Project on McDonald’s Corporation Essay Example for Free

Project on McDonalds Corporation EssayIntroduction and flat coatIn 1940 two brothers Dick and mackintoshk Macdonald assailable their own restaurant. Eight years ago the introductory concepts and rules of immobile viands fruit and gross sales were formulate by them. Initi altogethery the business was cr tucker outed in a such way that e actuallything should be actually fast and effective. Brothers spent much time elaborating the layout of the kitchen in their first restaurant, sothey striked the goal.Inspire of the fact that later they sold their business and their family no longer the owners of it, immediatelyadays mcdonalds have the similar efficient system of production and sales that it is adequate to(p) to introduce and maintain all over the world exploitation different st straddlegies and methods. External EnvironmentExternal environment is a bunch of several(a) outward forces that may have a great impact on the comp eachs performance. The external environ ment of e truly comp whatever comprises of three levels the general, labor and contention environments. The desegregation of information received from these environments back ups to identify and shape the telephoners strategies. Thereby, in outrank to admit what hindrances association faces or may envision in the future, it is essential to analyze all the levels of its external environment.It was mentioned earlier that the headquarters of McDonalds locates in the U.S. so we will analyze general and fabrication environments in this region.General EnvironmentThe general environment is usually examined by the analysis of 7 surgical incisions demographic, sparing, political/legal, sociocultural, technological, global and physical environment components. First of all, the demographic segment is concerned with the population complex body part and omposition. The USAs population is estimated at 313 286 000 people in 2012. By analyzing population composition, it crumb be said that on that point is very high level of immigration. Moreover, it rouse be said that the birth rate is sufficient 13.68 births/1,000 population in 2012, according to CIA World Factbook.Thereby, these statistics help to understand that the region is kind of proceedsable and comfortable to operate in collectible to the heroic population size and excessive flesh of potential employees. Last merely no least, according to U.S. Census Bureau, the median ho economic consumptionhold income during period of 2006 to 2010 is $51914 which is quite high. Secondly, the political/legal segment is quite important for the analysis because the constancy is passing contingent on the different kind of taxes imposed by the governments. McDonaldsCorporation is obliges to pay business taxes, payroll taxes, Food Product Association taxes (19% ofthe radical profit and 19% in the p sift of each product) and health and social insurance for the employees. The changes in governments tax policy may suddenly affect the accompanys revenue. As regards the economic segment, one of the major challenge for fast forage effort is that to keep the price is low for the client. However, it is quite hard because nowadays the USA is still suffering from the financial crisis which can be a possible occasion to decrease in outside forage function in a whole.The dimension influencing the fast food industry the most is the sociocultural. The reason is that the industry is helpless on peoples favourences and opinions thats why even tiny changes argon crucial. From 2000 to 2002 McDonalds lettuce dropped from $1.977 million to $893 million. It was caused by the increase of customers health-consciousness and fears of obesity, as a consequence, any(prenominal) customers prefer to a greater extent than fitter options which offer a greater variety of food for health conscious customers.Further much, it is quite important to devote attention to technological segment because the technologie s al ways mean faster operation and damage minimization. McDonalds uses different modern appliances to prep ar its food without many an(prenominal) dangers and in a quick way. Moreover, the mass of McDonalds restaurants take into accounts free Wi-Fi. In addition, McDonalds improved the technology of its supply chain management.Regarding the global segment, it should be highlighted that most U.S. companies are focused globally which bureau that they operate in many different countries. McDonalds is not an exception. It is located in 119 countries and is known as one of the most spread fast food restaurants chain.Last further not least, nowadays more and more companies are concerned with social responsibility and environmentally friendly policies.Industry EnvironmentThe industry environment is usually analyzed by Porters five forces model. Firstly, it is the Threat of New Entrants. The threat of saucy entrants in the fast food industry is high because in that location are no l egal barriers which would keep them from reckoning the industry. The major barriers in which a firm faces in the industry are the economies of home and the access of the distri unlession.In high society for a firm to enjoy success in the industry, they must spend a large keep down of capital on advertising and marketing. The industry is very hawkish because firms are always attempting to steal customers from each other. Access for distribution is crucial in the restaurant industry because if the customer cant see you or access you slowly its possible that they wont goout of thither way to eat there. Franchise options too make is easier to enter the market, for example Subway has built their strategic plan around franchise options. Therefore, initially the only cost to enter the market is the starting capital required to open a restaurant. However, it can cost upwards of millions of dollars for all the equipment, licensing, and the property. This costly barrier is the most pr obable reason that people do not enter this business. The food-service industry doesnt have any exit barriers, which allow firms to easily leave the industry if theyre not successful, at virtually only the cost incurred.The second force is Bargaining Power of Buyers. McDonalds, and the industry, has attempted to gain market capitalization, by keeping the customer satisfied, out-of-pocket to the fact there are relatively no duty period costs. For this reason, they have adopted the slogan, the customer is always right. The industry must try to maintain a hold on the market by conforming to a changing society as well as maintaining high tonus. One of the industrys most recent concerns is that of creating a healthier society and prevention of obesity. McDonalds corporation has faced previous law suits on being held accountable for obesity, withal following the litigation process of cigarettes and tobacco companies.The courts ru take against this issue in McDonalds favor, making this a remote future risk factor. McDonalds has had to gainful legal fees in order to defend itself in this type of litigationhowever, even with this incremental cost they are still achieving a significant rate of earnings step-up. In addition, McDonalds, in its effort to be a more socially responsible unified citizen by supporting a healthier society, has wined light and rose-cheeked scorecard items in order to give customers additional eating options and in doing so, broadening the array of its customer base magic spell offering its existing customer base with healthier menu options. Thirdly, it is Bargaining Power of Suppliers.It can be said that McDonalds has a large bargaining power because of the fact that they spend 4.852 billion dollars in food and paper in 2004. This can be argued that the companies that McDonalds buys from could be largely dependent on McDonalds business. Although in recent years the industry has had a small problem with beef, because of the outbreak of the mad cow disease. This problem raised the cost of beef in Europe tremendously but the cost actually went up around the world because of the beef shortage in Europe.In this content it can be argued that the suppliers of beef have a strong voice as well. The suppliers that sell to McDonalds have a strong voice in addition because of the fact that the switching cost for McDonalds as a whole would be so tremendous that they would not want to make that change, so any problems or disputes would be worked out with there suppliers. Also, with the opposition and the number of buyers in the market place, losing a large company like McDonalds could destroy any supplier but there are other prospects out there to buy that product like Wendys, Jack inthe Box, Burger King and a hardly a(prenominal) others that they may be able to salvage there losses. As for the paper goods that McDonalds buy from the manufacturers, if McDonalds were to change manufacturers the supplier could easily change there manufacturing to note book paper by reasonable readjusting the machines but it would come at a great cost. The fourth force is Threat of Substitute Products. McDonalds is known for their famous French Fries, Big Macs, and Happy Meals. Competitors of the industry also try to compete with similar products therefore, leading to price wars.McDonalds created a one dollar bill Value Menu, in response to contentions such as Wendys 99 cent menu. Overall, the industry has tried various product differentiations in order to hoard up greater market dole out, but most consumers are drawn to the classics for which the establishment is known for. However, growing concernto achieve a healthier society has led McDonalds, as well as other competitors, to make extensive menu changes, in order to conform to a more concerned society. McDonalds is doing more and more to compete with health focused restaurants like Subway.Nutritionist and other leading experts have been hired to join the McDon alds team in order to ensure that the correct items are added to the menu, while still keeping and improving the classics that they are famous for. For example, the chicken nuggets that we all grew up on are now 100% white meat. McDonalds is flexible in their menu to conform to the changing tastes of society, but they always serve with a smile The fifth and utmost force is Competitive Rivalry within an Industry. Currently in the fast food industry, there is intense competition for increment in the market. The market growth is rising because of the convenience factor and busy consumers not having enough time to cook a meal.The restaurant industry is also growing rapidly due to opportunities in other global markets. In McDonalds case, they actually have a competitive profit because they have already entered many different countries and are succeeding in these countries. Each firm within the food-service industry is susceptible to losing customers because there are relatively no swi tching costs for consumers, therefore the industry has to rely heavily on their brand image and quality of products. McDonalds has a number of competitors however they are currently the leader of the industry in market capitalization with a cap of $39.31 billion.Competitor AnalysisIt is almost vital to know the competitors in your industry in order to be able to overtake and surpass them. The top competitors of McDonalds are Burger King, Wendys, KFC and Subway.Burger KingBurger King is the second largest hamburger fast-food chain in the world and is the number one competitor for McDonalds. Burger King has 11,400 locations in 58 countries and derives 55 part of its revenue from the drive-through window. Burger King reported 1.72 billion in 2002 in revenue which is a 17 percent increase compared to a 4 percent increase reported byMcDonalds over the same period. Burger Kings distinct assets include the anomalous Whopper with its one of kind charbroiled taste and the company policy of preparing the hamburger any way that the customer wants it.Burger King has distinguished itself over the years in many ways including being the first in the fast-food industry to en keep mum its patio seating in 1957 thereby offering customer indoor eat experience. Burger King also differentiated itself when it installed the drive-through window in its restaurants in 1975. In addition to the Whopper Burger King also offers a few set items on its breakfast menu that differs it from it competitors including the Croissanwiches and french toast sticks. The rest of the menu also offered the unique veggie burger and chicken Caesar salad.WendysWendys is the third largest fast-food chain with 9,000 stores in 33 countries world wide. In 2002 they reported 2.73 billion in revenue which is up 14.2 percent from the previous year. Wendys offers several unique items including the Frostys and Spicy whiner Sandwiches as well as healthier items such as salads, baked potatoes and chili. Wendys has also distinguished itself through the creation of the special value menu with all items on it under a one dollar.Wendys also owns several small companies including Tim Hortons and Baja Fresh Mexican Grill. It plans on increasingly using acquisitions of smaller brands to further growth. In next decade Wendys plans to add between 2 and 4 thousand new stores worldwide. One important failing of Wendys is the lack of easily recognizable product compared to McDonalds Big Mac of the Burger King Whopper.KFCStrategic ObjectivesKFC has the strategic objectives of expansion along with profits and sales growth. KFC has also been applying its strategies at improving services and making them more and more customer friendly. It has not only been customizing its menu according to the countries that it has been operating in, it has also been essay to cater to different ethnic groups like African Americans and Hispanics. Such types of strategies are focused on increasing the customer base by give way customization of products. otherwise than the conventional eat-in restaurants, KFC has also been augmenting into non-traditional facilities like shop classping malls, hospitals, universities, stadiums office phaseings etc and a number of strategies have been formulated to aid this kind of expansion. Competitive AdvantageA very strong financial background is one of KFCs competitive advantages. KFC has been functioning as a multi case corporation for several decades. As a result, the company is familiar with the logistical and quality problems which accompany operating an international food operation, and has demonstrated that it can work with host countries and businesses within the host country to develop a outline which works in the most cost effective way. With the passage of time, KFC has developed another very important competitive advantage for itself environmental Friendliness.In March 2009, the first eco-friendly green KFC was opened in Northampton USA. The restaura nt is designed according to environmental goals that include cutting energy and water consumption by 30 percent and reducing CO2 emissions. Operations at the new site are also expected to reduce waste and the amount of rubbish sent to landfills the restaurant composts and recycles other waste, grease and used cooking oil. Other than this, in an effort to reduce its packaging by 1,400 tons, KFC is now switching from cardboard to recyclable and biodegradable paper wrapping for some of its products.SubwayStrategic ObjectivesThe strategic objectives of Subway focus on creating a global strategic plan to enable Subway restaurants to succeed internationally. Other than this subway is intent upon introducing the concept of healthy fast food. Sandwiches of Subway have been included in diet plans by experts. Subways stand regarding obesity in children is not new to its customers. Strategies at Subway are not only round a real ambitious increase in franchises all over the world but they are also closely making the food more and more appealing to the health conscious customers because health conscious attitudes, according to the experts, are here to stay now. Competitive AdvantageOne of the greatest competitive advantages that Subway was born with is its healthy menu. The salads and sandwiches appeal much more to the people as compared to fried chicken, burgers, fries and pizzas. With its advertising and promotion, Subway has long been highlighting its healthy food in advertising and promotions and with the passage of time, it has established itself as a healthy brand. Another competitive advantage that subway enjoys is the fact that along with traditional locations, Subway restaurants can be found in more than 4,000 non traditional locations such asfood courts, health clubs, hospitals, universities, amusement ballparks or just about anywhere. In fact, Subway restaurants can even be found in automobile orientrooms and Laundromats This global presence is indeed a sus tainable advantage for Subway and needs to be managed properly. Subways fresh food is also a competitive advantage because unlike its competitors like McDonalds it allows its franchisees to use up their own food suppliers, to ensure they can access the freshest ingredients.Resources, Capabilities and Core CompetencesResources Human resourcesMcDonalds is does its best to reward outstanding employees for exception work. It is also putting more emphasis on its hospitality training to ensure a friendlier and customer focused support cater. Brand loyaltyThe long queues to McDonalds in food courts is the best illustration of high level of brand loyalty, that company continues to develop. In advertising campaigns McDonalds uses the slogan Im lovin it which it there attempt to make McDonalds an easy choice for families. They have also started using popular music to appeal to youth population. Real estateIt may be surprising, but real estate ownership is one of the significant Mcdonalds r esources. It is estimated that McDonalds generates more money from its rent than from its franchise fees. One of the ways in whichMcDonalds receives property from its franchises is in rent money. McDonalds owns all property in which a McDonalds expiration was built regardless if the location is a franchise or company owned.CapabilitiesMcDonalds used to have several capabilities, among them hiring process and employees training and product innovation. Hiring processIt is complicated and systematic. It comprises of 3 main stages. 1. Initial interview and psychometric evaluation. On this step the candidates undergoing simple interview and tests evaluating their verbal and critical reasoning2. Job evaluation. On this step candidates have 2 days practice in a restaurant that allows them to look at McDonalds as a future employees and HR team to assess candidates performance 3. Final interview. The last stage of hiring process includes general interview and decision about the candidates is made.Taking into consideration staff training, McDonalds has many training programs on every level of restaurant. Training forums are made for canonical workers and they start from the very beginning of working in the restaurant. They are designed to help employees with their communional skills and encourage growth in the company. Other programs are created for managers of the restaurants, such as Basic Shift Management, Advanced Shift Management, and Systems Management Course .Their main objectives are providing information about internal standards and procedures, teaching data analyses and strategies of identifying and settlement different problems. For higher levels employees McDonalds has internship programs for students and recent graduates. Programs let them practice in different spheres of companies performance such as Information technologies, Marketing, Finance and others. Other McDonalds get wind Leadership Development program is based career planning, Individual Development plans, career maps, succession planning, learning activities and others. Product innovationThe main resource underdeveloped product innovation dodge are full-time chief working in studios in Munich, Hong-Kong and Chicago. Moreover, localization of products also plays important role in suppuration of innovative products. For example, in India Beef and pork products are not offered due to Indian religious beliefs. What is more, meat and vegetarian meals are prepared in separate areas of the restaurant again as a result of religious laws about preparation of food for vegetarians and meat-eaters.There is an Indian version of the Big Mac in India is calledthe maharajah Mac and made with two grilled chicken slices, onions, tomatoes, cheese and a spicy mayonnaise. In Taiwan company introduced kao fan (literally baked rice), that resembles a burger with rice patties in place of buns. Finally, in Philippines McDonalds serves even spaghetti with in sweet tomato sauce, topped wit h cheese.Core Competences Produce quick cheap food to large number of customersWith this concept, they are able to expand into many countries be the largest fast-food chain in the world. The process of production is the company core competence. Initially it was designed in such way as to be fast and very effective. There is precise guidance of how to do every activity.Mcdonalds pioneered in the systematization of its processes.Efficiency of operations and synchronisation is the basis for success of the company.Also, it may be said, that burgers and fries are themselves McDonalds core competences. McDonalds classic burgers has always taste the same in any outlet in the world. This consistent quality assures customers trust and loyalty to the product. It also provides an assuring brand experience. StructureSome specialists consider the unique schemeal structure of McDonalds as its core competence. McDonalds never used rigid hierarchical organizational structure, that company managed to sustain over the years. It uses freedom with framework mantra, keeping structure decentralized. It allows local managers to make decisions by themselves. It also plays significant role in localization of menu due to local needs.Business-Level StrategyThe business level strategy McDonalds uses integrated cost leadership and differentiation. It means the products of mcdonalds is the cheapest on the market and more over McDonalds does its best to make them absolutely different from what others produce, using localization and instauration new products almost every year.So the target of its strategy is to meet the needs of buyers whose preferences are distinctively different from others. So MD deals with the costumers who want very fast service with good quality. And it is different from the visitors of not fast food restaurants. The product line is customized to meet their needs. The marketing emphasis is put on communication and market analysis again to satisfy their needs. Finall y the way to sustain strategy is remaining dedicated to serving one niche and be better than competitors in everything and do not dilute the brand image entering other niches.Corporate-Level StrategyCorporate-level strategy is a strategy which is aimed at the long edge position of a business. A corporation or business can use plenty of methods to develop a corporate level strategy, however, basically, there are four main strategies that almost all businesses use which are Concentrate on a single business, other words, business stays on the same industry on purpose to create a strong competitive position within the industry. Diversification which is to move to a new business to provide a new good or service. There are two kinds of diversification, link diversification which is to compete in similar area/industry of activities to build asynergy and unrelated diversification which is to enter a new industry to compete and build a portfolio strategy. International Expansion. This mea ns some competition in more than one market to serve the needs of the other markets/countries. Vertical Integration. This is a way to cut costs by providing your own ways of inputs, backward vertical integration and your own channels of distribution and selling outputs by forward integration.Therefore, now lets move directly to McDonalds corporate-level strategy. Nevertheless, before we start to consider all the main points of this particular type of strategy, some overview details will be given.Mc Donalds is a fast food restaurant operating on a global basis. It is operating on 119countries world wide. Mc Donalds was opened for the first time in Cyprus in June 1997 and by now there are 16 Mc Donalds restaurants in Cyprus.So, Mc Donalds uses corporate level strategies like all other global basis corporations in order to reach corporate goals to be cost effective. MC Donalds is a business which only concentrates on a single task which is the fast food business industry as stated by D r. Weber, (2000). This special issue someday will help a lot the business to concentrate directly on one single task and get not only more power and market share, but consumer loyalty also in result.This happens because of the fact that they will run many strategies to find the best solutions of the consumer needs and preferences. However this can be very risky if the business fails to meet the right needs of consumers and therefore will not be profitable and as a result will close down due to the possible bankruptcy.Firstly, as it was stated in Washington post (2005) MC Donalds diversifies its operations in many ways. Thus, the company uses related diversification in order to produce the same products which are burgers and salads basically, but they provide just an enormous number of choices, such as Big Mac or Mac chicken, different kinds of salads.Moreover, McDonalds operates in more than one geographical area but still performing the same task. Also it has opened MC cafes all ar ound the world. McDonalds gets many advantages by doing related diversification, firstly, if there are two Mc Donalds restaurants in a city, so the two firms can build a synergy by co-operating with the right to use some special facilities such as the advertisements, suppliers and sometimes events, for instance, charity events. Secondly, as statedby Ricky, W (2003), the firm depends less on a single product, so its less vulnerable to competitive or economic threats. Other words, Mc Donalds having variety of products like burgers, salads, ice creams and drinks is not being threaten of competition because this particular company has diversity in its products, for instance, Mc Donalds Greek Mac makes it more stable and steady than such rivals as Burger King because the rivals do not have such product.Thirdly, it allows the firm to use technology or expertise developed in one market, for example, fast food to enter a second market more cheaply and easily e.g. MC Caf. However, the only disadvantage that Mc Donalds faces, is the cost of coordinating the operations of the related divisions. In 2001, McDonalds launched a new venture by initiation two hotels in Switzerland (Zurich and Lully) under the name Golden Arch Hotel Stefan, M (2005).This is a good example of an unrelated diversification because of the fact that Mc Donalds is victorious risks of its business from a single activity to many others like taking part in the Hotel industry. Unrelated diversification provides a portfolio for Mc Donalds because it is operating on two absolutely different industries and the risk is reduced because if one of the two markets that the business has activity in fails to grow successfully, then the growth of the other market will cover the costs of it.Secondly, such strategy is less vulnerable to competitive threats because any given threat from a competitor is likely to affect only a portion of its total operations. However, unrelated diversification is very difficult to m anage since the company has to deal with two markets and their strategies, plans and organization and coordination of each specific market which it isdealing with. McDonalds has introduced the American concept of fast food to many foreign Markets as stated by, Francine L, (2005). Moreover, the firm has by now, expanded throughout most of the world by operating on 119 countries. Thus, Mc Donalds is known globally today because it is expanded internationally. Mc Donalds is using multi-domestic strategy to serve each nations needs. It is customizing the fast food menus for each specific country/nation to suit the peoples wants. For instance there is Greek Mac in Cyprus and Greece. The advantage of this strategy is that the company is targeting a nation very effectively and gains market share by attracting the customers whereas, the cost of production will increase in order to add a new receive to the firm and the prices will rise to cover the costs. As stated in Getting the Facts Str aight leaflet of Mc Donalds, the firm is working with top suppliers and independent experts on health and safety.The Cyprus Mc Donalds restaurants inputs such as meat, is order regularly from Italy with the highest quality and when they enter the island,it is supplied to all the franchise branches on the island by Mc Donalds vans and trucks. This shows that Mc Donalds owns its inputs and has its furthestms to breed cattle and grow vegetable and potatoes. Therefore, this allows the company to diminish costs by doing vertical backward integration. Moreover, it maintains a guaranteed time, quality and amount of supply to the restaurants when required.The drawback of vertical integration is that, at the beginning of the integration huge amounts of capital should be invested in to the backward integration. Mc Donalds business has been working since 1956 till now successfully and still operates under these corporate level strategies.Cooperative StrategyA cooperative strategy means inter action between two or group of companies which work together to achieve a shared objective. By measures which areincluded in cooperation, companies can create value for the customer at a lower cost or with more benefits than it is able to do by itself. The primary type of cooperative strategy used is strategic alliances.Such kind of cooperations means that companies partly share their resources and capabilities between each others to produce new resources and capabilities, e.g. gain shared objectives. Such corporations as McDonalds, Coca-Cola and Disney are the biggest multinational corporation with outstanding profits.But how can they enlarge their profits with the same amount of resources? The answer to this question is cooperation.Lets look through some strategic alliances formed by McDonalds.Alliance with Coca-ColaMcDonalds alliance with Coca-Cola has no number of paper to fall back onjust a common vision and a lot of trust, according to Mr Ivester (Cokes chairman). On place se tting up in the burger business in the 1950s, one of Ray Krocs first successes was persuading a Coke executive Waddy Pratt to provide him with their drink.Cokes relationship with McDonalds goes far beyond than just a supplier It has helped McDonalds to go to the new markets all over the world, because Coke is sold in almost twice as many countries as McDonalds. Michael Quinlan, McDonalds chairman, runs off a long list of areas of cooperation, from banking relationships to equipment design. There is also very close relations between the members of this alliance at board level. When Cokes chairman Robert Goizueta died, flags flew at half-mast at McDonalds around the world.Alliance with DisneyThe alliance between McDonalds and Disney has moved way beyond doing only movie promotions with Happy Meal toys. Nowadays this alliance has made enormous amounts of progress, for example McDonalds being a sponsor of Dinoland, one of Disneys attractiveness in Animal Kingdom, has built its restaur ant outside this attractions park. This new smart McDonalds is decorated in DisneyWorld style. The staff wear uniforms which is approved byDisney, which demonstrates McDonalds characters.Alliance with Master Card and VisaMcDonalds has announced an alliance with MasterCard and another alliance with Visa USA to bring cashless payment options to McDonalds restaurants in the US. By this cooperation with MC and Visa, a company has provided more comfortable system of payment in McDonalds which attracts customers.Alliance with Malls and Gas StationsMcDonalds latest expansion targets call for approximately 3,000 new restaurants world-wide both 2008 and 2009. Two-thirds of new restaurants will be built outside the USA. On the other hand, in the US approximately 600 new restaurants will be supposed satellite units mini-McDonalds found in malls and especially in nationwide retailer. McDonalds has formed alliances with Amoco Oil Co. and Chevron Corp. in the US to built restaurants in tandem wi th gunman stations to cover more and more destinations all over the country.Global StrategyMcDonalds has initially expanded to international markets in the conditions of strong regulations and overcrowded market in the USA. In the very beginning they offered a standardized products and attracted new clients with clean environment policy and brand equity. Recently the company adapt to new conditions by providing new product line and redesigning retail space in order to meet local needs and tastes.This strategy has allowed McDonalds to adapt quickly to new countries, but at the same time it created a long-term threat of diluting the brand and loosing its association with American culture. For instance, in Europe McDonalds becomes going beyond fast-food conception. In order to compete with coffee shops, McDonalds started offering more comfortable conditions, such as WI-FI and iPods for rent. Moreover, they created new healthier and locally adopted foods.Some specialists suggest, that if the company continue to expand with this strategy, it will be quite difficult to remain recognizable and meaningful brand.Now it is time to consider McDonalds global strategy in more detail, taking China, South Africa, Brazil and Saudi Arabia as examples of strategy realization. But firstly, it is worth mentioning a few background facts.There is an incredible opportunity to expand in the world. McDonalds annual growth rate is about 1000-1500 restaurants and by 5-10 countries. According to the statistics, the company employed about 2 million people worldwide in 2000. The company adapts easily to new customers preferences by incorporating in the menu pommefrite sauce in Belgium and Holland and special mayonnaise based sauce in Iceland.ChinaThe McDonalds strategy in China is vary specific and it is aimed for adaptation to local culture. In comparison with the US, it was important for Chinese clients to focus not only on the food, but also on the restaurants atmosphere. That is why i n China McDonalds restaurants are very similar to the American coffee houses with comfortable conditions for conversation and meetings. An other part of McDonalds strategy is introducing national tastes in its menu, such as the teriyaki burger.South AfricaIn South Africa McDonalds decided to focus on high populated cites. The point is to serve people where they eat, shop or play. The companies survey figured out that drive thru facilities are much effective then restaurants themselves, that is why there was made a decision on improving retail spaces. Moreover, McDonalds marketing strategy was concentrated on potential customers with different income level.In South Africa McDonalds has 90 branches spanning all nine provinces. It has 3 000 staff in just 39 restaurants, most working for franchisees. Each new restaurant opening creates as many as 80 new jobs, which is really important in current conditions.BrazilThe eighth largest McDonalds market is concentrated in Brazil. Management t eam here is mostly focused on quality improvement and customer satisfaction and it was awarded for these efforts with Franchising Hallmark of Quality.Furthermore, McDonalds Brazil is one of the best employers and fifth among most admired companies in the country.Saudi Arabia and IndiaThe most characteristic feature of McDonalds in Saudi Arabia is that it closes five times a day for muslim prayers. McDonalds India offers aloo tikki and paneer. And it doesnt serve beef or pork at all. The Big Mac becomes maharajah Mac in India. The company created special conditions for vegetarians with separate kitchen, cook and utensils. Moreover, in Ahmedabad the company decided to open an all-vegetarian outlet. Holding in respect Muslim tenets of belief, the company does not serve pork in all Islamic countries.There are two absolutely unique restaurants in the Holy City of Makkah, where Islamic customers are exclusively served by the staff, fully consists of Moslem employees, from the Service Cre w to the Restaurant Manager level . And finally, McDonalds efforts have improved the local industries and national preservation due to the fact that more than 50% of the products used are manufactured locally and in the gulf regions.RecommendationsFor Business-Level StrategyThe main recommendation in call of business-level strategy is to remain in the same niche. McDonalds pioneered the whole concept of the fast food restaurant, that is why it should go to some other businesses, such as higher-level restaurant, because it can dilute their image of best fast food restaurant.For Corporate-Level StrategyDue to the fact that not every family has a direct access to McDonalds cafes or just their place is too far from the restaurants, the idea to provide fast food to supermarkets. The products will be sold in the special vacuum cleaner package, so that it would have their original taste. This way the restaurant will loose nothing because there are only advantages which consist of making extra profit and gaining customer loyalty through spreading their production into the farplaced (far located) regions.For Cooperative StrategyAs we have seen in the examples of McDonalds alliances cooperation is very efficient way of development. In my opinion, McDonalds can cooperate with greater amount of companies. However, it should be very selective in choosing partner not to dilute its image. For example McDonalds can cooperate with Apple McDs can provide free rechargers to Apple gadgets in its restaurants, while apple spread some apps by the AppStore. I think that McDonalds also shouldcreate alliance with some attraction park companies, as theyve made with Disney. Of course it would be more profitable for McDonalds because of the amount of clients concentrated in one place. On the other hand, ones park logo and symbolic in MacDonalds is worth it.For Global StrategyIn spite of the fact, that McDonalds has great expansion opportunities, it is essential for the company to reme mber about its forcefulness and to prevent brand dilution by means of concentrating on traditional American fast-food menu and including no more then 30% of specific dishes. Talking about the companys pros, it is essential to continue developing and improving marketing campaign towards children and adults in foreign countries. In addition, such fresh ideas as creating vegetarian restaurants should be adopted in more countries in order to give customers alternative choice. Moreover.It would be a great idea to install Internet access terminals in each restaurants in order to reduce the amount of lag time between a customers orders and pick up of the order. This will show the innovative company level and improve its brand image for customers.ConclusionIn the conclusion it is worth mentioning that the best prove of fantastic effectiveness of McDonalds strategy is the fact that its competitors trying to copy its standards and processes to become more competitive at the market where McDo nalds still remains the leader.View as multi-pages