Category: McDonald’s

Fast food industry has been considered one of the most popular and financially powerful markets across the world. For decades, the global fast food giants have been gaining fantastic revenues, but recently this tendency shifted. Worldwide fast food brands faced one of the most serious threats a business can come across – the change of the consumers’ preferences and tastes. This paper focused on the exploration of the problems challenging McDonald’s and its brand image, as this fast food brand is known to be losing a lot of income lately. The company is in need of brand refinement and the improvement of reputation. This paper discusses the ways of achieving positive results and making McDonald’s a stronger competitor.

Changes Are Necessary

Ten years ago no one would even imagine that instability could hit such huge and powerful business as McDonald’s. This company used to be considered as one of the most reliable from the perspective of profit; it was ahead of customer demands and introduced a number of innovative products successfully dealing with recession and financial crisis. McDonald’s’ sales in the United States grew from 22 to 36 billion dollars between 2004 and 2012. After that the company faced a noticeable revenue decrease. It started with the retirement of the CEO of McDonald’s Joe Skinner in 2012.

After that retirement, it took the company only several months to experience its first since 2003 global drop of monthly sales and cost several McDonald’s’ leaders their jobs. In 2013 the company struggled through a lot of ups and downs, introduced a number of new products such as Premium McWrap, Fish McBites, Blueberry Pomegranate smoothie, Egg White Delight and a new series of Quarter Pounders. It was obvious that the company tried to return its lost customers and re-gain the profits. Regardless of all the effort, in 2014 the net income of McDonald’s dropped by 30 per cent. This happened because the business’s key group of consumers, millenials, stably preferred fast-casual chains such as Chipotle to McDonald’s. In order to re-gain its status and improve the brand image McDonald’s needs to introduce some brand refinement changes, develop a new approach to its products and the way they are marketed.

4 C’s Analysis

One of the biggest strengths of McDonald’s is the low price of the products. Reduced costs of the ingredients such as processed meat and vegetables, products that can be preserved for long periods of time without getting spoiled or transported without getting damaged improve the company’s revenues due to the low risk of product loss. Besides, the customers of the company mainly favor the Dollar Menu. Regardless of all the innovative meals and foods McDonald’s offers, the consumers keep choosing the Dollar Menu items because being cheap and fast is the basis of a fast food business. Since this strategy seems to be failing, it is possible that McDonald’s could experiment and improve the sustainability of the products.

The improvement of sustainability will definitely help the business attract its key customers – young people interested in tasty and fast meals of good quality. This way, offering more expensive but healthier products might be a good opportunity for McDonald’s to improve its performance.

In order to find out the needs of their customers the company could conduct a research, for example a digital survey, and inquire about the wishes and propositions of the key consumers concerning the improvements of the menu. This way, the company would gain more confidence considering the future transformations. Besides, operating in the era of customization, McDonald’s would not be wrong to add some “create your own product” options.

Finally, convenience is another significant component of the contemporary marketing. The products need to be easy to access, so developing a mobile application, allowing the consumers to choose and build their own meals and order them using their mobile devices would be a good way to reach out to all kinds of clients.

Company

Today, McDonald’s is facing unusual for it changes – the profits are dropping, the clients prefer other brands and the brand reputation has seen better times. The company reacted with a series of digital campaigns called “Our Food, Your Questions”. The campaigns were designed to reveal the secrets of the production of the fast food sold by McDonald’s and to defeat some negative myths impacting the business’s reputation. The company explained various processes happening “behind the scene”, which did not facilitate many changes. Basically, the company openly stated that their food was mainly unhealthy and contained hormones and GMO ingredients, which are known to be some of the scariest words for the contemporary consumer. If the company does not change its approach, it will be likely to lose even more income and experience a serious downfall of reputation as the new trends are gaining power and McDonald’s with its unhealthy meals may quickly become outdated.

Competition

Currently, one of the most serious competitors of McDonald’s is fast-casual food industry which attracts the key groups of customers – the young consumers such as students, travelers, school children, people in their early thirties. One of the most recognizable fast-casual restaurant chains in the United States today is Chipotle. The slogan of this brand is “Food with integrity” which maintains that the business prioritizes the best ingredients produced with respect towards the environment. Chipotle offers fast meals of good quality such as wraps, sandwiches, salads made of healthy and fresh ingredients.

The second prominent competitor is Panera Bread which also emphasizes integrity and serves fast-casual meals freshly made out of sustainable ingredients. Panera Bread maintains the image of a responsible food producer, the items in Panera Bread menus look home-made which creates the atmosphere of genuine care about the consumers and promotes trust. At the same time McDonald’s’ meals are known to have artificial smells and appearances very different from the ones in the advertisements.

Customer

The target consumers of McDonald’s are young individuals – school and university students, people in their 20s and 30s. They are called millenials, and they were raised in the atmosphere of awareness of the environmental pollution, healthy nutrition and negative impacts of mass production. This is why they prefer sustainable food producers using healthy and organic products and promoting respect towards the environment. Millenials are tech-savvy and appreciate quality and speed.

Category

The most important cultural trends dominant in the contemporary food marketing targeting millenials are customization, connectivity, and healthy diet. This is why McDonald’s is recommended to develop an option allowing the customers to build their own food items out of individually selected ingredients. Besides, McDonald’s could introduce an application allowing the customers to select their meals remotely by pressing buttons and adding ingredients into their hamburgers or wraps which would allow the consumers not only to alter the meals but to stick to price ranges they are interested in. Moreover, McDonald’s has been a target of environmentalists and nutritionists for years. Now it seems to be the time for the company to introduce serious changes to its approach towards food.

Two Options

The two ways for McDonald’s to improve its performance include the employment of customization of its products and the embracement of connectivity, digital technologies and mobile applications for food delivery. Going for the former option McDonald’s would be offering an ultimate solution to the issues of menu items introduction. Allowing the consumers to create their own hamburgers will utilize the typical for humans desire to experiment which will attract and retain consumers to McDonald’s chains.

Embracing connectivity and developing a mobile application for remote food ordering McDonald’s will be putting itself out to the market and making its products more accessible which will also help to increase the customer base, especially among tech-savvy millenials who like speed and comfort and are ready to pay for it.

Hypothesis

In my opinion, the two positioning options can be mutually integrated; mobile application may be designed to provide the customers with “create your own” function. Yet, choosing between the two solutions I personally believe that “create your own” option is harder to implement since it will require new approach towards the whole system of making McDonald’s products. Going this way would be likely to change the culture, structure of McDonald’s and its basic mission. Using mobile application will increase the sales and attract more consumers, this is the easier option. It should be employed first to facilitate immediate improvement of income. Most importantly, McDonald’s needs to address the quality of its meals, otherwise none of the innovative strategies will work for long.

Introduction

Jan Fields is the Executive Vice President (EVP) and Chief Operating Officer (COO) of McDonald’s USA where she is in charge of the strategic decision and the overall business results of over 14,000 McDonald’s restaurants based in the United States.

Jan Fields, a military wife, started her career at McDonald’s in 1978 at the age of 22 flipping burgers at one of the many McDonald’s restaurants established in the US. Since then she rose through the ranks by working at the various levels and positions of the company.

Before her current location, Fields worked as the president of McDonald’s Central Division where she oversaw the operations of more than 4,400 restaurants in the United States.

Her elevated status now requires her to manage the daily activities of over 14,000 fast food restaurants operated by the retail giant (Success Magazine, 2009).

Background of her Career

With no college degree or any job qualifications and experience, Jan Fields made a fateful stop for a drink inside a McDonald’s restaurant in Dayton, Ohio as she was on her way for an interview.

She spotted the hiring sign for crewmembers and decided to apply as she preferred the flexible work hours the restaurant was offering its employees. Fields applied immediately for the job and succeeded in the interview preceding her secretarial job interview.

After her first day at work, she was overcome with emotion and lamented to her husband that she was not able to do the job because it was too hard.

The reason for this was that the restaurant had many rules on how to make French fries which made them distinguishable from other French fries sold by competing companies such as KFC (Hartman et al., 2009).

Fields eventually decided to endure the hard working conditions in the restaurant by returning there the next day to work at the front counter. It was while she was serving customers that Fields realized she loved her job.

This enabled her to advance towards the various positions within the company as well as the various tiers of management. She was able to progress from being a crewmember to a fry chief and then to every restaurant-level position within the company.

Fields were able to manage the Dayton restaurant in Ohio for more than two years before she moved up again to manage multiple restaurants in the larger area of the United States (Hartman et al., 2009).

During her journey to the top, Fields held to her work ethics and philosophy where she focused all her strength and ability on the current job she held instead of concentrating all her efforts on receiving promotions.

She explained her philosophy by stating that if an employee focuses on their existing job by placing a lot of effort on the performance of the job thereby doing it better than other employees; then their advancement to the next position within the organization would come at a much faster and easier rate.

Fields noted that recognition within McDonald’s was easily rewarded for employees who performed their work duties at their best possible work effort.

She, therefore, attributed her career success to performing her work duties exceptionally well and not focusing on getting another job within McDonald’s (Success Magazine, 2009).

Career Advancement

Since her humble beginning as a crew member at the McDonald’s restaurant in Dayton, Fields has worked for the company for over 28 years in the span of which she has become a senior vice president for the Central Division as well as a senior vice president for the Southeast Division of the company.

Currently, she is one of the six executive vice presidents at McDonald’s and she attributes this success to her ability to deal with limitations and obstacles during her work.

Her work ethics and philosophy of not letting situations or people get in her way has enabled to achieve career progression within McDonald’s.

She was also the regional vice president of the Pittsburg region in the United States before she moved to the role of senior vice president in the Central Division (McDonald’s, 2011).

As a senior vice president, her work duties involved visiting various fast-food restaurants operated by McDonald’s in almost half of the country.

At some point in executing her duties, she moved around with a stopwatch in her car to time the drive-through lanes in various fast food restaurants to determine the pace of service as well as the quality of food being served to customers.

Fields were able to advance from the position of senior vice president for the Central Division to be the chief operating officer and executive vice president of McDonald’s, a job that would require her to oversee the duties and responsibilities of over 800,000 employees working for McDonald’s.

Apart from being the executive vice president and chief operating officer at McDonald’s, Fields serves as a board of member for the Ronald McDonald House Charities, the Chicago Urban League and the United Cerebral Palsy Organization (McDonald’s, 2011).

Honorary Awards and Achievements

Jan Fields has been honored with many awards throughout her entire career with the first award being the President’s Award which she received in 1988 for being an outstanding employee of the Company.

She was also a recipient of the McDonald’s Golden Arch Partners Award in the same year for exemplary service and achieving considerable results in strategic initiatives within the company.

In 2001, she was honored with the McDonald’s Women Operators Network Recognition Award while the following year she was honored with the Women’s Leadership Award for her ability to serve in various managerial positions within McDonald’s (Businessweek, 2011).

One of her major work achievements has been that of being a longtime advocate for people development within the company where she has actively participated in employee mentoring and diversity programs.

She has also held the position of an executive sponsor for the Career Development program within McDonald’s where she mentors employees on the various career progression alternatives they have for progressing within McDonald’s.

As an executive sponsor, she has been able to speak in many diversity network meetings that are meant to support diversity in the workplace.

Fields is also a member of the Chicago Network which is an organization for professional women occupying high seats in the business, art, academic or government industries (McDonald’s, 2011).

Her career progression and achievements have made a notable mark on the rest of the world with Forbes magazine ranking her as one of the 100 most powerful women in America during the 2008 and 2009 edition (Forbes, 2010).

Fortune magazine also ranked her amongst the 50 most powerful women in the world during the 2007, 2008 and 2009 Fortune lists (Fortune, 2011). Fields were also ranked by the Wall Street Journal as one of the 50 women to watch for the 2007 list.

References

Businessweek (2011). McDonald’s Corp. Web.

Forbes. (2010). Janice L. Fields. Web.

Fortune (2011). 50 most powerful women. Web.

Hartman, L., Sheehan, J., and Mead, E., (2008). Started as a crew: Jan Fields and McDonald’s. Case Study No. UVA-E-0308. Charlottesville, US: Darden Business publishing.

McDonald’s (2011). Jan Fields. Web.

Success Magazine (2009). From fry to COO: McDonald’s Janice Fields says focusing on her job, not obstacles, paved her way to success. Web.

Dealing with the racial issues is not an easy task, especially when it comes to discussing the relationships between the Native Americans and the people who moved to American in search for new opportunities and the need to try his/her luck. The sad outcomes of these relationships have become notorious not only in American history but also all over the world.

The inability to compromise and to find the common language with the natives has been discussed countless times; therefore, another discussion will not add any more novelty. The specifics of the relationships between the white and the native [population of the American continent as it was portrayed in novels, however, is worth close attention.

For example, in Last of the Mohicans, a movie adaptation of Fenimore Cooper’s cycle about the Mohicans, the Frontier in the Last of the Mohicans symbolizes the contradictory relationships between the Natives and the colonists, showing that, no matter what steps might be taken by both parties, neither of them will ever be able to cross the barrier between the two and stay alive.

With the help of rather evident symbolism, Mann manages to create the concept that defines the course of the entire movie. Being an inanimate object, the Frontier seizes the audience’s attention by showing them how the Frontier, an inanimate object, becomes one of the leading characters in the movie.

It must be admitted that the movie offers considerably less ambiguity than the book. While in the novel, it is easier to show the dilemma between making friends and making war, in the movie, the given highlights are somewhat blurred.

As a result, the audience gets a rather one-sided picture concerning the way in which the relationships between the white colonists and the Native Americans developed.

It is important to stress that in the movie, the concept of the Frontier as the symbol for the long-lasting grudge that each of the opponents has been bearing against another one is somewhat in the shadow, while the relationships between the characters, as well as character development, are in the foreground. In fact, little has been left from the original idea of making the Frontier a symbol of the conflict between the two nations.

The Frontier is mentioned as the place where the leading characters meet, where they discuss various issues and where the most intense events take place. However, the Frontier is never referred to as the line that splits two nations apart.

One might argue, nevertheless, that the movie conveys the given idea rather subtly. Indeed, the fact that the Frontier is not addressed anywhere directly as the symbol of enmity between two nationalities, does not mean that it is not referred to at all. As it has been mentioned above, the image of the Frontier appears in several scenes that play a pivoting part in the movie plot.

The fact that the movie does not mark the Frontier as the exact venue where all the subplots meet to contribute to the interpretation of enmity between the Native Americans and the invaders does not mean that the Frontier is completely devoid of meaning in the movie.

It is remarkable that several key events take place next to the Frontier or at the Frontier. For example, it is mentioned at least once that “frontier land’s the only land affordable to poor people” (Mann). The given cue makes it clear that the Frontier is considered the “no man’s land,” a place where both the Native Americans and the colonists can enjoy their rights.

The given interpretation adds one more layer to the multiple meanings that the Frontier has in the movie. Not only does it serve as the mark that separates two nations, but also provides the two enemies with an opportunity to have a break from the fight as old as time.

That being said, the Frontier can be viewed as both the point of reconciling with the enemy and being at daggers with the opponent. In that sense, it is much more reasonable to view the Frontier as the point at which both the protagonists and the antagonists make their choices concerning whose interests they are going to fight for.

Although Cooper shows in a very graphic and convincing manner that the relationships of trust, friendship, and even love could exist between the Native Americans and the colonists, it is still worth admitting that such relationships were rather an exception than an everyday occurrence.

Because of their cultural differences, their attitude towards the American land and their unwillingness to compromise, the Native Americans and the colonists built a wall that separated them from each other much more successfully than the famous Frontier. Being the symbol of a conflict between the two nations who will never come to terms, the Frontier gained a very symbolist meaning very soon and for quite obvious reasons.

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Abstract

The current paper outlines a proposal for a study aimed at examining business ethics in relation to marketing plans adopted by McDonald’s. A number of issues regarding ethics and market planning are outlined in the proposed theoretical framework. In line with the need to safeguard the wellbeing of consumers, the project highlights the importance of understanding the effects of ethical standards on selected marketing plans, such as advertising.

The author outlines a hybrid research design that will be used in the proposed study. To this end, the research will assume a combination of a case study and an exploratory study design. Some of the findings expected include the required ethical standards with regards to an organisation engaging in marketing. The ethics touch on, among others, advertising and labelling. The author concludes that an ideal marketing plan is one that satisfies the various needs of consumers in the industry.

Introduction

Background Information

Ethics play a very important role in the business world. The standards are used to ensure that the products sold to the consumer are genuine and of high quality. Given this significance, there is a need to examine the concept on the basis of a real-life example. The proposed research intends to analyse the specific notions of ethics associated with marketing and other business activities.

According to Murphy and Laczniak (2012), the marketing plan adopted by a given entity should adhere to certain ethical standards. In light of this, the proposed project will analyse some of the ethical measures employed by businesses. McDonald’s will be used as a case study for the planned research undertaking. The proposal will focus on ethical standards regarding the formulation and implementation of marketing plans in the fast-food industry at the international and state levels.

Research Rationale

The research project is mainly intended to examine the marketing plans of a food chain business. The rationale behind business operations in many entities is the need to maintain high standards (Murphy & Laczniak 2010). McDonald’s was selected as the preferred case study owing to the fact that it is a successful entity in the fast-food industry. The author seeks to identify some of the marketing strategies adopted by the firm to achieve this success. The ethical nature of these promotional plans will be analysed.

The learning experience of the researcher also informed their interest in this field. To this end, the study is guided by labelling and advertising campaigns. The proposed study is intended to point out some of the ethical shortcomings that organisations fail to address in their marketing plans.

Objectives of the Research

The study is intended to achieve the following objectives:

1. To establish the standards of ethics required in the marketing of a given product
2. To illustrate the common ethical mistakes committed by businesses with regards to marketing.
3. To outline the impacts of failure to adhere to ethical standards during marketing.
4. To propose a number of ethical marketing plans

Research Questions

The proposed research undertaking will respond to the following questions:

1. How are ethical standards applied in marketing plans?
2. What are the effects of unethical marketing plans?

Critical Literature Review and Theoretical Framework

Relevant Literature

A number of studies have been conducted in the larger field of marketing and ethics. Most of these works are aimed at establishing the relationship between the two concepts. The studies by Brubaker (2007) and Sirgy and Lee (2008) are examples of landmark inquiries carried out to investigate the link between marketing plans and ethical standards. In their research, Brubaker (2007) discusses the importance of ethics in relation to direct marketing. Most food chain businesses employ a direct marketing plan in their operations. In light of this, the study by Brubaker (2007) becomes an important point of reference as far as the literature review is concerned.

When used in marketing, ethical practices bring about the notion of consumer’s wellbeing. The findings made in the study by Sirgy and Lee (2008) shed more light on this element of marketing. Sirgy and Lee (2008) focus on organisations dealing with consumer goods. As already mentioned, the proposed study will examine the marketing plan put in place by McDonald’s. As such, the findings made by Sirgy and Lee (2008) will enhance the reader’s understanding of the ethical measures required in McDonald’s.

Theoretical Framework

The process of developing a suitable marketing plan borrows heavily from theories in this field. Scholars who have conducted studies touching on this issue have used different theoretical frameworks. The proposed research will be based on green marketing and consumer wellbeing theories. The study by Sirgy and Lee (2008) made use of the consumer wellbeing premise.

Sirgy and Lee (2008) point out that the welfare of the clients should be taken into consideration when establishing a link between relationship and transactional marketing. The green marketing framework is ideal for the development of a suitable promotional plan. The theory highlights the importance of protecting the environment when conducting business.

The two theories indicated above are important to the proposed research project given their ethical connotations. For instance, the study by Brubaker (2008) illustrates the need for socially acceptable activities with respect to direct marketing. The green framework to be used in the research will help outline the activities that can be adopted by firms in the development of an ethical marketing plan. In addition, the two theoretical frameworks have been used in previous studies. The planned research will build on the findings made in past studies that have used the two approaches.

Methodology

Research Design

Different studies adopt varying research designs to obtain the desired results. According to Saunders, Lewis, and Thornhill (2003), the selection of a research methodology is based on the study problem presented by the scholar. The proposed study is intended to examine marketing plans in the context of ethical standards. A study of this nature requires the researcher to familiarise themselves with the given subject and structured point of reference. To this end, the proposed inquiry will adopt a hybrid approach made up of exploratory research design and a case study.

The objective of carrying out research is to explore and improve the existing information about a subject. Saunders et al. (2003) opine that a case study allows one to make use of concepts that are already in existence. In addition, Saunders et al. (2003) suggest that an exploratory research design allows the scholar to refine the subject matter of their study. In light of this, the two research designs will broaden the knowledge existing around ethical standards required in the development of marketing plans.

Research Context

The proposed study will be domiciled in the food chain industry. According to Hundekar (2010), understanding the ethics involved in the formulation of marketing plans requires the researcher to gauge levels of consumer satisfaction. Some of the key features involved in this assessment include the labelling of the product and the advertisements involved. The study will focus solely on the marketing plan used by McDonald’s.

Research Procedure

The research designs proposed for the study give rise to two phases of data collection. According to Saunders et al. (2003), secondary information is usually collected first. In the proposed research, secondary information will be accessed through critical literature reviews and analysis of the case study. Primary data will be accessed using two tools. The two are interviews and questionnaires. Invitations will be sent out to respondents. Research ethics, including the need for informed consent, will be observed in study envisaged in this proposal.

Methods of Data Collection

An exploratory research design is used in testing hypotheses. In line with this, a number of hypotheses will be formulated for the proposed study. According to Saunders et al. (2003), the exploratory design requires the adoption of both primary and secondary sources of data. The literature review will provide preliminary (secondary) information. Information from the case study will also act as secondary data. However, to improve the credibility of the study, questionnaires will be administered to a designated number of participants. The same will act as the primary sources of information.

Data Analysis

The proposed research will make use of two sets of data. The two include qualitative and quantitative information. Under such circumstances, Saunders et al. (2003) recommend the use of deductive and inductive data analysis procedures. The study will adopt both methods of data analysis to enhance the results.

Discussion

Significance of the Proposed Research

Market planning is important to any given business as it improves chances of growth. According to Smith (2012), companies that fail to observe ethical practices in marketing risk losing their clients to competitors. The proposed study will highlight the common ethical weaknesses among organisations in relation to the implementation of a suitable strategy. The findings made will improve existing information on the fundamentals of consumer welfare.

A viable research undertaking should yield practical solutions to a given problem. Saunders et al. (2003) argue that studies conducted in the business field can be used to provide solutions to companies that are in need. The findings of the proposed research will provide McDonald’s with workable solutions that will help address some of its ethical problems affecting the marketing plans used. For instance, an ideal advertisement plan will be developed to avoid misleading consumers who are buying particular commodities. In addition, suitable labelling techniques will be proposed.

Research Limitations

The research design proposed for the study is characterised by a number of limitations that affect the attainment of the intended objectives. According to Saunders et al. (2003), exploratory research designs are associated with small sample size. The development means that it is hard to make generalisations in the study (Saunders et al. 2003). On their part, case studies are associated with difficulties when it comes to the establishment of the cause-effect relationships between variables. Consequently, the information illustrating the link between ethical shortcomings and marketing plans will be limited.

Provisional Work Schedule

References

Brubaker, S 2007, ‘Ethics and regulation in direct marketing’, Direct Marketing: An International Journal, vol. 1 no. 1, pp. 55-58.

Hundekar, S 2010, Principles of marketing, Himalaya Publication House, Mumbai.

Murphy, P & Laczniak, E 2012, Ethics in marketing: international cases and perspectives, Routledge, Abingdon, Oxon.

Saunders, M, Lewis, P & Thornhill, A 2003, Research methods for business students, 3rd edn, Prentice Hall, Harlow, England.

Sirgy, M & Lee, D 2008, ‘Well-being marketing: an ethical business philosophy for consumer goods firms’, Journal of Business Ethics, vol. 77 no. 4, pp. 377-403.

Smith, N 2012, Marketing ethics, SAGE, Los Angeles.

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Organizational Impact Paper

Technological advancement keeps on causing changes in various industries through innovations, creativity, and advanced designs. Currently, change is inevitable in every organization, and thriving organizations include those that adapt and adopt to change immediately once it occurs. Through innovative and creative designs, the efficiency of processes and quality of products and services have been enhanced.

Most importantly, organizations use innovations and creativity to underpin their competitive advantage in the market. The food and manufacturing industries are among other industries that have been affected positively by the tremendous innovations, designs, and creativity. McDonald’s and Nike organizations are examples of companies whose competitive strategy is focused on innovation, design, and creativity around the globe.

Innovations

Nike organization is known as the most innovative company that deals with sports shoes and apparel. In recent years, Nike has changed its strategic focus from risk management, philanthropy, improvement of labor, and environmental impacts on innovation and creativity (Nike, Inc report, 2012). The focus on innovation has influenced Nike’s corporate responsibility strategy enabling it to make products that are more suitable in the 21^st century.

The company believes that for it to continue being the leading athletic brand round the world, it must provide innovative new products that are sustainable because future profitability depends on product sustainability. The increased focus on innovation and sustainability is aimed at helping Nike to have greater returns to its business, factory workers, and consumers. The reason Nike invests in innovation and creativity is to remain environmentally responsible in the 21^st century as every organization strives to be green (Nike, Inc report, 2012).

The food industry continually experiences amazing innovations making it difficult for any food company to survive in the market. As a result, MacDonald’s restaurants restructured their competitive strategy focusing it on innovations and creativity. MacDonald’s restaurants continually introduce various novelties making the chain one of the international corporations that continues to drive innovation in the fast food industry (Cramer, 2009).

Some of the innovations are advertised well while others are designed in the manner that customers and even competitors cannot notice. For instance, due to rampant unemployment, MacDonald’s was unable to make enormous profits from 2007 to 2009 (Cramer, 2009).

This made the organization change its strategy by introducing an innovative breakfast version of its dollar menu to attract more customers. This implies that MacDonald’s has positioned itself in the market through technology and innovation to meet the needs of the dynamic market.

Throughout its history, MacDonald’s has remained the best seller of fast food, and this can be attributed to new technologies and innovations. It became the first to introduce specialty coffee, enabling its customers to enjoy a cup of coffee while discussing their issues.

Since it introduced the specialty coffee and offered it at affordable prices, it has gained a considerable share in the U.S. market, as compared to Starbucks. Innovation in the food industry is crucial as it helps organizations to develop creative new products. Through innovations, MacDonald’s has continued to get more profits and higher sales from the American fast food industry. It is not imaginable how the food industry could be without the rapid innovations introduced by MacDonald’s restaurants (Cramer, 2009).

Creativity and Designs

Over the years, Nike has changed its athletic products in terms of design and creativity to suit dynamic sporting events. Nike understands that innovation goes hand in hand with creativity and design. Initially, sportswear was huge and heavy, with poor shapes, but when Nike focused its corporate responsibility on sustainability and innovations, it produced new designs that utilize environmentally friendly materials.

For instance, the company has invested in considered design, which combines sustainability and innovative performance products for its target customers (Nike, Inc report, 2012). This design aims at reducing toxins and waste of material resources. Also, Nike introduces new designs into the market because it relies on the availability of natural resources.

The scarcity of resources has made the organization engage in making appropriate designs that correspond with the resources available. Being the leader in the sportswear industry, Nike has managed to influence other organizations from depending on the limited natural resources (Nike, Inc report, 2012).

On the other hand, MacDonald’s has never stopped to design new food products and introduce them into the market at the required time. MacDonald’s growth strategy depends entirely on its constant designs and the creativity it puts in the manufacture of its fast food. The company has managed to drive a lot of profits as well as win many customers through creative designs.

The company offers different food designs which appeal to many customers. MacDonald’s restaurants are known to include innovative and creative designs in their menu (Cramer, 2009).

Conclusion

In conclusion, innovation, creativity, and design affect a company’s strategy in several ways. Through innovative designs, organizations can survive in a dynamic and competitive market. Nike and MacDonald’s organizations have managed to be the leaders in their respective industries because of building their competitive strategy around innovation, creativity, and new designs.

The current market environment is competitive, and the ability of the organization to adopt to and adapt changes in its industry is the key to success and profitability. This is the reason why MacDonald’s and Nike organizations have incorporated innovation, creativity, and design in their overall strategy.

References

Cramer, M. (2009). The Emerging Role of Operations Research at McDonald’s. Web.

Nike, Inc report (2012). Strategy: Innovation in the Offense. Web.

The article called “McDonald’s: When the chips are down” posted on The Economist, the world-renowned portal for economic news and discussions, explores the innovations that appeared in some of McDonalds’ outlets this year. The article presents a detailed review of the work and issues the world’s biggest international fast food company experienced lately and the crises it had to deal with.

The rapid pace of contemporary technological progress has made McDonald’s take a new approach towards its marketing system. McDonald’s starts a new chapter of its business history, becoming much more progressive and tech-savvy.

The innovation this company plans to provide from its restaurants is a touch screen that allows the customers place their orders remotely by means of composing their own burgers out of suggested ingredients which include various types of buns, sauces, meat, and vegetables (McDonald’s: When the chips are down par. 1).

Apart from the new technologies presented at the restaurants, McDonald’s is also planning to become more active on the Internet, starting a new mobile application that would allow the customers to pay by means of using their phones and such payment systems like Google Wallet and Apple Pay. Moreover, the company is planning to become more connected online and engage in communication and interaction with its customers on various social networks.

This integration of modern technologies into the fast-food business of McDonald’s seems like a valuable and timely move that is likely to bring a lot of benefits for the company, especially after the series of crises it had over the last two years. Lately, McDonald’s had to deal with scandals in China and Japan related to the declining quality of the products and ingredients sold there.

At the same time, the company lost a part of its revenues in Russia when a number of restaurants were shut down as a consequence of the economic confrontation happening between the United States and Russia at the moment.

To address its financial losses, McDonald’s has been expanding its menu and adding a variety of new items. Yet, the experts believe that this harms the company’s business and drives it away from its initial goal, which is serving good quality freshly made fast food very quickly (McDonald’s: When the chips are down par 9).

The analysts add that chasing a variety and trying to offer a wider range of choices to its clients McDonald’s risks its quality and speed. This way, the company needs either to cut down the number of items in their menus or to be prepared to lose more customers due to the declining quality of service. Besides, the new and exotic items make the final products of McDonald’s more costly, and this contradicts the company’s policy of selling low-price food.

Being the world’s largest and most famous fast-food chain, McDonald’s also becomes the target for negative PR from the side of eco-friendly activists, animal rights protectors, nutritionists, and other haters (McDonald’s: When the chips are down par. 12). The efforts of these parties negatively impact the company’s reputation as it is often viewed as the symbol of all fast food in general.

In conclusion, the article explores the ups and downs of the business at McDonald’s, its biggest challenges, and the strategies to address them. The pressure and stress McDonald’s currently undergoes require the company’s leaders to react quickly, be flexible, and employ measures that bring quick results.

Works Cited

McDonald’s: When the chips are down. The Economist. 2015. Web.

Kuwait is an Islamic region, which in the early years had few investors. This was because there was little knowledge of the marketing opportunities in the region. The religion and culture of the people living here influenced their perception of the services offered especially retail services. The discovery of oil attracted many foreign investors to Kuwait and this led to increased spread of wealth to those who were poor.

Many immigrants were from America, India, Bangladesh and other parts of Asia. The wealth from the extraction of oil accelerated growth in the middle and upper-middle classes. As a result of this, McDonald’s corporation – an American fast food company – was one of the 63 companies attracted to develop a branch in Kuwait. It specializes in selling cheeseburgers, hamburgers, French fries wraps and breakfast items.

McDonald’s corporation is considered to be a small store and it will be hard for it to succeed in the industry because it lacks incentives. On the other hand, McDonald’s is believed to ignore some cultures and behaviors of customers. McDonald’s corporation cannot expand their services into new markets because the Kuwait market is now saturated. For McDonald’s retail store to grow, it needs to first understand the importance of culture and religion to the residents of Kuwait (Blank 4).

This will improve human relations that will have a positive effect on the incomes of the retail stores. According to Raven and Welsh, McDonald’s fast food store should hire foreign workers from different countries who have experienced different needs and different ways of satisfying those needs.

This will be an opportunity for them to diversify in production of different types of foods. Foreign employees can easily be brought in from the head office in America. This will be an advantage to McDonald’s corporation because it will have to train its workers on how to prepare its products as well as how to use the equipments (Blank 5).

McDonald’s corporation should focus its attention on service encounters and satisfaction of their customers because customers are believed to receive less emphasis in the developing countries. Customer satisfaction is known to be specific to a transaction while service quality is affected by the attitude employees have towards service delivery.

The corporation should, therefore, invest its resources on improving the quality of services offered by its employees to their customers, for example, through training. This will help it to expand into other new markets leading to increased growth and profitability (Blank 5).

McDonald’s corporation should understand the culture of residents to help it in segmenting the market and resource allocation. Before entering into a market, it should have full information of the different cultures that exist in that market so as to operate profitably. National culture is considered as the main factor that influences international management as it will determine the decisions made by management concerning its operations (Blank 5).

McDonald’s corporation should prepare its food in large quantities in order to take advantage of economies of scale, which will lead to reduced costs and increased profits. The extra profits gained through savings from producing in large quantities will help expand to other areas. It should also invest in proper technologies and train employees on this modern technology (Blank 7). This will make the operations efficient and effective thereby reduced costs.

McDonald’s corporation as one of the fast food companies is considered a low wage industry. It, therefore, cannot afford to pay the minimum wages. This leads to high turnover. It should, thus, take advantage of the sub minimum wage for the youths. Sub minimum wage reduces training costs because it does not require any additional training for the first consecutive ninety days. The working conditions of the employees should be improved and their health standards maintained in order to motivate them to work harder (Blank 7). The company should seek real expertise in brand development.

Finally, the top management at the organization should be well trained to make appropriate decisions that will make the operations of the store more effective. They should be able to research on information about the market and take advantage of the information to enter new markets. They should also possess interpersonal skills to help them relate with employees in a proper manner. This will motivate employees to put more effort in their work. Employees should also be allowed to make some decisions that affect them. The firm should adopt new business models, which will help in averting its smooth operation (Blank 9).

For McDonald’s corporation in Kuwait to grow internally and externally, it should first understand the culture and religion of the residents who are the target customers. It should apply sub minimum wage to reduce employee turnover because it cannot manage to pay the minimum wage. It should also segment the market so as to serve the customers better. This can be done through obtaining relevant information about the market. Lastly, it should make sure it takes advantage of economies of scale and also provide good working conditions for employees.

Works Cited

Blank, Steve. “Why the Lean Start-Up Changes Everything.” Harvard Business Review, 2013. Web.

Introduction

Product positioning is a crucial marketing mix function that ensures the strategic placement of goods and services in the market. McDonald’s is known for its robust product positioning strategies that have continued to offer the brand, which has a unique competitive edge in more than 100 countries worldwide. This essay provides insight into McDonald’s product positioning strategy.

McDonald’s Product Positioning and Corporate Strategy

The fast-food company conducts its business in a way that targets families. In fact, it has made itself a friendly family low-cost restaurant in the fast-food industry (Hanratty et al. 548). The corporate strategy focuses on an economical business by providing healthy and blissful meals with considerably short delivery times.

The McDonalds utilizes tech-savvy point-of-sale systems to shorten the customers’ waiting time. The company made globalization one of its core strategies. Through internalization, the organization has introduced its products and customer service to various foreign countries. Close attention is paid to the cross-cultural diversity aspects associated with the cross-border business (Dabija and Postelnicu 210).

To position their products in line with the globalization strategy, the company has introduced numerous local business themes such as the ‘Aunt and Uncle’ McDonalds in China. The themes correspond to the country’s emphasis on family values. The company has also established a unique fast food globalization strategy known as ‘Mcdonaldization.’ The term implies the proliferation of the fast-food company worldwide by matching the principles of the organization with the family values of the host country.

The company has gone further to make its environment a hangout place by introducing services such as wireless internet connections, laptop points, play stations, and playgrounds for children (Bobba 76; Hanratty et al. 549). As the restaurants serve children, they have products too for the whole family.

Weaknesses in McDonald’s Product Positioning

The McDonald’s product positioning has faced stiff challenges in both the American markets and abroad (Nandini 21). Its products have been criticized for posing health threats such as obesity, heart disorders, asthma, and mad cow disease to children. The McDonald’s products have also been questioned for having environmental issues such as the genetically modified potatoes that are used to prepare the meals. In addition, the beef used in the restaurants comes from as many as five different countries (Nandini 21).

This practice of mixing substances from different and extreme distant origins is problematic since the likely contamination is difficult to trace. The introduction of fast food products in different countries has affected local cultures adversely. Many people feel that it undermines the local cuisines that match with their traditions (Westjohn, Singh, and Magnusson 59).

The relevance of the EPS/EBIT Chart in Strategy Implementation

The determination of the financial risks of the enterprise is accomplished using different tools with a view of acquiring adequate capital to implement various strategies. Business risk refers to the unpredictability of the enterprise’s expected earnings before the interest and taxes (EBIT) (Rose 137). An EBIT analysis is utilized as a technique to determine the extent to which the debt and/or stock should be used to fund the projected strategies.

Successful strategy implementation requires additional capital that can be obtained from the debts and equity besides the company’s operations and sale of assets (Rose 137). The EPS/EBIT Chart Terms include the Earnings Per Share (The Net Income divided by the number of Shares Outstanding), Earnings Before Interest and Taxes (EBIT, also referred to as operating income), Earnings Before Tax (EBT), and Earnings After Tax (EAT).

Works Cited

Bobba, Samantha. “The role of the food industry in tackling Australia’s obesity epidemic.” Discover the opportunities in general practice 1.1 (2013): 76. Print.

Dabija, Dan-Cristian, and Cătălin Postelnicu. “Mcdonald’s – Between Internationalization and Regionalization of Restaurant’s Value.” Review of Management & Economic Engineering 14.1 (2015): 205-219. Print.

Hanratty, Barbara, Beth Milton, Matthew Ashton, and Margaret Whitehead. “‘McDonalds and KFC, it’s never going to happen’: the challenges of working with food outlets to tackle the obesogenic environment.” Journal of Public Health 34.4 (2012): 548-554. Print.

Nandini, Satya. “McDonald’s Success Story in India.” Journal of Contemporary Research in Management 9.3 (2014): 21. Print.

Rose, John. “Extending the Presentation of the EBIT-EPS Relationship for Introducing Financial Leverage in the Classroom.”Journal of Financial Education 1.1 (2010): 137. Print.

Westjohn, Stanford, Nitish Singh, and Peter Magnusson. “Responsiveness to Global and Local Consumer Culture Positioning: A Personality and Collective Identity Perspective.” Journal Of International Marketing 20.1 (2012): 58-73. Print.

Introduction

McDonald’s is one of the largest fast-food restaurant networks in the world. It works as a global franchiser; more than 80% of their restaurants are possessed by independent businesspersons (‘Our Business Model”).

According to the official website, the company serves approximately 69 million clients every day, in nearly 36,000 restaurants located in more than 100 countries of the world (“Company Profile”). In 2014, it had total revenue of $27,441 billion, and a net income of $4,758 billion (“MCD Income Statement”). So, is there any prospect for growth for such a large company, and if yes, what is it?

Current Situation at McDonald’s and Threats

Despite the fact that McDonald’s is among the largest fast-food worldwide networks, it is still planning to grow and develop. For example, in 2013, McDonald’s plans for 2014 were to introduce a wider selection of foods and drinks, as well as to offer free WiFi. It also planned to open nearly 1,500 new restaurants and get an operating income growth of 6-7% (Campos par. 7).

However, according to MCD Income Statement, the organization’s operating income in 2014 accounted for 90,7% of the operating income in 2013 (whereas the income in 2013 was 101,86% of 2012). So, the company has, in fact, suffered a great decline in sales in 2014. According to Udland, this is due to a rise in the levels of obesity and the increase in customers’ preference for healthy food (par. 3).

Thus, it can be inferred that competitors of McDonald’s are not only other major fast-food restaurants such as KFC, Yum Brands, Burger King, or Wendy’s, but, more importantly, various restaurants (both local and worldwide) that serve healthier food. It is stated that consumers in New York are willing to pay more for meals that resemble home dinner in restaurants that look more like a kitchen than manufacturing (Hussain).

Opportunities for Recovery and Growth

Udland claims that in such a situation, when McDonald’s’ sales are steadily falling, and the company is confronted by a long-term crisis, the only chance for its recovery and/or growth is to swallow other businesses of the same type, such as Wendy’s or Starbucks (par. 5).

On the other hand, Brumley asserts that there is much opportunity for McDonald’s business in one particular region, which is China: the company’s CEO and his team “see China as the most productive place to foster change … even if only because China is the only place they truly understand how to improve” (par. 7). So, a possible way of improving the company’s situation is to focus on the development of the Chinese market.

Another prospect of improving the current situation might be related to the food McDonald’s offers. As we mentioned before, clients often opt for other restaurants due to the fact that they offer healthier meals. Thus, McDonald’s might consider changing the menu and adding more types of healthy food to it, such as salads or analogous vegetable dishes. This practice is not new; in fact, McDonald’s already has the experience of introducing healthier types of food (such as carrot sticks). Perhaps it is time to conceive additional similar options.

Conclusion

As we see, McDonald’s, despite its famed reputation and being a worldwide company, nowadays suffers a great decline in its sales. According to the authors cited, the decline is, to a great extent, the result of changing tendencies and preferences of the customers who opt for healthier food choices.

There may be not a great perspective for the company’s development nowadays; most analysts are concerned with the problem of declining the drop in the sales. On the other hand, the company might still be able to develop further in some regions (particularly in China), and it might improve its own performance in markets by introducing new products that would correspond to consumers’ wishes.

Works Cited

Brumley, James. McDonald’s Is About To Tap Into A Huge Growth Opportunity. 2014. Web.

Campos, Adrian. How McDonald’s Plans to Keep Growing. 2013. Web.

Company Profile n.d. Web.

Hussain, Samira. McDonald’s Losing Out to High End Competitors. 2015. Web.

MCD Income Statement. 2015. Web.

Our Business Model n.d. Web.

Udland, Myles. Maybe the Only Way for McDonald’s to Grow is to Buy Wendy’s. 2015. Web.

McDonald’s is an American international enterprise that deals with fast foods. The franchise business that operates in more than 100 countries is based in the United States and is greatly influenced by federal regulations. Following the enactment of a law to promote healthier nutritional behavior, McDonald’s Company has moved to comply with stipulated legal requirements and to modify the nutritional content of its products. This paper seeks to discuss the costs that are involved in the decision to enhance nutritional standards. The paper will identify relevant costs and costs that are not relevant to the decision.

Corporate social responsibility aimed at improving nutritional standards is one of the decisions that have recently been made by McDonald’s corporation. One of the major initiatives in this decision involves the production of dairy products that are low in fat content. The company also ensures that the percentage of calories in its products is reduced to about 20 %. The company’s move further extends to conducting awareness campaigns that target families as a whole with the main agenda of enhancing better nutrition among children. Other initiatives about the decision involve the production of specialized packaged meals, reducing sodium content in products, advertisements, and organized field trips by the organization’s key personnel.

This decision was made in the year 2011 and its implementation is expected to be long term. Full compliance with the legislation to set nutritional standards is expected to be accomplished by the end of March 2012. Further considerations such as reduction of sodium content in foods are projected to be fully implemented by the end of the year 2015. Though advertising was to be reinforced, it has significantly been used by McDonald’s to spearhead nutritional awareness campaigns. The period for implementation of the decision, therefore, includes the years 2011 and 2012 for active measures with slight extension to future periods.

To implement the decision to improve nutritional standards, the company faced a variety of inputs in terms of implementation costs. The first initiative, aimed at reducing fat, sodium and calorie content in the foods would, for instance, require inputs such as research and evaluation machinery and personnel. There was also the option of using alternative sources of raw materials that would yield low percentages of the minerals in products. Similarly, advertisements would call for the company’s marketing inputs while field trips would require the application of the company’s vehicles, work hours, and monetary expenses.

These inputs can be classified into either relevant costs or costs that are not relevant to decision making. The first classes of inputs that are considered irrelevant to making decisions are historical costs. Historical costs include costs of plants, machinery, and vehicles and are costs that have already been incurred before the decision. Relevant costs, on the other hand, include opportunity costs and sunk costs. These include benefits that would have been derived if another alternative were adopted instead of the decision and the costs that must be incurred in implementing the decision.

The table below summarizes some of the relevant costs and costs that are not relevant to the company’s decision to improve its nutrition standards.

Table 1. Estimates of involved costs

Though the involved inputs are costly, a large percentage either are not relevant costs as they are historical costs or would have been incurred irrespective of the decision. The company, however, stands to benefit from the improved corporate image that may boost its sales.