Operation Strategies Employed by McDonalds (Essay Sample)

Name
Instructor
Subject
Date
McDonald’s Operations Strategy
Introduction
Operations management strategies are approaches to corporate management and activities that help a business to achieve efficiency, reduce costs, achieve customer satisfaction, and maximize profits. McDonald’s global enterprise involves a variety of operations management strategies aimed at improving and maintaining customer satisfaction and growth across its outlets. This essay discusses the specific operations strategies that McDonald’s employs to counter competition and achieve competitive advantage in the fast food industry.
Cost Based Strategies
Cost-based strategies are aimed at providing services and products at low prices to attract more customers as maintain the existing customer base (Lawrence and Weindling 211). McDonald’s efforts to achieve this goal include providing products of different sizes to suit customer’s cost needs. This strategy is informed by the idea that pocket-friendly products and services meet the cost expectations of a large section of the target market. It is on this basis that McDonald’s offers variety in terms of sizes, such as big and small size hamburgers. In addition, McDonald’s has implemented an online platform (the mobile app) for customers to order and pay for food, which improves efficiency as well as saves time. The McDonald’s mobile app is a cost-saving strategy since customers can place and pay for their orders without being served by an employee. In the long term, this approach will help the company to minimize the number of employees and consequently reduce labor-related costs.
Quality Based
Quality is one of the areas where the company has placed a lot of emphasis by maximizing and maintaining consistence in product quality (Upton and Margolis 5). Consistence in quality is very crucial in achieving customer loyalty and creating a strong brand name. McDonald’s strategy for achieving and sustaining high quality involves using a product line method, whereby all outlet retails follow the same procedures and observe the same standards in the preparation of foods, prizing and serving customers. Consistency in quality helps to satisfy consumers’ expectations about McDonald’s products and services, which in turn promotes customer loyalty.
McDonald’s prepares its food products using standard recipes and customized equipment throughout its chains. Fred Turner, former Senior Chairman, emphasized the importance of menu size. He introduced the operations manual, which included detailed specifications about the preparation of food, the optimum cooking and storage temperature, and food quantity. He personally visited and assessed each restaurant to ensure these specifications were followed, after which he issued a letter grade showing a restaurant’s performance in the categories of food quality, customer service, cleanliness and value (Upton and Margolis 3). When he was named the Operations Vise President in 1958, Turner established a strict manual for the preparation and serving of McDonald’s hamburgers, French fries, and other food products. For instance, he insisted that French fries “"had to be precisely 0.28 inches thick,” and that "exactly ten patties had to be formed from each pound of beef” (The Economist 2013). Every hamburger is dressed exactly the same way in all restaurants: mustard first, ketchup, onions, and lastly two pickles. Such guidelines have been instrumental in ensuring that customers enjoy the same food experience in any of the McDonald’s chains. A McDonald’s burger tastes the same whether taken in Moscow or Montreal, New York or Sydney. Quality consistency, in this regard, is a critical strategy for the company in terms of helping to establish a strong brand name.
Efficiency
McDonald’s efficiency strategy involves reducing wastage of food. For instance, the company uses modern technology to store food, which minimizes wastage because it reduces spoilage and increases the number of days that food can stay fresh (Upton and Margolis 4). At the same time, using state-of the art storage facilities helps to preserve food for longer periods without losing their quality. This in turn allows the company’s outlets to prepare food in advance, which helps to achieve efficiency by ensuring that there is always ready food for customers.
Availability
The firm’s global retail outlets located in various places around cities and residential neighborhoods ensure that its products have a big market reach. The strategic location of franchise outlets in public places as well as the establishment of drive-through joints has helped to ensure that its products are available to as many customers as possible (Upton and Margolis 6). At the same time, the company uses a franchise model whereby it allows independent businesses to use the company’s brand name to sell the same food products. This strategy has seen the establishment of more than 5,000 medium and small size McDonald’s restaurants around the world, increasing the company’s global reach.
Speed Based
Speed helps to provide fast services by reducing the length of time that customers wait on line before getting their orders served. The establishment of small restaurants, kiosks and online ordering system allows customers to order for foods or have them delivered more quickly. In addition, the company has launched a mobile app, which