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McDonalds Case Study

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Case Study - McDonalds

McDonald's is a highly remarkable global brand characteristically associated with notions of an American consumer democracy and way of life. 'The Golden Arches' have their presence in 120 countries and has more than 33000 restaurants. With well over one million employees, McDonald's impact on the workforce has been significant. By 2000, one out of eight Americans had, at some time in their life, worked for this company. In the recession of 2008, McDonalds was the only company other than Wal-Mart to post on Dow Jones Industrial Average stocks that ended 2008 with a gain. With figures like these and brand which is a household name, 'McDo's' is definitely the Goliath of the fast food business.

Will this giant corporation, which has been running the chain since the 50's, be able to sustain the needs of its time? Is it compatible to the necessities of today's generation? Does it tend to the same target customers who it has been over the past 60 years? Has it been successful in branding itself appropriately in the Web-age? The answers to these questions will determine the fate of the company's future.

1) Plan to Win Strategy: The history of McDonalds is quite well known and is time and again hailed as one of the best success stories of all times. So we shall not focus on much of its past and just take into consideration its recent history and go forward with it. Jump to circa 2003. McDo's was in a slump. It was held solely responsible for making America obese. Its health and sanitation methods were being questioned. They had trouble from the animal rights activists. Basically they were being punched from all sides.

Ralph Alvarez, a Cuban-born former accountant who is McDonald's president and chief operating officer, tackled these challenges with a new initiative called- Plan to Win. This was when the executives realized that their core market had gorged on expansion. And since 2003,McDonald's has been on a roll, when, to get out of a slump, it halted rapid expansion and instead focused on improving the food, service, atmosphere and marketing at its existing outlets.

2) Sanitation: An irate customer quotes: "Consider how the animals consumed by McDonald's are raised and you've an issue far more morally disgusting. You're going encounter in a typical day. Stand and observe at any of their stores and you'll see people handle money and then assist in the wrapping of sandwiches without a hand-washing."

This was the general opinion of public just before 2003. Adversaries and other NGO's campaigned and engaged in a lot of mudslinging at McDonalds for the same. Though this issue has not been completely addressed, the company made an effort to hold more importance to cleanliness and sanitation. It set stricter deadlines so that the primary principle of McDonalds- to provide clean, affordable food is not compromised. McDonald's suppliers have food safety management systems in place, including Good Manufacturing Practices (GMP), a verified Hazard Analysis Critical Control Point (HACCP) plan and crisis management, food security and other applicable programs.

3) 'Glocalization': Since the new millennium, more than 60% of McDonald's income came from outside US. So it has been imperative for McDonalds to keep their brand menu items and along with that offer a local variety. This was definitely a smart marketing move, but again, with that came newer controversies. Like for example in China, where food safety is a major concern, especially after scandals like the one in 2008 where milk and infant formula throughout the country was tainted with melamine, a plastic used to make countertops and dry-erase boards, McDonalds started a 'Chickileaks' campaign , insights into company's chicken supply chain. The goal is not exactly to convince customers that their chicken



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