Strategic Management: McDonald's Current and Proposed Strategies

This presentation discusses the current strategic direction of McDonald's, its mission, and the use of the Ansoff Matrix. It also proposes a new strategy for the company using Bowman's model.

Strategic
Management

INTRODUCTION
 Strategic management is the practice of formulating
as well as implementing major goals and objectives
of company and thus enable firm with respect to
attain success in the market in an effectual way.
 McDonald owing its existence to 1940 is world’s
largest fast food chain which has its operation
present in around 119 countries.
 McDonald has around 59% of conventional
franchisee, 21% of its store are licensed which are
given to foreign affiliates. However, 20% of the
restaurants are operated by McDonald only.

MISSION
 The ultimate mission of the company is to provide
best and high class services to the buyers.
 The firm also has the goal to maintain as well as
enhance the satisfaction level of buyers by giving
them high quality of goods and services.
 Company is totally committed in enhancing the fast
food chain experience of their customers.
 Hence, in order to achieve the same it makes use of
four basis p's of marketing effectively which is of
product, price, place and promotion.

CURRENT STRATEGIC
DIRECTION
 The current tactical direction of company is not to
become the biggest fast food restaurant chain, but
is to become best fast food restaurant chain all over
the world.
 The company is making use of product, price, place
and promotional tactic with an aim to give the
practical implementation to the respective concept.
 There are some examples which indicates that how
McDonald is achieving its tactical direction by
using 4P's of marketing. In United state market,
firm tactical plan basically focuses upon breakfast,
chicken and convenience. In European market
cites firm focuses upon affordable offerings, classic
menu and premium selection etc.

ANSOFF MATRIX
The model which is given below also
help in giving description about the
tactical direction of cited company.

AS PER ANSOFF MATRIX CURRENT STRATEGY
OF MCDONALD IS FOLLOWING

CURRENT STRATEGIC DIRECTION FITTING
INTO PRESENT ENVIRONMENT
 The current tactical direction of firm is perfectly
meeting with its current environment.
 The main goal of firm is to deliver high quality services
to customers and maintain their level of satisfaction.
 In the given task, the tactics which is being employed by
cited corporation is playing very critical role.
 For example, by developing new product McDonald is
fulfilling needs and demands of all its buyers.
 In the similar way, the firm is also making changes in its
operation as per the culture of nation where it is
operating its function. Thus, it is through this way only
McDonald is delivering the best services to its
customers.

Continued....
 McDonald runs variety of its operation through
franchisee concept. Thus, in case if most of its
operation diminishes due to any reason then in the
given circumstance it can make use its diversifictaion
tcatic.
 Herein, the firm can raise money for its venture by
using different other business such as hotel and cafe
etc. Thus, it is correct to said that firm current tactic
perfectly fits to its envionment.

USING MODEL FOR SELECTING NEW
STRATEGY FOR MCDONALD

PROPOSED STRATEGY
 By making use of Bowman's model, an effective
tactic is suggested to the manager of cited firm.
 It is recommended to the firm that it should use low
price or cost leadership tactic.
 Cost leadership is suggested because the firm is
having the team of such skilled personnel which can
give practical implementation of the given tactic.
 By using this approach, McDonald can attain
competitive edge in market where it is operating its
operation.
 This method will also assist in improving sales and
profits of corporation.

Cost leadership enhancing the
capabilities
 The cost leadership tactic will give opportunity to
McDonald in terms of selling its product and services
at low prices.
 Thus, made it capable with respect to target different
group of customers who belongs to varied income
category.
 The given thing will help in creating different image
of McDonald in the mind of its buyers.
 McDonald can also give tough competition to its
rivalries which are also offering the same type of
services but at high prices.
 Thus, through this way firm can attract large number
of price sensitive buyers and thus the given thing will
help in sustaining the growth of company.

CRITICAL EVALUTION OF COST LEADERSHIP TACTIC THROUGH
BENEFITS AND LIMITATIONS
Benefits Limitation
 It enable McDonald to target
different income group of buyers.
 It enable firm to sale its product at
cost effective prices.
 Firm reliance with the low price may
tend to hamper the quality of product
which is being delivered by
McDonald. This is because, in the
practice of making low cost meal
there is a greater chances that the
firm will make comprise on the
quality of raw material which is
being purchased by it for making
meal.
 In the practice of cost reduction there
is a chances that McDonald can
make elimination of many of its
employees. In this situation, there is
a chances that significant increment
is being found in the time to deliver
the product to its respective buyers.
This will have direct effect on the
satisfaction level of customers.

CONCLUSION
 It can be stated that making the selection of one
specific tactic for the company is not an easier task.
 This is because, with an aim to do the same manager
of firm will have to conduct thorough analysis of the
business environment.
 Furthermore, for the firm it is very essential that it
should use such tactic which can give its competitive
advantage.
 This is due to the fact that, on doing all given type of
work overall benefit can be gained by McDonald in
terms of increased profit and sales.

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