McDonald’s Business Strategy

Smile, food and good time

Section 1 : Mission and Vision of McDonald
1. Introduction

Business strategy helps a business to shape an action plan in order to achieve its desired objectives. Implementing the right strategy will help a business to be successful.

1.1 Mission and Vision of McDonald’s

1.1.1 Mission Statement

A mission statement refers to the goal of an organization and the path to achieve those goals. (Bain & Company guide, 2015)

1.1.2 Vision Statement

A vision statement is where a company wants to go in two, five or more years and what it wants to achieve. And it also gives a clear picture to the employees what the company wants to accomplish over a long period of time. (Evans, J, 2010)

For example the vision statement of Microsoft is to empower people and organizations at any moment and on any device to achieve more. (Lawrence, G, 2016)

1.1.3 Mission and Vision of McDonald’s

McDonald’s founded in 1940 is in the fast food restaurant industry. Then, in 1955, it is established as McDonald’s Corporation. The mission statement of McDonald’s is about the strategies of the company and the strategic objectives to develop its activities. As for its vision statement, it guides the company’s strategic decision to stay the leader in the fast food restaurant industry globally. (Meyer, P, 2015)

The mission statement of McDonald’s state that their mission, to be the best place where customers will enjoy eating and drinking, to have a pleasant working environment for their employees and to deliver a service with good quality. (Meyer, P, 2015)

The vision statement of McDonald’s is to be modern, that is to produce what consumers expect and to deliver a contemporary customer service. And to achieve this, they plan on delivering high quality food with great taste and provide a service that can be trusted. (Meyer, P, 2015)

1.1.4 Mission and Vision of Burger King’s

Burger King’s is one biggest competitor of McDonald’s founded in 1953 and operating on a global market.

The vision of Burger King’s is to be the most profitable quick serving restaurant business, to have excelling employees serving burgers around the world through a successful franchise network. And as for their mission, it is to offer food of good quality, a quick service at reasonable prices in a clean and attractive place. (Rowland, C, 2015)

1.2 Goals and Objectives

1.2.1 Organizational Goals

According to Barney and Griffin, organizational goals provide a path to ease planning, to motivate employees and to help a company to evaluate and improve its performance. (Feliciano, D, 2008)

A goal should be SMART, which is specific, measurable, attainable, realistic and timely. Goals are plans to achieve mission and vision.

1.2.2 Organizational Objectives

An objective is a specific activity that a company takes to achieve a goal. (Reh, J, 2016)

1.2.3 Goals and Objectives of McDonald’s

The strategic plan, the plan to win, the goals and objectives of McDonald’s are to have a larger choice in their menus, to increase the accessibility of the brand of McDonald’s and to run better restaurants and to offer the best foods and beverages. (Street Insider, 2013) To develop a strategic plan, an organization has to well identify their missions and visions.

1.2.4 Core Competencies of McDonald’s

Core competencies are what you do the best, your main strengths. The strength of McDonald is that being the number one in the fast food restaurant, they have the skills, the finance and the brand image. They also have a delivery system which is rapid. Moreover, McDonald’s is exposed everywhere, all over the world. Thus, the core competencies of McDonald’s are its delivery service and its brand image.

Section 2 : The core activity of McDonald’s
2.1 The core activity of McDonald’s

The headquarter of McDonald’s is based in Oak Brook, Illinois. They are located in over 100 of countries around the world. McDonald’s is one of the largest fast food restaurants selling hamburgers to millions of customers throughout the globe daily. It’s core activity is the cooking and the sale of fast food.

In the beginning McDonald’s was selling hamburgers, french fries, cheeseburgers, chicken, breakfast items, soft drinks, milkshakes and desserts. But then customers became more health conscious, the company introduced salads, wraps, fruits and smoothies in their menu.

Furthermore, McDonald’s introduced McCafé which lead to an increase in sales. (Fagansusanto, 2012)

For the year 2017, McDonald’s has decided to add two new sizes to the Big Mac, The Grand Mac and the Mac Jr. (Campbell, J, 2016)

2.2 Strategic Planning of McDonald’s

Strategic planning refers to the process of creating a plan of actions for the company to follow so as to achieve competitive advantage. (Evans, J, 2010)

In 2015, the CEO of McDonald’s, Steeve Eastbrook announced that their recent performance has been poor with a sales drop of 2.3% in the first quarter of 2015. (McDonald’s Corporation, 2015)

According to Steeve Esaterbrook, their organization has been doing inefficiently and they need to make better decisions to improve the performance of their business. Moreover, with the franchise system of McDonald’s, employees around the world have been striking for a pay rise and better working conditions. The company needs to take into consideration customers changing taste and that are the only way to stay in the game. (Peterson, H, 2015)

The strategic planning to increase sales and to attract more customers is:

  1. An all-day breakfast menu
  2. Allow customers to build their own burgers
  3. In Japan, they launched an app where customers can complain
  4. Stop using chicken with antibiotics
  5. An effort to help to end deforestation

However, none of these solutions above have led to the main objective of increasing sale. (Kasperkevic, J, 2015)

2.3 Issues in Strategic Planning

The reason for the sales decline of McDonald’s is that firstly, there are many competitors in the fast food restaurant industry. As the sales of McDonald’s were falling in 2014, its competitors, Burger King, Yum Brands’ (YUM) and Wendy’s (WEN) sales were raising. This is because competition is offering better burger and a lot of variety. (Berr, J, 2014)

In Mauritius, the main competitor of McDonald’s is Kentucky Fried Chicken (KFC), which is here since a very long time. There is also Subway, which is very healthy. Moreover there is more KFC in Mauritius than McDonald’s, therefore KFC reach a larger audience than McDonald’s. In addition, with the increase in the rate of obesity and other health problems regarding to the consumption of fast food, many people has switch to healthy food, and as for McDonalds it is synonym of full of fat and unhealthy meals.

The customer service of McDonald’s is very poor, the employee serving foods and drinks are not very friendly, they can be rude and not very professional. One reason is that now, consumer have a lot variety of choice, which can be stressful for the employees. (Munarriz, R, 2014)

Meanwhile, in China, there was a significant drop of sales as they were using beef and chicken that were contaminated and expired. And in Japan, customers have found bits of plastic and a tooth in their food. (C, R, 2015), Japan and China have the more numbers of restaurants, the second place and the third place respectively, the United Stated being the first place where there are more restaurants. This clearly means that a fall in sales in China and Japan due to their lack of hygiene and carefree, McDonald’s losing a large numbers of consumers.

2.4 Planning Techniques of McDonald’s

A way for McDonald’s to avoid issues in its strategic planning is to have a better planning technique so as to better implement its strategy and improve its poor performance.

One technique for strategic planning that can be used is the BCG Matrix. The BCG (Boston Consulting Group) is a matrix that represents graphically the position of an organization. It helps

the company to know where to invest, what are the growth prospects according to its market share and rate of growth. (Martin, M, 2016)

The diagram above represents the four quadrant of the BCG matrix. Stars represents that the company has the highest market share in the industry and that the business generates cash. In this quadrant, companies are advised to invest so as to maintain its position due to fast growing market. Cash cows represents that the company has a large market share in an industry that has a slow growing rate. Here, since there is low opportunity for business growth, the company is advised to invest so as to maintain the current productivity level or the business can face difficulties. Dogs represent that the company has a low market share in an industry having a low growth rate. Since the company is not generating cash, it is advised to use the retrenchment strategies. And the question marks represents that the business has a low market share in a growing industry. The company is advised to invest, by using expansion strategy or else retrenchment strategy will have to be adopted. (Martin, M, 2016)

For the case of McDonald’s, having a high market share and being in a fast growing market, it is situated in the Stars quadrant. So as mentioned below, McDonald’s need to invest. The fast food restaurant industry is a competitive one, McDonald’s can consider an expansion strategy, that is, investing in places, countries where there are few numbers of McDonald’s restaurants.

To conclude, the recent performance of McDonald’s has been poor. And none of its strategies has proved to be effective. The company has to review their planning techniques and their strategies to be implemented to be competitive. Expansion seems to be a good strategy to be adopted considering the BCG matrix.

Section 3 : SWOT analysis of McDonald’s
3.1 McDonald’s Current Position

McDonald’s current position is that the sales of the organization are dropping. The second quarter of McDonald’s in 2015 reported a 4% fall in its sales revenue. Steve Easterbrook, the chief executive of McDonald’s stated that the company was making slow progress even though the sales drop as with the changes of, All Day Breakfast and McPick 2 allowing customers to select two items from its McPick menu for 5 dollars, the customers are responding positively.(Kasperkevic, J, 2015)

3.2 Marketing Audit

The marketing audit is an important part of the marketing operation process. It is an analysis of the marketing activities of an organization. It evaluates the company and tries to improve its marketing performance. (Akrani, G, 2013)

Marketing audit analyses the internal factor and the external factor of a company. Organizational audit also known as internal factor evaluation helps a business to analyses the strength’s and weakness of a company while environmental audit also referred as external factor evaluation assess the competitor environment. Referring to the case study, the sales of McDonald’s is dropping. An organizational and environmental audit will help the company to identify its weakness and seek new solutions to improve its sales performance and to understand its competitors and make better marketing strategy.

3.3 Organizational Audit

3.3.1 SWOT Analysis

The SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis is a process that identifies and analyzes factors that internally and externally have an impact on an organization. It is a framework that will assess the strengths, weaknesses, opportunities and threats to help the organizations makes better decisions in the competitive environment they are operating. (Rouse, M, 2013)

3.3.2 SWOT Analysis of McDonald’s

  1. Strengths
  • Strong Brand Image Globally

McDonald’s is a brand recognized around the world. McDonald’s is constantly adding new items to its menu which is appreciated by its customers. The company also provides consistency of food, meaning that the taste of eating a Chicken Mac in Mauritius is the same in London. Selling to millions of customers daily around the world has contributed the success of the fast food restaurant. (Dalavagas, I, 2015)

  • High market share

McDonald’s is located in almost 120 countries, therefore is does not only rely of the market of United States to make profits. For example, Burger King relies mostly on its earning on the United States. (Dalavagas, I, 2015)

  1. Weakness

•Negative advertising

A documentary, “Supersize Me” which shows that McDonald’s contributes to obesity and other health issues as the food contains a lot of fat and oil. Moreover, nowadays customers are becoming more health conscious and thus McDonald’s sees a decline in its sales, hence a drop in its revenue. (L, C, 2016)

  • High Employee Turnover

Jobs at McDonald’s are low paying and does not required much skills. Hence, many employees do the jobs for a short periods of time, for example as a part time job while studying and as they know they will not be staying long, many of them don’t take the job seriously and have a low performance. And, clearly since there is no really an opportunity for career growth, there are a large number of employees who leave. (Dalavagas, I, 2015)

  1. Opportunities
  • Change in menu

McCafe which has proved to be a successful idea with a menu that is health conscious to customers, which includes fruit smoothies. Furthermore, in the Unite Stated, they have recently introduced sirloin burgers and artisan chicken in their menu. (Dalavagas, I, 2015) With the economic struggle, the low cost menu of McDonald’s has helped to attract low income earners customers and compared to other fast food restaurants it is more easier for McDonald’s to apply menu with a low cost. (L, C, 2016)

  • Expansion

McDonald’s the largest fast food restaurants which have more than 31,000 restaurants operating globally announced that the company is going to refranchise 3,500 restaurants by the end of 2018. The organization has opportunities to open new restaurants in more underdeveloped countries as there are already many restaurants in North America and Europe whose markets are saturated. (Dalavagas, I, 2015)

  1. Threats
  • Competitive market

The fast food restaurant market is an expanding one as people wants more and more foods that are already cooked and that are prepared quickly. McDonald’s has to compete with strong brand as Burger King, Wendy’s or Yum, or in Mauritius, it is KFC. As consumers have a variety of options, competitions enjoy a rise in sales as the expense of McDonald’s which loose a consequent number of consumers. However the market share in the market is still the highest.

  • Health-Conscious Customers

With a growing number of health issues, especially in the United States, where the rate of obesity is significantly high, many consumers are changing their lifestyle; they are eating more healthy and nutritious food, resulting in a fall in the demand of fast food like McDonald’s. . (L, C, 2016)

McDonald’s has brought several changes in its activities since its sales drop such as the change in the menu which has bring several benefits to the company. McDonald’s is a company that is recognized internationally, and it has as mission to continue its global expansion. As mentioned

above there is opportunities for market development for the company, China, the country having the largest population and still the number of restaurant in China is low. Thus, expanding the

Asian market is a good way to increase the company’s market share. In addition, McDonald’s should take into consideration the new healthy style of its consumers and introduced in its menu food and drinks that are healthy, moreover, it is also one way to fight fierce competition. If McDonald’s uses the right marketing strategy to overcome all its challenges, they will still be the leader of the fast food restaurant industry.

3.3.3 TOWS Matrix

A TOWS analysis is an effective way for a company to develop strategy for the company to benefits from new opportunities, to use its strengths to reduce threats and to overcome weaknesses. (Hamel, G, 2007)

Strengths: Strong Brand Image Globally High market shareWeaknesses: Negative advertising High Employee Turnover

Opportunities: Change in menu Expansion
Aggressive strategy: Use of maximum of opportunities and the strengths of the company to develop dynamically.
McDonald’s is the largest food chain restaurant around the world, and to continue of being the leader of the industry, the company can develop new restaurants as motioned above in the Asian market where we have a large number of population but few restaurants.
Competitive strategy: Fight the weaknesses using opportunities in the market
Negative advertising mostly in America where McDonald’s is linked to obesity, to overcomes this situation, the company can change its menu, bring more healthier choice for the consumers, more salads, wraps, smoothies to attract more consumers.
Threats: Competitive market Health-Conscious CustomersConservative strategy: To maximize success the company needs to look from the inside, what it can achieves.
Provide more healthier food There is fierce competition in the market, and one way to reduce threat of competitors is to bring innovative products or search for new market. For example the McCafe has proved to be a great idea and attract consumers who want a good cup of coffee.
Defensive strategy: The company is in unfavorable position and it needs to minimize weaknesses and threats.
In order to reduce threats of competitors, the company needs to strongly analyse the needs of consumers so as to satisfy their wants.

Clearly, the company needs to provide healthier foods to its consumers that are the first way to stay ahead of its competitors; this will also help to create good advertising. As for the fierce competition, innovation in its menu will help to attract more consumers and prospects.

Section 4 : Environmental Audit
4.1 PESTEL Analysis

A PESTEL (Political, Economical, Social, Technological, Economical and Legal) analysis helps to determine the opportunities and threats of a company in the external environment. The objective is to find out how these opportunities and threats can affect the business performance.

4.1.1 PESTEL Analysis of McDonald’s

Political factors can affect the activities of McDonald’s. For instance, public health policy may discourage people to consume fast food. On the other hand, the increase for international trade agreements is an opportunity for McDonald’s to expand its business. Economical changes across the world can influence the industry as McDonald’s has restaurants globally. For instance, in US where there are most of McDonald’s restaurants, if there is a slowdown in the American market, this is a threat for McDonalds. On the other hand, a stable growth in the Mauritian market is an opportunity for McDonald’s to grow. The social factors in the environment can either support the business or limit its activities. McDonald’s can target low income households based on the factor of widening wealth gap. It can also improves and adapt its menu for different target. However, due to the healthy lifestyle trend of many people nowadays, it can be a threat for McDonald’s as its menu is a synonym for fat, but McDonald can turn that in an opportunity by offering healthy menu. (Greenspan, R, 2015)

Technological factors can play a great part in the success of a company depending on its use of technological applications. McDonald’s can improve its business efficiency by applying more automation so as to increase productivity. Environmental external factors can have an impact on McDonald’s performance. Climate change can be a threat for farms and thus affecting the supply chain of McDonald’s. However, the company can expand its strategies on its corporate social responsibilities. McDonald’s must abide to the legal requirements imposed in the industry. For instance, minimum wage levels can be a threat for the company which will lead to higher production costs, implying higher prices. There are also regulations on health in workplace which can reduce the revenues of the company. (Greenspan, R, 2015)

To conclude, there is opportunity for business growth. And as for the social factors, McDonald’s must introduce a healthy menu. And the company can also adopt new technological strategies so as to increase productivity.

Section 5 : Stakeholder Analysis of McDonald’s
5.1 Stakeholder Analysis

Eden and Ackermann in 1998 defined stakeholder as any person or an organization that has the power to positively or negatively influence the actions of a company, to negotiate with the company and to change the strategic future of the company. (Stakeholder Map, 2012)

Stakeholder analysis is an analyse and consideration of the way stakeholders can impact a company. Companies have to understand the power and interest of each stakeholder so as to make strategic decisions. (Kokemuller, N, 2013)

5.1.1 Stakeholder Analysis of McDonald’s

The internal stakeholders are McDonald’s are the employees, its managers and the investors as for the external stakeholders; they are the customers, the communities, the government and the supplier.

The top stakeholders of McDonald’s are the employees and the customers; however each of the stakeholders can also influence the actions of the organization. The four main stakeholders are the employees, the customers, the investors and the communities. (Smithson, N, 2015)

  • Employees

McDonald’s consider employees an important stakeholder group as they are the ones who have the direct contact with the customers and they need to serve and talk to the customers well so that they come again, thus the customer service has to be a good one. However, with the low wages, the employees are constantly demanding higher wages. (Smithson, N, 2015)

  • Customers

Customers are the ones who keep the company going. Customers want to have good quality of food at affordable prices. However, the menu at McDonald’s is very criticized as there are many health issues.

  • Investors

Investor’s main aim is that the company makes profits. They are also an important group of stakeholders as a fall in sales can results that the investors stop investing. Thus McDonald’s have to make good decisions so that the menu is attractive to increase growth rate.

  • Communities

McDonald’s plays an active role in the community. There is the Ronald McDonald House Charities that helps families in need financially. There is also the McDonald’s Global Best of Green recognizes and rewards ideas and contributions related to the environmental that are

innovative. McDonald’s have to maintain a positive image as the community can affect the company by negative advertising. (Smithson, N, 2015)

In conclusion, to keep the client service excellent, McDonald’s can improve their compensation strategy to motivate the employees and keep them satisfied. And as for the health issues, McDonald’s can provide healthier menu which will keep the customers happy, the communities to create good advertising and the investors to keep investing.

Section 6 : Porter’s Five Forces Analysis of McDonald’s
6.1 Porter’s Five Forces

Michael Porter developed the five forces model to analyse the competitive environment in which a product or a company operates. The five forces that can affect a product, a brand or a company are the threat of new entrants, the power of suppliers in the industry, the power of the buyers that can influence prices, the threat of substitutes and the competitive rivalry. (The Economic Times, 2013)

6.1.1 Porter’s Five Forces Analysis of McDonald’s

The five forces analysis will focus on the fast food restaurant industry and analyse the competitive environment. This analysis will give the company strategic directions for the company to take.

  • Threats of new entrants

New entrants in the industry can impact the market share of McDonald’s. Due to the low costs, customers can easily switch from McDonalds to new fast food restaurant companies. Also, the capital cost to set up a new fast food restaurant is quite affordable. However, the brand of McDonald’s is strong that it is expensive to build a brand that can match that of McDonald’s. Thus, the threat of new entrants is of moderate force. (Gregory, L, 2015)

  • Suppliers power

Suppliers influence the production of McDonald’s. The suppliers of McDonald’s are not vertically integrated. Also there are a large number of suppliers, meaning that the organization does not control the distribution system. Thus, the supplier power is of week force.

  • Buyers power

Here, the buyer power is strong. There are many substitutes that consumers can easily switch from McDonald’s to another fast food restaurant. This implies that customers can impose what they want on McDonald’s.

  • Threats of substitutes

The threat of substitutes can have a significant impact on McDonald’s. There are a large number of substitutes for McDonald’s, such as bakeries, food outlets and food prepared at home. These substitutes are also competitive in terms of satisfaction and quality. The substation is of strong force.

  • Competitive rivalry

The fast food restaurant industry is a competitive one. The industry is made up of many companies of different sizes; it can be global chains as McDonald’s or the local Jimmy fast food restaurants. Furthermore, consumers having a large choice at low price can switch easily from restaurants to restaurants. This shows that the competition in the industry is of strong force.

To conclude, the Porter’s Five Forces Analysis shows that there is a lot of competition in the industry and there can be even more competition as it is easy to set up a fast food restaurant. It also shows that with the low switching costs, it made it easier for customers to change from McDonald’s to another competitor. The company has to develop new strategies to avoid the threats of new entrants and competition in the market.

Section 7 : Strategy Evaluation of McDonald’s
7.1 Growth Strategies

McDonald’s key objective is to expand its business operations and open more restaurants so as to increase their market share and to increase profitability. There are many different methods for a company to expand its operations. The different strategies that a company can used to for future expansion are substantive growth, limited growth and retrenchment.

7.2 Limited Growth

Limited growth can be implemented through market penetration, market development and product development.

Kotler and Armstrong stated that market penetration is when a company adopts a low pricing strategy for new and existing products so as to attract a larger number of customers. (Knowledge Brief, 2012) A market development strategy involves selling existing products and service in a new customer market. (Kokemuller, N, 2013). Product development strategy is to develop new product or to modify existing product for new or current market. (Nielsen, L, 2010)

For example, the product development of McDonald’s was the launched of McCafé products, it is a new product for current market of McDonald’s as well as for new market.

7.3 Substantive Growth

Substantive growth can be implemented through horizontal integration, vertical integration, related diversification and unrelated diversification.

Horizontal integration is a substantial growth strategy, where a company expands its activities by merging with another company in the same industry. (Mitzsheva, M, 2011). On the other hand, vertical integration is the two businesses merge together but at a different stage of production, there is forward integration, merging with a company with the supplier while backward integration is merging with a company with a manufacturer. (The Economist, 2009). Related diversification is when a business expands or adds to its markets or existing product line. On the

other hand, unrelated diversification is expands by adding to its product line or market product that are unrelated. (More for small business, 2009)

7.4 Retrenchment

Retrenchment includes turnaround and divestment.

Turnaround strategy involves changing a company that is making loss in a profit making company. (Chand, S, 2013). Divestment strategy is used when the turnaround strategy has been attempted but had been useless or unsuccessful. It is when a company sells or liquidates a portion of its business so as to have cash and pay off its debt. (Business Jargons, 2015)

In 2015, when McDonald’s sales and revenue were declining, the organization adopted a turnaround strategy, the company tries to have simpler menu, quicker customer service, better food quality among others. (Peterson, H, 2015)

7.5 Appropriate Future Strategy for McDonald’s

As mentioned above in the PESTLE analysis, an environmental factors affecting McDonald’s is the healthy lifestyle of consumers today. Thus, an appropriate strategy that McDonald’s can adopt is the limited growth more precisely, the product development. With the healthy lifestyle trends nowadays, McDonald’s can introduced a healthier menu; this will helps to attract a lot of consumers and prospects. This strategy can have a positive significant impact on the performance of the business.

Section 8 : Implementation Strategy of McDonald’s
8.1 Implementation of Strategic Planning

A strategic plan is a plan to set priorities, way to achieve objectives with and all the other critical elements. However a strategic plan is of little us is it is not the implementation process is not well applied.

8.2 Roles and Responsibilities for Strategy Implementation
  • Corporate level strategy

Corporate level strategies are strategic decisions that a business makes that can affect the whole organization such as mergers or financial performance. (Bradley, J, 2013)

  • Business level strategy

Business level strategies are the plans that companies use to conduct different functions at business level. They are changes that need to be implemented at different levels of the organizations. (Vitez, O, 2010)

  • Functional level strategy

Functional level strategies are strategies for each department level, for example, human resources, finance, research and development. (Bradley, J, 2013)

8.3 Requirements for New Strategy

To be able to implement new strategies, McDonald’s will need various resources. For instance, expansion strategy, the company would need finance resources so as to be able to do the expansion, human resources, as more people will be need for the new restaurants, production resources such as machinery, raw materials including ingredients, food products. For product development, the company would equally need finance resources to finance the research and development process and also to implement the new product and additional equipment so as not to interrupt the production process.

8.4 Monitoring Strategy

The three criteria used to monitor a strategy are suitability, feasibility, and acceptability. Suitability is to see whether the proposed strategy fits the mission of the company, reflects the competence of the company and captures opportunities and avoid threat. Feasibility is to measure whether the company has the necessary resources so as to implement the strategy. And acceptability is about the expectation of stakeholders; it measures if the expectations of shareholders, customers and employees are met. (Boundless, 2014)

Let’s take the product development strategy, a menu with healthy food. This strategy can be monitored by the suitability, feasibility and acceptability criteria. Under the suitability criteria, we can see that the mission of McDonald’s to provide good quality of food is achieved, it also avoid the threat of competition, offering a healthy menu. Under the feasibility study, the company can check if the company has the required resources to implement the strategy. And the acceptability criteria monitor whether the expectation of stakeholders are met. For instance, the expectation of customers are met, that of a healthy menu, and if customers are happy this will increase profit, meeting the expectation of directors and shareholders are met.

8.5 Target and Timescales for Achievement

As mentioned above, to implement the product development strategy, the target and timescales for achievements are that firstly the target is to be a place where customers will enjoy eating and drinking, and one way to achieve is to have a menu that will make customers happy. The timescale of the market can be every three months or annually to see the impact of this strategy on the business performance. More advertisements can be made to inform customers of new items in their menu.

8.6 Recommendations
  • According to the BCG matrix, an expansion strategy needs to be implemented so as the company continue to maintain its position in the stat quadrant.
  • Based on the SWOT and TOWS matrix, McDonald’s needs to rapidly do some changes in its menu. The company will also enjoy positive advertising. Thus, adopting a competitive strategy by bringing a healthier menu.
  • In addition, the PESTLE analysis also confirmed the two strategies above. Furthermore, the company can also change their production process by adopting new technological applications so as to increase its productivity.
8.7 Conclusion

To conclude, implementing the right strategy will help the business to remain the leader of the industry and the highest market share. Many analyses has confirmed that a change in the menu should be the next step of McDonald’s, this will contribute to many other benefits such as the increase in the number of customers, increasing profit, and fighting competition. These strategy needs to be well monitored so as to ensure that the company has implement the good strategy and the company is going in the good direction.


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