For every organization, the operation strategy is an important core to reach the organization’s mission, vision and goals. Operation strategy can be assumed as the method the organization use to reach the objectives. If the operation strategy developed, the organization can implement effective and efficient systems for the usage of resources, time and the working process. In the world market, McDonald was the first food industry and also started the world market chain system. The fast food industry is ran by many types of business ventures like franchises and affiliate. It serves food products like French fries, burgers, chicken products, beverages, dessert, salads wraps and fruits for breakfast, lunch, dinner and supper. McDonald is a global food service retailer leader which has more than 1.7 million employees in more than 33,000 local restaurants in 122 countries. More than 80% of McDonald’s restaurants worldwide worked by local distributor and local public. McDonald Corporation produces new product or scheme by every year in order to attract the customers.
McDonald applies a strategic operations strategy for achieving a large market share and rise value to the shareholders. The main objective of company in the operational areas is to be effective production process as possible. McDonald is multinational company but they operate locally. The declaration of McDonald’s operation strategy is to provide consistency in operations to support for high product quality. This must be accomplished with suitable speed, low cost and process innovation as changes in customer taste. Its distinctive competence of operation strategy is continuous improvement of the transformation process.
According to the McDonald’s operational strategy, it is clear that both consistent and high-performance quality are considered ordered winners, while speed, cost, and innovation are considered order qualifiers. The competitive priorities related to cost, quality, flexibility and speed are as followings:
Cost – McDonald has a well-planned cost control strategy. They adopted just in time strategy that decrease the cost of unnecessary storage and waste. In due course this means lower cost for McDonald.
Quality – Quality object leads to certain actions and policies in operations to provide a service that customer wants. It provides a variety of nutritious, high-quality food products including salads, fruits and vegetables.
Speed – The operation process is so well designed at McDonald’s that every customer who comes is served quickly. They have preparation time set for burger and other menu so that the order is delivered within 3-4 minutes. Even during the busy hours the staff members ensure that the order is delivered on time to the customer.
Flexibility – As market changes, McDonald’s need to increase the range of new products or substitution it offers. McDonald is flexible to meet the customer needs. McDonald has a multiple trained staff in order to be flexible.
Product and service
McDonald provides high quality products which are hygiene and reliable. They guarantee that a high standard of product is carried out all times and they try to compete very competitively with other fast food business. The products of McDonald have safe packaging for the product. Moreover, it servers nutritional guide of the product clearly state what the product contains. As a service, the staffs are trained to provide the entitled service to establish him or herself with their tone, manner, language (body language) to satisfy the customers and make them appreciated of feeling more welcomed and values them as a proper customer.
Process and Technology
The process of McDonald starts with the order by customers and then after the order is received, the design must be completed and delivered. With this operational process, McDonald plan to be possible to deliver a reasonable product within reasonable time. The order placed by the customer is taken by one of the crew members operating at the tills, as the orders is entered to till, a message is passed to the appropriate crew member in the kitchen for order preparation. It is likely to present its digital ordering platform and upgrade its restaurants with its experience of the future which includes self-serve kiosks. A digital ordering platform and kiosks at restaurants can help in minimizing the time taken for meal order.
The company purposes to maximize the product quality within constraints such as cost and price limits. They use production line method to maintain the product quality consistency. There are training for employees to prepare and present meals according to very specific procedures that are strictly enforced in the preparation and handling of raw and cooked products. Ten-minute holding time for products gives high quality and freshness to each customer. If the products cannot be sold within 10 minutes from the preparation time, they are discarded.
Business strategy can be defined as it is a long term planning of a business with specific goals and target within a specific time with the available resource. Top level management make the management plan for business running in profit. McDonald business strategy is to run the process of food in short time ready to its customers at low competitive price but to earn profit by reducing the product cost and expanding the worldwide. McDonald’s operation strategies are being made by senior management level and these strategies are implemented in all branches of McDonald and these strategies are also distributed to all franchise branches. It means all operation managers from all branches control operation activities. McDonald has adopted operation strategy which is emphasized on customer satisfaction and the importance of customers. As the company has increased using the information technology, it has developed new ideas to develop the operation activities of the business. With the introduction of stock control data base system which avoids unnecessary ordering keep the stock up to date in store, it has become very simple and time saving now. Stockrooms are linked directly to main fact of sale system and the manager can know what product is moving fast and how much he should order more products. (Typepad, 2009)
As operation strategy of McDonald, they reduce the cost with efficient equipment. McDonald lighting plays an important role in minimizing the operation cost. McDonald use fluorescent low consumption lighting in the kitchen and each restaurant saves 11,000 KWh of electricity each year as the result. Another one is about packing which plays important role in quality, integrity and safety.
In order to achieve its business strategy goals, McDonald is focusing on reducing of the operation cost more and more. McDonald purchase potatoes from farms that make the cost reducing. Moreover, McDonald has start serving family treat and also provide the indoor playground for the kids. This is also included in the strategy to achieve the business strategy. McDonald has a policy to provide the fresh food to customers in a minimum time because McDonald know that customer satisfaction can be achieved only if it serves the customers with a good quality food with short time and cheap price. Moreover, McDonald arranges maximum number of tills for customers and chairs are arranged for less disruption to customers who are stranding in the Que. It can be said that McDonald has effective and efficient operation system as it has trained staff for each duty in kitchen. Most of the products are ready to serve form. Most of the products are just placed into the oven or just make warm to serve with minimum time which normally takes time 1-5 minute. For outbound logistic, McDonald use the IT technology in the warehouse and it informs the warehouse body that which branch is running out of the product. This way can make cost effective as branches do not require to have stock room for the goods.
To conclude, McDonald has the clear and effective operation to support its business strategy which is serving the food to customers with minimum time and cheap price. Moreover, McDonald uses the technology which is cost effective to get maximum production at short time. It is the good point that McDonald focuses on the quality by controlling Ten-minute holding time for products that ensures best quality and freshness to every customer. As recommendation for McDonald, it is required to adjust the operation strategy which can complete the business strategy with changing time in order to get competitive advantage. Moreover, it is required to research the changing customer’s taste from year to year and emphasize the strategy which can meet the customer needs which makes customer satisfaction.