Approaches of Capacity Management in McDonald's

Case Study

Table of Contents
INTRODUCTION...........................................................................................................................3
QUESTION 1...................................................................................................................................3
What approaches does Mc Donald seem to take for its capacity management to reconcile
capacity and demand?..................................................................................................................3
QUESTION 2...................................................................................................................................4
Analyse the implementation of four Ds by the McDonald Restaurant?......................................4
QUESTION 3...................................................................................................................................5
Evaluate what the five performance objectives mean for the operation in McDonalds?............5
QUESTION 4...................................................................................................................................7
Calculate the average number of customers arriving at the till and the average time they must
wait before exiting McDonald’s Drive-Thru...............................................................................7
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................1

INTRODUCTION
Operation management is defined as business practice that develop highest level of
efficiency possible in the context of business. It is related with the converting stocks and labour
into goods and services to increase profitability of business entity. Operations management
teams require to take balance costs with revenues to attempt the greatest net operating profit
possible (Annarelli and Nonino, 2016). This report based on the McDonald corporation which
was established in 1940s. It is best known fast food chain that operates across 101 countries and
have provide services about 70 million customers a day. In this report consist of different
approaches of capacity management to reconcile capacity and demand. Along with implement of
four D's by the MacDonald restaurant to conduct operation management and analysis
performance objectives in company. Moreover, calculate of average arriving customers in
restaurant and provide challenges based on the computation.
QUESTION 1
What approaches does Mc Donald seem to take for its capacity management to reconcile
capacity and demand?
Capacity management is defined the act of assuring a business increase its expected
activities and production output at all times underneath all situations. The capacity of business
mainly analysis on company can achieve, manufacture and selling out in specified period of
time. There are following approaches of capacity management that followed by the MacDonald
such as:
 Level capacity: This approach consist of maintaining stable manpower level and results
rates over the planning horizon. It supports to MacDonald to manage inventory levels
from the production of finished goods greater than expected in condition of low demand
variability. It is a maximum level of production output provide by the company. In
context of MacDonald, inventories of finished products as well as raw materials are
keeping in reserve items require when run out of stock. In recent years management has
realised big stocks are expensive so they are decided to change methodologies in stock
and production management (Osei-Kyei, Chan and Ameyaw, 2017).
 Demand management: It is a planning methodology which is applied by an organisation
to forecasting, planning and managing the demand of products as well as services.