Analysis of McDonald's Management Information System (MIS) Report

This report provides a detailed analysis of McDonald's Management Information System (MIS). It begins with an introduction to McDonald's, its history, and current market position. The report then analyzes McDonald's competitive environment using Porter's Five Forces, assessing the intensity of rivalry, the threat of new entrants, the bargaining power of suppliers and buyers, and the threat of substitutes. Following this, the report delves into McDonald's value chain, examining inbound logistics, operations, and outbound logistics, as well as two support activities. Key value-adding activities are identified and justified. The report concludes with recommendations on how McDonald's can leverage information technology and innovative ideas to enhance its business processes and competitive positioning, drawing on the analyses of Porter’s 5 Force analysis and “Porter’s Value Chain”. The report references relevant academic sources to support its analysis.

Running head: MANAGEMENT INFORMATION SYSTEM
Management of Information Technology for McDonald's
Name of the Student
Name of the University
Author’s Note:

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Table of Contents
1. Introduction............................................................................................................................2
2. Analysis of the Competitive Environment for McDonald’s with Porter’s Force Analysis. . .3
3. Identification of the Key Value-Adding Activities with Proper Justification........................6
3.1 Analysis of Inbound Logistics, Operations and Outbound Logistics..............................7
3.2 Analysis of Two Support Activities in Porter’s Value Chain for McDonald’s...............8
3.3 Identification of the Key Value-Adding Activities with Justification.............................9
4. Conclusion and Recommendations......................................................................................10
References................................................................................................................................13

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1. Introduction
A management information system or MIS can be referred to as the computerized
system, which consisted of hardware and software and serves as the subsequent backbone for
the organizational operations (Fountas et al. 2015). This particular system gathers following
data from several online systems, analyses the information and even reports relevant data for
aiding in the management decision-making process. It is useful for better coordination,
analysis, visualization and control of information. The following objective of this
management information system is to increment the profits and value of the business. Several
distinct and popular organizations have implemented this type of IT for gaining maximum
competitive advantages, and one of such significant organizations is McDonald's Corporation
(McDonald’s. 2020). It is a great American fast food organization, which was founded in the
year 1940 as a restaurant by Richard and Maurice McDonald.
The headquarters of this particular organization is in Chicago, Illinois, in the United
States of America, and presently, there are more than 38000 restaurants in the entire world.
The founders have rechristened their respective business as the stand of hamburgers and then
turned the organization into a specific franchisee with the logo for Golden Arches that was
initiated in the year of 1953 at the location in Arizona (McDonald’s. 2020). During 1955, one
of the most famous businessmen, namely Ray Kroc, joined McDonald's as the franchise agent
and then proceeded for purchasing the chain from these brothers. Currently, this particular
organization is the largest restaurant chain by revenue, and they have been serving more than
69 million customers in the entire world within 100 countries. The major products of this
specific organization include hamburger, chicken, milkshakes, French fries, salad, soft drink,
breakfast items, wrap, coffee and dessert.

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The total number of employees working in McDonald's is around 210000, and they
have ensured maximum competitive advantages in the business without any type of
complexity. Although the organization is the best known for their hamburgers, French fries
and cheeseburgers, they are also featuring chicken items and desserts (McDonald’s. 2020).
After consideration of feedback from their customers, they have also added salads, fruits,
smoothies and fish to their respective menu. The main revenues of the organizations come
from the royalties, fees as well as rent paid by the franchises and even from the sales within
the organization operated restaurants.
As per two distinct reports, published, McDonald’s is referred to as the 2nd largest
private employer that comprises of around 1.7 million staff after Walmart. One of the major
and the most important strategies of this organization is that they utilize updated technology
in their business for ensuring that maximum effectiveness and efficiency is being gained
without any issue or complexity. Moreover, they have been enjoying their top position for
several years and have been using strategies for employee satisfaction to a high level
(McDonald’s. 2020). McDonald’s is performing well and has been competing with popular
fast-food organizations, such as KFC, Starbucks, Burger King and several others. This report
will be outlining a detailed discussion of the competitive environment of McDonald's with
the following details.
2. Analysis of the Competitive Environment for McDonald’s with Porter’s Force
Analysis
The environmental analysis could be referred to as a strategic tool, and it is the
procedure to identify every internal and external elements that could impact the
organizational performances. This type of analysis can entail a subsequent assessment of the
opportunity or threat level, presented by different factors (Laudon and Laudon 2015). Such

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evaluations are required to be translated into the procedure of decision making, and it even
helps in alignment of the strategies with the environment of the firm. The environment is
inclining the business, and every situational factor helps in the determination of regular
circumstances affecting the organization.
Hence, these businesses should continuously analyze the trade environment as well as
the market (Shiau, Chen and Tsai 2015). Several tools of strategic analysis are present, which
can provide knowledge about the organizational environment. All possible opportunities and
threats are being identified in the process, so that the business activities are updated and the
business gains subsequent competitive advantages. The organization of McDonald’s
Corporation requires to consider their external and internal environments, so that they are
able to gain maximum effectiveness without much complexity. Various factors are
considered for understanding the current position of the organization in the existing market
place to gain high success (Mathooko and Ogutu 2015). A proper analysis of this competitive
environment of the organization of McDonald’s with Porter’s 5 forces is being provided in
the following paragraphs:
i) Competitive Rivalry: The first as well as the foremost force of the Porter’s Five
Forces analysis for the organization of McDonald’s Corporation is competitive rivalry. This
particular force is strong since the organization is one of the most competitive businesses in
present situation (Kanakulya and Jinzhao 2017). With several local and multinational
restaurants in the world that comprise of the same menu. This distinct competition is
eventually becoming powerful with every player within the industry that is striving for the
market shares. A specific level of saturation is also being developed in the organization.
There are several competitors of this organization of McDonald’s Corporation in all over the
world, which include Burger King, KFC, Johnny Rockets, Starbucks and several others. Each
and every player is eventually spending on marketing, so that they are able to innovate

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majorly and also open new franchises for the core purpose of incrementing their subsequent
accessibility to the new potential clients. This type of increment in the total number of
participants has substantially made this competitive rivalry a stronger force for McDonald’s.
ii) The Threat of New Entrants: The second important and significant force of the
Porter’s Five Forces analysis for the organization of McDonald’s Corporation would be the
threat of new entrant (Koc and Bozdag 2017). This particular force is weak on an
international level for McDonald’s, since there exists several distinct entry barriers. For
becoming a successful competitor of the organization, this particular entrant will require to
make a larger number of outlets in the world that needs a huge capital investment as well as
time. Moreover, the respective organization would also have to invest time for quick
establishment of economies of scale for becoming profitable and then gain accessibility to the
respective suppliers for meat and any other raw material, so that it becomes easier to carry
out subsequent marketing and create awareness within the customers. It makes it quite
challenging for the new entrants to get into and then provide high competition for the
businesses like McDonald’s. However, the similar threat is quite high over a local scale, in
which the investments are not high, around two to three outlets are adequate and the
economies of scale are being recognized successfully (Kehoe and Mateer 2015). The local
outlets could also provide competition and hence this force is moderate for McDonald’s.
iii) Bargaining Power of Suppliers: The third distinct and noteworthy force for
Porter’s Five Forces analysis for the organization of McDonald’s Corporation is the
bargaining power of suppliers. Different raw materials like potatoes and chicken that are
being utilized by the organization on a regular basis are accessible from the larger number of
suppliers and different orders of the organization are huge on a regular basis (Simatupang,
Piboonrungroj and Williams 2017). Several suppliers are present in the local environment
and hence they do not have a chance to giveaway with the organization or even try to force it

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for increment of its respective prices. Moreover, they can effortlessly and promptly switch
the suppliers with lower switching costs. Hence, this particular is weak for the organization.
iv) Bargaining Power of Buyers: Another distinct and important force of the Porter’s
Five Forces analysis for the organization of McDonald’s Corporation is bargaining power of
buyers. This particular force is strong for the organization. Different buyers of McDonald’s
comprise of several subsequent options that are available in the market and hence they might
be a in a negotiation position. The buyers could easily switch from any 1 restaurant to the
next without any type of switching costs as soon as they are referred to as unconvinced
(Prajogo, Oke and Olhager 2016). The customer loyalty towards such fast-food organization
is reduced regularly with several competitors. Moreover, the buyers can also protests against
any price increment and hence the organization might face turmoil in their business and
customer retention.
v) The Threat of Substitutes: The final force is the threat of substitutes. There are
several substitutes of food from McDonald’s, such as KFC or Domino’s Pizza. The bakery
items are also considered as substitutes of the products of McDonald’s; hence the
organization might face high competition while retaining the customers. Maximum of such
substitutes are highly competitive in respect to the consumer satisfaction as well as quality
and also switching to the substitutes would not comprise of any type of related switching
costs (Indris and Primiana 2015). Several health concerns are also raised against such distinct
products of the organizations and the customers can complain against their products for not
considering maximum health benefits under any circumstance. As a result, it can be referred
to the fact the force against the organization of McDonald’s Corporation is stronger.
3. Identification of the Key Value-Adding Activities with Proper Justification

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It is required to include technology in the business for ensuring that maximum
effectiveness and efficiency is gained without much complexity. An organization is able to
obtain few of the most important and noteworthy benefits from successful implementation of
technology in the respective business. Various business applications involve distinct
databases, such as SQL servers, few transactional systems like the real-time order entries,
electronic mail server such as Exchange and several others. The organization would be able
to involve different technology after analysis of their inbound and outbound logistics (Shtal
et al. 2018). Proper analysis of Porter’s value chain for McDonald’s is provided below.
3.1 Analysis of Inbound Logistics, Operations and Outbound Logistics
The primary activities of this value chain of McDonald’s are directly included in
production as well as sale of the respective products for the targeted consumers. Proper
analyses of the primary value chain activities could improvise the performances of McDonald
are provided below:
i) Inbound Logistics: It would be extremely vital to improve a stronger relationship
with the suppliers as their supports is required for receiving, storing as well as distributing the
product (Ansah and Sorooshian 2017). Without proper analyses of these inbound logistics,
the company could also face several experiments within the stages for product development.
It also emphasizes on all the features of transformation from various raw materials into the
finished products. The major examples of these inbound logistics involve retrieving raw
materials, storage of input and finally distributing the raw material for initiation of
production.
ii) Operations: The overall significance to analyze these operational activities would
raise as soon as the raw materials attain and the organization of McDonald’s is ready for
processing the raw materials into several end products for launching it within the market. The

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major examples of these operational activities include machining, testing, accumulating and
packing. The proper maintenance and repairing of the equipment also falls under the category
(Kraja and Osmani 2015). It also involves both service and manufacturing operations; hence
maximization of efficiency as well as improvement of productivity. It even attain reliable
economic development and also set for competitive advantages.
iii) Outbound Logistics: These logistics involve different activities, which deliver the
product to the clients through passing from various mediators. Few different activities are
warehousing, order processing, delivering, material handling and scheduling (Hueske and
Guenther 2015). They could also analyze and optimize the logistics for exploring competitive
advantages for better execution of business growth objectives.
3.2 Analysis of Two Support Activities in Porter’s Value Chain for McDonald’s
Two suitable and important support activities within the Porter’s value chain for
McDonald’s Corporation are as follows:
i) Firm Infrastructure: The first and the foremost support activity within Porter’s
value chain for McDonald’s Corporation is firm infrastructure. It eventually denotes a range
of different activities such as management of quality, legal matter handling, accounting, and
planning and even management of strategies (Zinovieva et al. 2016). The most efficient
infrastructure management could enable the organization in optimizing the overall values of
the total value chain. The organization of McDonald’s Corporation can also manage the
respective activities of infrastructure for the core purpose of strengthening the competitive
positioning in the market. As a result, the company will have the capability to gain maximum
effectiveness and efficiency without any type of complexity.
ii) Technology Development: The 2nd vital and important support activity within
Porter’s value chain for McDonald’s Corporation is technology development. Several distinct

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activities of the technology are majorly dependent over the subsequent technological support
(Bartusková and Kresta 2015). Such technological incorporation within production,
marketing, human resource activities and distribution needs the organization in proper
realization of the significance of overall technological development. It could be eventually
divided into the process and product technological development activities. Few distinct
activities of the technology development in McDonald’s Corporation include automation of
software, research of product designing, data analytics and technology-supported customer
services. The respective R&D department is being categorized in the category of technology
development for this specific organization of McDonald’s (Gilbert 2015). Moreover, they can
include their major effectiveness and efficiency in procurement activities.
3.3 Identification of the Key Value-Adding Activities with Justification
The value-adding activities are those significant activities, which eventually add the
values to different customers and the execute three distinct and important steps, which
include the step transforming the item towards completion, step to be completed after the first
time and finally the customer care for the first step to be done eventually (Zheng and
Manoharan 2015). The major value-added activities involve working that the customer would
be willing to pay for, working that physically transformation of the product and finally
working in such a manner that it is being done apart from the first time. The organization of
McDonald’s would be able to deal with different types of issues and complexities after
inclusion of different major value-adding activities. These activities would be ensuring that
the business would be getting following competitive advantages or benefits.
The first and foremost principle value-adding activity for the organization of
McDonald's would be the successful elimination of wastes. It is required to eliminate wastes
from their products so that maximum hygiene is maintained in the food particles and all the
customers are highly satisfied in the process. It can be done after implementation of different

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advanced technologies. Moreover, the respective complexities would be resolved (Bae 2017).
They would be able to reduce the waiting time to a high level, and processing of wastes can
take place to ensure that the business becomes successful under every circumstance. The
defects would also be avoided successfully, and the staff would become highly trained as
well as motivated at the same time. It would also simplify the process and then ensure a high
percentage of success. The other essential and significant principal value-adding activity for
the organization of McDonald's would be the implementation of lean methodology in their
business. It would be helpful for them to ensure that they are performing well, and the
organization would be following all types of success criteria and ensure customer satisfaction
to a high level.
4. Conclusion and Recommendations
Therefore, a conclusion can be drawn that IT is the significant usage of different
systems for the core purpose to store, retrieve and manipulate the confidential information
and data. This type of technology includes all kinds of peripheral equipment, software and
hardware and are being operated by the limited number of users. As a result, the respective
organization is capable of dealing with different kinds of issues and demanding situations
efficiently and promptly. The commercial utilization of this information technology can
easily encompass telephony and computerized technology. The information technology
involves different layers of the physical equipment such as hardware, operating systems,
software applications, virtualization and many more.
Several distinct applications execute the programmed instructions for manipulations,
consolidations, dispersing and even impacting the datum for following business purposes.
The computerized servers are responsible for running the business application, and different
servers interrelate with the clients as well as any other server for more business networks.

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These technologies are also responsible for providing maximum advantages to the business
and reduce the issues to a high level. McDonald’s is one of the most significant organizations
in the fast-food chain in the world. They have been enjoying some of the most vital and
noteworthy competitive advantages in their organization. They hence have been focusing on
the innovation and new creativity in the business processes.
After analyzing the organization with Porter's value chain as well as Porter's five
forces, it is being observed that they should bring out innovation in their products with low
costs for better customer retention and maintenance of their position in the market place.
They have used information technology for gaining the capability for viewing different
changes within global markets, faster than the usual requirement. McDonald’s have been
working much more effectively and efficiently for maximizing productivity and hence have
obtained fast communication and subsequent protection of records to a high level. The above-
provided report has properly outlined the detailed analyses of the McDonald’s competitive
environment with various details, like Porter’s five forces and Porter’s value chain.
Suitable recommendations for the organization of McDonald’s for the process of
business deploying IT to improve their business processes and enhancement of competitive
positioning are provided below:
i) Streamlining of Processes: The first, as well as the foremost suitable and useful
recommendation for the organization of McDonald's to improve their business procedures,
would be proper streamlining of the processes and activities. It would ensure that the
organizational efficiency is increased after simplification of tasks and also bypassing the
unnecessary steps or cutting or waste with distinct modelling techniques.
ii) Reduction of Delivery Lead Time by Process Improvement: Another suitable and
essential recommendation for the organization of McDonald's to enhance their competitive