McDonalds Case Study

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There are several financial risks also. Adding menu items will incur a cost, especially if items are tested and found to be unsuccessful- lack of sales. Each menu item will require research and marketing, and this will also require an investment. If the menu items sell then the investment can be recouped, however, if they are unsuccessful both the company and the franchisees will lose money. McDonalds will have to make significant investments in testing menu items prior to bringing them to market in order to mitigate the risks.

LINKING THEORY AND PRACTICE:

McDonalds has experienced great success following a prescribed formula. They have focused on a consistent menu, low prices and fast service. This model will continue to be successful but will require several small changes within the same framework. As the Slack and Lewis textbook surmises, internal operations decisions impact external marketing position and vice versa. McDonalds must use their competitive advantage of a robust supply chain and highly productive processes to maintain low cost, resulting in low prices for consumers. In other words, McDonalds competes on quality food at low prices (value for money), therefore, it will need to develop the low cost of goods and efficiency within its operations, in order to meet its objectives.

CONCLUSION:

The key to McDonalds continued success will require them going "back to basics" with small changes. McDonalds strength has been in maintaining quality, service and consistency in every restaurant. McDonalds patrons expect this and will not likely tolerate drastic changes. They will have to cautiously experiment with new menu offerings and only allow options that complement their current menu. McDonalds will need to be strategic in selecting the menu items, requiring that the options be locally produced and environmentally sustainable. Additionally, strategic marketing will be fundamental to "selling" the upcoming changes.

Sources:

Nigel Slack and Michael Lewis, Operations Strategy. Essex, England, Pearson Education Limited (Pearson (Intl)), 5th edition, 2017.

News, ABC. “McDonald's Blamed For Making Teens Fat.” ABC News, ABC News Network, 26 Nov. 2002, abcnews.go.com/WNT/story?id=129992.

“Super Size Me.” Wikipedia, Wikimedia Foundation, 21 Oct. 2017, en.wikipedia.org/wiki/Super_Size_Me.