Contemporary Management Issues in the 21st Century: McDonald's Case Study

This report discusses contemporary management issues in the 21st century through McDonald's case study. It explores the role of AI in business strategy and workforce management in a global environment. The report also covers the four building blocks of strategy and their impact on the fast-food industry.

Contemporary
Management issues in
the 21st century.

Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY ..................................................................................................................................1
McDonald’s background and history ..........................................................................................1
Four Building blocks of strategy .................................................................................................1
Role and impact of AI on overall business strategy ...................................................................2
Work force management of McDonald's in a global environment..............................................4
CONCLUSION ...............................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Management is a vital aspect of every business, the success of the organisations depends
on how effectively the company is able to mange its human resources and other necessities of the
business. The decisions made by the management are based on assumptions on the basis of the
facts and statistical data. The impact that the decisions make is immense, which could lead to
possibly positive and well as negative outcome. The management of any organisation is required
to develop strategises which will drive the launch of new products along with scaling the existing
products, the theories and the assumptions the management make decides the future market
position of the company. 21st century is technology driven and experiences many technological
transformations and innovations which turns out to be beneficial than the previous one,the
companies for their survival have to adapt the new technologies to gain the benefits from such
technologies and bring the best for their respective companies (Zeba,and et.al, 2021) The issues
the management faces and the way they overcome them is mentioned in the report.
MAIN BODY
McDonald’s background and history
On 1940 Richard and Maurice McDonald opened their very first outlet in San Bernardino
California. In the year 1961 McDonald’s applied for U.S trade mark and initiated the drive in
restaurant later in those years the main target of the company were children. McDonald's came
up with with service of delivering food at its fastest. The company change its logo three times
between the years 1940 – 1960 (Nishant, and Corbett,2020). In the early years the company
primarily focused on selling hamburgers, along with different kinds of chicken, sandwiches,
chips which were later rep[laced by French fries and soft drinks and some dessert options.
Four Building blocks of strategy
A set of defined actions is considered as a strategy, the formulation of strategies is done
for the effective implication of rules or any other changes introduced, along with handing the risk
factors of the company which could impact the functioning of the company. McDonald's is a
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global brand with a huge employee base. For effective management and human resource
development the company is required to use effective strategies on the basis of which the
management will be able to formulate solutions. The implication of the four building blocks in
the formation of McDonald's strategies is explained below:
 Conceding: While applying this strategy the company can buy time against their
competitors and work on the development of the strategies which will help them in
scaling their products . As McDonald's works in the fast food industry and have to face
local as well as global competitors, conceding turns out to be a saviour for the brand as it
helps in providing the time that the brand will require in developing an effective strategy.
 Confronting: This element of the strategy focuses on the direct action taken by the
company, for the resolution of a particular issue. As McDonald's is a global company and
have employees of diverse cultures the possibility of internal clashes rises, for which
confronting helps in the resolution of such possible conditions.
 Competing : the direct or indirect action taken by the company to defend or supersede its
competitors will be accounted in the third building block of the strategy it helps the
company in formulating strategies which helps them in identifying their lacking as well
as strong points to combat their competitors (Marcus,and Davis,2019).
 Cooperating: Refers to the principles which combines all the elements of the
organisation together which will help the company in achieving its determined objectives,
it aids the process by providing the surplus needs of the project initiated by the company
which will turn out to be beneficial for all.
Role and impact of AI on overall business strategy
Before McDonald's many companies incorporated artificial intelligence in their business
operations. Irrespectively McDonald's has been the first organisation in the fast food industry
who has adapted AI into their operations. Artificial Intelligence is widely used as it makes the
processes more effectiveness and helps organisations restore productivity, as by passing years
the customer base of the organisation is increasing rapidly the installation artificial intelligence
has become a necessity(Kodan, and Pathania,2020). The changes that McDonald's has gone
through with the installation of artificial intelligence is as follows:
 Reduced processing time: AI reduces the time required in the development of product
life cycles and makes the process comparatively faster. The accelerated processes helps
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the organisation in initiating the delivery process comparatively faster. AI cuts all the
unnecessary processes which are considered as an hindrance in the processes of the
organisation.
 Desired Expansion: with the use of AI for business model expansion, McDonald's and
any other organisation will be able to expansion the business horizons globally. With the
help of the filtered data and statical figures make the process of decision making much
quicker and easier.
 Improved Customer service: AI assists businesses in providing tailored and unique
solutions to the problems faced by their customers. This process of providing the needed
helps within the expected time periods significantly improves the customer experience
(Prajapati and Prajapati,2022). Customer service has a vital role to play, regardless
companies are not able to provide the expected service which is the main reason of
customers switching to another brands.
 Overcome from human error: Manually operated processes are prone to errors, the
errors generated delays the estimated time of the entire project as the steps are
interconnected. Artificial Intelligence helps in reduces the chances of errors which were
being generated because of manual negligence. This considerably save the times and
helps them in delivery the product within estimated time period. The reduced production
times helps in developing loyalty among the customers as it reduces the cost of
switching.
 Improved talent management: Artificial intelligence has helped organisations in
recruiting the right talent as it helps the human resource mangers in screening the
resumes according the job requirements which reduces the time indulged in the hiring
process and helps the company in finding the right talent and vice versa.
Regardless of the advantages McDonald's have gone through many challenges after
integration the AI with their operation. As the company is famous for delivery the same food the
same flavour and quantity to its customers in this scenario including a wide and diverse menu
can cause difficulties regarding to the authenticity of the brand, as the company is rapidly
altering their menus this has significantly created many problems for the people involved in the
process.
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Work force management of McDonald's in a global environment
The workforce management is one of the significant process for a global business. A global
business have huge and diverse workforce and to manage such workforce it requires an approach
where differences are valued (Lillford and Hermansson, 2021). McDonald's has adapted global
environment very well in their menu and marketing strategies. The company's human resource
department has created workable instruments and strategies to manage such broad and diverse
workforce. McDonald's workforce management system include various activities which are
mentioned below.
Forecasting and Budgeting – The company creates a forecast about how much new employees
they may need to open a new outlet or to perform a specific task. Also with help of budgeting
tool the company analyse how much staff can company afford.
Staff Scheduling – The staff scheduling is a vital aspect for any business to manage their day to
day operations without any problem. The company have a shift system and the system can be
different from state to state. Shift timings for employees are flexible and are designed in such
way that it is also beneficial for the company to schedule their staff in case any employee's
absence or during workloads.
Employee performance management – To manage global workforce performance McDonald's
keep their employees informed and trained about new market trends and innovations. The
management of the company is not only focused on making more sales but they also motivate
their employee to perform better. The companies employee engagement strategy enhance
employee pride in the business and allow employees to contribute in increasing business
performance.
Cultural influence management style – The companies management consider that employees
from different cultures get motivated from different incentives. The company uses different
workforce management styles to manage their workforce in different countries. The company
also look to build a relationship of trust with their employees.
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CONCLUSION
In this report it is concluded that management is a significant aspect of every business and
companies can use four building block strategy to make effective business strategies. In this
report we discussed about role and impact of AI on business strategies. The report highlights that
how AI changed McDonald's operations and improved their efficiency and productivity. The
report also discuss about how the company manage their workforce in global business
environment.
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REFERENCES
Books and Journals:
Zeba, G.,and et.al, 2021. Technology mining: Artificial intelligence in manufacturing.
Technological Forecasting and Social Change, 171, p.120971.
Nishant, R., Kennedy, M. and Corbett, J., 2020. Artificial intelligence for sustainability:
Challenges, opportunities, and a research agenda. International Journal of Information
Management, 53, p.102104.
Marcus, G. and Davis, E., 2019. Rebooting AI: Building artificial intelligence we can trust.
Vintage.
Kodan, R., Parmar, P. and Pathania, S., 2020. Internet of things for food sector: Status quo and
projected potential. Food reviews international, 36(6), pp.584-600.
Prajapati, J.B. and Prajapati, B.G., 2022. Clinical Decision Support System Braced with
Artificial Intelligence: A Review. In International Conference on Image Processing and
Capsule Networks (pp. 531-540). Springer, Cham.
Lillford, P. and Hermansson, A.M., 2021. Global missions and the critical needs of food science
and technology. Trends in Food Science & Technology, 111, pp.800-811.
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