McDonald’s
Strategic Planning and management
Instructions:-
Throughout the semester this unit has identified the effective ingredients for strategic management of hotel business in the 21st Century. Choose a contemporary hotel business you are familiar with or would like to learn more about. Clearly explain what makes this company successful in the hotel industry. Base you explanation on theories of strategic hotel management and planning from the essential text or related journal articles
Your reference list must contain references from the essential text and a minimum of 12 related journal articles. You may use other credible references in excess of your 12 journal articles. In text references must be applied.
Format:
Word Count: 1600 to 1800 words
Style: Essay form-grammatically correct
Font: Times New Roman
Size: 11 Point
Spacing: 1,5 lines
Justification: Fully justified
Indentation: First line
Referencing: BMIHMS (Harvard). No footnotes.
Submit to: Turnitin BUS304
Structure:
BMIHMS Cover Page
Introduction -10%of words count
Body (no headings)-80% of words count
Conclusion-10% of words count
Reference List
NEED TO FOLLOWING THE Building foundation
1) Words per sentence – 15 to 25. Beyond 30, the sentence is running on
2) Sentences per paragraph – 6 to 10. Approx 120 to 200 words
3) Paragraphs start with topic sentence – the theme of the paragraph
4) Theory is used to analyse the case – do not recite the theory
-The topic sentence is the theme of the paragraph
-Theory is linked to the facts that you have found/identified
-Supporting sentences build the argument/position presented in the topic sentence
Solution
Strategic Planning and Hotel Management
Introduction
It is an undeniable fact that the level of competition in the hotel industry is becoming a significant factor of consideration, while executing managerial functions. Owing to trends of increased travel and tourism, business investors have found attraction in the hotel industry, with some putting up new ventures, alongside an advancement of the existing ones. Hotel management teams strive to curve a leading role, and sustain their competitiveness in the market, by offering unique, demand-based services that serve interests for different customer categories (Galliers & Leidner, 2014). For any hotel to maintain such a leading role, it is imperative to invest in strategic management, analyzing both the current and future operating environments. The strategic environment should take into consideration the economic and market conditions, trends in consumer and travel operations, as well as the prospects of changes in the competitive landscape (Hill, Jones & Schilling, 2014). The management of McDonalds is a perfect example of the outcome of strategic management, which has positioned the multinational cooperation as a leader in the competitive hotel landscape.
McDonald’s Corporation
The McDonald’s corporation, based in the United States of America, the corporation is ranked as one of the world’s largest hamburger food restaurants. McDonald’s corporation serves some of the largest number of restaurant customers of about 68 million customers spread in 119 countries across the globe (Grant, 2015). Among some of the most famous dishes served in the McDonald’s restaurants include; hamburgers, cheeseburgers, Filet-O-Fish, chicken sandwiches, soft drinks as well as chicken McNuggets. In addition, the corporations also serve coffee, snack wraps, McCafe beverages, oatmeal, French fries, salads as well as McFlurry deserts. McDonald’s corporation has established 33510 restaurants that across the globe, which serve various menu to the esteemed customer at different price points. The 31st day of December, 2011 marked one of the greatest achievements to the corporation when the out of established 33510 restaurants spread in 119 countries across the globe were franchised, among which 6435 were put under the management of the company.
The hotels and resorts that have the highest chances of standing the forces of competition in the hotel industry, include those that focus on the long term planning. The long term planning involves a critical analysis of the current situation, based on the objectives for the future. Strategic hotel management requires that the management initiates a 5-year term plan (Harrison & John, 2013). The 5-year plan should be subject to an annual update, based on the analysis of current situations. In addition, a hotel should produce annual marketing plans, some of which include commercial ads. Annual plans often help to address the more tactical initiatives aimed at beating the forces of competition. Such strategic plans help to secure the hotel’s future financial health in terms of its profitability. Elements of strategic plan for McDonalds include:
McDonald’s Mission
The mission of the corporation is to sustain a continuous improvement of not only their social performance, but also the environmental performance through its conservation policy. McDonald cooperation, through the established high level of coordination and corporation with the suppliers as well as the other franchisees, are dedicated to hard work, which shall enable it achieve a sustainable future for the corporation and the community of customers (Brown, Bessant & Lamming, 2013). More specifically, McDonald Corporation has a mission for being the favorite choice for many customers looking for places to eat by offering best dishes in the most professional manner (Young & Nestle, 2003 and Kaplan & Atkinson, 2015).
McDonald’s Objectives
- To integrate environmental concerns such as environmental conservation measures into the general management strategies in an attempt to adding value to the entire community.
- To establish professional training opportunities for both personal as well as professional growth in order to raise the relevant standards of job satisfaction.
- To offer a variety of highest quality choices of products to the customers in terms of dishes, that do not only offer maximum satisfaction to their expectations, but also go beyond the client’s level of expectation and trust in the products.
- To establish strong and reliable partnerships with various partners such as the suppliers, for an ethical operation that meets the standards of an acceptable social standards.
- To establish a working environment for the corporation’s workers and happy and a relaxing environment for the customers where every occupant of the premises feels valued, dignified and accepted at all times.
McDonald’s Aims
- McDonald corporation aims to base the various strategies formulated by the corporation’s management on the most relevant and effective scientific principles available.
- To preserve and protect the health as well as the welfare of the corporation’s workers and make necessary improvements in the standards of living in their various places of operation.
- The corporation aims to increase the economic profitability of the corporation and efficiency in resource use as well as harnessing the benefits derived from ecological services.
Current Corporate Strategic Position
Just as noted in the introductory sections, McDonald’s corporation is ranked as one of the largest restaurants in the world, having established 33510 restaurants across the globe serving a variety of dishes to approximately 68 million customers. The corporation has established franchised restaurants in 119 countries in various parts of the world (Grant, 2015). With a focus on the corporation’s brand, McDonald’s corporation started divesting in the other chains that had been acquired during the early periods of 1990. McDonald’s corporation gained ownership of a better part of Chipotle Mexican Grill up to 2006, a period which acted as a turning point by the corporation’s divesting from Chipotle by a means of a stock exchange (Leung & Law 2013).
The modern position of the corporation provides for a system where most of the already franchised restaurants across the globe offer both the drive-through services as well as the counter services to customers (McDonald et.al., 2013). Both types of services may often be offered at an indoor or outdoor level. In order to adapt to the increasing trend of coffee popularity in mast restaurants and general coffee shops, McDonald’s corporation have introduced McCafe as an accompaniment to the already existing services. McCafe has seen the improvement of the coffee services to most coffee customers in many countries such as Australia, where an increase in sales of up to 60% has been realized. The trend of coffee popularity has therefore increased tremendously, resulting to the establishment of the over 600 McCafe across the globe (Grant, 2015).
In terms of the global operations, the McDonald’s corporation is considered as one of the most popular companies with the highest number of licensed branches in various branches across the globe, and as such. McDonald’s corporation is widely recognized by many corporations as an emblematic of globalization (Parente & Strausbaugh-Hutchinson, 2014). The globalization strategy has been a key factors to the progress of the corporation (Grant, 2015). For instance, many observers have made common suggestions that the company deserves credit for the great improvement in the quality of restaurant services in the places where it establishes.
The locations of the franchised branches in many countries across the globe are also a major strategy that greatly works to boost the performance of McDonald’s corporation. The restaurants are located either close to or adjacent gas stores (Hoque, 2013). Similarly, the McExpress are located in such a way that they provide for limited seating, for instance, some are located in shopping malls, while others have also been established in Walmart stores. This type of location is strategically designed by McDonald’s corporation in order to tap maximum number of customers who use such facilities as the shopping malls or the gas stores (McDonald et.al., 2013). The target customers in such restaurants often require resting places, where they are served with their desired meals such as coffee. In addition to the McExpress, there are the McStops, which are strategically located to tap truckers as well as travelers who often demand truck stop services.
The process of formulation of alternative strategies that would the organization inn meeting its future goals and objectives are often based on the suitability, feasibility and the acceptability of such strategies. The management team of McDonald’s corporation should promote the culture of value addition to most of their products in order to keep matching ahead of their stiff competitors (Haley & Boje, 2014). The process of value addition is one of the most sustainable strategies for most of the branches located in different countries. This is because the company has adequate profits which can offer an investment ground to the value addition program. Customers would definitely have better preference to their products (Grant, 2015). However, the organization must exercise care on the level of value addition, where unhealthy chemical substances should be eliminated from their products.
This strategy attempts to build a better reputation for McDonald’s corporation as the world’s healthiest fast food processor. McDonald’s corporation should consider a further expansion and establishment of more branches in countries where there are no existing branches. It strategy would offer a stronger competitive advantage to McDonald’s corporation over its local competitors. This may be achieved through planning for expansion of the various branches in different countries into other sub-braches in such countries and even beyond the borders. However, this will be determined by the underlying policies in such regions. Some regions or countries have policies that do not permit sale or consumption of fast foods (McDonald et.al., 2013). This strategy would help McDonald’s corporation in maintaining its position as the world’s largest seller of fast food across more than 80% of the nations in the world.
In
summary, the development of a strategic plan for a hotel, just as other
organizations, help to determine its position in the next 3-5 years. In
addition, it also outlines the route to the desired future position, as well as
a mechanism of assessing the achievements. There are instances in hotel
management where managers often concentrate more on immediate, or instant
decisions. Such instant decisions involve customer complaints and maintenance
issues, which may distract it from focusing on the future goals. Developing a
strategic plan for the hotel is a virtual necessity, to help it realize its
potential long-term profitability as well as its ultimate existence. McDonalds,
owing to its strategic managerial approach, has taken a leading role in
offering fast food services to a base of loyal customers across the globe.
Bibliography
Brown, S., Bessant, J.R. and Lamming, R., 2013. Strategic operations management. Routledge.
Galliers, R.D. and Leidner, D.E., 2014. Strategic information management: challenges and strategies in managing information systems. Routledge.
Grant, R.M., 2015. Contemporary Strategy Analysis 9e Text Only. John Wiley & Sons.
Haley, U.C. and Boje, D.M., 2014. Storytelling the internationalization of the multinational enterprise. Journal of International Business Studies, 45(9), pp.1115-1132.
Harrison, J. and John, C.S., 2013. Foundations in strategic management. Cengage Learning.
Hill, C., Jones, G. and Schilling, M., 2014. Strategic management: theory: an integrated approach. Cengage Learning.
Hoque, K., 2013. Human resource management in the hotel industry: Strategy, innovation and performance. Routledge.
Kaplan, R.S. and Atkinson, A.A., 2015. Advanced management accounting. PHI Learning.
Leung, R. and Law, R., 2013. Evaluation of hotel information technologies and EDI adoption the perspective of hotel IT managers in Hong Kong.Cornell Hospitality Quarterly, 54(1), pp.25-37.
McDonald, J. and Styles, M.C., 2014. Legal strategies for adaptive management under climate change. Journal of environmental law, 26(1), pp.25-53.
McDonald, R., Shalloo, L., Pierce, K.M. and Horan, B., 2013. Evaluating expansion strategies for startup European Union dairy farm businesses.Journal of dairy science, 96(6), pp.4059-4069.
Parente, D. and Strausbaugh-Hutchinson, K., 2014. Advertising campaign strategy: a guide to marketing communication plans. Cengage Learning.