Responsible Progress: Role Played by Stakeholders Indecision Making (Case Study Sample)

Responsible Progress: Role Played by Stakeholders Indecision Making
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Responsible Progress: Role Played by Stakeholders Indecision Making
McDonald’s is a prominent international fast food chain. Its successes have been attributed to efficiency in their supply chain, positioning, and global presence. McDonald’s has 35,000 outlets that are either operated autonomously as franchise or affiliates controlled by the company(McDonald's Corporation SWOT Analysis, 2014). Despite competitive advantage attributed to its capital intensity, worldwide presence, and innovation. The company has been proactively restructuring and introducing new products into the market to cope with fears competition especially from the second largest fast food chain KFC. The company has faced some criticisms that date back to 90s that portray the company as irresponsible and make the profit at the expense of people’s health. The company has been, however, keen to ensure that it maintains it position by involving itself with proactive green environment campaigns (McDonald's Corporation SWOT Analysis, 2014)
Problem
The emergence of price sensitive consumers has caused the firm to react by cutting down its prices but in order to do that, it has to reduce costs of operation to the point it can merge the new price. The expert opinion says that a price cut is imperative. The firm is also aware of increasing environmental concerns by consumers. Competitors are also undergoing changes that are geared toward price downward reviews and brand positioning. KCF is considering organic production and green energy utilization.
Options available for McDonald
1.Mechanization
Macdonald’s could invest in automation in the supply chain management and replace some workers with machines and systems that are cheap to operate. This option will involve one-time capital expenditure (consultation and installation). The maintenance expenses are projected to be lower than human labor
2.Peruse sustainable organic production and green options
This option has been proven to be sustainable and cost effective, but it will take a longer time to adjust. The outcome is dependent on variables of the climate and consumer’s opinion on environmentally friendly and overnice products. Most people are a concern with sustainability but over 80% trust third party certification. Macdonald will, therefore, have to purchase the rights to Logos like the Rainforest Certified Seal, a brand that is less famous than MacDonald will not gain any considerable attention to using the seal on their products.
Decision-making player
To arrive at a conclusion of what a firm should do, One Investor, The CEO and the environmental activists are on settings.
Investor
The investor is suggesting that the company adopt the mechanization of the supply chain management. His option has higher chances of success as proven technology exists. Mechanization, apart from cost reductions, service delivery will be faster. This may help maintain customers and even win more from firms that have slower services. The investor is keen on returns and the maintenance of the market status. McDonald is already a leading fast food company with considerable returns. The investor will be interested in profitability as well as sustainability. A decisive will ultimately put off competitor’s threat for some time. However, the senility of price will be dealt with in this manner as the firm may now offer its product at a competitive price.
Rationale for Investor’s suggestion
McDonalds is a capital-intensive firm. Competitors are possibly considering green or organic options of price reduction, for the purpose of differential it is important that a different method of accessing competitive advantage is explored. For a competitive edge to be sustainable, a firm should be able to adopt a management aspect that relate directly to a market variable and continually and innovatively advanced. Continuous improvement is essential to ensure that an aspect/element of control is not replicated by competitors. This way, McDonald can invest in a progressive technology than other players in the industry cannot aford today. With experience and advancement in such technology, the firm will continually improve its mechanized supply chain management offering a “moving target” to able competitors like KFC. McDonald will access a sustainable competitive advantage that will not be easily replicated by any of its investors since it is the largest in terms sales and capital base.
Shortcoming of investor’s suggestion
Every decision-making process must consider the deficiencies of an option. Investors may not be in a position to critically analyzes and draw possibilities of dynamics of the market. Consumers test and preferences change with time. The company should, therefore, consider all possible outcomes. If the environmental aspects that are not the central motive of mechanization impact the perception of the customers on the products, then brand repositioning may be necessary. Positioning has nothing to do with the price or the product. It is about getting into the mind of the consumer that is difficult. If mechanization send a negative signal and the creation of the perception that McDonald do not mind the implication of its actions on the environment and the health of the consumers, the mechanization efforts may serve not ultimately its purpose.
Green lobbyist
Environmental cautiousness is on the rise and company is actively adopting green options. Environmental activists are there to ensure that actions of a firm do not endanger the environment. Activists are powerful, but the fact that there is no enforceable responsibility taken by them makes the dealing with them a creepy moment. Businesses fear activists and occasionally accuse them of malice. Activists have however done much for the general public by being a powerful voice behind the actions of a major company. Activists will always take their stand at the side of the public and no regard to the profitability of the business. Green environment activists usually rely in depend on credible audits done by third parties. Their involvement in business is imperative since companies need to be kept in a check.
The activist insists that McDonalds should consider adoption green solutions and organically raising its stock and purchasing organically grown farm animals. The green lobying will reduce the cost of products and may allow McDonalds to cut down its prices.
Activists are public watchdog and whistleblower which will not hesitate to take action whoever an agreeable policy is Brocken.
Rational
Thinking will reduce carbon environmentally friendly. It is a sign of good citizenships and the display of how the company is committed to citizenship. Although activists are not int...