Reflective Analysis of the Internal Business Environment

This document provides a reflective analysis of the internal business environment, focusing on the value chain analysis and its application to McDonald's in the United Kingdom. It discusses the primary and support activities involved in the value chain, as well as provides a reflection on the analysis. The document also highlights the importance of long-term relationships and branding in McDonald's operations.

REFLECTIVE ANALYSIS OF
THE INTERNAL
BUSINESS ENVIRONMENT
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Table of Contents
Value chain analysis....................................................................................................................3
Operates business in the United Kingdom ..................................................................................4
McDonald value chain analysis...................................................................................................5
Reflection on value chain analysis...............................................................................................8
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9
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INTRODUCTION
Value chain analysis is used to enhance profits by creating goods or services that the
consumers are willing to pay attention rather than the cost to develop it (Mudambi and Puck,
2016). Firm like McDonald must decides why they wants to enhance its values chain within the
context of its competitive benefit to differentiate among its competitors. Present report lay
emphasis on the description of the Value chain model through Porter. A description to the
franchise business such as McDonald firm as it operates within the United Kingdom. It also
focuses on the internal environment of Mcdonald by primary and secondary activities.
Furthermore, it highlights on the Reflection regarding value chain model that assist to determine
internal environment of firm.
Value chain analysis.
It is considered as a combination of a system regarding a firm that able top utilizes to make the
money. To create services or product , a value chain analysis made of different subsystems. It
involves the process from beginning to end (Jaligot and et.al., 2016). This analysis is utilized as
a tool for recognizes activities in as well as around a firm.
Classification regarding value chain analysis
Primary activities – These are the kinds of the functions that can be directly concerned
accompanied by the conversation regarding input into output as well as circulate activities that
are known as Primary activities. It involves
Inbound logistics- Here in this process different range of actions such as storing,distributing as
well as receiving that can makes the available services and goods regarding process called
operational process. Such as transportation,handling and stock control (Fernandez-Stark and
Gereffi, 2019).
Operations- It involves the activities that able to modify input raw materials to the product
ready for sale, it is known as final product for sales such as operations. The activities came
under this criteria are assembling, machining, packaging.
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Outbound logistics- As per the name suggests these are the kinds of actions that assist in
storage,collecting as well as delivering of the services and product to the consumers within
inbound logistics (Hamilton-Hart and Stringer, 2016).
Sales and marketing- All the actions such as sales,marketing, research ,advertising,public
relations that can be used to make consumer aware regarding services and product as well as
creates demand for it,came under marketing.
Services- It means that the services can be provided by the consumers to maintain or improve
the values regarding product such as it involves after sales services,financial services and many
more.
Support activities- These are the kinds of the actions that aids primary activities in achieving
them as well as assists such actions. It includes
Development of technology
It needed development for heavy investment that takes years for development and research, its
advantages can be enjoyed for various years (Rosales and et.al., 2017) .
Human resource development-It is considered as the activities that are most common that excels
all the activities of the firm. It encloses overall selection,promotion,transfer,retention dismissal
of the employees and also their appraisal.
Infrastructure
It is the management system that able to gives ,its services to the firm. It includes
finance,planing, information,government affairs and quality control.
Procurement-Here the actions served the firm ,through supplying all the crucial inputs such as
machinery,material as well as other consumable items that are needed by the firm regarding
primary activities (Tadesse and Fayera, 2018).
Operates business in the United Kingdom
Franchise- This kind of business already established firm ,for example McDonald's that is
owned through franchisor but can be managed through a franchisee. To use their business
model franchisee sells the rights to the franchisor who can to pay the ongoing fee. Start-up cost
and workload cost can usually lower,relationship with suppliers, marketers and Distributors
already exists,business finance is acquired. Thus, huge amount of ongoing fees restrict
franchise's benefits that are long term also cheaper operating methods that can be utilises unless
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sanctioned as well as negative activities through a fellow franchisee that may causes damages to
the business (Purcell and et.al., 2017).
McDonald's restaurant first opened within the year 1974, nowadays there are over 1,250
UK restaurant they create jobs,serves millions of consumers as well as gives opportunities to
businesses and local people. Franchise of McDonald is known as the investment that is known
as the appealing investment but for the firm it is really hard that they have to find out the right
people. It is considered as a challenge as has a cash flow is about £110,000 - £320,000. Also,
they make sure that they offer world-class support ,development and training to their franchisees.
They also make sure to provides the benefits of branding and marketing that consider as one of
the most established on the planet (Howieson, Lawley and Hastings, 2016).
McDonald provides the long term relationship accompanied by the suppliers that are built
regarding trust. They trust them to give great food as well as within return they trust to influence
and respond to the market trends. Because of the investment they put into the building
relationships as well as various suppliers and also prefreed trading consumers. They also feel
confident as a franchisee by knowing that a secure supply chain within place (Fernandez-Stark
and Gereffi, 2019).
McDonald value chain analysis
McDonald unable to take it as a rigid Framework through delegating the equal
significances to all the actions . The affective value chain analysis does not need all the actions
or functions at the same level. Thus, it can identify the significances of the activities as per their
role within service or product process.
Mention below some primary activities that can be directly included within selling as well as
producing the product to the target oriented consumers. Some primary chain actions can enhance
the performance as given below
Inbound logistics
To develop strong relationship with the suppliers it is required to store and receive as well as
distribute the product. It is considered as the most vital as McDonald faces different challenges
within product development phases. It needed a firm to highlights on each and every aspect
regarding change from raw products to the end products. Some examples such as storing inputs,
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retrieving law materials and also distributing components and raw materials to the start
production (Tadesse and Fayera, 2018).
Operations
The significances of evaluating raw materials ,where McDonald's is ready to process the
raw materials into the finished products as well as launch into the market. Such as
packing,machinery, testing and assembling. Repair and maintenance of the equipment also came
under this category. It Involves both service and manufacturing operations. It evaluates
operational activities for enhancing productivity ,assuring the competitive success , maximizing
the efficiency of McDonald. Enhance productivity can aid firm to accomplish regular economic
growth , enhances profitability as well as set a basis regarding competitive benefit (Tadesse and
Fayera, 2018).
Outbound logistics
Restaurant operates within following formats such as drive -thru,sit down restaurants,ski thru
and counter-services outlets. Conventional process is follows by sit down restaurants as it
includes waiter to taking order as well as delivering food . Also some activities are
warehousing,transporting,material handling ,order processing as well as delivering to the end
point. Firm optimize and analyses to explore competitive benefit sources as well as
accomplishing objectives of business growth. As Outbound logistics actions managed timely
accompanied by optimal cost as well as product delivery process that put a negligible negative
effect regarding quality. It enhances growth opportunities and maximizes consumer satisfaction
for the Organization. Firms must pay specific significances to the outbound logistics as it can
offer goods that needed rapid delivery and are perishable to the end consumers (Mudambi and
Puck, 2016).
Marketing and sales
At this step , firms will focuses on the differentiation and benefits points to the provided products
to convince the consumers that they can offer better than the competitors. They are producing
high quality products as well as unique features products at the affordable prices. Such as
promotional activities,channel selection,building relations with the channel members, sales
force,advertising with channel members (Jaligot and et.al., 2016). The firm can use the
marketing funnel framework to structure its sales and marketing actions. The strategies
regarding marketing can either be push or pull within nature. It rely on the Objectives of the
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businesses of McDonald, competitive dynamics,brand image as well as current standing within
market.
Wisely and effective integrated marketing actions can develops the brand equity of firm as well
as it aids the firm to stand out from the competition (Howieson, Lawley and Hastings, 2016).
Thus,it must avoids false commitment regarding the features of the product that are unable to
fulfilled through the department of production. It also focuses on the requirement to assure
coordination between various value chain actions (Tadesse and Fayera, 2018).
Secondary activities
These support activities aid in coordinating as well as facilitating the primary chain analysis
actions. It also benefits from evaluation as mention below.
Infrastructure
Effective infrastructure management enables McDonald to betterment the value regarding the
whole value chain. It able to control the actions of infrastructure to strengthening the position
that is competitive positioning within marketing. Such as legal matters
handling,financing,planning,strategic management, accounting (Hamilton-Hart and Stringer,
2016).
Human resource management
It also evaluates the management regarding Human resources such as
recruiting,training,rewarding,selecting, performance management and many more. McDonald's
effective management enables to reduces the competitive pressures rely on
commitment,motivation as well as skills of its employees. Here the company also accomplish its
cost minimization objectives through evaluating training and hiring costs accompanied by their
relative return. McDonald's workers heavily depends on the talent that can enhance the
significances of this value chain actions (Fernandez-Stark and Gereffi, 2019).
Technology development
In modern times all the actions regarding supply chain activities rely on the technological
support such as in production,marketing,human resource actions, distributions needed to realize
the significances of the development of technology. Such as product design research,technology
supported consumers,data analysis, automation software and technology supported consumer
services ,also the research and development department of firm is falls under this category
(Jaligot and et.al., 2016).
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Reflection on value chain analysis
As I came to realized that value chain analysis of McDonald's conducts to look out each
and every step that needed to create a product. As overall goal is to deliver the maximizing
values regarding least possible total cost (Howieson, Lawley and Hastings, 2016).
Value chain analysis is used for communicating information, evaluating, gathering
regarding decision-making that will assist the firm to recognizes all the activities as well as
process within the firm. By the help of it can recognize primary as well as support activities that
the Mcdonald's create.
I came to realised that By the help of the VCA ,McDonald recognizes the value
generating activities as well as their cost drivers. A huge benefit of value chain analysis is that it
is a flexible framework to the business of McDonald's, their competitors and their respective
places within industry's value (Tadesse and Fayera, 2018). It aids to understand the issues of the
McDonald involved accompanied the promises of making consumer value commitments as it
highlights on the actions that are required to deliver the value proposition.
As per my view it allows McDonald recognizes the actions that are profitable or not. It
enables firm to establish the cost drivers ,after tat it enables for lowering costumer values and
improvement strategies to be applied. With the help of the Value chain analysis capable to
identify areas with negligible cost to the distribution channel and raw materials (Hamilton-Hart
and Stringer, 2016).
CONCLUSION
From above, it had been concluded that Value chain analysis is a combination of a system
involves the process from beginning to end. It includes Primary activities ,Operations, Outbound
logistics, Sales and marketing-Support activities Human resource development. It also focused
on the McDonald's restaurant that is operates within the United kingdom as McDonald long
term relationship .It is already established firm can be managed through a franchisee. They make
sure that they offer world-class support make sure to provides the benefits of branding and
marketing McDonald's is ready to process both service and manufacturing operations to
accomplish regular economic growth , enhances profitability. It also focused on the Reflection of
McDonald , recognizes the value generating activities accompanied the promises of making
consumer value commitments.
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REFERENCES
Books and journals
Fernandez-Stark, K. and Gereffi, G., 2019. Global value chain analysis: a primer. In Handbook
on Global Value Chains. Edward Elgar Publishing.
Hamilton-Hart, N. and Stringer, C., 2016. Upgrading and exploitation in the fishing industry:
Contributions of value chain analysis. Marine Policy. 63.pp.166-171.
Howieson, J., Lawley, M. and Hastings, K., 2016. Value chain analysis: an iterative and
relational approach for agri-food chains. Supply Chain Management: An International
Journal.21(3). pp.352-362.
Jaligot, R. and et.al., 2016. Applying value chain analysis to informal sector recycling: A case
study of the Zabaleen. Resources, Conservation and Recycling.114. pp.80-91.
Mudambi, R. and Puck, J., 2016. A global value chain analysis of the ‘regional
strategy’perspective. Journal of Management Studies.53(6).pp.1076-1093.
Purcell, S.W. and et.al., 2017. Distribution of economic returns in small-scale fisheries for
international markets: A value-chain analysis. Marine Policy.86. pp.9-16.
Rosales, R.M. and et.al., 2017. Value chain analysis and small-scale fisheries
management. Marine Policy.83.pp.11-21.
Tadesse, B. and Fayera, B., 2018. Value Chain Analysis of Potato: The Case of Sheka Zone,
Southwest Ethiopia. International Journal of Horticulture & Agriculture.3(1). pp.1-10.
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