Founded in 1948 by brothers Dick and Mac McDonald, McDonald’s Corporation is a leading global food service organization. The company’s potential for growth and expansion was recognized by salesman Raymond Albert Kroc, who advised opening new restaurants. In 1961, Kroc gained full ownership of McDonald’s after purchasing the McDonald brothers’ shares.
In 1967, McDonald’s began its international presence by expanding beyond the United States. By 1994, there were already 23,000 restaurants operating in 110 countries and generating $3.4 billion in annual revenues. The company continues to grow rapidly with a new restaurant opening every three hours.
Not only does McDonald’s experience expansive growth, but it also dominates the market by holding a significant share of total U.S. eating-out sales at 7%, surpassing its closest competitor Burger King. Additionally, through its extensive network of global restaurants, McDonald’s serves approximately 1% of the world’s population on a daily basis.
Jim Delligutti developed the world’s most sold hamburger, known as the “Big Mac”, in 1967 for feeding construction workers. The “Big Mac” serves as the corporation’s biggest attraction and backbone. McDonald’s also stays ahead of the competition by continuously introducing new menu items. This approach demonstrates McDonald’s utilization of an analyzer strategy, as they introduce new products while defending their existing ones.
“Our aim is to provide individuals with affordable, fast, and excellent quality food.”
McDonald’s aims to be the leading force in the global food-service industry by establishing the benchmark for customer satisfaction and enhancing market share and profitability. This objective can be achieved by effectively implementing our convenience, value, and execution strategies.
When examining McDonald’s corporation, it is important to consider its Task Environment, which encompasses the following:
We will also look into McDonald’s Workforce Diversity and its Total Quality Management.
Customers are individuals or entities that exchange money for an organization’s goods or services.
McDonald’s used to primarily target young people, but their focus has shifted over time. Now, McDonald’s aims to appeal to a wider audience, especially families. This diverse market includes individuals of different ages, from kids to the elderly. McDonald’s caters to these various demographics by offering products like the “Happy Meal” for kids and the “Egg McMuffin” for older customers. Additionally, McDonald’s recognized the growing demand for healthier food options in our changing world. To respond to this, they introduced a new product – a regular hamburger that tastes like real meat but is made from plant-based materials such as Soya beans. This innovative option not only attracts health-conscious consumers but also targets vegetarians specifically.
McDonald’s targets the working and middle classes by utilizing psychographic segmentation. These individuals have hectic schedules and a preference for quick meals, which makes fast food restaurants more appealing to them.
McDonald’s serves customers from various social backgrounds, including the working and middle classes, as well as people of all ages.
A competitor is an entity that vies with other entities for resources.
Regarding our observations, in the Lebanese market, McDonald’s faces competition from two distinct types of competitors:
Indirect refers to companies that produce one or two products that compete with McDonald’s products, posing a potential threat to the company.
Four indirect competitors have been identified: Henry J. Beans, T.G.I. Friday, K.F.C., and Popeye’s.
Henry J. Beans, or Hank’s, stands out from McDonalds with its menu consisting of hamburgers and fries. However, Hank’s distinguishes itself as a bar restaurant and hangout spot, leading to higher prices for its offerings. The main customer base of Hank’s is primarily middle to upper class individuals, with the middle class being the primary shared segment among these customers.
T.G.I Friday, K. F. C., and Popeye’s are competitors of Henry J. Beans as they provide similar options and vie for the attention of customers who want chicken nuggets and fries.
Both Hank’s and T.G.I. Friday’s compete with McDonald’s by offering hamburgers and fries, whereas K.F.C. and Popeye’s rival McDonald’s by providing chicken nuggets and fries.
McDonald’s has direct competitors, which are companies that produce the same products or provide comparable services.
Our research indicates that McDonald’s faces competition from three main rivals: Burger King, Wendy’s, and Hardee’s.
Burger King, McDonald’s main rival, operates globally with a presence in 110 countries and a total of 9644 restaurants.
Wendy’s, the second largest competitor of McDonald’s in the fast food industry, has a global presence with a total of 6776 restaurants operating in 32 countries.
Hardee’s is McDonald’s primary competitor in the fast food industry and its only direct rival in Lebanon, alongside Juicy Burger. Hardee’s boasts a global presence with 3080 restaurants across 20 countries.
McDonald’s is confronted with fierce rivalry from three main opponents: Burger King, Wendy’s, and Hardee’s.
Suppliers is a firm that offers resources to other organizations.
Driven by two specific factors, McDonald’s has opted for a backward vertical integration strategy to replace the majority of its suppliers.
2) In order to guarantee the superior quality of its products.
McDonald’s obtains its supplies from different sources, including their own farms. These supplies include beef and milk for their products. Fresh vegetables are also contributed by local grocery stores to McDonald’s. As part of their partnership, Coca-Cola exclusively provides soft drinks to McDonald’s. In addition, McDonald’s acquires raw materials like flour, sugar, and yeast for their operations.
A strategic ally refers to an organization that engages in a joint venture or similar arrangement with one or more other organizations.
McDonald’s has formed a strategic alliance with Walmart, Chevron, Amoco, Disney, and Coca-Cola.
Walmart and McDonald’s have collaborated to form a partnership that benefits both parties. By having McDonald’s restaurants inside Walmart stores, customers have convenient access to affordable fast food options. According to McDonald’s corporation, this collaboration allows shoppers to easily enjoy popular menu items such as the famous “Big Mac” sandwiches, well-known fries, and beloved “Happy Meal,” while also saving time during busy shopping days.
McDonald’s, Chevron, and Amoco have collaborated to provide customers with a convenient experience. Their combined establishments include a full McDonald’s restaurant with dining room service, allowing patrons to easily refuel their vehicles and enjoy a meal in one location.
McDonald’s and Disney have joined forces in an exclusive collaboration, granting McDonald’s the exclusive rights to offer fast food options at Disney theme parks in the U.S. and other global Disney destinations. As per the agreement, McDonald’s will oversee restaurant operations while Disney will leverage McDonald’s as a promotional channel for its films.
Regulators are entities or governmental bodies with the power to govern and influence an organization’s policies and practices.
Two instances of government restrictions have impacted U.S. citizens and organizations in foreign countries. For instance, the U.S. government enforced a ban on entry and work for all U.S. citizens and organizations in Lebanon. Similarly, an embargo was placed on Iran, which also barred U.S. organizations from operating within the country.
As a result of the successful influence of interest groups in the regulatory field, McDonald’s has implemented ethical farming practice changes across its global operations to improve its treatment of animals, specifically focusing on cows and chickens.
The task environment refers to a specific organization or group that impacts the organization. This includes competitors, suppliers, customers, strategic allies, and regulators. In the case of McDonald’s, the task environment is important as it presents both opportunities and threats.
Diversity is present in a group or organization when its members have differences in important dimensions like age, gender, and ethnicity.
At McDonald’s, diversity is highly valued, making it an attractive starting point for many teenagers embarking on their careers. A significant number of these young employees eventually pursue various professions ranging from movie stars and skilled workers to famous athletes, managers, and other educated positions in society. Remarkably, two-thirds of McDonald’s middle and upper management have previously served as crew members in its restaurants. Regardless of age, whether they are teenagers or elderly individuals entering or reentering the job market, everyone has equal opportunities at McDonald’s. In fact, the company even offers specialized job roles for individuals with disabilities who rely on wheelchairs or crutches permanently.
Moreover, employees at McDonald’s enjoy flexible working hours tailored to their needs. This includes part-time options for those seeking only a few hours of work per week as well as full-time positions for those desiring more substantial employment. Additionally, workers have control over their schedules and can select between morning, mid-day, or evening shifts within the restaurant.
McDonald’s promotes a positive work atmosphere by embracing diversity among its employees and management. They offer equal job opportunities to individuals from diverse backgrounds and provide flexible working hours, resulting in increased customer satisfaction.
Quality encompasses all the features and characteristics of a product or service that contribute to meeting its stated or implied needs.
The text highlights how McDonald’s follows total quality management (TQM) practices to ensure various aspects in their operations. These practices include employees adhering to punctuality, grooming, and hygiene standards, as well as frequently washing hands to maintain cleanliness. Employees are also required to follow Standard Operational Procedures, which involve using plastic gloves while preparing food, ensuring proper frying of meat and fries, and thoroughly washing vegetables used in dishes. McDonald’s places emphasis on teamwork and high energy among employees to minimize customer wait time. Furthermore, the management emphasizes the importance of maintaining cleanliness in their restaurants by keeping them tidy, sparkling,and spotlessly clean. Together, these measures contribute towards providing fast, accurate,and friendly service with a smile.
The merger of Daimler and Chrysler resulted in the creation of Daimler Chrysler, establishing it as the fifth largest automotive manufacturer globally. The company has an annual revenue of approximately $130 billion and employs 421,000 individuals worldwide.
“Our companies have a common culture and mission focused on producing excellent cars and trucks to meet the needs of our customers.”
Various entities, including competitors, customers, strategic allies, suppliers, and regulators, are engaged with businesses.
Daimler Chrysler faces tough competition from several car manufacturers due to its wide range of products. The company produces small passenger cars, luxury cars, vans, and trucks. However, globally, its main rivals include GM, Ford Motor Company, Toyota, and Volkswagen.
Daimler Chrysler serves individuals from diverse social classes, including both the working class and the upper class. They also focus on attracting young and sporty customers through their sports utility vehicles, while catering to elderly and wealthier customers with their luxury models.
Daimler Chrysler’s suppliers consist of various industries such as electronics, plastics, rubber (for tires), and steel.
Daimler Chrysler collaborates with tire manufacturers including Bridgestone, Michelin, and Dunlop.
Green Peace and other environmental organizations, along with governmental agencies, are pressuring Daimler Chrysler to decrease air pollution. The focus is on reducing CO and CO2 emissions from vehicles. In response, Daimler Chrysler is required by regulations to incorporate safety features into their car designs. These features include side impact beams, air bags, three-point seat belts in rear seats, and child-friendly safety measures.
Benz, the largest industrial firm in Germany, offers a range of passenger cars from simple to luxury. To maintain their leading position, they must implement Total Quality Management (TQM).
Benz places emphasis on a variety of car qualities, encompassing stability, reliability, safety, high performance, and luxury. These aspects collectively contribute to an effective Total Quality Management (TQM) program. It is crucial for Benz to consistently highlight the stability and reliability of their cars in order to ensure that no defective vehicles are manufactured. Moreover, safety measures include rear three point seat belts, specialized seats designed for children, and bumpers made of special composite materials capable of absorbing significant impacts to safeguard car occupants. TQM also encompasses luxury by integrating automatic features such as automatic windows and gears, automatic climate control systems, and electronically adjustable seats with built-in heaters.
As illustrated, McDonald’s, Daimler Chrysler, and Benz are major corporations that share a common objective: to offer their customers top-notch products. These enterprises prioritize customer satisfaction, taking their customers’ needs and desires into consideration. Additionally, the companies exhibit a strong focus on growth, as seen through Benz’s merger with Chrysler and McDonald’s continuous opening of three new restaurants every three hours. Moreover, the companies operate with a decentralized structure, leading to high employee morale and motivation. Notably, these companies have a global presence. Furthermore, they employ an Analyzer Strategy by consistently introducing innovative products. The firms have also embraced diversification; for instance, McDonald’s employs backward vertical integration to replace its suppliers, while Chrysler and Daimler merged to become a more diversified entity.
These companies have different strategies. For instance, Benz focuses on differentiation by highlighting its high-quality and high-value products. Conversely, McDonald’s employs an overall cost leadership strategy to minimize costs and boost sales. Similarly, Chrysler also follows an overall cost leadership strategy to decrease costs and increase its sales volume.
Summarizing our analysis, we have examined the impact of McDonald’s Task Environment, Workforce Diversity, and Total Quality Management on the organization. To remain a leader, McDonald’s must prioritize growth and readiness for adversity, along with implementing an analyzer strategy like Daimler Chrysler and Benz. This involves introducing new products while protecting existing ones.
