Meeting Customer Needs: Report on McDonald's and Tesco Issues

This report analyzes the service and product issues at McDonald's and Tesco, two prominent companies in the fast-food and supermarket industries, respectively. It begins with an introduction to both companies, highlighting their global presence and market share, while also raising questions about their sustainability and customer satisfaction. The report then applies relevant theoretical frameworks, including the Transformation Model from Operations Management and Customer Relationship Management (CRM). The methodology involves data collection from company websites and independent studies. Findings reveal sustainability issues within McDonald's supply chain, particularly regarding the sourcing of raw materials, environmental impact, and the nutritional value of its products. The report also explores the gaps in Tesco's CRM strategies, suggesting improvements through big data and personalized marketing. The discussion section delves into the implications of these findings, emphasizing the need for sustainable practices and enhanced customer relationship management to ensure long-term success for both companies. The report concludes by highlighting the importance of adapting to changing consumer needs and technological advancements to maintain a competitive edge.

Service and Product Issues at McDonald and Tesco
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Introduction
It is undisputable that McDonald is one of the world’s best fast food companies. Every
four hours, a new McDonald's point opens somewhere on the planet. About 30 thousand
branches of the empire of hamburgers are scattered in 118 countries. The concern receives 36
percent of its permanent income in Europe. However, as McDonald grew and expand, it is
always important to ask questions such as : What would be the performance of McDonald 20
years to come? Are the services and products offered by McDonald sustainable? In order to
maintain the image of an "environmentally friendly" and "environmentally-friendly" company,
where you can also have a pleasant snack, McDonald's has to spend over $ 1.8 billion annually
on advertising. Toys and other tricks attract children. But behind the smiling Ronald MacDonald,
reality is hidden - McDonald's is interested only in money, making a profit on everyone and
everything, just like all multinational companies. But for a long time, the network of these
restaurants has been at the center of criticism of consumer organizations. The McDonalds case is
being dragged out, people are obese and dying, and the authorities are still not opposed to the
distribution of these products. This clearly reveals that there are a number of issues at McDonald
that ought to be addressed.
Tesco supermarket company is one of the UK's largest food supermarket company,
loyalty program the company implemented - the "club card" (Clubcard), to help companies
market share rose from 16% in 1995 to 2003 of 27% Become the UK's largest supermarket chain
group. Tesco's "Club Card" has been evaluated by many overseas business media as "the best use
of customer database loyalty program" and "the healthiest and most valuable loyalty program".
Brief overview of theories

The first theory I will apply is the Transformation Model from the Operation
Management Literature. The Transformation Model is a framework to understand the various
components of how well the organization produces goods and services that meet customer needs
(Slack and Lewis, 2011 ).
Figure 3: The Transformational Model (Slack, Brandon-Jones and Johnston, 2016)
Another theory that is used to diagnose and recommend for solutions to McDonald is the
theory of supply chain management. It is undisputable that McDonald has one of the agile supply
chain management system. However, the McDonald’s supply chain management system does
not meet one important element- sustainability.
For Tesco, the main theory I will use is the customer relations management (CRM). So
far, Tesco does well as far as CRM. It has Club Cards which can enable customers get discount
and win prizes. It also has magazine designed to keep customers updated about new products,
new offers and many special events taking place at Tesco. However, as the paper will reveal,
there are few gaps that ought to be filled. In other words, the paper will reveal that the current
CRM is not optimal.
Methodology

I obtained the data from the McDonald’s and Tesco’s website and from other
independent studies done on the sources of raw materials used by McDonald. There are also
several articles written regarding the two companies.
Results/ findings
A closer look at McDonald reveals that it violates some of the elements of sustainable
supply chain. After the publication of the scandalous book by the German journalist Eric
Schlosser “Fast Food Nation”, all the McDonald's tables in the world shuddered. For several
years, the journalist studied how the fast food system plowed not only the diet, but even the
landscape, first of America, and then of other continents. In this book, he tells us where the meat
comes from, why fried potatoes are so tasty, and what is the real price of a hamburger that is not
hung over the counter. Having stated all this, Schlosser is still fighting off the angry sharks of the
American food industry. For attacks on America's favorite food, he was called an economic
ignoramus and a fascist. McDonald’s officials said that “the real McDonald’s has nothing to do
with this book. He's lying about our people, our work and food. ”
It is necessary to understand that almost the entire meat industry was taken over by large
fast food corporations, since the largest restaurant chain on the planet is at the same time the
greatest buyer of beef, and in the USA - meat in general. Everything has changed: from the
contents of the cow feeder to the butcher’s salary.
Previously, farmers' cows fed on grass, as laid down by nature. Cows intended for a large
fast-food meat grinder, three months before euthanasia, are herded in huge herds to special sites
where they are fed with grain and anabolic. One cow can eat more than 3,000 pounds of grain

and gain 400 pounds of weight. At the same time, the meat becomes very fat, just right for the
stuffing.
Already in the 1980s, McDonald's was criticized for the fact that most of the meat, which
ultimately settles in the stomachs of US citizens in the form of thin slices between two pieces of
white bread, owes its origin to South America. Huge expanses of rainforest are dying, giving
way to pastures for cow herds owned by an American multinational corporation.
In 1997, in London, the concern broke out against its two critics, which attracted
widespread attention. Critics accused McDonald's of importing Brazilian beef into the UK and
Switzerland back in the 1990s. Witnesses affirmed under oath that beef from farms in Brazil and
Costa Rica, as before, is supplied to the concern in the United States. These farms were located
on the expanses of the former rainforest, during the rooting of which a part of the Indian
population was expelled from their habitual habitat.
Today, the meat offered in 5200 branches of Europe is the meat of European cows.
German meat grinders scroll for "McDonald's" more than 30 thousand tons of beef per year.
Approximately one third of the feed necessary for keeping animals is imported by the EU. Half
of it comes from the countries of the "third world", where colossal agricultural spaces are used to
grow this feed. Here we are talking about the most fertile and climate-friendly lands, which,
therefore, fall out of local food production.
In total, 1.3 billion cows are slaughtered for meat in the world. At the same time, about
half of the world grain harvest, which is 600 million tons per year, is spent on feed for them. In
Brazil, a fifth of arable land is given for breeding feed for the countries of the European Union.
Meanwhile, hunger is intensifying in the country! The rich cows gobble up the bread of the poor.

On the other hand, it is clear that Tesco has implemented a number of CRM strategies.
For nearly two decades, the retailer has never stopped issuing loyalty cards for old
customers. Now, retailers have finally reached the front line of digital innovation.. As the
first department store to provide food online, the company also installed an augmented
reality mirror component, allowing customers to virtually try on clothes. Tesco recently
launched its own 7-storage tablet Hudl. Despite having the Tesco Clubcard and magazine,
there are still gaps in Tesco’s CRM.
Discussion
Although McDonald is one of the world’s best companies, its future hangs in a balance.
This is attributable to the fact that its supply chain system is not sustainable and that the quality
of the products it produces is questionable. As suggested by the transformational model, a good
operation management should be able to combine inputs in a manner that the final product would
be high quality and can satisfy the consumer. However, although products produced at
McDonald are tastier, they have one drawback- full of saturated fats, additives and are highly
processed. Instead of satisfying the consumers, the products predispose them to overweight and
obesity. Similarly, the findings reveals that the raw materials used by McDonald are produced at
expense of the environment. This shows that with time, the supply of raw materials will decline
because the environment is being destroyed slowly by slowly. It can also be demonstrated that
McDonald does not meet all key elements of transformational model. Specifically, McDonald
meets most of these requirements except for the quality. At McDonald, a top-grade flour bun is
covered with sugar syrup, plus mayonnaise, fried potatoes, fried meat and all other ingredients.
The origin of most of the inputs at McDonald are genetically modified (cheap production, long
storage, etc.). In addition, McDonald’s production process is characterized by too much mixing

of different components of food (bread, meat, dairy ingredients, etc.). It is very hard on our
gastrointestinal tract. Additionally, at McDonald, various artificial additives are added, such as
flavor enhancers (well, damn it, it seems unrealistically tasty to us (including me) there is a
burger). It is important to understand that 90% of all the products we buy are pre-processed. As
you know, preservation and freezing kill the natural taste of food. Therefore, the last 50 years,
mankind has been increasingly resorting to the help of chemical plants. The taste industry is
classified . Leading American companies will never disclose the exact formulas of their product
or the names of their main customers. So that visitors to a fast food cafe think that he has an
excellent cuisine and the merit belongs to talented chefs. Potato and hamburger recipes should
not be sought in cookbooks, but in the works Food Technology and Food Engineering. Almost
all products come to cafes already frozen, canned or dried, and the kitchens of these cafes
become the last resort in a number of complex industrial processes. All these observations
clearly reveals that the quality of products produced at McDonald is not optimal. It is a violation
of transformational model. In the long run, we get obese and overweight people. Obesity and
overweight are major risk factors for non-communicable diseases. Obesity is the second leading
cause of death in the United States after smoking. Every year, 28 thousand people die from it .
The level of obesity among the British, who love fast food more than all Europeans, doubled. In
Japan, with their sea and vegetable diet, there were almost no thick ones before - today they have
become like everyone else.
Concerning Tesco, it is important to note that although it has adopted some of the CRM
strategies, there is still chances for advancement of its CRM. Nowadays, with the rapid
development of science and technology, society has entered an era of the combination of big data
and artificial intelligence. More companies have also launched new models in business

operations to meet the needs of the new era. In this era of cloud computing, the Internet of
Things, and the Internet flooding the entire society, in the process of customer relationship
management, companies have launched a professional CRM software to dig deeper into the
needs of customers and then use suitable products. Or service to satisfy customers and win
customer orders. With e-commerce business model, CRM can also collect a variety of data. For
example, Tesco can record the customer's behavior in chronological order, when did the
customer log in to the website, from which landing page did the website enter, and what were
viewed Products, how long they stayed, how many times they entered the website, which
products were purchased, which products were reviewed, etc. can be recorded in detail. In this
way, the analysis and portraits of the crowd can be scientific and detailed. Then you can carry
out personalized marketing activities to achieve personalized information push. For example, for
people who have been browsing and buying the same brand of skin care products for a long time,
when the new product is launched, they can accurately push the information to her. Such
accurate push can greatly increase the sales of the product. It can be seen that in the era of the
vigorous development of the Internet of Things, big data, mobile Internet, and artificial
intelligence, companies have introduced a CRM system that can greatly optimize the operational
data of enterprise users and pinpoint the deep needs of users. The key competitiveness of
development.
Conclusion
The analysis has revealed that although McDonald is considered one of the best
companies in the world, it has some defects which when not corrected can hinder the future of
the company. The analysis revealed that the quality of the products produced by the company is
not good for consumers. It also demonstrated that the supply chain is not sustainable. This

clearly reveals that McDonald has some tasks to do to insure its future. Tesco, on the other hand,
has adopted some CRM strategies. However, there are still some gaps in CRM strategies. The
next section will give some of the recommendations for McDonald and Tesco.
Recommendation
One of the best recommendations for McDonald is to make its supply chain system more
sustainable. The company can achieve this by working closely with the suppliers. The company
ought to focus on downstream supply chain management. This will enable the company ensure
that environment is not destroyed in process of producing the raw materials. The company
should also reduce the use of saturated fats, sugars and adopt healthier food alternatives.
On the other hand, Tesco should bear in mind that apart from implementing customer
loyalty information system, it should conduct efficient customer information management
analysis, carry out matching customer promotion and supplier management cooperation.
Secondly, Tesco should adopt effective operation and management of customer service center
(calling system) and Internet e-commerce, and carry out unified and efficient marketing activities
with multiple touch points. Third, Tesco should have comprehensive system management of
marketing and efficient marketing

References
Slack, N., Brandon-Jones, A. & Johnston, R. (2016), Operations management, Eighth edn,
Pearson, Harlow, England
Slack, N. and Lewis, M. (2011). Operations strategy, 3rd edn, Pearson Education