McDonald's: Report on Organizational Changes and Menu Adaptation

This report provides an in-depth analysis of the organizational changes implemented by McDonald's, a leading American fast-food chain. It examines the company's strategic responses to evolving market demands, particularly the increasing consumer focus on health and wellness. The report details McDonald's menu adaptations, including the introduction of healthier food options and the removal of certain items, and analyzes the factors driving these changes, such as rising obesity rates and public health concerns. It explores the challenges McDonald's faces, including customer resistance to menu changes, and discusses the organizational theories relevant to understanding these shifts. Furthermore, the report covers McDonald's market presence in various countries like Australia and the strategies it employs to maintain its competitive advantage. The report concludes by summarizing the impact of these changes on the company's overall business performance.

Running Head: MANAGEMENT
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McDonald’ss
Bachelor Of Business
Report
Student
9/29/2019

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Executive summary
Today, to sustain in the dynamic and challenging business environment, the majority of
MNC’s are undergoing organizational changes. In the following report, it has been discussed
about the organizational changes, which are critical for the stability of an organization. With the
rapid change in the market, it has become important for the organization to bring changes in the
working of an organization, in its product, services or technology. The purpose of the
assignment is to highlight changes in Mc Donald's which is the largest American fast food
company. This assignment is divided into major parts where different has answered related to the
changes in the menu of the company. In the report, the discussion in the context has been
conducted.

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Contents
Introduction............................................................................................................................................3
Overview of McDonalds’s.....................................................................................................................3
Organizational Change in McDonald’s.................................................................................................4
The need of change and Possible Outcomes..........................................................................................5
Resistance faced by McDonald’s...........................................................................................................6
Organizational Theories.........................................................................................................................7
Conclusion.............................................................................................................................................8
Bibliography..........................................................................................................................................9

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Introduction
Organizational change is a procedure, which is adopted by various companies to bring
changes or modifications in their structure, operations, technologies, and culture. These changes
constantly influence the working of the companies. Today to sustain in the challenging and
dynamic environment, modifications in the organization have become a necessity (Pham, 2018).
As future managers of McDonald’s company , a research study has been conducted to
examine and receive the insights regarding the demand for hamburgers, fries, and beverages of
McDonald’s. It was identified that due to the high prevalence of obesity and excessive
consumption of junk food, the demand of its food is decreasing. Therefore, there is a need of
change in the menu of this family restaurant (Murphy, 2019).
Overview of McDonalds’s
McDonald’s is an American largest fast-food chain, which established by siblings
Maurice and Richard McDonald in San Bernardino, California in 1948. McDonald’s is known
for its hamburgers, French fries. According to the company's website, McDonald’s is currently
operating in 118 nations and through its 36000 franchises, it is providing premium services to
about 69 million people on an average base (Maynard, 2018). However, due to the high
prevalence of obesity among kids and youngsters, the demand for their Happy Meal is reducing
and boycott by many people. To retain its customers, McDonald’s will be launching a new
combination and variety of healthy and nutritive food so that customers can access healthy happy
meal food and enrich their experience (Kirk, 2018).

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Along with the USA the market of this largest food chain can be found in Australia, India
and many other powerful companies. In Australia, McDonald’s was initially started in Sydney in
1971 and now it has approximately 900 stores. With more than 90, 000, the restaurant serves the
taste of millions of people on a daily bases. The company has a great market position of about
66% where it is majorly managed and operated by individuals who own franchises of the
company. In Australia, Mc Donald’s is known by its short and famous name Macca’s (Scanlan,
2019).
Organizational Change in McDonald’s
Organizational process means determining the goals and delegating the task and
responsibilities to the workforce for the accomplishment of objectives. In this procedure
company involves the personnel in the decision making process so that according to the overall
views and opinions of team can direct the company towards the profitable decision.
To retain its powerful position demand for its food in the market, this fast-food company
has introduced healthy food in its menu. Besides this, as the company menu card has become
very vast and complicated in the US, the company has decided to cut off some of its food choices
which will eventually help in offering food at many affordable prices, less ambiguity, and
efficient services. The reason behind such a decision is to serve the simple and appealing food to
customers, which can enhance their experience (Economy, 2019). Along with the menu, they
will be making changes in their classic dishes by increasing the healthy choices for the
customers. To improve the nutritive value at breakfast time, they are adding more veggies and
fruits so along with healthy die, customers can taste and relish food. For that, they are making
changes in their high-calorie menu by launching grilled chicken wrap. Further, to promote safe

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and healthy food, the company has declared to remove synthetic colors, ingredients, and
preservers from its fast-food menu. They commit to using 100% fresh beef in Chicken Mc
Nuggets, which will eventually improve the quality of the food (Maziah, Saemah, & Nooraziah,
2015). In Australia, this global fast-food franchise is striving hard to enrich the moments of the
customers by introducing one of the delicious and juiciest burgers Australian customers have
ever had while serving them burgers with freshly cooked onions and grilled chicken. Attributing
to a healthy diet, this fast-food giant is serving Happy Meal for the kids, which involved tiny
burgers, a small packet of fries and little soda with the surprising toy. However today the
company is making changes in the happy meal so they kids while playing with the toys can
understand the importance of a healthy life. Therefore, the company is removing artificial flavors
and removing the additional sugar from strawberry shakes a yogurt, minimizing the size of
potato fries so with the intake of natural fruits and veggies kids can play and enjoy their Happy
Meal. Along with the kids, the company among the adults has promoted this revolution (Maziah,
Saemah, & Nooraziah, 2015).
The need of change and Possible Outcomes
The company has brought this change as there is a prevalence of unhealthy food among
youngsters and adults is increasing due to health hazards like obesity, depression and various
health issues are increasing. In the US, it has been seen that approximately 84.8 million
excessively consume junk and processed food on an average base (Dowell, 2018). Due to which
many NGO and human rights organization is protesting against the fast-food giants. The
management of the company also observed that due to a wide range of menu customers were
having difficulties in making choices, therefore, the company has introduced Dynamic Yield

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where the customers according to their choices and wants can order food. This application is
fascinating and captivating as through this, it can make promote new launch drinks and shakes
and customers can select through a touch of a button. T sustain and generate a profitable business
the company is improving its classic items like Chicken Mc Nugget (CNN, 2018). Tough the
company has introduced various healthy items but still, it is hard to consume fast food on a
regular basis. It is being said, although the company is empowering the customers to adopt a
healthy lifestyle they are not considered a part of the healthiest diet. To promote and enhance the
lifestyle of the customers there are numerous choices available to the customers like less sugar
breakfast, fruit diary items. In the preparation of the burgers earlier, the company was using
artificial butter and cheeses (Maze, 2019).
While indicating about the changes in the preparation of theses burgers and wraps Ms.
Sharon Paz who is a vice president of McDonalds’s , Australia said that the marketing team of
the company has done a comprehensive research to receive the insights about the wants of
customers so that changes can be made in the preparation of food. However soon the company
realized its harmful impacts and eventually replaced it with real and natural butter. Besides this
the company used to high concentration sugar syrups in the production of burgers, they stopped
its further usage when they realized the facts who they are damaging the health of the customers.
Resistance faced by McDonald’s
While initiating the changes in the menu of the company, many of its potential and
regular customers were not satisfied and happy with its sudden decision. In 2018, this food fast
restaurant removed from its demanding items, which was opened from midnight to 5 in the
morning. the main reason behind the decision was to make the experience of the customer more

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valuable and pocket-friendly. Moreover, at the management level, the company was struggling to
enhance the experience of the customers, therefore in Europe and Russia, the company has
launched artificial intelligence in the system so that customers can have the best experience of
their life and they can make lifelong memories with their family and friends (Kirk, 2018).
Despite such resistance the company can make a powerful impact over the customers (Maze,
2019).
Organizational Theories
To drive an organizational change there are various theories which are employed by the
companies
1. Classical Organizational Theory: This theory was generally originated during the time
of industrial revolution which majorly emphasis over the efficiency and productivity
irrespective of the behavioural attitude of the employees. This theory is combination
science as well as Bureaucratic Theory and administrative theory, scientific management
involves the optimum utilization of tools with the workforce a then carefully examining
each aspect of the manufacturing process. This theory has widely adopted the theory,
which is universally applicable in all types of organizations (Pham, 2018).
2. Neoclassical Organizational Theory: This theory is a response to the authoritarian
structure. This theory majorly focuses on the feelings and happiness of personnel. It
promotes the creativity and growth of the personnel, which will eventually improve
productivity and generate profit (Pham, 2018).

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3. Contingency Theory: This theory is unique and thus applied by the organizations
according to their organizational structure. In this theory, the focus has been placed over
the manger's competency to adapt to the work environment of the company.
4. Systems Theory: It is assumed that all the organizational aspects are interrelated. It
depicts an open system in the state of Dynamic Equilibrium, which is continually moving
and changing.
5. Organizational Structure: It depicts an important part of the company that is its
structure. It is an important theory as through it multiple issues can be depicted more
quickly and effectively (Pham, 2018)

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Conclusion
It can be concluded that organizational changes can bring various challenges for the
companies which can be overcome by it positively. McDonald’s has conducted various changes
in the menu of the company. By repacking various unhealthy items from the list, the company
introduced various healthy choices for the customers which will enhance the lifestyle of the
customers. Through their resistance, however, they were overcome by them.

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Bibliography
CNN. (2018, October 3). CDC report: 84.8 million U.S. adults consume fast food every day and
other startling findings. Retrieved 2019, from CNN:
https://www.abcactionnews.com/lifestyle/fast-food-consumption-cdc-report
Dowell, M. (2018, May 21). Think McDonald's Is Unhealthy? You'll Be Shocked to Know Just
How Bad It Used to Be. Retrieved 2019, from Showbiz Cheetsheet:
https://www.cheatsheet.com/health-fitness/think-mcdonalds-is-unhealthy-youll-be-
shocked-to-know-just-how-bad-it-used-to-be.html/
Economy, P. (2019, April 6). McDonald's Is Making a Surprising Change to Its Menu That Is
Going to Make a Lot of Customers Very Unhappy. Retrieved 2019, from Inc:
https://www.inc.com/peter-economy/mcdonalds-is-making-a-surprising-change-to-its-
menu-that-is-going-to-make-a-lot-of-customers-very-unhappy.html
Forbes. (2017, April 7). Is It Unhealthy To Live Entirely Off McDonald's Food? The Answer
May Surprise You. Retrieved 2019, from Forbes:
https://www.forbes.com/sites/quora/2017/04/07/is-it-unhealthy-to-live-entirely-off-
mcdonalds-food-the-answer-may-surprise-you/#1dc10e4c8160
Kirk, K. (2018, March 31). “The World’s Lovin’ It”: The Global Brand Success of McDonald’s.
Retrieved 2019, from Global marketing professor:
https://globalmarketingprofessor.com/the-worlds-lovin-it-the-global-brand-success-of-
mcdonalds/

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Maynard, M. (2018, November 16). McDonald's Makes More Happy Meal Changes, Bringing It
Closer To A Healthy Meal. Retrieved 2019, from Forbes:
https://www.forbes.com/sites/michelinemaynard/2018/11/16/mcdonalds-makes-more-
happy-meal-changes-bringing-it-closer-to-a-healthy-meal/#1831e06c14b7
Maze, J. (2019, January 14). Explaining McDonald’ss Franchise Dispute, And Why Its
Important. Retrieved 2019, from Restuarant Business:
https://www.restaurantbusinessonline.com/financing/explaining-mcdonalds-franchise-
dispute-why-its-important
Maziah, M., Saemah, R., & Nooraziah, J. (2015). Child-friendly Approches: Choosing the Best
Educational Psychology Tool to Teach Healthy Behaviour for Kids. Procedia - Social
and Behavioral Sciences, 435-441.
Murphy, B. (2019, September 6). McDonald's Just Made a Truly Stunning Change to Its Menu.
(There's Only 1 Little Problem). Retrieved 2019, from Inc: https://www.inc.com/bill-
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Scanlan, R. (2019, May 22). Big change to the way Macca’s cooks and serves its classic burgers.
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c69c3930bb0cd1a37e9a7fe20585ab54