This report will aim to use SWOT analysis to analyze if Mcdonald's provides their customers will good quality service and if the business's customers are satisfied with the business. Firstly, it will briefly explore the business's history and the progress the business makes throughout the year. In addition, the report will also provide recommendations as to how Mcdonald's should provide its customers with the best service thus, satisfying customer requirements.
Terms of reference
This report has been demanded by Janvier Nkurunziza, who is the communications lecturer at the City of Glasgow College. Where it will be submitted on the 23rd of October 2019.
Research Methods
To conduct this report, a variety of both Desk and Field research methods were conducted to obtain information. The report has gained information from a wide range of sources. Such as conducting surveys. Thus, also using websites as my main source of receiving information (see bibliography)
History of McDonald's
This sector will talk about the history of Mcdonald's.
It can be seen that this food industry was first established in San Bernardino, California. It was run by brothers Dick and Mac McDonald In 1940 featuring a large menu and car hop service to customers.
In 1955, McDonald's had seen to open their first ever franchise in Illinois where the business launched McDonald's Corporation where Ray Croc had bought Mcdonald's from the Donald brothers in 1961. (See Appendix 1) Therefore, the number of outlets had topped 1,000 before the decade's end. Where a huge increase in growth was seen with the business as the company’s stock began trading publicly during the 60s.
In 1963, the known public face of Mcdonald's, Ronald McDonald the Clown was introduced by the organization thus where the double arch logo had become Mcdonald's known brand. Furthermore, Mcdonald's was successful in expanding their business internationally. For example, in 1967 the organization was able to expand to Canada. Where overall reaching 10,000 restaurants.
Over the years, McDonald’s was able to widen their product portfolio thus widening their variation of products instead of hamburgers being their main one product. For example, the company’s now famous burger, the Big Mac was available in 1986. Along with other products such as the egg McMuffin (1973), Happy Meals (1979), and Chicken McNuggets in 1983. (The Editors of Encyclopaedia Nov 2017).
Finally, from the official McDonald's website, I was able to gather the information that Mcdonald's had published its ever-Social Responsibility report on 15/4/02.
This act therefore aided the business in many ways as it boosted the company’s reputation within the market thus building the business's brand and attracting a wider proportion of loyal customers. (2017-2019 McDonald's).
McDonald’s progression to success
This area will be gathering information from my sources about McDonald’s progress over the years by analyzing Mcdonald's Sales, Products, and most importantly Customer Satisfaction and the service they provide to their customers daily.
Since the start of its official opening, Mcdonald's had seen to have increased rapidly over the years. Today, Mcdonald's has over 37,000 restaurants across the world (see Appendix 2). Furthermore, Mcdonald's brand worth is estimated to be around $126 billion US dollars thus showing the succession and worth of the organisation. The business has seen to have an increase of restaurants since 2015 having 30,000 restaurants to now over 37,000 in 2018 showing its massive growth over the years. (Lock, Aug 2019)
In March 2017, Mcdonald's introduced their Velocity Growth Plan to satisfy their customer’s needs. The plan aims to retain its customers by expanding its many areas of strength such as breakfast and family occasions. Furthermore, the plan consists to bring back customers who have left the business by improving the quality of their products such as their taste, enhancing convenience, and offering strong value.
This plan has already started to bring effect to the business. For example, McDonald's introduced many technological strategies in 2018. Where the business had focused on its global mobile app. Furthering this, self-ordering Kiosks and digital menu boards were also introduced under the Velocity growth plan to provide self-easy access to its customers. McDelivery is highly seen to be one of the most successful growth plans Mcdonald's has introduced in the past years. Where customers are able to download the Uber Eats App thus allowing consumers to have home deliveries. This, therefore, opens a huge way of receiving profit and customer satisfaction
Furthering this, I had chosen to conduct the use of a survey (see appendix 3) where 31 individuals have provided their opinion regarding their satisfaction towards Mcdonald's. Due to this being up to date it and being primary information, it furthers the reliability of the information given. However, due it can contain biased information favoring Mcdonald's thus not being a 100% accurate source.
The results from the survey stated that most customers had included about how unhealthy the products are which are provided by this organization. Furthering this 60% of people were not satisfied with the quality of products as burgers are mainly dry and are not up to standard and are mostly rushed in making. This shows that Mcdonald's is not really growing in the sense of providing good customer satisfaction to its consumers.
Company Structure
From my research, I was able to see that Mcdonald's recently reformed their organizational structure in 2015. This would, therefore, lead to an improvement in the organization's grasp and control of its worldwide franchises and businesses.
Furthering this, the business is seen to adapt to a divisional organizational structure therefore meaning that the business is divided into different components in which certain responsibilities are delegated to different modules thus based on their operational requirements. When relating it back to Mcdonald's it has three different components. These are:
Global Hierarchy. Mcdonald's has seen to adapt to a global hierarchy to expand to ensure all its operations are covered throughout the world. This, therefore, ensures that corporate control is structured and driven in the right direction and managed properly.
Performance-based groups. This type of division has seen to be reorganized since 2015 where the business has divided up sections geographically worldwide. Where (a) U.S., (b) international Lead Markets, (c) High Growth Markets, and (d) Foundational Markets and Corporate. Where the business is able to take control and lead their businesses throughout these certain divisions bringing a more effective and structured output and performance.
Function Based groups. Mcdonald's is seen to have a group of people for human resource management, and also a Supply Chain and a Sustainability group to focus on chain management and their sustainability. Thus allowing the business to control and focus on the basic functions within the company. In addition, in this type of structure groups can be added and changed as the business expands its markets. (Andrew Thompson (February 26, 2019).
From the research that I have gathered, it can be seen that an advantage of McDonald’s hierarchy structure is that it provides support to monitor and control its global divisions and components.
Also for its performance-based divisions the business is able to enable different strategies based on its market performance allowing for effective approaches to market changes,
However, even with such structure and efficiency, the issue is seen to limit the business's flexibility. (Andrew Thompson (February 26, 2019).
Conclusion and Recommendations.
From my analysis, I can conclude that Mcdonald's has been improving their customer base by providing good customer satisfaction to their consumers. For example, since its introduction to its velocity plan, customers have been more satisfied with the businesses services thus allowing for more customer loyalty. McDelivery has had a huge impact on the business's performance by attracting a wider consumer base as they have taken the opportunity of targeting those who prefer home deliveries thus providing the business with huge income.
Furthering this from my survey, it can be seen that many customers are happy with the wide product portfolio the business has to offer to its customers. However, I was also able to find from my survey that Mcdonald's does not offer Halal meat which could be a huge opportunity McDonald has a hold of. For example, the company can target the Muslim and Jewish segment in the market allowing for more customers to buy the businesses products allowing for more revenue to be made as many consumers are more likely to buy from other food industries which are McDonalds biggest rivals such as, KFC and Nando’s.
Overall, I further recommend McDonald's widen its product portfolio to target vegans and vegetarians in the market which would also attract a wider consumer base thus generating a better reputation for the business.
In addition, I can further recommend that McDonald's not rush their productions, as from my survey 64% of those have complained that Mcdonald's do not reassure their quality and presentation as it is not up to standard as they advertise to their customers. This, therefore, will highly impact the business as customers are more likely to leave the business and become loyal to other food industries that provide a better quality standard of products. Thus losing a huge proportion of consumers and having a negative reputation within the market.