Evaluating McDonalds' Business Environment in South Korea

This report provides an analysis of McDonald's business operations and environment in South Korea. It begins with an introduction to the business environment and background of McDonald's, highlighting its establishment and growth in the South Korean market following the 1988 Olympics. The report discusses McDonald's strategies, including menu adaptations to local tastes, pricing, and customer service. It emphasizes the company's focus on quality, innovation, and employment generation. Furthermore, the report uses PESTEL and Porter's Five Forces frameworks to evaluate the external factors influencing McDonald's in South Korea, such as political, economic, social, technological, and environmental aspects, as well as competitive forces within the industry. The analysis aims to provide a comprehensive understanding of the challenges and opportunities McDonald's faces in the South Korean market.

Business Organisations and
Environments in a Global Context

Executive Summary
The assignment is regarding McDonalds in South Korea which formulates the policies regarding
the establishment of the organization in the respective country. It provides the scenario regarding
the development, the environmental measures, and pestal analyses along with portal five forces
which provides the scenario of the organizational environment along with the external features
and its effect in an effective manner. The assignment focuses on the effective measures taken to
develop the company in South Korea along with the measures in the field of innovation and
creativity. It is the subjugation of the policies in an effective manner along with the measure to
promote development and focus on its prime aspects as to providing services to the customers in
an effective manner.

Table of Contents
Introduction......................................................................................................................................4
Background to Business Organization.............................................................................................5
Background to Business Environment.............................................................................................8
PESTEL, Porter Five forces............................................................................................................8
Table..............................................................................................................................................11
Time Plan.......................................................................................................................................13
Referencing....................................................................................................................................14

Introduction
The business environment means the entire domestic and the peripheral factors affecting the
organization. It includes the employers, employees, workers, creditors, shareholders, financial
institutions and all the persons involved directly or indirectly in the functioning of the
organization. It is the collaboration of the management of the organization. All the elements
present in the functioning of the organization are directly or indirectly affected by the internal
and external factors of the organization. It also includes suppliers, retailers, clients; its
competitors so on and so forth.
An organization is a collective head brought together for a unified purpose of producing goods or
services in a consecutive manner. Organization can be profit or not for profit organization. The
function of a not for profit organization is directed towards the collective service oriented
towards the welfare of the society. On the other hand profit organization is directed towards the
profit factor and which is oriented towards the service of the organization in the simultaneous
manner. In case of profit organization directed towards the expansion of the market and the
inclusion of the commercial output in the specific manner. Both the internal and the external
environment perform in a synchronized manner the functions of the organization. There are three
types of business organization namely sole proprietorship, partnership and the cooperative
organization. The functioning of the above mentioned organization is different in their approach.
In this assignment the organizational aspect of McDonalds in South Korea will be discussed.
McDonald started in California in 1948. After originating it diversified its outlets to various
countries. The company is a international fast food behemoth. It is one of the largest food chain
in the world. Its functioning is diversified and on a global sphere. The functioning of the
organization is spread around thirty thousand locations and hundred eighteen countries. It is one
of the global hub in terms of providing service to the consumers on a simultaneous manner.

Background to Business Organization
During the Olympics in South Korea the Concept of Mc Donald’s arrived in Korea. It started
trending during the Olympics in the South Korea and after the Olympics the concept of
McDonalds started in the country. McDonald was the preferred restaurant in dining out the
consumers in South Korea in the significant manner. It started gaining ground after its inception
during that period. McDonalds opened its first restaurant in Apgujeong- Deong during that
period. There was the culmination of hundreds of customers during its inauguration in
Apgujeong Deong. After its inception in the Korean market it gained ground on a simultaneous
manner. It started trending during that point of time.
For the past twenty five years it has been providing services to the consumers on a continuous
basis and attracting consumers on the run. It started providing employment opportunities on a
simultaneous basis. Currently the company has employed around fifteen thousand employees
around South Korea. Providing quality services to the customers has been the bench mark of the
company for the decades (Carrasco, 2017). It has added to the generation of revenue in the
country appreciably. Providing services at a nominal rate has been the unique selling proposition
of the company time and again. It has escalated in the goodwill simultaneously. It has
continuously been on the hike during that period of time. It has registered a global hike in its
marketing aspects on a continuous basis. The functioning of the organization has changed on a
simultaneous basis. It started gaining grounds with the inception of innovative ideas. The
innovative concept in the organization led to its boost at the global sphere. The concept of the
society started gaining grounds in the significant manner. In South Korea, McDonalds served as
the Big Mac as well as Bacon Cheese Burgers and Breakfast menu along with Quarter Pounders
in the menu (Kim, 2017). Prices tend to fluctuate in the significant basis. The price scenario
tends to provide a shift in the functioning of the organization.
Customer feedback is also the prime concern in the organization (Burke, 2017). It tends to
provide the element of customer retention on ca dynamic basis. It is the unique selling
proposition of the organization which helps in the retention of the customers on a systematic
basis. The functioning of the organization along with the accountability of the organization tends

to provide the leap in the functioning of the organization on a simultaneous basis. The delegation
authority in the organization also plays a significant role in the dynamics of the company
concurrently. The advent of the concept of collective efforts on the part of the management adds
to the decorum of the organization along with the detailed and effective functioning of the
organization at the same time. The effective implementation of the policies in the marketing of
the organization adds to the quality in respect of its functioning of the organization. Initially the
prices were cost effective but gradually it gained grounds in a significant manner. The market
scenario as regards the other products was in the inflation stage as compared to the McDonalds.
The company has been implementing all kinds of aggressive promotions along with the
continuous addition of the new menu in the backdrop. Each new-fangled service is an audacious
stride that requires ample outlay both in the labour and the equipments.
The company’s are designed to assure high quality standard with respect to its functioning and
its services on the go. All the restaurants are either operated by a company or by a franchisee
under conformist franchisee and development licenses and overseas associated markets under the
license agreements. Conformist franchisees add to the company’s revenue channel through the
payment of lease and royalties based upon a percent of sales with specified rent payments along
with the initial fees received upon the opening of a new restaurant or the granting of a new
franchisee term.
McDonalds restaurant offer a significantly standardized menu, although there are geographic
variations to suit the local consumer tastes and preference (Adams, 2016). Adding to that
McDonalds tests new foodstuffs on an enduring basis. Mc Donald’s comprise cheese burgers
and hamburgers, Quarter Pound, Chicken Mc Nuggets, Snack wraps, Egg Mc Muffin so on and
so forth. The functioning of the company is not seasonal basis but on a yearly basis.
Management of the company is entrusted with the responsibility to manage the functioning of
the organization on a significant manner. The effective management and the accountability add
to the regime on a consecutive manner. It holds copyright along with the patent rights which
ensures the authenticity of the company and infringement of the rights leads to the penalty
concurrently. Advertising, endorsement and communal relations focus on the worth, victuals
flavor, nourishment, expediency and patron know-how. The company continuously endeavors to

improve its communal accountability and ecological practice to achieve elongated term
sustainability which benefits McDonalds and the society it serves concurrently.

Background to Business Environment
PESTEL, Porter Five forces
Business environment all the internal and the external factors that affect the functioning of the
organization at the same time (McKinnon et al., 2015). It includes all the elements be it the
internal management and the external management of the organization in the functioning of the
organization. It projects the scenarios related to the execution of the policies and the
accountability of the concern concurrently. The basic feature regarding the management of the
organization is directed towards the synchronization of the management in their execution of the
task force. The managerial prospects are inclined towards the effective management of the
organization significantly. All the factors oriented towards the functioning of the management
are affected by the inclusion of the internal and the external environment. The key feature of the
business environment is that it is dynamic in nature and changes are erratic. Business
environment differs from place to place, region to region and country to country. Political
scenario also plays significant role in the execution of the internal and external management of
the organization.
The importance of the business environment can be determined by the image that they procure in
the business environment in a noteworthy manner (Schaltegger and Wagner, 2017). Business
environment helps to identify the individual strengths and the weaknesses in view of the
industrial and the wide-ranging environment. It helps to analyze the strategies of the competitors
and at the same time nurturing its own strategy. It helps in accepting business challenges and
implementing the same in a detailed manner. The basic objectives of the organization are
creating customers, retaining customers and providing quality services in an effective manner.
Innovations and earning profits are the regime from the organization and tend to provide the
culture of development in a significant manner. Moreover, the objectives related to the human
resource and the labour workforces tend to provide the boost in the organizational think tanks.
The social factor also plays a significant role in the promotion of the organization in an effective
manner (Bryson, 2018). Social factors provide the public platform to socialize the product in an

effective manner. The effective execution of the policies in the organization vests with the
management in an effective manner.
Business environment in this assignment is about McDonalds in South Korea. The environment
states regarding the prospect of the company in the South Korea and its execution in the country.
The execution of the same is possible through the analyses of the factors that directly affect the
company. The factors can be attributed by the PESTEL analyses. The analyses would help in the
changes that are to be ascertained in the regulation of the same in an effective manner.
McDonalds is a rapid service restaurant and is loved by customers around the world. The
effective service of the restaurant adds to the goodwill of the company. The analyses of Portal
are configured in the following manner.
Political analyses speak about the political attributes that are ascertained during the functioning
of the company significantly (Kurtz, 2018). It includes the political analyses and the prospects
regarding the inclusion of a particular company in a particular country. The government policies
regarding the particular company, the legal, social matters and the overseas market all are
enshrined under the analyses.
Economic factor is the next external analyses in an organization. It states regarding the income
rates, exchange rates, inflation, business and non-refundable income of the consumers in an
effective manner. It is the analyses of the overall economic scenario prevailing in the
organization in a significant manner. It provides the income and the sales stature in an effective
manner..
Social factors includes the social attributes namely the beliefs and the attitudes of the people in
general (Borgatti et al., 2018). This includes population growth, career attitudes, health
consciousness and the age distribution of the population.
Technological factors are the ones which include the attributes of technological advancements,
innovation in the respective fields, new habits of producing goods and services, new ways of
providing the goods and services to the consumers and the ways to improve the ways to execute
the policies chartered (Vezzoli et al., 2015).

Environmental factors include the sphere that is related to the external environment of the
organization (Harper and Snowden, 2017). It includes the strategies that are followed by the
competitors along with the changes that are to be equipped in the execution of the same in an
effective manner. It enumerates the changes that are to be followed in the innovative sphere.
Legal factors include the legislation that is chartered for the startups in the organization
concurrently (Riseley, 2016). This includes laws related to the land and the amendments that are
executed in the similar aspects. The legal factors if infringed can result in the drastic changes in
the organization significantly and can even lead to penalty clubbed with infringement.
There is also the inclusion of PORTER Five Forces. It includes the following:
Competitive rivalry- Here the organization checks the competitors market and its extensive
nature in the same. It keeps a track at the competitive strength along with the policies they
follow.
Supplier’s power- It includes the prices that are executed for the products. It determines the
arena of the suppliers in a significant manner. It gives the opportunity to shift to the alternatives
available thereon.
Threat of Substitution- This is directed towards the competitive nature in the market and the
threats that can be encountered during the case of shift in the functioning of the product
simultaneously. This is directed towards providing certain outsourcing on the part of the product
or the inclusion of innovative measures as to the product.
Threat of new entry- It is one of the effective theory which provides the zeal to the
introduction of new and vibrant measures in the product features along with the introduction of
ancillary products and changes on the part of the market strategy.
Buyers Power – This is one of the cardinal features in the execution of the market base at a
significant style. The consumer behavior and the pricing policies play a effective role in the
retention of the product along with the customer base.
These theories were introduced to analyze the markets profitability along with the enunciation of
the attractiveness in terms of the product market in the respective sphere.

Table
The table formulated states regarding the statistics in the aforesaid years namely 2015-2016. The
table provides the scenario that the trend in 2016 tend to increase as compared to 2015. The brisk
change is due to the marketing strategies that are formulated in the prospective year as compared
to 2015. The changes arose because of the changes in the functioning of the management of
McDonalds in the respective years. The table charters the prospective report that the shift in the
respective years tend to provide the conclusion that the derivatives in the respective year is due
to the inclusion of effective measures in the marketing policies along with the measures in the
planning and design approach in the respective field. The table gives a brisk idea regarding the
ratios of profit ascertained along with the shift in the ratios simultaneously. The table acts as the
policies that are subject to the changes along with the effective manner in the execution of the
policies in the respective field. The inclusion of the innovative measures adds to the regime of
development significantly. The inclusion of the effective measures does add to the fluctuation in
the field of market orientation radically.
The inclusion of the productive measures in the field of promotion and development does add to
the enhancement of the product alongside. The inclusion of the policies in the long run does add

to the growth and development in the respective field simultaneously. The inclusion of effective
measures as regard to the competitive world does add to the measures that are followed in the
escalation of the product at the same time. The effective measure with regard to the management
does add to the configuration in terms of effective management simultaneously. The execution of
effective measure as regard to the managerial measures does add to the development in the
respective field concurrently.