Mcdonalds Case Analysis

Mcdonalds Business Analysis
'In the 1990s managers will be judged on their ability to identify, cultivate, and exploit the core competencies that make growth possible - indeed, they'll have to rethink the concept of the corporation it self.'

C K Prahalad and G Hamel 1990
McDonalds has been well known since 1940 as the standard for ultra convenient family friendly meals. According to the company’s website, the fist restaurant opened in San Bernardino, California as a barbeque restaurant but eight years later Dick and Mac McDonald restyled the restaurant and streamlined the menu to nine convenient items including their famous 15 cent hamburger. In 1954, a mixer salesman saw potential in the business and opened the first McDonalds franchise in Des Plaines, Illinois. In four short years the chain had grown to at least 100 restaurants. Today, McDonalds is an international corporation with stores in as many as 100 different countries.

Organizations do not exist in vacuum. They operate within a competitive industrial environment. Analyzing its competitors not only enables an organization to identify its own strengths and weaknesses but also help to identify opportunities for and threats to the organization from its industrial environment. SWOT analysis is a systematic analysis of these factors and the strategy that reflects the best match between them.

Let us analyze these principals in relation to the core competence of McDonalds, one of the largest food chain companies in the world. Let us first start with the strengths and the positive aspects which define the performance of this company. How can we define the company’s strengths? Strength is a distinctive competence that gives the firm a comparative advantage in the market place. For instance financial resources, image, market leadership and buyer supplier relations etc
McDonalds is the no: 1 fast food chain stores with a 40 million customers visiting it per day. It has over 30,000 branches in 120 countries. It derives 80% of its revenues from eight countries like Canada, Brazil, Germany, France, Japan, UK, Australia and US. The greatest strength was creating an image in the minds of the people and introducing them to the fast food culture. Delivery speed, customer care and cleanliness are the core strengths on which these stores expanded. They created a corporate symbol and their advertisement campaigns were highly successful in establishing the brand image and logo in the minds of the millions. Two mainSTRENGTHS: McDonalds has a large market share, strong brand name, image and reputation. CEO Jim Skinner and the previous CEO James Cantalupo quickly and efficiently enacted a strategy that allowed the company to recover from its first loss ever in 2003. (Dess, 2007) The “Plan to Win” strategy focuses on people, place, price and... competitors generally identified with McDonalds are the Burger King and the KFC. McDonalds marketing strategy is concerned with the internal resources, external environment and its basic...