...Thanks to Jim Skinner’s no-nonsense leadership, the global restaurant juggernaut is doing better than ever. Luckily for McDonald’s, Skinner is an operations whiz who has turned the restaurant giant into a well-oiled machine, insisting on planning and accountability throughout the company. Skinner isn’t a micromanager. He’s simply intensely focused on the efficiency and performance of McDonald’s MCD 0.68% 33,000 restaurants worldwide and the enormous, complex infrastructure that supports them, a managerial trait that has resulted in nothing short of a Golden Age for the Golden Arches. Since Skinner, 66, became CEO in 2004, the company has delivered an annual growth rate of 5%, with revenue topping $24 billion last year. Same-store sales, a closely watched industry metric, have climbed each of the seven years of his tenure, and in that time the stock has returned more than 250% — even after the early-August equities selloff — vs. 16% for the S&P 500 (SPX). [Click here to read our 2005 story about how McDonald’s got CEO succession right.] If you haven’t been in a McDonald’s lately, you might assume that the company simply has been the beneficiary of the struggling economy in the U.S. and elsewhere in the world, and that cost-conscious consumers are flocking to fast-food eateries instead of sit-down restaurants. But to post the kind of impressive numbers McDonald’s has — and to weather the current turmoil — Skinner has had to find ways to attract new diners while retaining the hard-core...
Words: 2368 - Pages: 10
...GLOBALIZATION Globalization is a term that is constantly being referred to when discussing the current market. What does it really mean? Definition: The process of making world economy dominated by capitalist model ( World System Theory By I.Wallerstein) | Joseph chin (2006) stated that globalization is all about increasing the links amongst organizations around the world to the mutual benefit of all concerned. This involves shrinking space, shrinking time and disappearance of boarders. The idea of globalization may be simplified by identifying several key characteristics that are improved transportation and communication technologies, loosened regulations on financial institutions, increased demand for imported goods, and lowered international trade barriers. Joseph (2006) stated With record harvests being in developed countries it is somewhat easier to enter because they usually have fully development communication, distrubution,and transportation systems to name but a few facilities factors. Most successful global business are aggressively building their global strategies around, common technology used in many markets particularly in areas of information technology, when they high cost of research and development that must be recovered through sales in many countries. BACKGROUND OF THE COMPANY McDonald’s is one of the top restaurant chains in the world, touching the lives of people every day. The long journey of the burger brand started...
Words: 2925 - Pages: 12
...2 McDonalds’ Introduction 3 Globalisation and McDonald’s 3 Globalisation strategy of McDonald 5 1. Think Globally but Act Locally 7 2. Pricing 8 3. Advertising/Promotional strategies 8 4. Social responsibility 9 Challenges for McDonald 10 Conclusion 11 Reference 12 The Impact of Globalisation on Multinational Companies Introduction Globalization is a term used to describe the trend of growth; trade practices between undertakings perform beyond the geographic and economic boundaries, so that they exist (Waters, 2001 Brinkman, Brinkman, 2002). Globalization is used to describe the nature of the dominant international trade and business, as they are no longer limited to serving specific groups of consumers in the country (Levy, Hammond and Gross, 2003), the globalization of the increase is due to the expansion of economic and capitalist drive to achieve growth, and taking existing resources , improve the degree of efficiency of the operation. Thus, globalization is also very closely related to the outsourcing companies seeking to existing units, the production moved to another country, economically sensitive wage labour. A typical example of this is the first McDonald's in 1955 as a company in California, opened in 2013, is now in 195 countries and has more than 30,000 restaurants. This process, because it is difficult to control, some multinational companies responsible for the operation of globalization, it is obvious that there are a variety tasking do...
Words: 3182 - Pages: 13
...The functions of management are planning, organizing, leading, and controlling. With globalization, technology and innovation companies must continue to stretch their imaginations to reach greater heights. Even though companies need to make continuing changes, both internal and external customers assist in the company’s overall success. Tami Scurti - Globalization In 1940 in the city of San Bernardino California the first McDonalds hamburger was served. Today there are more than 33,000 McDonalds in 118 counties (about McDonalds, 2011). To take this operation from a tiny bar-b-que drive up, complete with car hop service to the conglomerate it is today, is the essence of globalization. McDonalds restaurant is aggressively globalizing. One of the reasons they are so successful is their ability to create new foods for the market in which they are serving. In India one may order a McSpicy Paneer. A Paneer burger is vegetarian and made of curd cheese, and a very popular item. In Japan one may order a seaweed burger. Occasionally in France one can purchase a rabbit burger and wash it down with wine. Another reason for the success of McDonalds globalization is that they do not try to bring the American McDonalds to each country they bring McDonalds into the country for instance serving wine in France, standing up and eating in Japan (Lubin, 2011). A manager in charge of globalization has to use strategic planning, or planning for the future, yet also must use operational...
Words: 1619 - Pages: 7
...Globalization and Organization Behavior Globalization is something that affects us all from our clothes, to our food, and shoes. It has changed the world permanently, for both better and worse. The word Globalization has had numerous meanings throughout history; it was also acknowledged at one point in 1930 as an interpretation of human experience (“Oxford English Dictionary”, 2010). There have been disagreement by scholars with the roots of globalization for some time; however, critics claimed that globalization was created in the modern era as some scholars believe that the origin can be followed through a history of events. A perfect illustration of this is the economist Andre Frank, who asserted that there were traces of globalization in the third millennium B.C. during the imperialist age. Other scholars dispute that there were globalization economies that occur throughout the Hellenistic Era and Islamic Golden Age (Moore & Lewis, 2009). It is believed, by economists, that the spread of the Greek culture in the Hellenistic Era was an early practice of economic globalization. Globalization was influenced by culture with a diversity of food that was found in many different areas. The Jews and Muslims resulted in the globalization of crops, trade, knowledge, and technology in the Islamic Golden Age. Then, Christopher Columbus, in the Age of Discovery, discovered the New World in 1492 and a globalization of trade of gold, spices, and timber were all traded between Africa...
Words: 2271 - Pages: 10
...GLT-1 Effects of Globalization on Native Non-Western Cultural Practices Globalization is defined as the “process by which the experience of everyday life, marked by the diffusion of commodities and ideas, is becoming standardized around the world” (Concise Encyclopedia online). One example of the effect of globalization on the non-Western world can be seen in the expansion of Coca-Cola from a small soda company that was served in local pharmacies and soda fountains to a multi-billion dollar empire. Coca-Cola was developed by a pharmacist named John Pemberton in Atlanta, Georgia. “During 1886, Coca Cola's first year, sales averaged a modest nine drinks per day…[today] more than 70 percent of their income comes from outside the U.S., making the Coca-Cola Company a truly global company” (http://www.ideafinder.com/history/inventions/cocacola.htm) McDonald’s is another example of globalization on the non-Western world. Dick and Mac McDonald opened the first McDonald’s Bar-B-Q restaurant in San Bernadino, California in 1940. The brothers eventually restructured their menu to a variety of burgers, French fries, and milkshakes and by 1965 they had 700 restaurants across the United States. In 1967, the first international McDonald’s opened in Canada and Puerto Rico. The company continued to grow. By the end of 1983, there were 7,778 McDonald’s restaurants in 32 countries around the world. The company’s popularity continued to spread. On January 31, 1990...
Words: 279 - Pages: 2
...Many have argued that the U.S. popular culture is at the forefront of globalization, so much so that globalization can largely be viewed as the spread of American culture. Globalization by definition is generally used to describe the way the transportation, communication, technology, and cultural change have facilitated the movement of materials, goods, and ideas across continents and national borders (Johnson, p. 501). McDonald’s, for instance, is the largest fast food chain in the world that offers a wide range of products to its customers. Among them are hamburgers, milkshakes, coffee, and many more. However, in some countries, McDonald’s serve culturally different menus (Johnson, p. 269). For example, McDonald’s is offering rice in Hong Kong, and beer in Germany. After all, the majority of their outlets outside the United States are franchises. This illustrates the effect of McDonald’s on the global environment. Consider the following question: Does an item's history and origin make it inevitably American? According to Johnson (2014), some people examining the international music scene claim that cultural globalization has brought new possibilities of pleasing everyone. She continues to state that music critics say the American music industry is fueling healthy competition, encouraging musicians and performers to create more innovative mixed expressions of their own national cultures. Culture encompasses various aspects of communication, beliefs...
Words: 479 - Pages: 2
...are strategic management, democratic leadership skills, human resources management, ethics management and 1.1 Strategic Management One of the management actions that have contributed to the success of McDonalds will be their strategic plan which called ‘plan to win’. The idea of this plan not only for them to be the biggest fast food restaurant chain but to be the best fast food restaurant chain. McDonald implement this plan by analyzing the 4 P’s which are product, price, promotion and place. Product is the features, quality and quantity of product or services offered by McDonalds to its customers, such as packaging, desirability, looks etc. According to A.Linbranza, McDonald’s first entered India in 1996 which doesn’t really fit their representative kind of market. To apply the mentioned strategy, McDonald’s adopted product localization and innovation skill, as they...
Words: 5535 - Pages: 23
...1-18. McDonald’s global marketing stagey is based on both of global and local marketing. Which is marketing mix element called glocalization by using 4Ps (product, price, promotion, and place marketing mix). McDonald’s business model that can set up everywhere in the world by franchisees and commitment to communities. In additions, McDonald’s provides three important thing to customer: inexpensive food with consistent taste regardless of location, quick service, and clean environment by promising and delivering. Aside from these things, standardization can be seen from McDonald’s appearance --- their trademark logo (Golden Arches). In terms of globalization, McDonald’s offer core menu items like hamburgers, French fries and soft drinks. Which are standardized products in the same way everywhere. McDonald’s is doing the “Think Globally, Act Locally” strategy for some of their marketing activities. An example of this is the company’s slogan. McDonald’s standardized the “I’m lovin’ it” and then adapted it to different languages based on the location. Another example is that while McDonald’s offers the same menu across the world, the food ingredients are produced locally or are coming from local sources. By this way, McDonald’s can minimize costs and also cater to customers’ desires. As Ken Koziol, the vice president for worldwide restaurant innovation said “McDonald’s built on a strong foundation of a core menu that we took around the world but we need to make sure...
Words: 720 - Pages: 3
...Johanna Christine Swierzy – Student ID 504072 CASE 1-2: McDonald’s Expands Globally While Adjusting Its Local Recipe Overview. Today, McDonald’s golden arches are one of the most recognized symbols in the world, just behind the Olympic rings. While growth within the U.S. has slowed, the picture outside the U.S. has appeared brighter, until recently. However, globally, taste profiles and consumer desires are changing. McDonald’s has responded to these changes by altering their basic products (when necessary) to fit the requirements of the local markets. While not always successful, it has proven to be a winning strategy. 1. Identify the key elements in McDonald’s global marketing strategy (GMS). In particular, how does McDonald’s approach the issue of standardization? The status of American-style hamburgers, fries, and soft drinks is already very popular in the whole world. In many locations, the menu adapt the customs and tastes of individual countries. McDonald’s offers an ultimate example of “global localization.” The key elements in McDonald’s marketing strategies are - inexpensive food - good taste - easily available for everyone - quick service - attend and serve the customer as fast as possible instant and receptive satisfaction from the customer. - clean, familiar environment. One of their major global marketing strategies is that they adapt their food to each region, but doing it in a way that they keep selling and offering the same product in a way people from...
Words: 659 - Pages: 3
...Current Strategy Evaluation Current Strategy McDonald’s current strategy of “being better, not just bigger” involves delivering locally-relevant restaurant experiences, improving existing restaurants, and create new products that meet the changing needs of its customers. This strategy works towards increasing sales and guests counts while optimizing operations to increase profitability. Much of McDonald’s strategy involves promoting new and classic menu items such as the Big Mac, McCafé and Snack Wraps while delivering the best food experience possible. The company also feels that it can grow sales with maintaining and expanding its dollar menu so that more affordable items are available. Furthermore, the company provides locally preferred menu items so that it doesn’t alienate itself from its communities (example: Restaurants in Hawaii offer pineapple instead of fries). Combined with convenient locations, optimized drive through service and longer store hours these factors should provide exceptional restaurant experiences. The company has also allocated $2.1B towards restaurant improvements for 2009 to modernize its operations. These funds are also to help continue its specialty coffee and beverage expansion. This investment is done with the expectation of serving more customers at a faster pace (including drive-thru) as well as being able to provide its new McCafé drinks and future specialty drinks. These improvements should add to customer experience and improve...
Words: 3336 - Pages: 14
...people. Based upon this DVD, I tend to see it from a Marxist perspective because it talks about how the rich people are getting richer at expense of poor people that are getting poorer, “the class struggle”. Personally y agree with the Video, and my position is against globalization, but I can’t be 100% in opposition because there are some points that make it positive; for this reason, I will explain what are the pros and the cons of globalization from my opinion. One positive side of globalization is that it promotes global economic growth, creates jobs, makes companies more competitive and lowers prices for the consumer; thus, countries can balance their inflation. Also, there is a worldwide market for the consumers that can access to products from different countries without live their houses. In addition, with the advance of technology the world is more integrated, and there is more influx of communication between countries. For example, with Skype we can communicate across countries with our family and friends; even more, we can make conference calls with people located in different countries. Also, mass communications and quick dissemination of information through the Internet are benefits of globalization....
Words: 1647 - Pages: 7
...Globalization is the system of interaction among the countries of the world in order to develop the global economy. In a Global market different nations work together in a single market and do international trade. Globalization refers to the integration of economics and societies all over the world. Globalization involves technological, economic, political, and cultural exchanges made possible largely by advances in communication, transportation, and infrastructure. In other words, it is an elimination of barriers to trade, communication, and cultural exchange. The main theory behind globalization is that worldwide openness will promote the economic wealth of all nations. As every coin has two sides likewise some people think that globalization is beneficial for an economy and some of them think that it increases the interference of developed countries in underdeveloped nations and affect the decision making and growth of underdeveloped countries. Arguments against Globalization: 1. In Globalization countries do business in a single large market that could lead to few dangers. Earlier, if any nation is not able to do well financially or made some mistakes, that specific country used to bear the losses. However, in today’s Global economy where different countries are doing business in a same single market, if one nation is not able to do well all other countries’ economies also gets affected. For instance, we have seen that due to financial downturn in American economy...
Words: 1042 - Pages: 5
...accrue as organisations become bigger and expand their activities. For McDonald’s, economies of scale allow for bulk purchase of products with a high volume turnover, research at a national level, faster growth and specialised management and franchise support. McDonald's economies of scale benefit the company in various ways in its international endeavours including: the fact that its uniform menu offerings can be mass produced, lowering production costs; the company's bargaining power with its suppliers lowers its input costs and boosts margins; the company's large advertising budget gives McDonald's a significant competitive advantage over its competitors. http://www.gurufocus.com/news/167949/mcdonalds-still-strong-despite-headwinds Most importantly McDonald’s enormous purchasing power and economies of scale have allowed for the company to achieve a very low cost of goods sold. T The firm enjoys economies-of-scale advantages over its rivals in marketing and purchasing, helping it achieve superior returns. The average MCD restaurant in the U.S. had sales of $2.0 million in 2007, versus $1.2 million at Burger King and $1.3 million at Wendy’s http://www.checkcapital.com/research_reports/mcd_1109.pdf Since McDonald’s does not directly manufacture any of the materials associated with its operations the company continually seeks a stronger relationship with its suppliers. Most importantly McDonald’s enormous purchasing power and economies of scale have allowed for the...
Words: 495 - Pages: 2
...How does globalization influence health and lifestyle? 2012/7/26 Traditionally, globalization is welcome in a host of countries for the reason that it can increase international trade and fuel the local economic growth. Yet, a growing number of people nowadays are beginning to be concerned that transitions brought by globalization could make a negative effect on their local lifestyle and health. Widespread and overwhelming, globalization plays a vital role in people’s life. From my own perspective, health and cultural problems are the two essential issues that triggered by globalization. Admittedly, globalization reinforces cultural exchange and transmission. Nonetheless, it can undermine the local cultural identity as well. Especially, the spread of American corporation all over the world has visible and variable consequence on local culture, such as fast food chains. It is well known that food not only represents an aspect of local culture but also reveals the habits and traditions in society. For example (Cited in Source Work, 2012, p.179), the French unique cuisine reflects their culture, which makes the French feel more proud. Because of their sense of pride, quite a few French people have started to be concerned that the U.S. fast food chains would crowd out their own products. Besides food products, restaurant chains can influence both eating habits and traditions. For instance (Cited in Source Work, 2012, p.179), Starbucks, in Italy, gives rise to widely cultural...
Words: 816 - Pages: 4
