Case Study Analysis - McDonalds

CASE STUDY ANALYSIS - CASE 10 MCDONALDS

September 29, 2011

I. History

In 1937, Patrick McDonald opened "The Airdrome" restaurant, it was located on Route 66 (Huntington Drive) it was near the Monrovia Airport. Hamburgers were ten cents, and all-you-can drink orange juice was five cents. In 1940 two sons, Maurice and Richard moved the entire building 40 miles east to San Bernardino, California, they then named the restaurant "McDonalds" McDonalds has been around for 71 years. In 1991 McDonalds owned $13 billion fast-food industry, operating 12,400 restaurants, franchises and joint ventures

II. Internal Environment:

McDonalds originated standardization in the production and service of fast food, but it did not. The company did, however, contribute greatly to that standardization. In 1948, Mac and Dick McDonald introduced the "Speedy Service System" helped to further the principles of the modern fast food restaurant. In 1957 Kroc asked Turner to visit franchises and evaluate the performance of their restaurants. In the mid 60's McDonalds employed several full-time consultants to visit restaurants to give them a grade, this if the restaurant had a passing grade of a B then the owner was allowed to purchase more McDonalds. Fred Turner laid the foundation for a successful franchise system that has lasted well into the 21st century. Turner drafted a 75 page training manual that was later 360 pages by 1974. McDonald's operations manual was the main test used in classes taught at the Hamburger University. McDonalds' Speedee Service System and, much later, Ray Kroc's McDonald's outlets and Hamburger University all built on principles, systems and practices that White Castle had already established between 1923 and 1932.

III. External Environment:

McDonalds is a trusted name in the food industry and they continue to modify their menus, stores and their employees to stay that way. McDonalds has competed with chains such as Burger King, and Wendy's while at the same time compete with healthier establishments such as Subway and Panera Bread. McDonald faces many more challenges by staying practice on being a positive face for social awareness, community involvement. Employees currently working for the McDonald Corporation know that they are working for a socially responsible company.

IV. SWOT:

Strengths: McDonalds has a strong global presence. McDonalds market in both the domestic and international markets. The benefit from cost reduction through economies of scale because of its enormous size and its huge global presence. In the international markets McDonalds is well placed to expand and take advantage of long-term economic