McDonald's

BARROZO | FERRER | RAMENTO | SABAS | VICENTE

Background
A. McDonald's as a global fast
food chain
McDonald’s is one of the leading fast food
chains not just in America, but also in
international states and countries across
the world.
This restaurant started out as a small burger
stall in California, but the chain continued to
expand domestically and internationally,
extending to Canada in 1967, reaching a total of
10,000 restaurants by 1988, and operating more
than 35,000 outlets in more than 100 countries
in the early 21st century.
Mission
McDonald's brand mission is to be our
customers' favorite place and way to
eat and drink. Our worldwide
operations are aligned around a global
strategy called the Plan to Win, which
center on an exceptional customer
experience – People, Products, Place,
Price and Promotion. We are
committed to continuously improving
our operations and enhancing our
customers' experience.
Vision
To move with velocity to drive
profitable growth and become an even
better McDonald s serving more
customers delicious food each day
around the world.
Background
B. History
Maurice and Richard McDonald started the first McDonald's restaurant
in San Bernardino, California in 1948. They bought appliances for their
small hamburger restaurant from salesman Ray Kroc, who was
intrigued by their need for eight malt and shake mixers.

On April 15, 1955, he opened the first McDonald’s franchise in Des

Plaines, Illinois, and in the same year launched the McDonald’s
Corporation, eventually buying out the McDonald brothers in 1961.
The public face of McDonald’s was created in 1963 with the introduction
of a clown named Ronald McDonald, while the double-arch “m” symbol
became McDonald’s most enduring logo in 1962, lasting far longer than
the tall yellow arches that had once dominated the earlier restaurant
rooftops.
Background
C. Changes in the industry
Mcdonald’s changes in the industry
include technological advancements
using machines and gadgets in the
fast-food restaurant. This made service
to be faster and products to be of
quality. This leads to an increase in
customer satisfaction and loyalty.
Dominance in the market
because of:
1. Clean environment
2. Affordable price
3. Sucessful franchise model
D. Competitive positioning
It is rooted in their history that they wanted to
offer a fast paced yet affordable kind of food to
almost everyone, and this in itself makes them
one of the most visited restaurants worldwide.
McDonald’s strives to be cost leaders and offer
their food at prices that cannot be matched by
their competitors. In order to do this, McDonald’s
must be efficient and keep their everyday
operations costs as low as possible
McDonald's is the fast delivery and dine-in
service.
Aside from this, McDonalds already established a
successful branding worldwide, as it ranks as the
6th most important brand in the world and
considered as the most visited restaurant
worldwide..
Operations Management Strategy
Operations Management Strategy
McDonald’s as a business in the fast-food industry, wherein the products
sold are expected to be in the hands of the consumer in a limited span of
time. It is only natural that the business achieves its competitive advantage
through its Response. McDonald’s competes with its competitors and
achieves the expectations of its consumers by actively trying to send their
products within a given time frame.
McDonald brothers developed the “Speedee Service System”
which focuses on fast response by mechanizing the kitchen of
their then roadside burger shack. Each of the 12-person
employees specialized in specific tasks, and much of the food
was preassembled. This allowed McDonald’s to prepare its
food fast and ahead of the time—when an order was placed.
Process
McDonald’s process strategy
revolves around efficiency by
cost-minimization which
supports the strategy of the
company. This strategic decision
area of operations management
focuses on maintaining
efficiency in their processes to
fulfill the market demand. The
production line method that
they use maximizes efficiency
and capacity utilization
Current Operations Management Areas
Inventory
McDonald’s is keen on
minimizing inventory costs to
support its operations. Local
intermediaries and distributors
are all in contact with
McDonald’s restaurant
managers to efficiently manage
inventories.
MRP
Multiple ingredients are used by
the different products that are
sold by the company. These
ingredients are all involved in
different processes that are
standardized depending on the
order of the customer. To
minimize the lead time,
ingredients are already set in the
kitchen and ready for assembly.
 Strengths
- Recognizable brand
Weaknesses
-Health hazard
P Health regulations | Government policies |
international relations/ Trade agreements

in the industry - Saturated market

- Wide range of
products
- Overdependent on
franchisees
E Economy of each country | Spending
capabilities | Less income = Less sales

- Same product quality - Overdependent on

- Strong business
model
the western market
S Health consciousness | Cultural reference

Threats
Opportunities
- Technological
innovation
- Competitors T Online presence | Managing operations |
Better technology = Better service quality

- Regulatory pressure
- Menu innovation
- Growing market
- Recession
L Unexpected changes in laws | Quick
adaptation | Political instability

E Environmental awareness | Sustainability

programs | Climate change
Analysis of Operation Management Area

Process Inventory Inventory

the factors that equated
to a profitable and
successful operations
are 1) constant
communication 2)
organized inventory
management 3)
warehouse management
Analysis of Operation Management Area

Inventory MRP
Bill of Materials
 RECOMMENDATIONS
RECOMMENDATIONS
RECOMMENDATIONS
Human Resources Management
The company must train their employees in working at the same level of
quality and pace of their ideal employee.
Process
The researchers suggest that the company should regularly update their
customers, who ordered online, regarding the current status of their orders. This
way, they will also be service differentiated because they take into consideration
the things that will make the life of their customers more convenient.

Inventory Management
As previously mentioned in calculating for the reorder point (ROP), even before the
inventory count reaches the ROP, the personnel of McDonald’s should already consider
restocking. By thinking ahead and regularly checking up on the inventory count of the
ingredients, they will lessen the possibility of going out of stock again.