Strategic Analysis Report for McDonald's (Research Paper Sample)

STRATEGIC ANALYSIS REPORT for McDonald Restaurant
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Table of Contents
Executive Summary…………………………………………………………………………….3
Background and Introduction………………………………………………………………….4
Position of McDonald Corporation ……………………………………………………………6
S.W.O.T Analysis……………………………………………………………………………….7
Analysis of External and Internal Factors Using PESTEL Factors…..........................................9
Political Factors…………………………………………………………………………………9
Economic Factors…………………….. ………………………………………………………10
Technological Factors …………………………………………………………………………10
Legal and Environmental Factors…............................................................................................11
Internal Factors…………………………………………………………………………………11
Quality Service and Products…………………………………………………………………..11
Strategic Internal Management…………………………………………………………………11
Innovativeness and Product Design…………………………………………………………….12
Equipment and Facility Design…………………………………………………………………12
References………………………………………………………………………………………14
Executive Summary
McDonald’s conglomerate is a regional as well as an International company that deals in food products. The string of companies competes in the fast food industry delivering French fries, hamburgers, bacon bugger, sausages and many other consumable products using branding, heavy expansion and standardization as the critical force behind their success. In addition to that, McDonald’s offers many hospitality services to the wide customer base in the regions the company has operational bases. For a close to actual figure in estimation, McDonald company has plants and distribution bases in more than a hundred and fifty countries commanding a restaurant line of over thirty thousand joints worldwide.
McDonald restaurant line had had a rapid expansion and growth to many domestic and international backyards. In that regard, the company did employ a rapid and intensive expansion strategy venturing into foreign countries through three prime methods: joint ventures, franchising and company-owned restaurants. For a great number or rather the majority of international restaurants joints did originate from franchising contracts and agreements. The top management of the McDonald restaurants joins did agree to rely on franchising to enable easy marketing and to facilitate acceptance of the then new eating patterns into the new markets that had no much exposure to the reliance on fast food as supplements to cooking at home. For today’s success story of the McDonalds, the management automatically attributes the maximum gains and the minimal risks, a mindset of most risk-averse investors, to the franchising approach.
The centralized nature of the McDonald’s international organizational structure is of great help to the institution. Thanks to the centralizing property, the McDonald restaurants keep a close watch on the operational cost, production, marketing and quality standards. The company has an ethnocentric management strategy. For that reason, the company indeed relies on the local breed of professionals and as well trains their members of staff for the major production sections and marketing. Hence, most of the restaurants’ products exhibit a close to similar characteristics in the sense that sugar, milk, and other ingredients are of similar concentration in the foods.
McDonald’s employs a two-dimensional management strategy to control the international subsidiaries. The necessity originates from the need to have uniformity and conformity to the rules and code of conducts of the organization. McDonald restaurant uses a rules approach to oversee the overseas operation. For that reason, the management control is only with the headquarters that is the only plant that creates rules, policies and procedures for the other entire affiliate restaurant. The management ensures a cultural approach prevails in the control of management structure. The primary trait of the approach is evident in the procedures and policies that the overseas affiliates conform to and implement in the course of their operations regardless of the major internalization undertaken by the headquarter plant.
Keywords: fast food, McDonald Corporation, tax, PESTEL analysis, Internal and external factors, fast food products
Background and Introduction
Restaurant refers to an enterprise that provides catering services. In most cases, these are joints that prepare and serve people ready food or rather they are just dine-ins. Restaurant classification takes root from their method of preparing food, serving, pricing and hospitality services available. Customers do change the outlook and status of a restaurant. For that reason, the changing purchasing power of the customers and the quality of brands does play a critical role in determining the status of a particular restaurant. In addition to that, the food industry does evolve at a quite fast pace. There has been a revolution in the methods of preparation and serving of food. For instance, many joints did evolve from preparing and serving using waiters to providing fast food and take away services leading to the emergence of restaurants notably, the famous McDonald Corporation. McDonald’s conglomerate is one of the largest and fastest growing fast food products supplier and service provider in the world today. The corporation operates in more than one hundred and fifty countries and boasts an outlet number of over thirty thousand joints. McDonald group of restaurants boasts the largest customer base for their fast food products. For that reason, the corporation has over two and a half million workers and provides services to about eighty-five percent of the World’s population in a single year. In addition to that, the company offers a wide range of fast food products and has more emerging brands than their industry competitors have. McDonald’s primary fast food products include bacon burgers, hamburgers’, and French fries. In addition to that, most of the McDonalds outlets offer salads, fish, and fish products as well as fried chicken.
McDonald chain of restaurants did start operations in the early twentieth century, around 1954. The growth of the company has been incredible as the managers and owners are more than willing to expand at any cost. The philosophy has indeed been to the advantage of the restaurant. The maxims of the philosophy refer to a situation whereby more outlets get into the market in different locations at any cost and compete considerably with other players in the market. For instance, the rapid growth rate of the McDonald chain of restaurants insinuates that there is at least a single outlet opening in a period of five hours in a day and in the overall year. Profits grow with a great number of outlets operating in different locations hence serving many customers. For that reason, the management and employees do operate in many areas and open more joints to rival their competitors and maximize profits. The expansion to new markets has been successful in all areas of the globe thanks to the g...