Managing Information and Technology: Mc Donald's IT Report (LSBM100)

This report provides a comprehensive analysis of Mc Donald's, focusing on its information technology (IT) management and its impact on the company's competitive advantage. The report begins with an introduction to information management technology and its application at Mc Donald's, followed by a detailed overview of the company's history and operations. It then delves into an external analysis using the PESTLE framework, examining political, economic, social, technological, legal, and environmental factors that influence Mc Donald's business. The report applies Porter's Five Forces model to assess the competitive landscape, evaluating the intensity of rivalry, bargaining power of suppliers and buyers, and the threat of new entrants and substitutes. Furthermore, it analyzes Porter's value chain to identify key activities and their importance. The report also discusses how Mc Donald's can leverage IT to improve business processes and address identified issues, concluding with a summary of findings and recommendations. The report aims to provide insights into how Mc Donald's utilizes IT to enhance its operations and maintain its position in the fast-food industry.

Report About a Company

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Detail and history of business company......................................................................................1
External analysis ........................................................................................................................2
Porter five forces model.............................................................................................................4
Analysis of Porter's value chain and importance of activities.....................................................6
Discussion on how businesses could deploy information technology to improve its business
processes and to address any issues and concerns that are highlighted in analysis....................7
CONCLUSION ...............................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
Information management technology is referred as a processes, systems, hardware and
software company that uses to conduct its day to day to operations(Omekwu, 2006). Various
budget line that encompasses all systems and costs of setting them up and maintaining them is
known to be information management technology. In general information technology is said to
be discipline where all information technology resources of a company are managed in
accordance with its need and priorities. It consists of tangible investments such as hardware,
software, networks, data and data centre facilities and as well as staff who is being hired to
maintain them(Ilmudeen and Bao, 2018). This report is based on managing information
technology concept of Mc Donald's, which is a American fast food company and opened up its
business as a restaurant that mainly deals in providing hamburgers. The report below includes
detail and history of business company, external analysis, porters five forces model, analysis of
porter's value chain and importance of activities, discussion on how businesses could deploy
information technology to improve its business processes and to address any issues and concerns
that are highlighted in analysis along with its conclusion.
MAIN BODY
Detail and history of business company.
Mc Donald's corporation is an American fast food company, that was founded in 1940
and it opened up as an restaurant in United States. Company majorly deals and carries its
operations in providing Hamburgers to customers. Mc Donald's is considered as an world 's
largest restaurant chain by its revenue and serving over 69 millions customers on daily basis in
across 100 countries(Harlie, Rajiani and Abbas, 2019) . Company is basically best known for its
hamburgers, cheeseburgers and fr french fries along with that company is also focusing on
providing chicken products and breakfast food items like soft drinks, milkshakes, desserts and
wraps. In response to constant changing customer's tastes and a negative backlash as its food
items comes under unhealthy.
Mc Donald's is taking use of various information technology tools and it is considered as
one of most successful as well as famous brand across global world. Company is trying to
improve its applications of IT and information system on relation to corporate goals of company
as considered as one of priorities of company. At first company was started in 1948 by brothers
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Maurice and Richard Mc Donald in San Bernardino, California. They bought appliances for their
small hamburger restaurant from a salesman Ray Kroc, who was intrigued by their requirement
for eight malt and shake mixers(Benckendorff, Xiang and Sheldon, 2019). As when Kroc
visited to brothers in 1954 to determine how a small shop could sell large number of milkshakes,
and analysed a simple, efficient format which permitted brothers to produce huge quantities of
food at low prices. And self service counter has reduced the requirement for waiters as
customers were receiving their food quickly as hamburgers were cooked ahead of time, wrapped
and under heat lamps. And by seeing a great promise of in their restaurant concept, Kroc offered
them to start a franchise program for Mc Donald brothers (Pearlson, Saunders and Galletta,
2019). And on April 15,1955, they opened their first franchise in Des Plaines, and in same year
they launched Mc Donald 's corporation. After that public face of Mc Donald's was created in
1963 with a introduction of a clown that named Ronald Mc Donald. After that this chain
continued to expand domestically and internationally expanding to Canada in 1967 and there are
operating in more than 35,000 outlets in across more than 100 countries in early 21st century. As
a luck Mc Donald's has became most popular family restaurant that emphasizing on affordable
food, fun and flavours which appealed to children, teenagers and adults.
As now Mc Donald's is considered as one of most successful and well famous brand
across global world. As information technology in company helps company to enhance their
customer relationship management, marketing and sales activities by providing a real time
transmittal of their inventory, point of sale or POS and as well as financial data.
External analysis
External analysis is performed by business companies to determine and analyse external
factors of companies that could affect its external business environment(Davenport and Beers,
1995). External analysis could be carried by performing PESTLE analysis that includes
determining external political, economical, social, technological, legal and environmental
external factors that could affect company's business operations. In terms of Mc Donald's
PESTLE analysis of company that determine its external factors are as follows:
Political factors:
These factors determine extent and factors of government and government policy that
could create an impact and affect a particular company. Political factors of company consists
political policy and stability and as well as trade, fiscal and taxation policies. So it has been
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analysed that political factors sometimes create an impact on company's carried operations and
affect way how do they carry their business practices. So for that it is essential that companies
are required to respond to present and anticipated future legislations and could adjust their
marketing and business practices according to that. In terms of Mc Donald's, company is having
political stability in their businesses as company is operating and carrying its business in across
over 100 countries (Große, Nyman and Sundberg, 2019). As carrying businesses as a restaurant,
company has to comply with various government regulations pertaining and ensuring health and
hygiene. As some governments that been pressuring fast food company due to fast food has been
increasingly been taken as a junk food, leading to obesity, cardiovascular difficulties and high
cholesterol. There are also some others political factors of company that are as follows:
 There is a regulation made by government in increasing international trade agreement
that can be taken and proved to be a opportunity for company to carry its business.
 Mc Donald's is constantly facing changes and modifications in government guidelines for
diet and health towards customers that could proved and said to be a opportunity and as
well as a threat for company in corporate markets. There is a evolvement of public health policies in various countries, which Mc Donald's
could take it as a opportunity and as well as threat for their company.
Technological factors:
These factors determine and analyses rate of technological innovation and development
which could affect a market and company. Technological factors consists of changes in digital or
mobile technology, automation, research and development (Soto-Acosta, Popa and Martinez-
Conesa, 2018). Sometimes there is often a tendency to focus on development takes place in
digital technology, but consideration that should be given to new methods of distribution,
manufacturing and also logistics. In terms of Mc Donald's, as technology plays to have a very
limited area and role in fast food company. Technology factors could help company with having
scheduling, ordering, forecasting, sales and foot traffic that could lead to have customer payment
for food. Technology could be used for having an ease, inexpensive advertising on internet,
providing wifi and computing devices to satisfy customer's needs(Englander, and Wong, 2021).
There are also some others technological factors that affects operations of Mc Donald's are as
follows:
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 There is a moderate research and development activity which is to be taken in company
which can proved to be a opportunity for company.
 There is a increase in business automation that is faced by company which can proved to
a opportunity for company.
 Mc Donald's is facing a increase in their company's sales through their mobile devices
which is an opportunity for company.
Porter five forces model
Porter 's five forces model is defined as a framework that analyses a company's
competitive environment(Benitez, Llorens and Braojos, 2018). It helps in determining
company's strengths and weaknesses. This model helps in analysing company's structure to
identify its corporate strategy. Porter's five forces model can be applied to any segment of
economy to understand level of competition within company and enhance company's long term
profitability. Factors of porter's five forces model is explained as follows:
Competition in company:
It refers to number and amount of competitors and their potential ability to undercut
various companies. Larger amount and number of competitors, along with a number of
equivalent products and services that company offers and lesser power of company(Roche,
1992). Suppliers and buyers seek out and determines a company's competition and if they are
capable of offering a better and worthy deal or lowers prices. Conversely, when there is a
competitive rivalry is low, company has greater power to charge higher prices and set terms of
deals to accomplish large profits and sales.
In terms of Mc Donald's, company faces tough and high competition as because being a
fast food restaurant market is being saturated (Shorman, Allaymounq and Hamid, 2019). This
component of porter's five forces model handles effects of competing companies in business
environment. This external factor increases intensity of competitive rivalry that company
experiences. In case of Mc Donald's, company has a strong force of competitive rivalry that has:
 Higher number of companies
 High aggressiveness of companies Low switching costs
Bargaining power of suppliers:
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Bargaining power of suppliers refers in addressing that how easily suppliers that could
drive up cost of inputs. It is affected by number of suppliers of key inputs of products or
services, that how unique these inputs are, and how much it would cost and expense a company
to switch towards other supplier. Few suppliers to a company, and more a company would
depend on a supplier. And as a result, supplier has more power and could drive up to input costs
and push for others advantages in trade.
In terms of Mc Donald's, company faces suppliers influence in terms of company 's
production capability that is based on availability of raw materials (Gelinas, Sutton Jr, and
Federowicz, 2019). This component of five forces model determine and identifies impact of
suppliers on company and their fast food restaurant business environment. Porter's five forces
model analyses a low vertical integration weakens bargaining power of suppliers. That means
that they means that they do not control distribution network that transports. In case of Mc
Donald's, company faces weak bargaining power of suppliers which is based on following
external factors:
 Large number of Suppliers
 Low forward vertical integration of suppliers High overall supply
Bargaining power of buyers:
Bargaining power of buyers includes driving prices lower prices or their level of power.
It is affected by how many number of buyers or customers a company has, how significant each
customer or markets for its output. Small and powerful customers could lead to negotiate for
lower prices and better deals(Tomanek and Lis, 2020). Company which has various smaller,
independent customers will have an easy time charging higher prices to increase company's
profitability.
In terms of Mc Donald's, company addresses power of customers on business
performance. This component of five forces model deals with influence and demands of
customers and how their decisions could impact its businesses. There is a market saturation
where customer can choose from many fast food restaurant other than Mc Donald's. And this
makes bargaining power of buyers a strong force in affecting company's external environment.
In case of Mc Donald's factors that contribute to strong bargaining power of buyers are as
follows:
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 Low switching cost
 Large number of providers and suppliers
 High availability of substitutes
Analysis of Porter's value chain and importance of activities.
Porter's value chain analysis is also referred as value chain analysis which is business
management concept that was developed by Michael Porter. As it explains that a value chain is a
set of collection of activities that are performed by a company to create value for its customers
(Tanriverdi and Du, 2020). Porter 's value chain analysis basically focuses on systems and
activities with customers as a central principle rather than on other departments and accounting
expenses categories. It links systems and activities to each other and demonstrates effect of cost
and profits(Knights and Murray, 1992). Value chain analysis makes clear where sources of value
and losses could be found in companies. In terms of Mc Donald's porter's value chain analysis
are as follows:
Operations:
Mc Donald's operates owned and franchised restaurants. And about 80% of Mc Donald's
restaurants are owned and operated by independent franchises. Its formats conventional
franchising developmental license and affiliate.
Conventional franchising that involves franchises of paying rent and royalties on
percentage of sales along with payment of initial fees when opening a new restaurant. In this
type of franchising, company owns land and building and secures a long term lease for
restaurant location and franchise that pays for equipment signs, seating and décor.
Developmental license consists in providing capital for whole businesses , including real
estate interest. In developmental license agreement no capital invested by Mc Donald's
corporation. Royalty is paid by license on percentage of sales in addition to initial fees upon
starting of a new restaurants or grant of new license (Chae, Koh, and Park, 2018). This
structure of developmental license ownership is used by company in more than 70 countries with
a total of 5,228 restaurant.
Affiliates as other form of franchising that is referred to a limited number of foreign
affiliated markets. Mc Donald's receives royalties from affiliates on percent of sales.
Marketing and sales:
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Company uses print and media advertising extensively to communicate its marketing
message to representatives of target customer segment. Company's advertising budget in US
alone equaled to USD 1.42 billion in 2014. Along with print and media advertising this amount
was spent on sales promotions, events and experiences and public relations.
Service:
Company has high speed of provision of customer service which is one of main
competitive advantages of Mc Donald's. However it helps in attempts of company to provide
excellent customer services that contradicts its practices of paying minimum or sightly above
minimum wages to its employees.
Value chain analysis is necessary for company as it helps in:
 It helps in determining business primary and support activities.
 Analyses of value and cost of activities
 it helps in identifying various opportunities to gain and build competitive advantage.
 It helps in building key consumer values of customers.
Discussion on how businesses could deploy information technology to improve its business
processes and to address any issues and concerns that are highlighted in analysis.
There are various technology that could be used by company in order to enhance
company's business processes (Maggio and Artino Jr, 2018). As in recent times companies are
using various technology in order to carry their business operations effectively and efficiently.
Technology could be beneficial for companies to enhance company's business process. In terms
of Mc Donald's importance of technology that could be used in company's operations that helps
in improving business processes are as follows: Manage projects more easily, effectively and efficiently: Technology helps in managing
projects with more ease, effectively and efficiently. As technology has enabled business
owners and managers top stay on top of their projects by tracking time and process. With
help of web based project management tools like Basecamp, Many moon and Podio
could help in having efficiently collaborating with other teams and share access on
documents. Make use of productivity apps: Company could use of various productivity applications
so that production of products and services can be manufactured effectively and
efficiently.
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 Benefits from web based payments: Company is using various web based payment
methods for having an ease in carrying and providing payment to avail company's
products and services. By using various online payment methods customers can find an
ease in availing company's services. Make use of back up software: Company is using various backup software to carrying
their operations and practices so that their useful data and information can be kept
carefully with a security and in case if it lost they can use their back up software to
gather their valuable data and information. Measure user engagement: Company is implementing a method of measuring and
analysing user engagement towards their customers so in order to keep a touch in worthy
customers. Company is using various measures that analyses user engagement towards
customers in order to maintain company's survival in corporate markets.
 Make use of twitter to gain new customers: Company can use various social media tools
to promote about their company and its products and services. With help of social media
tools like twitter company can be able to grab more new customers and promote their
products and services in markets by using social media.
There are various issues and barriers that can be arise in carrying and using information
technology. Some of issues and challenges that company faces while using information
technology are as follows:
 There is as threat threat that can be arise in data protection.
 There can be an issue that arises of innovation and digital transformation.
 There is a issue of having a multi cloud security in carrying business operations.
 There is a issue of lacking agility in business processes (Howell, van Beers and Doorn,
2018).
CONCLUSION
From above report it has been concluded that each and every business company is
required to manage its information technology to carry and run its business activities and its
operations. As it information technology management refers to processes that includes hardware,
software, data and data centre facilities. This report includes detail and brief history history of
business practices of company. External analysis is explained in which various external factors
are explained in order to examine factors that can affect business of company. There is a brief
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explanation about porter's five forces model in which various elements and components of
business that affects company's operations and activities are mentioned. There is analysis of
porter's five model along with its importance of various activities and operations that are to be
taken care while carrying business operations. On these basis there is a discussion on how
business company could deploy its information technology in their operations and activities in
order to enhance its business processes.
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REFERENCES
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Chae, H.C., Koh, C.E. and Park, K.O., 2018. Information technology capability and firm
performance: Role of industry. Information & Management .55 (5). pp.525-546.
Englander, I. and Wong, W., 2021. The architecture of computer hardware, systems software,
and networking: An information technology approach. John Wiley & Sons.
Gelinas, U.J., Sutton Jr, S.G. and Federowicz, J., 2019. Business processes and information
technology.
Große, C., Nyman, M. and Sundberg, L., 2019, February. Information Technology Consulting
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Harlie, M., Rajiani, I. and Abbas, E.W., 2019. Managing information systems by integrating
information systems success model and the unified theory of acceptance and usage of
technology. Polish Journal of Management Studies.20.
Howell, R., van Beers, C. and Doorn, N., 2018. Value capture and value creation: The role of
information technology in business models for frugal innovations in
Africa. Technological Forecasting and Social Change, 131, pp.227-239.
Ilmudeen, A. and Bao, Y., 2018. Mediating role of managing information technology and its
impact on firm performance. Industrial Management & Data Systems.
Maggio, L.A. and Artino Jr, A.R., 2018. Staying up to date and managing information
overload. Journal of graduate medical education .10 (5). pp.597-598.
Pearlson, K.E., Saunders, C.S. and Galletta, D.F., 2019. Managing and using information
systems: A strategic approach. John Wiley & Sons.
Shorman, S.M., Allaymounq, M. and Hamid, O., 2019. Developing the e-commerce model a
consumer to consumer using blockchain network technique. International Journal of
Managing Information Technology (IJMIT) Vol, 11.
Soto-Acosta, P., Popa, S. and Martinez-Conesa, I., 2018. Information technology, knowledge
management and environmental dynamism as drivers of innovation ambidexterity: a
study in SMEs. Journal of Knowledge Management.
Tanriverdi, H. and Du, K., 2020. CORPORATE STRATEGY CHANGES AND
INFORMATION TECHNOLOGY CONTROL EFFECTIVENESS IN
MULTIBUSINESS FIRMS. MIS Quarterly, 44(4).
Tomanek, M. and Lis, A., 2020. Managing information on the physical education research field:
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