INTRODUCTION
McDonalds was founded in 1940 with its first store opening in San Bernardino, California by Dick and Mac McDonald with its headquarters in Oak Brook, Illinois, United States. There are more than 36000 restaurants of McDonalds across the world. The products served by McDonalds includes Hamburgers, French fries, Chicken, Frappes, Salads, Desserts. The famous slogan of McDonald’s is “I’m Lovin’ it” (Aboutmcdonalds.com)
SELECTING INTERNATIONAL STRATERGY
The success of business lies in how perfectly the business strategy of that company is made and implemented as a successful business strategy results in achievement of the objectives set by the company, making lots of profit and also expansion and growth of the business (Six Sigma Online Training Certification Information). International business strategy refers to the plans and actions of the private companies between different countries. There are four major business strategies namely International strategy, Global Standardization strategy, Transnational strategy and Localization strategy.
The international strategy involves taking products first produced for the domestic market and then selling them internationally with only minimal local customization.
The localization strategy focuses on increasing profitability by customizing the firm’s goods or services so that they provide a good match to tastes and preferences in different national markets
A firm using a transnational strategy seeks a middle ground between International strategy and a global strategy. Such a firm tries to balance the desire for efficiency with the need to adjust to local preferences within various countries.
A firm using a global strategy sacrifices responsiveness to local requirements within each of its markets in favor of emphasizing efficiency. (2012books.lardbucket.org)
McDonald’s uses transnational strategy which aims in providing best quality products at not very high price and tries to maintain their brand image by giving their customers satisfaction. McDonald’s products are sold almost everywhere in the world either by a company owned restaurants or by franchised restaurants. The company highly emphasizes on standardization of products by knowing the modern lifestyle, youngster’s taste, maintaining service standards, product innovation and using proper marketing tools for promotion. McDonalds decides the location as per the availability of local suppliers so that the standard of the quality of the product is maintained. It adapts the need of the local customers so well that it offers different services in different parts of the world. For example, it offers salads and beers in Europe, whereas in India it offers a wide range of Vegan food in India because there the preference of the people is vegan food more rather than non-veg food. (Google Books)
INTERNATIONAL SUPPLY CHAIN STRATEGY
There are two types of supply chain strategy namely Efficient Supply Chain which aims at making cost fully efficient and Responsive Supply Chain which is more flexible towards consumers needs and wants.
McDonalds has a highly responsive supply chain as they continuously try to give variety of products to their customers and all these can be achieved by having a balance between all the elements of global supply chain management which are as follows
• Facilities:
If the facilities provided are flexible and are more close to the customer, then the company would be a grand success. McDonalds focuses on being near to the customers by providing them all the facilities they need. McDonalds does a good research on places and then selects the one having competitive advantages. They also gives a lot of facilities to the employees such as competitive wages, giving meals and also giving them very flexible hours of work.
• Inventory:
The inventory also plays a very important role as compared to all the other factors. Excessive inventory can maximize cost and less inventory can minimize the cost and the responsiveness as well. McDonalds use JIT (Just In Time) inventory which means delivering goods when they are needed. Which means McDonalds does not prepare everything beforehand as in they don not cook everything beforehand. That means that when a customer places his order then only the product is made and that’s how its served fresh to the customer. (Management, Management and profile)
• Suppliers:
Suppliers are those who supply raw materials to the company. They play a very important role in the supply chain of a company. The suppliers must be dedicated towards their work to provide quality products so that the standard of the company is maintained. McDonalds work with very dedicated direct suppliers who are very loyal towards their work. The suppliers of McDonalds function across the world in various cultural and legal environment. McDonalds and the suppliers both are dedicated towards their minimum requirement of standards and facilities which is to be maintained which will result in advancement in McDonalds commitment in ethical, environmental and economic aspects of sustainability. (Mcdonald’S® Supplier Code Of Conduct)
McDonalds has different suppliers in different parts of country. For example, The United States suppliers are Lopez Foods who supplies Canadian bacon, breakfast sausage patties as well as beef patties, coffee comes from Gaving Gourmet coffee, the chicken, beef and fish products comes from Keystone Foods. (Mcdonalds.com) Where as the Indian suppliers are Amrit Foods who supply diary based products, Vista Processed Foods who supply chicken and vegetables, Mrs.Bector’s, Noida (U.P.) who supplies Buns. (Mcdonald’Stm India (North & East Region) FACT BOOK).
PRODUCTS
SUPPLIER
Apple
Mike Dietrich
Potato
Frank Martinez
Fish
Kenny Longaker
Beef
Steve Foglesong
Lettuce
Dirk Giannini
source: (Mcdonalds.com)
• Transportation:
As it is very clear that McDonalds is completely an outsourcing operation as all its products comes from suppliers or manufacturers. The transportation used by McDonalds are mostly single and multi temperature trucks (also known as cold chain supply chain) which move the products to the restaurants across the country.
• Information technology:
Information technology plays a very important role is progress of a company as now-a-days everyone wants advanced technologies. McDonalds uses 5 different technologies to operate the restaurants. These are as follows: (system)
♣ Transaction Processing System or TPS
McDonalds have a lot of suppliers who supplies raw materials to McDonalds and to keep a track on all the transactions made by McDonalds with the suppliers it adapted this system which, every time a transaction is made, registers the name, address, purchase made and also the invoice of the supplier with whom the transaction is made.
♣ Point of Sale System or POS
As McDonalds makes a lot of sales one day so it becomes impossible for them to take orders in a register so they replaced it with fully computerized Point of sales system in 1970 which was able to take orders in the system itself. Now-a-days these systems are fully touch screen and some restaurants also have self service system in which you can give your order manually.
♣ Decision Support System or DSS
A recent Decision which McDonalds made with the help of the Decision Support System was the installation of free WiFi. This decision was taken to attract young and tech people as their usage was measured and then the final decision of installing this was taken.
♣ Made for You System
In this system the placed order by customer appears in the monitor which is placed in the kitchen and according to which the employees complete the order and call the number to pick the order up.
♣ Hyperactive Bob System
This system monitors the people entering the restaurants through the parking lots or the drive-thrus by roof-top cameras installed in the restaurants so that the staff would know when the traffic is maximum and can prepare themselves.
CONCLUSION AND RECOMMENDATION
McDonald’s philosophy is QSCV which is Quality, Service, Cleanliness and Value. McDonalds highly focuses on its customer’s preference and taste. McDonalds, apart from being so close to their customers and suppliers, still needs to improve on certain matters like
¬ There are, sometimes, insufficient employers to attend the customers due to which customers need to stand in a long queue.
¬ McDonalds needs to improve its communication with the suppliers as there was a case in 2012 in which McDonalds wanted to launch a premium burger called English Pub Burger in United States which they were enable to as they could not get enough buns from their suppliers (Schonberger). So keeping this in mind they should try to find a solution for these types of problems.
¬ McDonalds should also keep on adding some new and good stuff to its menu so that no one gets bored of eating the same old food for a long period of time.
REFRENCES
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Mcdonald’S® Supplier Code Of Conduct. 1st ed. 2012. Web. 8 Jan. 2016.
Mcdonalds.com,. "Meet Our Suppliers :: Mcdonalds.Com". N.p., 2016. Web. 8 Jan. 2016.
Mcdonalds.com,. "Supplier Stories :: Mcdonalds.Com". N.p., 2016. Web. 8 Jan. 2016.
Mcdonald’Stm India (North & East Region) FACT BOOK. 1st ed. 2013. Web. 8 Jan. 2016.
system, McD. "Mcdonalds Information System: Mcd Information System". Mcdonaldsmis.blogspot.in. N.p., 2016. Web. 8 Jan. 2016.
Management, Operations, Operations Management, and View profile. "Mcdonalds Operations: Inventory". Mcdonaldsoperations.blogspot.in. N.p., 2009. Web. 8 Jan. 2016.
Schonberger,. "Here’S What Mcdonald’S Can Do To Turn Around Its U.S. Business". Fox Business. N.p., 2014. Web. 10 Jan. 2016.