McDonald’s Case Study Answers to questions for chapters 10, 11, 12, 13 & 14 1. The General policy of McDonald’s as shown in its 2009 Annual Report is to elevate the company into an industry leadership status; focusing on enhancing long term profitable growth, giving constant attention to talent management and leadership development, and to continue to provide relevant offerings, and support balanced lifestyles…
This is in line with its strategy of product re-imaging. McDonald’s know that at some point in time, products have a life cycle. In terms of pricing, McDonald’s is careful on setting the price for its product, as they consider the customer’s perception of value. Their philosophy behind this is that when their food is priced too low, customers may think that low price is indicative of low quality. Promotions play an important role in the marketing strategy of McDonalds. Most commonly used are TV, billboards, and a mix of marketing tools to get people’s attention, be interested, desire for the food and finally to act and buy. As to place, McDonald’s can be found in almost all areas around the world, which are 32,748 as of 2009. Location is part of re-imaging policy of the company. The bonus compensation plan of McDonald’s is the share-based compensation plan that grants executives various equity-based incentives that includes stock options and restricted stock units (McDonald’s Annual Report 2009) One of the problems of stock options is the upside and downward risk of price of stocks. Stock options have vesting time so that when stock option vests, the executive exercises option whether to buy the stock or not. ...
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In 2003, McDonalds reinvented its mission/vision by implementing a “Plan to win” strategy that focuses on becoming “bigger, not just better”. Action plans in implementing this strategy are to increase sales in every geographic segment of the business; to offer relevant menu to its 60 million customers per day, and to gain the confidence of stockholders by the profitability of its operation.
Even while the organization has over 33,000 stores worldwide they continue to expand and enjoy unparalleled industry success ("Mcdonald's -- the," 2011). The organization sells a variety of low costs foods, but has retained a central focus on hamburgers, French fries, chicken, shakes, and breakfast items.
Companies that seek to remain at the top of their industries, or even survive, need to have the favor of the customers. One of the viable ways of achieving is by presenting a positive image to the public through market, or alternatively taps the more profound aspects of their targeted market, especially those that relate to principles and morals of the public.
opening up new stores. It continued to open new stores and add new items to the menu without realizing the fact that its products were no longer selling as they were in the past.
2. Customer preferences were changing i.e. they were after for products which are fresh, nutritional as well as healthy.
These macro environmental factors are political, economic, social, environmental, and legal commonly known as Pestel. McDonald had to keep these macro environmental factors in active consideration in order to expand and establish itself successfully. Sometimes these factors become very burdensome but success demands its fulfilment.
The company depended on building more stores, and placed a large emphasis on the American, Britain, Germany, and French markets which had reached market saturation. Other fast food competitors were also providing better quality and healthier food options.
Floor running managers are subsequently followed by staff training crew. Crew members follow staff training crew. McDonalds’ is having a division organization structure at restaurant level. This structure consists of different teams