Internal Analysis on Macdonald’s

Resources and Capabilities

A firm’s resources and capabilities can be measured through identifying its tangible and
intangible resources and capabilities within. Tangible and intangible resources are
significant in implementing firm’s strategies. It ranges from financial, physical,
technological and organizational; while intangible can be human, innovation and
reputational assets. Incase of Macdonald’s, is the world’s largest chain of hamburger’s
fast food restaurants, serving nearly 47 million customers daily. The restaurants are
found in 119 countries and territories around the world. McDonald's operates over 31,000
restaurants worldwide, employing more than 1.5 million people. Looking at the
increasing popularity especially in South-Asian region it is predicted Macdonald’s would
expand even further in new countries and unexplored territories.

VRIO – Value, Rarity, Imitability, Organization

By developing a sophisticated supplier networked operation and distribution system, the

company has been able to achieve consistent product taste and quality across
geographies.

McDonald’s focuses not only on delivering sales for the immediate present, but also
protecting its long term brand reputation.

McDonald’s has continually adapted to the customer’s tastes, value systems, lifestyle,
language and perception. Globally McDonald’s was known for its hamburgers, beef and
pork burgers. But to survive in few regions where getting accustomed with the culture
and the eating habits have a influence on the survival of a business, the company had to
be responsive to the target countries’ customer’s sensitivities for example in India
MacDonald’s had to come up with a completely new menu thus if MacDonald’s open its
franchise in Bangladesh it has to change its regular offerings.
McDonald’s uses demographic segmentation strategy with age as the parameter. The
main target segments are children, youth and the young urban family. To attract children
McDonalds has Happy Meal with which toys ranging from hot wheels to various Walt
Disney characters are given. For this, they have a tie-up with Walt Disney. At several
outlets, it also provides special facilities like ‘Play Place’ where children can play arcade
games, air hockey, etc. This strategy is aimed at making McDonald’s a fun place to eat.
This also helps McDonald’s to attract the young urban families wanting to spend some
quality time while their children have fun at the outlet. To target the teenagers,
McDonald’s has priced several products aggressively, keeping in mind the price
sensitivity of this target customer. In addition, facilities like Wi-Fi are also provided to
attract students to the outlets.

Value chain analysis of MacDonald’s

Inbound logistics:
• Organizing the supply of food and materials to restaurants through approved third
party logistics operators.
• Production in huge plants denoted exclusive to McDonald’s control food
distribution and packaging system

Operations
• R&D in field research needs of end users.
• quality development in collaboration with good suppliers
• Forward integration: through franchisees with control over store presentation,
menu items etc. and enhance participation in process improvement
•

Outbound logistics

• Is the concern of the franchisee

 • Outbound logistics are growing as a part of McDonald’s recycling system
integrating in the logistics of distribution center

Service
• Services provided by the companies enrollment standards

Procurement
Sought partners with expertise on down trade distribution

HRM
HRM specialists in R&D and expertise in food formulation, education to raise awareness
of issues and raise demand. The addressing environmental issues and CRS.

INFRASTRUCTURE
Strong real estate portfolio. International organization more than 50000 employees works
in more than 50 countries.