This presentation discusses how McDonald's has used disruptive innovation to stay ahead in the retail sector in Australia. It covers their current operations, success factors, and relevant literature on the topic.
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MCDONALD’S DISRUPTIVE INNOVATION…
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INTRODUCTION •MCDONALDS IS ONE OF THE WORLD’S LARGEST FAST FOOD CHAIN AND ALSO ONE OF THE LARGEST IN AUSTRALIA. •MCDONALD’S IS FORERUNNER AND PIONEER IN A LARGE NUMBER OF BUSINESS INNOVATIONS THAT ARE LATER BEING ADOPTED BY MANY OF THE OTHER COMPANIES ACROSS THE WORLD. •IN AUSTRALIA DISRUPTIVE FORCES ARE THE FUTURE OF RETAIL AND EACH COMPANY IS COMPETING WITH EACH OTHER TO BRING INNOVATIONS THAT WILL ULTIMATELY DISRUPT THE RETAIL SECTOR AND BE AHEAD IN THE COMPETITION.
CURRENT OPERATION OF THE SELECTED RETAIL •MCDONALD’S IS THE WORLD’S LARGEST RESTAURANT CHAIN IN TERMS OF REVENUE. •CURRENTLY THE COMPANY IS OPERATING MORE THAN 40000 RESTAURANTS THROUGHOUT THE WORLD. •THE MOST LUCRATIVE AND PROFIT MAKING BUSINESS OF THE RESTAURANT CHAIN HAPPENS IN USA AND MORE THAN 15000 OF THE COMPANY IS LOCATED IN THIS PARTICULAR COUNTRY. •IN 2017 THE GLOBAL REVENUE OF MCDONALD’S WAS 22.82 BILLION U.S DOLLARS.
CURRENT OPERATION OF THE SELECTED RETAIL •THE RESTAURANT CHAIN HAS COME A LONG WAY SINCE THEN IN THE COUNTRY PRESENTLY HAVING MORE THAN 970 RESTAURANTS IN THE COUNTRY AND EMPLOYING MORE THAN 1 LAKH PEOPLE ACROSS THE VARIOUS LEVELS OF THE ORGANIZATION. •THE PRESENT NUMBER OF CUSTOMERS DAILY WALKING IN THE VARIOUS RESTAURANTS OF AUSTRALIA ARE PRESENTLY MORE THAN 2 MILLION DAILY AND THIS NUMBER IS INCREASING QUITE HEAVILY WITH THE PASSING YEARS.
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LITERATURE REVIEW •ACCORDING TO CHRISTENSEN, RAYNOR AND MCDONALD (2015) THE THEORY OF DISRUPTIVE INNOVATION IN BUSINESS THAT WAS INTRODUCED IN 1995, HAS BEEN ACCEPTED BY MANY BUSINESS INNOVATORS AND IS REGARDED AS A GUIDING LIGHT WHICH CHANGED THE COURSE OF BUSINESS PROCESS. •ACCORDING TO PANTANO (2014) THE THREE MAIN AREAS WHERE FURTHER ATTENTION MUST BE GIVEN IN THE FIELD OF DISRUPTIVE INNOVATION ARE “THE INNOVATION MANAGEMENT APPROACHES IN RETAIL INDUSTRY, THE DEGREE OF INNOVATION HETEROGENEITY, AND THE INNOVATION DRIVERS. STARTING FROM THESE EVIDENCES.”
LITERATURE REVIEW •CHRISTENSEN ET AL (2016) STATES “FOUNDATIONAL RESEARCH ON DISRUPTION HAS PRODUCED EXTENSIVE CITATIONS AND PROVOKED VIBRANT DEBATES, BUT EMPIRICAL RESEARCH IN MANAGEMENT HAS NOT KEPT PACE. SUCH INCONSISTENCIES WARRANT DEEPER REFLECTION AND PROVIDE THE IMPETUS FOR EVALUATING RESEARCH ON DISRUPTIVE INNOVATION IN MANAGEMENT AND STRATEGY”. •ROWLEY AND MCMURTREY (2016) POINTS OUT HOW MCDONALD’S HAS USED INNOVATION AND SUSTAINABILITY IN ORDER TO REMAIN STEADFAST IN THE BUSINESS ALL OVER THE WORLD. MCDONALD’S DISRUPTED THE RESTAURANT BUSINESS IN AUSTRALIA WHEN IT FIRST STARTED THE RESTAURANT AND THE CONCEPT OF FAST FOOD AT A CORPORATE LEVEL WAS FIRST CONCEIVED IN THE COUNTRY. •KING AND BAATARTOGTOKH (2015) HAS WEIGHED THE VARIOUS USEFULNESS OF THE THEORY OF DISRUPTIVE INNOVATION AND HOW IT IS RELEVANT IN THE RETAIL CONTEXT.
DISRUPTIVE INNOVATION BY MCDONALDS IN AUSTRALIA •A FEW OF THE REASONS THAT MCDONALD’S HAS BEEN SUCCESSFUL IN AUSTRALIA ARE FRANCHISING, INTERNATIONAL EXPANSION, GLOCALISATION, BRAND VALUE, LOWER PRIZE MORE FOOD, FREE WI FI, YOUNGER WORKFORCE. •MCDONALD’S IS A MULTINATIONAL BRAND HOWEVER IT ADOPTS THE LOCAL FLAVORS AND CUISINES IN ORDER TO ENTICE THE LOCAL POPULATION. THIS IS ALSO KNOWN AS GLOCALISATION, •THE CONCEPT OF GLOCALISATION IS ALSO ONE OF THE DISRUPTIVE INNOVATION THAT HAS ALLOWED MANY MULTINATIONAL COMPANIES IN BECOMING LOCALLY SUCCESSFUL.
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CONCLUSION •IT CAN BE CONCLUDED THAT DISRUPTIVE INNOVATION IS ONE OF THE MOST RELEVANT AND EFFECTIVE THEORIES THAT HAS AFFECTED THE ORGANIZATIONS LATELY. WHETHER OR NOT THE ORGANIZATION CAN IMPLEMENT AND ADOPT DISRUPTIVE INNOVATION EFFECTIVELY IS DEPENDENT ON THE MANAGEMENT OF THE COMPANY •INNOVATION IS THE ONLY WAY THROUGH WHICH DISRUPTION IS POSSIBLE IN THE FIELD OF RETAIL. RETAIL SECTOR IS A FAST GROWING AND CHANGING SECTOR WHERE THE REQUIREMENTS OF THE CUSTOMER IS ALSO CHANGING REGULARLY. THE COMPANIES MUST KEEP UP WITH THE CHANGING NEEDS OF THE CUSTOMERS.