Supply chain of McDonald’s (Article Sample)

ASSESSMENT 3: RESEARCH PROJECT REPORT Supply chain of McDonald’s Student Name Institutional Affiliations Instructor Date [Attach the UOWD approved cover page (should be generated from your subject folder] Supply chain of McDonald’s Abstract McDonald’s has a robust and exceptional supply chain being a leader in the fast-food industry. Through its well-defined strategy, McDonald’s integrates its supply chain by emphasizing strong relations withy suppliers, employees and franchisees. The company adopts a vertical integration approach which allows it to be fully in charge of most of its processes in the supply chain. Again, McDonald’s adopts technology and digital transformations and the metaverse for enhancing its customer experience and efficiency. Despite challenges posed by the COVID-19 pandemic and the Ukraine-Russia war, McDonald's has managed to navigate these disruptions by diversifying sourcing strategies and prioritizing sustainability practices. Looking ahead, it is recommended that McDonald's continues to invest in technology, particularly in the areas of digital transformation and the metaverse. By embracing emerging technologies and virtual experiences, McDonald's can further optimize its supply chain operations, enhance customer engagement, and stay ahead of the competition. Also, as the world transitions towards a more sustainable future, McDonald's should continue its focus on green initiatives and responsible sourcing, ensuring that its supply chain remains environmentally friendly and socially responsible. Introduction Supply chains are comprised of a network of activities, resources, organizations, technology and also the individuals who are involved in the process of creating and delivering a given product to the buyer. Supply chains entail everything right from delivery of source materials from suppliers on to the manufacturers and to the eventual delivery to the customer or end user. The business of managing a supply chain entails different stakeholders inclusive of warehouses, truckers, suppliers, vendors and business units. Successful supply chains are achieved through the proper implementation of best supply chain practices inclusive of production, sourcing, planning and distribution. This ensures the efficient delivery of services which again enhances profits. McDonald’s operates as giant global fast-food in over 100 countries and they serve over millions of clients on daily basis. The company has an amazing compilation of marketing tactics and recipes which requires prowess in managing the huge supply chain. McDonald’s is known to have a complex supply chain which permits the maintenance of high standards of quality. The company offers products which are consistent across its broad restaurants network. Right from material sourcing to final products delivery, McDonal’s has a remarkable supply chain practices with top-notch coordination. This paper thus is a case report of McDonald’s in the supply chain practices in the food industry which entails preparing, assessing and analyzing the food company Evolution of the concept, historical background, current trends and context The supply chain concept evolved in late 20th century, a time when companies got to realize the need for enhanced integration and coordination of the various entities and functionalities which are involved in the flow of services and products. The evolution of supply chain saw its rise in 1960s following the need to integrate different tasks such as demand forecasting, sourcing, planning, production, manufacturing, inventory, warehousing, materials handling, packaging, distribution, order processing and customer service. In the 1980s, this evolution became consolidation and was factored into management of materials, physical distribution as well as warehousing, materials handling and packaging. The 1990s, supply chains factored in integration which entailed logistics. The 2000s saw the need for value capture and factored supply chain management -IT, finance and strategic planning. The 2010s brought in digitalization in the supply chains ("Evolution of supply chain management," 2015). With this evolution of supply chain, the McDonald’s has not been left behind in this move since it has scrupulously adopted and implemented some of the best practices of supply chain within the food industry. McDonald’s has a very early record of implementing well-managed chains in ensuring consistency, quality and timely delivery (Díaz Pacheco, 2022). McDonald’s has globally been admired for its high-quality, consistent and quick food which is well attributable to the company’s efficient and well managed supply chain. The concept of McDonald’s supply chain is centered on a philosophy of a three-legged stool whose focus is the employees, suppliers and franchisees. McDonald’s was founded in 1948 by Maurice and Richard McDonald who are brothers by converting their drive-through barbecue restaurant into a milkshake and burger joint in San Bernardino California (Freight, 2023). At first the food joint had its focus on shakes, fries and burgers which were sold at half price and were served faster half the time as compared to competing food outlets. Service time was enhanced by the installation of a self-service counter thus taking off the need for waiters. Food was prepared before time and kept warm under high powered heat lamps which gave the McDonald’s a very sharp competitive edge at the time. In the 1950s and beyond, McDonald’s established its centralized system of supply chain being the first to do so in the food industry. This centralized system involved partnering with specific suppliers so as to ensured standardization of ingredients and quality throughout all franchisees. This way McDonald ensured that it was able to fully take control over sourcing, production as well as delivery of all its end products (Robertson, 2020). During its global expansion in 1960s and beyond, McDonald’s faced quite huge challenges while attempting to manage its already centralized supply chain following the need for meeting needs in a diverse manner due to customers’ preferences in various regions. Nevertheless, the food company has been able to overcome such hurdles in the food chain following its efficiency and quality and thus it has been able to establish a very robust brand in its global network of supply chain. In its current context, the McDonald’s faces its new opportunities and challenges in the supply chain. With a disruption of global supply chains by Covid 19, which has seen food companies suffer shortage of ingredients as well as logistics disruptions, McDonald’s has responded to such challenges via implementation of modern safety measures, diversification of the company’s supplier base as well as the implementation of suitable contingency plans. Again, McDonald’s is powerfully embracing automation as well as digital transformation which has informed the supply chain operations of the company and better efficiency. For instance, McDonald’s is heavily investing millions of Dollars in dynamic menu boards which are powered by AI-touch and machine learning driven approaches which involves touch-screen system of ordering which tailors every experience to the customer on the basis of real-time data points (Noble, 2022). These technological advancements enable the company to powerfully optimize its centralized supply chain system via a seamless customer experience (NALBANT & AYDIN, 2023). Description of the supply chain practice including its key elements As earlier noted, McDonald’s has one of the most amazing supply chains in the food industry which reaches over 68million customers over 39K franchisees in over 120 nations globally. Whereas the franchising model which McDonald’s adopts simply means that each outlet has its distinct owners, there is seamless consistency in the menu regardless of the McDonald’s restaurant one visits across the world. This makes the McDonald’s supply chain quite interesting (Ashton, 2023). The company’s supply chain is quite a big success because it is comprised a number of elements. First, McDonald’s maximizes on long-term supplier relations. This involves maintaining mutually inclusive relationships for positive outcomes for employees, suppliers and franchisees which they term as the three-legged stool. The company looks at creation of value from each party rather than just the mere exchange of value. The second element is an effective vertical integration in the supply chain. McDonalds is usually the source of its products via a very efficient utilization of vertical integration. Through every stage of the supply chain, the company is well integrated through partnerships with suppliers who are contracted. Thus, McDonald’s maintains its fast-food chain by processing the meet, growing the potatoes and delivering its own products. Thus, McDonald’s dominates its production, processing and distribution components of the supply chain which makes it possible for them to control the bigger portion of the entire chain. Another key element is that the company controls standards and quality in the chain by inputting very rigorous control measures for enforcing quality. The company embraces a very centralized model of distribution which again permits for reduced costs and streamlined operations (TimesPro, 2023). Again, the company uses advanced inventory systems to manage its systems and forecast demand. Timely, efficient and fleet optimization ensures seamlessness in delivery. Again, McDonald’s gives priority to a sustainable supply chain by working on various sustainability initiatives such as the NextGen Cup Consortium alongside Starbucks. Supply Chain Strategy and Planning McDonald's supply chain strategy and planning are thrusted on sustainability, quality and efficiency. The company concentrates on ensuring a very consistent supply...