Stakeholder Analysis

This report discusses the stakeholder analysis of McDonald's and Coca-Cola, including the identification of internal and external stakeholders, their roles and interests, and the level of influence they exert on the organizations.

STAKEHOLDER ANALYSIS

Executive summary
MacDonald’s is a world`s largest fast food chain of restaurants. Every company operates with
the help of stakeholders either they are internal or external. The company faces direct
competition from Wendy’s and burger king especially in terms of market share. Internal
stakeholders of the McDonalds includes employees, shareholders, director, and the senior
management. Whereas, external stakeholders include suppliers, customers, national
government, community, and distributors. A stakeholder matrix is an analysis of which
stakeholder exert what level of pressure on the company.

Contents
Executive summary...............................................................................................................................1
Introduction...........................................................................................................................................3
McDonalds............................................................................................................................................3
Coca-Cola..............................................................................................................................................3
• Introduction to the industry.................................................................................................................4
Identification of functional areas...........................................................................................................5
Internal and external stakeholders and their roles..................................................................................6
Identification of the nature and degree of main stakeholders’ interests, and implications of.................7
Identify the level of main stakeholders’ influence.................................................................................8
Develop a stakeholder matrix..............................................................................................................10
Conclusion...........................................................................................................................................11
References...........................................................................................................................................12

Introduction
This report brings out a discussion on stakeholder analysis about two major companies such
as “MacDonald’s” and “Coca-Cola”. It describes the nature of the business of both the
companies under different industries. This report has identified the relevance of internal and
external stakeholder in the organisation and it differs from company to company. Further, a
stakeholder matrix has been described that has elaborated that how differently each
stakeholder effect the organisation’s operations (Henisz, 2017).
McDonalds
McDonalds is an American food chain corporate, which was founded in 1940. Richard and
Maurice introduced the company. In 1961, it was recognised and filed under US trademark.
The company has its headquarter in Illinois but. It operates almost 37855 restaurants all over
the world in 2018. The product line of the company includes chicken, soft drinks, wraps,
hamburgers, breakfast, milkshakes, and deserts. Currently, the company generates a revenue
of US$ 21.025 billion in 2018. The company is the largest retail food chain in terms of
revenue and number of outlets with 210000 employees in 2018. The business line includes its
togetherness with suppliers, McDonalds and the franchisees. Each one of the business line
strived to become profitable (Rodrigues, Nikhil, & Jacob, 2016).
Coca-Cola
An American beverage company was founded in 1892. The company manufactures
carbonated drink that was invented in 19th century. The produces links to the licensed bottles
that has two main ingredients kola nuts and cocoa leaves. Coca-Cola is among the largest
beverage-producing manufacturer and distributor and also one of the largest company in US.
Apart from this, coca-cola offers coke, diet coke, sprite, Fanta, Dasani, smart water and ceil.
It offers 2800 products in more than 200 countries. There are number of variants offered by

the company such as caffeine-free Coca-Cola, Coca-Cola cherry, flavouring includes
lemonade, lime, vanilla, raspberry, cherry vanilla, Citra, orange and Coca-Cola orange
vanilla. The company maintains a strong network of 2.6 million retail stores. The company
independently develop the local market and further distribute to the grocers, supermarket, and
restaurants. In 2018, the company earned a revenue of 3,185 Crores (Serôdio, McKee, &
Stuckler, 2018).
Introduction to the industry
Coca-Cola belongs to beverage industry where it faces huge competition from pepsi,
Anheuser-bush imbed and other local soft drink companies. This includes an non-alcoholic
items such as soft drinks, tea, coffee and fruit juices. It is seen that its first step includes the
manufacturing of carbonated soft drinks. This industry targets youth population. With the
influence of American prohibition, the manufacturing of alcohol has been stopped. Most of
the equity shareholders in this group holds conservative investors as companies offer higher
dividend, regular market share, and the above stock price stability. With the high
competition, every organisation in this industry tried to differentiate itself from its
competitors. However, with time this industry has been carbonated drinks has been collapsing
as many people choose to prefer the healthy lifestyle. From the analysis of the industry, it is
seen that Coca-Cola owns nearly 48.6 percent of the market share. Beverage industry has
been growing nearly 5 percent and it is expected to reach to US$20 trillion by 2030 (Zhuang,
& Jiang, 2016). New government policies affect the industry in many ways such as increasing
society awareness for the environment and conservation of energy that has resulted in
stringent emission and protection policies for the environment. Increasing issues such as
obesity and other health issues has reshaped the industry as the demand for relaxation drinks,
drink coffee, and energy drinks has been gaining popularity that own to low calorie. From the
current statistics, it is seen that non-alcoholic beverages are valued at 967.3 billion in year

2016. The industry is expected to grow at the rate of 5 percent from 2017 to 2025 that has
been influenced by disposable income, changing lifestyle and population growth (Zhuang, &
Jiang, 2016).
McDonalds is a popularly known market leader in the fast food Industry or better known as
the ‘Burger’Industry. Marketing involves identifying what customer demand and striving
towards meeting their demands. The company’s success was as a result of the policy they
follow, known as the Q.S.C.&V. (Quality food, Fast friendly service, Restaurant Cleanliness
and a menu that provides value). In fact the growth of fast food has been named after the
organization as ‘McDonaldization’. The company follows a unique business model described
as the “three legged stool,” owners, suppliers, company employees (Zhuang, & Jiang, 2016).
It is an organization that develops, operates, franchises and services a worldwide system of
restaurants that prepare assemble, package and sell a limited menu of quickly prepared,
moderately price food. The customer prefer most that is because the process is transparent
and visible to customers. Customers are invited to check the ingredients used in the food.
Maintain high quality control standards. Use of innovative ideas and having latest
technologies installed. McDonalds easily accessible, it offers option for home delivery, fun
place for children. McDonald’s major competitors include that Burger King, Taco Bell,
Subway. McDonalds allow the company use its pricing advantage to push valve menu
offerings away from smaller restaurants. McDonalds net income rose to $1.38 billion, or
$1`.72 per share, from $1.21 billion, or 1.47 per share. Total revenue fell 9% to $5.14 billion.
McDonalds has adopted a global Anti-corruption policy, including FCPA (Foreign Corrupt
Practices Act). Its primary target market are children and adolescent. It affects their health
and increase obesity (Zhuang, & Jiang, 2016).
Identification of functional areas
The main functional areas, which are associated with MacDonald’s business activities are-

Business development
Management of business quality
Finance
Process designs
Strategy for location
Supply chain management
Human resources management
Transportation
Franchisees
Marketing
Internal and external stakeholders and their roles
Stakeholders are the person, group, and other regulatory firms that affect the operation of the
business. the stakeholders are either affected by ort affects the company`s operations, it can
be either directly or indirectly. The two types of stakeholders are internal and external
stakeholders. Primary stakeholders are considered as the internal stakeholders and the main
key business partners. On the other hand, external stakeholders are the people who plays an
important role in providing different range of resources. Whereas, internal stakeholders
include owners, employees, managers and the entire management team (Ramus, & Vaccaro,
2017). McDonalds have four main primary group of stakeholders such as employees,
customers, communities and the investors (Howse et al., 2018).
Owner- According to the strategies opted; MacDonald’s chooses blue ocean strategy and the
innovation strategy at high level of version and competence with low cost, which are

competent enough in order to acquire the huge market share. It is important for the CEO of
the organisation to undertake the policies of food safety properly. The owners aims to provide
the customers to highest level of satisfaction (Tseng et al., 2018).
Employees- It includes middle managers and lower level people that comply with the
business level strategy as per the instruction of the high managers. Employees faced issues in
regards to company`s reputation as employee conflicts lead to scandal in McDonalds.
Whereas on the other hand, external stakeholders comprises of suppliers, customers,
government bodies, and the creditors. Employees always seek for high wages and their job
performance as an influencing stakeholder (Ramus, & Vaccaro, 2017).
Customers- They want both the companies to serve then food with high quality as customers
usually buy several products. Customers would like to see the improvement in their servings
according to the better value fir the money. The aim is to focus on satisfaction of the
customers (Rodrigues, Nikhil, & Jacob, 2016).
Suppliers- the suppliers range from materials to materials as per their packaging. The
company has to comply with the rules and regulations related to food safety and suppliers
help them to serve best raw materials before producing such as it creates transparency to the
calorie content, other information, and ingredients in order to help the customers to know the
information (Rodrigues, Nikhil, & Jacob, 2016).
Investors and shareholders- it is certainly important if MacDonald’s is a profitable
organisation and it is a market leader in the fast food chain restaurant industry. As their main
goal is to make huge money for which they are assured that the company will steady expand
and grow.
Identification of the nature and degree of main stakeholders’ interests, and implications of
Conflicting interests

The conflict among the stakeholders in regards to their interest is very common as internal
stakeholders such as owners, top-level management and the employees will create such
business decisions in order to support and make business decisions. For instance- business
decision can be cutting down of the jobs because they suffer from severe recession or they do
not need them (Tseng et al., 2018). Here, this decision is likely to support the shareholders
banks and the employees and community oppose it. Another relatable example is that it adds
to create extra shift in order to increase the capacity of the factory that is likely to be
supported by management, suppliers, and customers whereas, the local community opposes it
(Thanh, & Phuong, 2018).
It can be introduction of new machinery in order to replace the manual work this likely to
support by the customers and investors whereas it can offend employees. Increasing the
selling price is to improve the profit margins that is likely to support by management and
shareholders but opposed by the customers (Sadeghirad, Duhaney, Motaghipisheh, Campbell,
& Johnston, 2016).
Conflicting interest occur when the goals of one stakeholder does not match with the thinking
of another stakeholder such as project manager may schedule tough in the peak seasons that
will not be liked by the employees. As it is important to compact with all the interest of the
stakeholders but paying ones are most important such as customers and shareholders
(Sadeghirad, Duhaney, Motaghipisheh, Campbell, & Johnston, 2016).
Identify the level of main stakeholders’ influence
The main stakeholders of the McDonalds who exert greater pressure on the organisation to
several activities. This pressure forces them to conduct their business according to them-

External stakeholders plays an important role in the accomplishment of goals to the
organisation such as -
Customers- the customers holds an important position in the success of the McDonalds. As
the productivity and the performance is measures in terms of turnover that it generates from
the sales. The interest of the customers lie in the offerings where the company offer them
high quality with low pricing. Their interest lies in the trending that has new flavour with a
change in the bottle pack of the products (Xue et al., 2017). MacDonald’s attain a space of
special customer in order to avail the cash discounts. Customers have severe impact on
business level strategy of the company because in case Coca-Cola, customers have started
looking for how many sponsorships it handles (Voinov et al., 2016).
Employees- MacDonald’s will address the concerns of the training programs as employee`s
main motive is their personal growth (Xue et al., 2017). Stake of the shareholders is more
near to training, fair wages and the career goals. Although, employees are trained to give best
services but still sometimes they become rigours (Xue et al., 2017).
Government- This partnership with the government association will help the economy of the
country to grow as well to reduce the unemployment rate of the stakeholders (Serôdio,
McKee, & Stuckler, 2018). The fresh investment will lead to growth of the sector by
providing the jobs to the people (Voinov et al., 2016).
Non-governmental organisation- WWF aims to provide and offer localised solution that id
with respect to a water availability and other accessing issue at the target site. McDonald’s
interest is to outreach certain programs such as McDonald’s house charity and other
community outreaches for programs. The interest of the stakeholders lie in installation of
water filter plants with the extensive outreach of the mobilisation of the opportunities.

McDonalds interest lie in investing in the organisation to support the activities of the
organisation (Voinov et al., 2016).
Develop a stakeholder matrix.
(Source: Nelson, Smith, Ly, Gustavsson, Sudlow, & Bexelius, 2018)
This matrix indicates the important of each stakeholder in the business operations. These
stakeholders are divided according to their potential and competitiveness to affect the
business. Customers, regulators, and sponsors possess high power with low interest in the
operations and profitability. The other category includes company`s top level management,
senior executives, and senior management executives possess high power with high interest
in the Coca-Cola profitability. Receptionist and help desk people have low interest and low
power in the organisation. At last, suppliers, internal users, developers, trainers, and testers
have high interest with low influencing power. For example- the supplier is always interested
in company`s liquidity position (Kearns, Apollonio, & Glantz, 2017).
Offensive includes those stakeholders that high potential and low competiveness in order to
affect the organisational goals. These stakeholders signifies as a menace to the organisational
strategy. It includes some stakeholders who are maximum customers to the organisation.
These stakeholder impose high power in the influencing the staff such as in retail sector,
every customer is under offensive (Hueske, & Guenther, 2015).

Swing- it considers people with high potential with huge competitiveness. The three main
clues is to deal with stakeholder, this will lead to changes in laws, and finally the organisation
will undertake various decisions, which differs from the existing ones. The aim of these
stakeholders is to get the information and polices regarding the services, which they will
incur from the company. One of the main key partnership is with the WWF (world wildlife
fund) in order to improve the hygiene of water as communities are often deprived of clean
water. Government agencies and SEC (Securities and Exchange Commission), these
stakeholders will impose penalties on the organisation as they do not have potential in
profitability but affect the organisation to great extent (Šimek et al., 2018). On the other hand,
the Pakistan`s Coca-Cola has huge commitment with government of Pakistan. As the
company have invested $350 million in Pakistan.
Hold- these stakeholders have low potential with low competitive threat. These stakeholders
are easy to handle by keeping in them in mind they will not affect the company in a negative
way. For example- suppliers (Kearns, Apollonio, & Glantz, 2017). They are responsible for
upholding the direct suppliers to the certain standard no less than as required by the law. The
main motive of the suppliers is to help the Coca-Cola in providing the customers in order to
quench the thirst by delivering the required services and products as needed by the customers
(Xue et al., 2017).
Defensive- this category is for the low cooperative potential with high competitiveness.
Investors and shareholders are the defensive shareholders (Hueske, & Guenther, 2015). The
suppliers ensures that they could get stable and ethical behaviour.

Conclusion
From the above discussion, it is seen that stakeholders plays an important role in affecting the
decision of the company. A comparative analysis was conducted of how Coca-Cola analysis
of stakeholders and McDonald’s differ from each other.

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Nelson, M., Smith, M., Ly, A., Gustavsson, A., Sudlow, C., & Bexelius, C. (2018). D2. 3
Stakeholder generated lists of priority RWE relevant outcomes and D2. 4 Disease
progression and outcomes classification matrix.