and their various locations. Operating a large restaurant like this requires high expertise in ensuring that the employees well motivated. In general the primary role of the function is to ensure qualified and ethically motivated employees are hired in the organization. Whenever employees and the management are on the same level, flow of work is smooth and less improving from the customers and staff can be obtained. At the restaurant, the employees work in shifts since the restaurant operates 24 hours. There have been various complains from the employees regarding workplace conditions and the role lies entirely on this functional unit. In addition to that, the human resource department should also offer the right training to the employees in regards to the work for efficiency achievement.
Mcdonalds Finance Function
This functional unit is the most sensitive and should be well taken care of. It involves the department which is involved in every cost or income at the organization. Right from the process involving input purchases to the payments of the employees and among other functions, it forms the central functional unit of McDonald’s restaurant. At the restaurant, there is the use of the integrated accounting and finance department. it is because of the extensive business operations and various people involved; each restaurant manager is responsible on how it performs financially with the full support of the centralized accounting and finance department. Although each functional unit is independent has different priorities, the coordination of all departments ensures that the organization has a well financial position. Financial reporting and management accounting are two responsibilities that steer the team in the right direction financially. Most decisions are made using the management accounting report which is assisted by the rest of the functional units (Orcullo, 2008). Knowing the needs of the consumers and availing the necessary data to the functional eases the way planning and logistics are conducted in the restaurant.
Mcdonalds Manufacturing Function Analysis
This function is in most industries, and it determines the quality and how fast the final products are brought to the restaurant. In McDonalds’s case, it is the department that decides the shape, and the size of the food products served. If the department comes up with the right quantity, the customers would be satisfied. It also controls the quality of the food served to the consumers. As earlier noted, all departments should be ready to work hand in hand to ensure there is a smooth flow and coordination of all the various departments in an organization. The manufacturing function of the organization also oversees the inventory reduction and to avoid wastages of purchased inventory.
As highlighted in the above functions, there is a closer relationship between all the functional units. At McDonald’s, the marketing function cannot work efficiently without the finance function since it has to be funded to develop the right brand (Murugan, 2007). In addition to that the research and development function cannot work efficiently if the information from the human resource is not well incorporated into the decision making plans. It is vital to improve the product manufacturing by following the research and development function results. The consumers and producers are highly utilized in decision-making functions since the meals and drinks that are served affect them directly. Coordination of all the functional as highlighted above plays a critical role in increasing the sales and improving the service delivery at McDonald’s chain restaurants. More finance should, however, be input into all departments more so the human resources function. Human capital training and motivation will steer the organization towards the right direction and increase the overall efficiency of an organization.
Gregory, L. (2017, January 5). McDonald’s Operations Management,
10 Decisions, Productivity. Retrieved March 1, 2017, from Panmore Institute: http://panmore.com/mcdonalds-operations-management-10-decisions-areas-productivity
Jones, B., & Brazzel, M. (2012). The NTL Handbook of Organization Development
and Change: Principles, Practices, and Perspectives. New York: John Wiley & Sons.
McDdonald's. (2016, December). About Us. Retrieved March 1, 2017, from
McDdonald's site: http://www.mcdonalds.co.uk/ukhome/Aboutus.html
Murugan, M. (2007). Management Principles and Practices. New Delhi:
New Age International.
Orcullo, N. (2008). Fundamentals of Strategic Management' 2007 Ed. Quezon:
Rex Bookstore, Inc.
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