McDonald's: Relationship Management and Reputation Report Analysis

This report analyzes McDonald's reputation management challenges, focusing on criticisms related to unhealthy food and its impact on brand reputation. It examines the stakeholders, ethical concerns, and the company's response, including menu changes and communication strategies. The analysis incorporates organizational behavior principles, internal and external communication methods, and the application of the Situation theory of public posts. Recommendations are provided based on ethical theories like Right-based ethics, Deontology, and the Common Good Approach, along with the application of Keller's brand equity model. The report suggests strategies to improve brand awareness, enhance customer relationships, and regain market leadership in the face of negative publicity and evolving consumer preferences. The report references various books and journals to support its findings and recommendations.

Relationship Management and
Reputation Management
Recommendations

TABLE OF CONTENTS
EXECUTIVE SUMMARY.............................................................................................................1
INTRODUCTION...........................................................................................................................1
ANALYSIS......................................................................................................................................2
RECOMMENDATIONS.................................................................................................................2
Right based ethical theory...........................................................................................................3
Deontology theory.......................................................................................................................3
Common Good Approach............................................................................................................3
Keller brand equity model...........................................................................................................4
REFERENCES................................................................................................................................6

EXECUTIVE SUMMARY
McDonald’s is one of the leading chain of fast food restaurants serving across world in
more than 100+ countries selling fast-food like that of burgers, French fries and desserts. But due
to increasing controversy in world media regarding changes in consumer taste, their health and
preference company also added fresh salad and fruits into its menu.
McDonald’s is facing issue of serving unhealthy food to people in across its outlet store
throughout the world and making people obese or overweight. So the purpose of this particular
study will be recommending and suggesting company how they could overcome issue. There
was many criticism which was made by people and media throughout the world relating to issue
of unhealthy food been served by organisation. This negative publicity of company impacted its
existing suppliers, consumers and even government of nations.
INTRODUCTION
The stakeholders of McDonald's are share-holders, employees, customers, suppliers, and
the public stakeholder group which includes communities and governments. The obesity issues
were being the main problem affected health of people up to a high extent (Carroll, 2015). It can
be analysed that McDonald's has been criticized on providing unhealthy foods to people in
accordance to the documentary film Supersize Me. The government and communities are mostly
affected by the foods provided by the firm and as a result, brand reputation has been declined
quite badly. In order to effectively resolve the problem and obesity issues, McDonald's
introduced completely new menu having salad option and lighter meal for meeting needs of
consumers in the best way possible.
Poor quality of products and food service will decline sales and brand image on
international stage as customers are present in the world. The ethical issue concerned with
obesity problem acknowledged in company is that it should not have been used fatty ingredients
in the meals which lead to problem of obesity among people. Another ethical concern is comfort
place of employees should be taken into account so that they may be provided with healthy
workplace atmosphere (Doorley and Garcia, 2015). Furthermore, company should enhance the
way of operations in accordance to cultural, social norms and belief of people of particular
country. Thus, interruption in operations may be alleviated with ease. This will satisfy the
company's customers in effective manner and profitability position will be enhanced quite
effectually.
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ANALYSIS
The organization behaviour is termed as a study in which how people interact with each
other within the groups. The scientific approach can be applied for workers' management in
McDonald's so that issues may be resolved quite nicely. McDonald's has good internal
communication by which it interacts with stakeholders such as customers and employees so that
they may provide ways for improvement in operations quite effectively. Online communication
tool and weekly newsletters are provided through internal communication so that employees may
be kept updated (Vargas, Stines and Granado, 2017). For strengthening external operations,
campaigns are launched about new products and services for increasing satisfaction level up to a
high extent.
Facebook posts are made for informing customers about upcoming changes or events and
responds are made to positive comments (Bowers and et.al., 2018). It focuses on Twitter as well
for promotional purpose and keeping in touch with stakeholders for discussing and resolving
issues if any. With reference to obesity issue, it has already started new meals involving menu
adding salads, fruit and yogurt low calorie options. The Situation theory of public posts is
applied by McDonald's for recognized target public to provide healthier food advertisements in
the best way possible. This shows that company is communicating with the public directly so
that their attitude may be changed on the food provided by firm and sales may be injected up to a
high extent. Thus, firm is showing Happy Meal advertisements to customers so that it may
resolve issue and as a result, firm's profitability position may be enhanced in a better way.
RECOMMENDATIONS
From the above analysis and purpose of organisation there are certain recommendations
which must be adopted by McDonald’s so that they could be resolving the issue which they
currently facing. McDonald’s is criticised by world media and its consumers for selling
unhealthy food which is cause of many disease like that of obesity, heart problem and that
related to blood pressure as well. They were having bad record of health, labour and
environmental related problems or concerns they were using beef tallow for cooking French fries
which was causing death to several Americans at very young age. So below are certain theories
of ethics been mentioned which company need to follow so that they could be able to overcome
their unethical problem.
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Right based ethical theory
The right based ethical theory was developed by John Locke which is based on natural
goodness of humanity for an individual or group of people on their ethics. All the rights will be
divided into negative and positive one which will help McDonald’s in gaining back their
reputation and improvement into operations as well (Hoejmose, Roehrich and Grosvold, 2014).
Company need to perform its actions in regard to by keeping in mind their ethical rights and
duties towards consumers and environment as well. Right based ethical theory will be dealing
and guiding McDonald’s how should they be dealing people and nature that must be protected
and preserved as well.
Deontology theory
This the moral philosophical theory which is based on action or duty of person which
shows whether the action done is right or wrong by regarding certain rules, regulations and
ethics. So this theory will depend upon what is correct and what is incorrect in way of action
themselves not based on action which is mentioned into consequentialism theory or according to
habit and character of actor which is mentioned into virtue ethics. As per the system of
McDonald’s it could be noted that deontological ethics will be undertaking moral obligation
which could arise form any external or internal sources like it is from unhealthy eating. Company
need to combat this issue which they are facing which could only be done by setting policies and
rules for restoring relationships with customers and government where they are currently been
working. They need to be ethically correct in all their actions which are supposed to be taken in
respect with consumers and government (Honey, 2017). They are operating under the system
theory where all departments with their subsystems so they must be adapting the changes in
environment.
Common Good Approach
According to this theory of ethical approach for firm that would be enabling company
within its ethical dilemma which is useful at time of any issue which arise or is involving
environment as well. The common good approach will be including regard with individuals as
the larger part of community and society. This also refers to as shared and beneficial for all or
most of members for the given community or alternatively that is achieved by citizenship and
collective participation as well. McDonald’s need to have common good approach towards the
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contemporary economic theory so that company is having policy for combating the
environmental issue and health related problems.
Keller brand equity model
Under this equity model brand awareness of company among people or customers of
world who are having negative perception about company into their mind. As there are many
controversy relating unhealthy food that are been served into restaurants by McDonald’s
(Proserpio and Zervas, 2017). It is very much required by firm that they are improving their
awareness for branding among people of all countries who are eating food of company. The
brand equity model of branding is having objective of increasing and improving vale of brand
and its products among customers for this it is highly recommended to use Keller Brand equity
model also known as CBBE model.
As per this model customers will be the main focal point for company so they need to
keep all their customers happy and satisfied in way of building up stronger brand image in
market. The model is having 4 level of stages including brand identity, meaning, response and
resonance.
 Level 1 brand identity or who you are- In this stage company need to find out answer for
the question regarding that what is actually brand in eye of customer. The brand will be
defined to as building up identity among people and for company itself. This will be build
up at point where customers are unaware about product of company and McDonald’s will
be working to build up stronger image for customers.
 Level 2 Brand meaning or what are you- This will be further elaboration about meaning
and importance of brand in view of customer which is important for customers to know.
If the service of McDonald’s is very good then only customers could be able to know
about company without gaining much information about it.
 Level 3 Brand response or what are the feeling for brand- After the time when
customers buy product of company then only they will be able to build up expectation
towards the brand and latter purchase. But if there is not similarity between reality and
expectation then customers could not be happy and satisfied with what McDonald’s is
offering them. Word of mouth publicity will be playing major role at this stage of brand
response.
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 Level 4 brand resonance or stronger relationship- The customer who is regular buyer of
product will always be able to respond to company’s new launch of product at faster rate.
This is the last stage of this model which includes having huge social media and
psychological connection of brand with its customers. Like McDonald’s is having the
capability of reaching that point where it having very stronger relationship with its
customers.
There are many factors which will be affecting brand awareness like that of its behaviour,
value, and attitude, engagement of customers and connection or feeling with customers (Sroufe
and Gopalakrishna-Remani, 2018). but certainly for these McDonald’s must be making their
efforts in spreading all sort of awareness so that they could be able to pioneer their market
segmentation and try to achieve level of brand resonance with the Keller Brand equity model.
From the following recommendation company will be easily making their market
position in gaining leadership again. As McDonald’s is having majority of share within this
industry which means that they are highly capable of being growing and developing with the
help of brand equity model and that of ethical theories mentioned.
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REFERENCES
Books and Journals:
Bowers, L. W and et.al., 2018. Breaking the obesity-cancer link: Nutritional modulation of
inflammation and epigenetic reprogramming.
Carroll, C.E. ed., 2015. The handbook of communication and corporate reputation (Vol. 49).
John Wiley & Sons.
Doorley, J. and Garcia, H.F., 2015. Reputation management: The key to successful public
relations and corporate communication. Routledge.
Hoejmose, S.U., Roehrich, J.K. and Grosvold, J., 2014. Is doing more doing better? The
relationship between responsible supply chain management and corporate
reputation. Industrial Marketing Management, 43(1), pp.77-90.
Honey, G., 2017. A short guide to reputation risk. Routledge.
Proserpio, D. and Zervas, G., 2017. Online reputation management: Estimating the impact of
management responses on consumer reviews. Marketing Science, 36(5), pp.645-665.
Sroufe, R. and Gopalakrishna-Remani, V., 2018. Management, Social Sustainability, Reputation,
and Financial Performance Relationships: An Empirical Examination of US
Firms. Organization & Environment, p.1086026618756611.
Vargas, C. M., Stines, E. M. and Granado, H. S., 2017. Health‐equity issues related to childhood
obesity: a scoping review.Journal of public health dentistry. 77. pp.S32-S42.
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