Name complet : Alain-Bernard MWAKA NGUMA

Student number : 22206447

Group : 1
The 21th of November 2022
Health Care Organizations Management Master

MCDONALD’S CORPORATION
Introduction
McDonald's is the world's largest restaurant chain by revenue, serving over 69 million
customers daily in over 100 countries in more than 40,000 outlets as of 2021. McDonald's is
best known for its hamburgers, cheeseburgers and french fries, although their menus include
other items like chicken, fish, fruit, and salads, etc.
1) WHAT IS MCDONALD’S MICROENVIRONMENT ?
I. The company (Macdonald’s)

1. Vision :

Is To be the best and leading fast food provider around the globe.

2. Mission statement

McDonald’s vision is to be the world’s best quick service restaurant experience. Being the
best means providing outstanding quality, service, value, and cleanliness so that they make
every customer in every restaurant not only smile but olso satisfy”.

3. Operations and business strategy

In McDonald's the business strategy for the company is to make food fast available to its
customers at a very low competitive price but to get profit as well by reducing the cost of the
product and expanding the business world wide. Operation management strategies in
McDonald's are being made by top management. These strategies are implemented in all the
branches of the McDonald's and these strategies are distributed to all its franchise branches in
the written form. McDonald's has adopted a strategy which is based on the three sections,
emphasizig on the customer importance and customers satisfaction and it has developed new
ideas to improve the operational activities of the business by increased using the information
technology. With the introduction of stock control data base system, it avoids unnecessary
ordering, keep the stock up to date in store. It has become very easy and time saving now to
order the stock.

 Reducing cost with more efficient equipment

Macdonald’s is using new equipement that are more energy efficient and gives better taste while
improving the crew efficiency and using less cooking oil to improve is service. The low down
oil quantity Fryer is the next age band fryer that improves cooking efficiency, simplifies
filtering and cleaning and provide enhanced environmental benefits. It olso allows restaurants
to roast the same sum of produce with in the region of 40% smaller amount oil. It in addition
uses more or less 4 % a lesser amount of liveliness than average fryers.

In reducing the cost of its operations McDonald's uses fluorescent low consumption lighting in
the kitchen. Tests revealed that each restaurant saves 11,000kWh of electricity each year.
Packaging plays an important role of McDonald brand not only for quality, integrity and safety
but also in its visibility to our customers.
McDonald's provides everything to its staff they required to do the the job efficiently and
according to health and safety methods and its employee work efficiently but with limited
resources but It helps the McDonald to get more productivity and get more revenue and improve
its services.

4. Humains resources

As McDonald’s Executive Vice President and Global Chief People Officer, Heidi
Capozzi oversees the company’s human resources operations around the world. In this role she
will lead Corporate Employee Relations, Diversity and Inclusion, Total Rewards and Talent
Management among other areas. In McDonald’s, HR planning is a starting point of ‘Personal
Management Action Program’. This program is usually expected when the need is to create
balance between supply and demand and through this it organizes a structure in which actions
are to be taken that are required to reduce staffing difficulties. It uses two models mainly for
forecasting : Transaction Court Per man Hour and Sales per Man Hour.

 Recruiting suitable applicants : McDonald’s usually advertises positions (job levels

in the organization) in the restraints. There are two types of recruitment. McDonald’s
corporation fills its positions by in Internal sources and in External sources :

A. Internal sources : The best source for filling the open positions are current
employees working within the organisation. Job positioning technique helps Mc
Donald’s to publicize and open job to its current employees and listing the job’
attributes like qualification, work schedule and pay rates.
B. External sources : Eternal sources used by McDonald’s are : Adverts in
Newspapers, on Web Site such as yahoo, MSN etc .and also vacancies are
defined in detail manner on mcDonald’s official website.

 Selection : From the pool of candidate’s applications short listing is done in which
applicants which are eligible are short listed. This is done by HR managers. They use
olso Written Test which aim is to know whether the recruits are able enough to meet
with the general practical requirements of the job. They procede to Initial Interview
conducted by restaurant Manager to every candidate who have passed written test.
Finally the final interview is done, conducted by five or six interviewers

 Training and development : Well trained crew, managers and employees are required
to achieve the standards like quality, service and cleanliness that are provided to
customers in mc Donald’s. Training process is highly structured. At every level training
is provided to employees they are trained to work on both floor to back area. It is based
on company’s core principles:-Quality and Service cleanliness
Training
Welcome meetings:-these lectures set out the company’s standards and expectations for the
new employees.

On the job training: – Mostly training is floor based. All new employees have an initial
training period. Basics are shown to employees and they can develop there skills.

Job rotation: – Job rotation is the job training process. This is to make employees familiar with
all levels of job and within different departments.
Audio _visual based training: – for the new trainees Mc Donald’s provide with DVDs, films,
video or audio tapes related to the operational or functional work of the organization.

Evaluation of training: – Mc Donald’s evaluate its training program through on the job
behavior that after the training session the behavior of employees are changed or not.

Performance appraisal
Performance appraisal is used to evaluate the performence leval of each employee. McDonalds
do performence review twice a year. Each and every employee have to do his or her job
according to some standards and rules which are clearly defined within an organisation during
the selection process , then after 6 months every employee is evaluated and checked whether
he or she is working according to standards defined to them for this OJE (on job evaluation)
performed by McDonalds ; and if employees need improvement they can do it after going
through feedback provied as results to them.

Objectives of Training and development in mc Donald’s is :

 To determine the exact needs of the job position/employees.
 To make the employees able to match with the current standards
 To develop the most effective training materials.
 To deliver the training materials with the most effective methods.
 To create the most effective impact on the results/behaviours.

 Top Manager

Chris Kempczinski is the President and CEO of McDonald’s U.S, who is leading as well as
other. Executive team members who continue to build it legacy and ensure it Golden
Arches shine bright. According to a statement by Enrique Hernandez, chairman of McDonald’s
board, Chris is instrumental in the development of McDonald’s strategic plan and oversaw the
most comprehensive transformation of the US business in McDonald’s history.

 Finances

Spero Droulias Senior Vice President and Chief Financial Officer, McDonald’s USA and as
Senior Vice President and Chief Financial Officer of McDonald’s USA, he is leading the U.S.
Finance and Business Insights organizations supporting McDonald’s 14,000 U.S. restaurants.
Each location earns an average of $2.7 million per year, according to QSR data from 2018.

McDonald's annual net income history and growth rate can be defined as company's net profit
or loss after all revenues. From 2010 to 2022, income items and expenses have been accounted.
For McDonald's, annual net income for 2019 was $6.025B, a 1.71% increase from 2018, for
2020 was $4.731B, a 21.49% decline from 2019, annual net income for 2021 was $7.545B,
a 59.5% increase.

 Research and development

McDonald’s spends a lot on research and development. In fact, it spends more on research and
development than any other fast food restaurant. This is because McDonald’s is constantly
trying to improve its products and services. For example, McDonald’s recently in 2018 they
invested $6 million in a new research and development center in Chicago. In 2017, McDonald’s
spent $633 million on research and development, which was 1.5% of their total revenue for the
year in research towards new product development and improving existing products, in
restaurant design and technology also, as well as packaging and advertising.

McDonald’s is increasing its team by hiring engineers, data scientists, and other technical
specialists. McDonald’s has creat new Tech Labs campus that serve as the center of its new
technology empire. Food and paper costs, payroll taxes, employee benefits, and occupancy
costs accounted for the highest percentage of the company’s operating expenses. McDonald’s
is best known for its research and development centers in Chicago, Illinois.

II. Suppliers
McDonald’s has an important relationship with his suppliers to ensure a continuous, good and
no disruption supply. McDonald’s has builded a strong relationship with the suppliers to
competing with other fast food operator. He care about where his food comes from and that’s
why he use responsibly grown ingredients from the McDonald’s community of farmers. These
are supply chain of Mcdonald’s :

 Lopez Foods, Keystone Foods and Kenny Longaker : Beef, meat & Fish Supplier -
Lopez Foods provides McDonald’s U.S. Supply Chain with USDA-inspected beef used
to make the patties served in restaurants, Keystone Foods provides many ingredients,
like some of the chicken for the Chicken McNuggets. Kenny casts a wide net to bring
the best of the sea to McDonald’s.

 Frank Martinez, Jenn Bunger and 100 Circle Farms, Potato Farmer :
Frank’s Russet Burbank potatoes are used to make World Famous Fries. Jenn works
alongside her family to harvest quality potatoes. 100 Circle Farms assesses quality based
on the potatoes’ uniformity.

 Mike Dietrich, Dirk Giannini an Apple Farmer and Lettuce Farmer,

Mike’s family-owned orchard hand-picks apples at their peak of ripeness. Dirk’s family
farm offers a variety of lettuce from tender to spicy

 A Coffee Supplier, Gaviña Gourmet Coffee

Gaviña Gourmet Coffee is expertly made by a master-blender before it arrives in your
McCafé beverage.

 Hildebrandt Farms and Milking R Dairy Supplier,

Hildebrandt Farms provides wholesome milk at McDonald’s locations throughout
Illinois and Wisconsin. Milking R Dairy provides milk for soft serve ice cream in
McDonald’s locations across the state of Florida.
III. Marketing Intermediaries
As we know, McDonald’s is franchise-around the world. Actually franchise system is the part
of marketing intermediaries that help McDonald’s to popularize, distribute and expand the
market around the world. So it choose credible franchise to insure their business performance.

McDonald's in the UK use Leo Burnett for their advertising. They also work with TMS and
Armadillo for certain advertising campaigns. All agencies go through a tendering process to
become a supplier to McDonald's. They are putting their current U.S. advertising relationships
with Omnicom’s DDB and Publicis’ Leo Burnett under review.
McDonald also needs physical distribution firms that help in distribution and transportation of
materials and goods around the country to its restaurant.

Financial intermediaries are important to McDonald’s because it to ensure financial

transaction, assistance and insurance coverage for the McDonald’s business to operate
normally.

a. Marketing Segmentation of McDonald’s

 Customers Behavioural
Behavioural segmentation dividing consumer based on their attitudes. McDonald’s open in 24
hours, for they who working until late night or they who are not sleeping at night, McDonalds
use this service to feed them because not every restaurant are open 24 hours especially middle
of the night ;

 Customers Social Psychographic

McDonald’s targeted to various social class which are lower-middle and upper-middle. For
example the Mac value which are cheaper and more convenience give for the lower-middle
class enjoy their meal. The Big value meal which is quite expensive can be purchase by the
upper-middle

 Customers Demographic
Malaysia are consider a Muslim country where by pork are not available for selling in
McDonald’s according to Muslim’s dietary laws, chicken and beef are only available in
Malaysia like McChicken, Big Mac, Big N’ tasty and so on. The “hamburger” is called as beef
burger to avoiding the word “ham” in our country.

b. Targeting

 Differentiated Marketing
McDonald’s using differentiated marketing strategy, targeting in several segments and separate
offers for each. McDonald’s always introduce the new low-priced products with the same
quality and service for the middle-class income groups of people.. Beside target for high-class
income of people, McDonald’s wants to earn their profit from the middle-class income of
people too.

 Concentrated Marketing
McDonald’s concentrated marketing effort on a segment, MacValue, develop services that
caters for the needs of particular groups for example MacValue is a promotion where every
single days for lunch time and dinner time that is 1pm – 3pm and 6pm-9pm during what all the
meals are discount about 30% for every set of meal.

 Local Marketing
Malaysia is a Muslim country, the culture of Muslim is very important in Malaysia even in
food. Pork are not available in Malaysia, therefore, pork burger are not selling in Malaysia
McDonald’s and instead by beef burger. All the chicken and beef should be slaughter with
Halal’s method. Besides that.
  Positioning
The value proposition used McDonald’s is more for the same. McDonald’s stands for
friendliness, cleanliness, consistency, and convenience as introduced by Ray Kroc. McDonald’s
provide a good environment for consumer to having their meal. The design for the McDonald’s
branches is nice and beautiful. Also Wi-Fi is provided for every branches of McDonald’s as
well for consumers to social in network or work. Besides that, the drinks provide by
McDonald’s are free for re-fill like coke, coffee and tea. It is friendly consumers.

 Product
McDonald’s product is convenience products, because they are consumer’s products and
services that customers usually buy frequently, immediately, and with a minimum of
comparison and buying effort. Inside of favourite item length got McChicken, Spicy Chicken
McDeluxe, Chicken McNuggets, Ayam Goreng McD (Regular/Spicy), Filet-O-Fish, Double
Cheeseburger, Quarter Pounder with Cheese, Big N’Tasty, Cheeseburger, Beefburger, Chicken
Burger, Bubur Ayam McD. This all favourite food is for any time per day. It offers 24 Hour
service for people except those in shopping centre.

 Place
Fast food is the sign of McDonald’s, for customers to receive the product and service including
resources is the part of customer buy. A place that meet customer must be near of customers.The
common place chosen by McDonald’s is downtown area. The downtown area was selected
because it can target more consumers. Place decision is related to channels that not just about
the physical place. It also involves in the management of bringing product to target consumers.

IV. Customer

McDonald's is the largest family restaurant in the world, serving approximately 69

million customers across 36,000 restaurants a day in the worldwide, in more than 100
countries. The UK & Ireland market is one of the most successful entities across the wider
business with 3.5 million customers in the UK, serving not less than an average of 4 million
people a day. (McDonald’s, 2022).

Customer that weather is household or individual buyer also is important in microenvironment’s

McDonald’s, more household consumer because McDonald’s have a clear market
segmentation that differentiate the consumer in group such as adult, workers and teenager
with different type and size/portion of food. Every customer has the potential of affecting the
company, hence McDonald’s needs to influence its customer using various types of media such
as advertisement.

V. Competitors

McDonald’s have many competitors in Malaysia such as KFC, MarryBrown, burgger king and
so on. There are competitors of McDonald’s, which McDonald’s must provide differentiation
in term of value and satisfaction than its competitors. McDonald’s invest more in understanding
customer needs and want so that he could increase his position in domestic market and in the
global market.
For that, McDonald’s differentiate from its competitors through its store quality, offering an
expanded range of product of increased perceived value and its marketing. Furthermore,
customer preferences have been addressed through an increase in salad offerings reduced fat
offerings, and expansion of wireless internet access.

McDonald’s is an industry leader in the fast food industry. Its key competitive advantages have
included nutrition, convenience, affordability, innovation, quality, hygiene, and value
added services.

2) WHAT THE MACRO ENVIRONMENT OF MCDONALD’S CORPORATION ?

Demographic Factors : of McDonald’s includes features such as age, gender, race,
occupation and density of people. So the McDonald’s introduced their products in the field that
products can be accepted by the customers. They also study the purchasing power patterns of
people according to their age’s level. A study conducted on mcdonald’s restaurant found that
the age group visiting McDonalds the most are the young people between the ages of 18 to 25
years. This particular ages of customer is 45 % of the percentage of all customer and this
particular age group are students and normally work part time.

The second highest consumers are having from 26 to 35 years representing 33 % of all. This
age group consumers often visits McDonalds as couples like husband wife, girl friend and boy
friends, family with and without kids. Only 16% of third age group (ages 36 to 40) visits
McDonalds. The consumers in this particular age group are more inclined towards healthy
eating habits. The frequency of customers visiting McDonalds more than 40 years is only 6 %.
The customers in this particular category are more health conscious.

Economics Factors : Economic factors that McDonald's Corporation considers while

conducting its analysis are :type of economic system in countries of operation – what type of
economic system there is and how stable it is, Government intervention in the free market and
related services, exchange rates & stability of host country currency, efficiency of financial
markets. Does McDonald's Corporation needs to raise capital in local market? Infrastructure
quality in Restaurants industry, comparative advantages of host country and services sector in
the particular country, inflation rate, Interest rates, unemployment rate, discretionary income,
economic growth rate, skill level of workforce in restaurants industry, education level in the
economy.
The Macro environment factors such as inflation rate, savings rate, interest rate, foreign
exchange rate and economic cycle determine the aggregate demand and aggregate investment
in an economy. While micro environment factors such as competition norms impact the
competitive advantage of the firm. McDonald's Corporation use country’s economic factor such
as growth rate, inflation & industry’s economic indicators such as Restaurants industry growth
rate, consumer spending etc to forecast the growth trajectory of not only sectoryname sector
but also that of his entire organization.

Naturals Factors : Before entering new markets or starting a new business in existing market
Macdonald’s carefully evaluate naturals environmental standards that are required to operate in
those markets. Exemples : Weather, Climate change, Laws regulating environment pollution,
air and water pollution regulations in restaurants industry, Recycling, Waste management in
Services sector, Attitudes toward “green” or ecological products, Endangered species, Attitudes
toward and support for renewable energy. Different markets have different norms or
environmental standards which can impact the profitability of an organization in those markets.
Even within a country often states can have different environmental laws and liability laws.

Technologicals factors : Technology analysis involves understanding the following impacts :

McDonald's examine Recent technological developments by Corporation competito,
Technology's impact on product offering, Impact on cost structure in restaurants industry,
Impact on value chain structure in Services sector, rate of technological diffusion. Technology
is fast disrupting various industries across the board. Transportation industry is a good case to
illustrate this point. Over the last 5 years the industry has been transforming really fast, not even
giving chance to the established players to cope with the changes. A firm should analysis the
speed at which technology disrupts that industry. Slow speed will give more time while fast
speed of technological disruption may give a firm little time to cope and be profitable.

Politic factors : McDonald's Corporation closely analyze the factors before entering or
investing in a certain market exemple : political stability and importance of restaurants sector
in the country's economy, risk of military invasion, level of corruption, especially levels of
regulation in services sector, bureaucracy and interference in restaurants industry by
government, are there any pricing regulatory mechanism for services, taxation - tax rates and
incentives legal, trade regulations and tariffs related to services and many others requirements
in restaurants . Political factors play a significant role in determining the factors that can impact
McDonald's Corporation's long term profitability in a certain country or market. McDonald's
Corporation is exposed to different types of political environment and political system risks.
To achieve success in such a dynamic restaurants industry across various countries ask to
diversify the systematic risks of political environment.

Socials factors : Society’s culture and way of doing things impact the culture of an organization
in an environment. Shared beliefs and attitudes of the population play a great role in how
marketers at McDonald's Corporation will understand the customers of a given market and how
they design the marketing message for Restaurants industry consumers. Social factors that
McDonald's Corporation analyze analysis before entying a market are : Demographics and skill
level of the population, Class structure, hierarchy and power structure in the society ; Education
level as well as education standard in the McDonald's Corporation ’s industry ; Culture (gender
roles, social conventions etc.) ; Entrepreneurial spirit and broader nature of the society. Some
societies encourage entrepreneurship while some don’t ; Attitudes (health, environmental
consciousness, etc.) ; Leisure interests.

3) SWOT ANALYSIS OF MCDONALD'S

I. McDonald's Strengths
Keys aspects of its business which gives it competitive advantage in the market :
1. McDonald's is a hugely popular brand name and high brand loyalty
2. Variety of products offered by McDonald's including burgers, wraps, nuggets etc
3. Hygenic food preparation and quick service is provided to the customers
4. McDrive Drive-in service for motorists and car owners is an extremely innovative way of
conducting fast food business
4. McDonald's has excellent advertising and marketing which makes it a top of the mind brand
5. Happy meal offered by McDonald's is great attracting children especially with the toys
6. McDonald's is present across the world at more than 38000+ locations in more than 100
countries
7. More than 1.5 million are working with the company, including the franchisees
8. The brand has been actively involved in sponsorships of global events
10. McDonald's has revolutionized the market with local products like McAloo, Tikki for India,
Mc Arabia for Middle eastern countries etc.
II. McDonald's Weaknesses
Here are the weaknesses in the McDonald's corporation :
1. Fast Food menu served at McDonald's is not highly preferred by health conscious people. So
mcdonald should creat a menu of divers bioalimentation to attract olso heath conscious poeple,
2. McDonald's has often been involved in lawsuits regarding environment, animal rights etc. in
today, wold poeple encourage the protection of environment and animal so mcdonald’s should
align itself with this tendance to evoid his competitor improve publicly in this aera and gain the
all customer who are are not agree whith this kind of behivior.
3. The menu is limited for a lot of customers and hence they might lose out on customers. So
mcdonald’s has conduct some reseach to diversify the menu by investigating on food habitude
in different locality of community to stretch the menu in all the restaurant .

III. McDonald's Opportunities

1. McDonald's can improve on the existing home delivery service
2. Get more innovative products for the vegan customers
3. With newer emerging markets, McDonald's can venture into these markets to grow the brand
4. Can introduce more menu items to support the existing items by getting more insight from
diferents customer’s culture all around the world, taking advantage of globalisation.
IV. McDonald's Threats
Some factors like increased competitor activity, changing government policies, alternate
products or services etc. can be threats. :
1. Threat from other eating joints/restaurants, which can reduce McDonalds' market share
2. Health conscious people avoiding fast food
3. Being a global brand, the operations of McDonald's can be affected by recession, fluctuating
economies, pandemic etc.
4. Constant vigilance from food regulatory bodies can affect business operations.
5. Food like burgers have become generic in nature and a lot of options are available in the
market.