The Business Environment: Value Chain Analysis of McDonald's (LSBM103)

This essay provides a comprehensive value chain analysis of McDonald's, examining its internal business environment. It begins with an introduction to the value chain model, highlighting its importance in assessing a company's activities and their impact on customer value. The essay then delves into McDonald's specific operations, breaking down its primary activities, including inbound logistics, operations, outbound logistics, marketing and sales, and services. It also explores the secondary activities, such as firm infrastructure, human resource management, technology development, and procurement, and how these contribute to McDonald's overall efficiency and competitive advantage. The analysis incorporates relevant academic references to support the discussion and concludes with a reflective essay, discussing the author's understanding of the business environment gained through this analysis. The essay demonstrates a clear understanding of the value chain model and its application to a real-world business like McDonald's, providing valuable insights into its operations and strategic management.

Value chain model.

MAIN BODY
3. Value chain model for examine internal environment of McDonald's.
Value chain model is highly popular in the business world. This creates more
effectiveness for business to analysis internal business environment of McDonald's are as
follows:
Primary activity: Inbound Logistics: This is very important for building better relation with suppliers as
their support is necessary for receiving, stores and distribute products and services to
customers (Anaf, Baum and Fisher, 2018). As per this aspects McDonald's need to make
focus on raw material, storage and finish goods. Without this company face ample
challenges in product development because it requires raw material. Operations: Operations are included both manufacturing and services operations. Those
are very important for McDonald's because company is deals in both by producing food
product and delivering to its customers. This management is help to McDonald's for
increase productivity by managing machinery and technologies. Outbound Logistics: This includes activity which deliver product to customers by using
different intermediaries (Rothaermel, 2017). This includes warehousing, schedule and
order passing. This help to analysis outbound activities for exploring competitive
advantage and for achieve goals and objectives of McDonald's. Company managed those
activities on time with cost and delivery of product is put minimum negative impact on
company. Marketing and sales: Marketing and sales is another important part which is help to
manage promotion of products and services at market place for giving updates to
customers related to products (Porter’s Value Chain Analysis, 2018). This creates more
effectiveness for business. This includes marketing activities of McDonald's like sales
force, promotional activities, pricing, uses of channels, quoting, advertising and building
positive relationship. These pulls in nature which are depends on company objectives,
competitive edge, current standings in market and brand image. These help to attract
more customers.
 Services: Services are another important aspects which are related with pre sale and post
sales services which are offered by company to its loyal customers. Most of the

customers are preferred effective services from McDonald's, and they consider post sale
services as promotional activities. As per that McDonald's need to analysis their support
activities for avoid damaged brand image and reputation.
Secondary activities: Firm infrastructure: This denotes with the infrastructure of company like quality
management and legal aspects, planning, accounting and strategic management. This
creates more effectiveness for business management. This help and allow to McDonald's
for optimizing the values of all over value chain of company. In that company need to
make control on infrastructure activities. Human resource management: Human resource management is another important
aspect because they are give hard contribution for achieve goals and objectives of
company in effective manner (Christensen and et.al., 2018). In that McDonald's make
proper focus on recruiting, selecting, hiring, training and performance management
activities. In this HR management can allow company to reduce competitive advantage
which is based on motivation and skills of workforce in effective manner. Technology development: In the modern era technology is more advanced and this
creates effectiveness when company need to make more focus on technology
development. This help to complete work on time without any delaying deadline in that
Illustration 1: Value chain model
(Source: Porter’s Value Chain Analysis, 2018)

McDonald's need to realize importance of technology development. This is more
effective and valuable way to promote their image at marketplace.
 Procurement: This includes in purchasing inputs which are required from equipments,
machinery, raw material and suppliers those are help to produce best and effective
finished goods (Demartini and et.al., 2017). In that McDonald's make complete focus on
their procurement process in effective manner by optimizing inbound, operations and
outbound value chain.
Those are help to McDonald's to increase positive brand image and best services and
productivity of company in effective manner.
4. Reflective essay on understanding business environment.
A value chain is the set of various activities which an organization carries for create best
values for its customers. This main purpose of creating this by companies to examine all of their
activities and see their connection at market place. This creates more effectiveness for
McDonald's for increased their productivity by understanding business environment. This model
is provided cost advantage to McDonald's by establishing the relative importance with every
activity in the total cost of product as well as this help to reduce cost opportunity. This is help to
me for analysing the internal business environment (Hastings, Howieson and Lawley, 2016).
With the help of this, I am able to make proper requirements of company by managing its
internal business activities in effective manner. This highly help me for understanding internal
business environment of McDonald's. This provides me proper information about all those
activities which are important for company that are divided into two parts like primary and
secondary. Primary activities are more important thinks to produce the best quality of product
and service by managing inbound and outbound activities, marketing and sales as well as
services provides to customers.
Marketing and sales are important which is help to sets channels of promotion to promote
products at market place. As per that I understand that services are important to build positive
relation with customers in effective manner. Those are primary activities which are more
important to warehousing of product and making strategy to build productivity and values for
customers (Knight and et.al., 2018). On the other side, secondary activities are includes
infrastructure of company, technology uses, procurement process and human resources. Those
another most important part which reflect on more provision to create effectiveness because

human resource of company are puts higher efforts for achieve goals and objectives of company
by giving hard efforts. This help me out that, technology is the best aspects which gives positive
reflection on customers because through that customers are easily tracked their product and
company receive customers orders in effective manner. This is very important and effective for
company to manager work effectively.
This provides various benefits to McDonald's which are understood by me with creating
value chain for company (Lee and Schmidt, 2017). This improves flow of material and products
of company. This help to company for effectively implement forecast sales of products.
Seamless flow of information which are important for company to managed their internal
business environment in effective manner.

REFERENCES
Books and Journals
Anaf, J., Baum, F. and Fisher, M., 2018. A citizens’ jury on regulation of McDonald's products
and operations in Australia in response to a corporate health impact assessment.
Australian and New Zealand journal of public health. 42(2). pp.133-139.
Christensen, C. M. and et.al., 2018. Disruptive innovation: An intellectual history and directions
for future research. Journal of Management Studies. 55(7). pp.1043-1078.
Demartini, M. and et.al., 2017, April. A manufacturing value modeling methodology (MVMM):
A value mapping and assessment framework for sustainable manufacturing. In
International Conference on Sustainable Design and Manufacturing (pp. 98-108).
Springer, Cham.
Hastings, K., Howieson, J. and Lawley, M., 2016. Creating value chains: the role of relationship
development. British Food Journal. 118(6). pp.1384-1406.
Knight, R. and et.al., 2018. Best practices for analysing microbiomes. Nature Reviews
Microbiology. 16(7). p.410.
Lee, H. L. and Schmidt, G., 2017. Using value chains to enhance innovation. Production and
Operations Management. 26(4). pp.617-632.
Rothaermel, F. T., 2017. Strategic management. New York, NY: McGraw-Hill Education.
ONLINE
Porter’s Value Chain Analysis. 2018. Online. Available through:
<https://www.toolshero.com/management/value-chain-analysis-porter/>