INTRODUCTION:

McDonald's Corporation is the world's leading food service organization. The

corporation started out as a small drive-through in 1948 by two brothers, Dick and
Mac McDonald. Raymond Albert Kroc, a salesman, saw a great opportunity in this
market and advised Dick and Mac to expand their operation and open new
restaurants. In 1961 Kroc bought out the McDonald brothers. By 1967 McDonalds
expanded its operations to countries outside the U.S.A. This unyielding expansion
led the Corporation to open 23,000 McDonald's restaurants in 110 countries in
1994, producing $3.4 bn in annual revenues. In addition, McDonald's opens a new
restaurant every three hours. Also, McDonald's has twice the market share of its
closest U.S. competitor, Burger King, representing 7% of total U.S. eating-out sales.
Similarly, McDonald's serves about 1% of the world's population on any given day
through its 23,000 restaurants internationally. Big Mac, the world's most sold
hamburger was developed by Jim Delligutti in 1967 to feed construction workers.
'Big Mac' is the biggest attraction and backbone of the corporation. Moreover,
McDonald's maintains its competitive advantage by constantly creating new items
to add onto its menu. This shows us that McDonald's practices an analyzer type of
strategy, introducing new items and defending its existing ones.

McDonald’s MISSION AND VISION:

We serve people with good quality food, fast and at low cost. McDonald's vision is
to dominate the global food-service industry. Global dominance means setting the
performance standard for customer satisfaction and increases market share and
profitability through successfully implementing our convenience, value and
execution strategies.

THESIS STATEMENT:

To have a clear picture of McDonald's corporation we need to look at its Task

Environment, which includes its: .Customers .Competitors .Strategic Allies .Suppliers
.Regulators we shall also explore McDonald's Workforce Diversity and its Total
Quality Management.

CUSTOMERS:

Customers are those who pay money to acquire an organization's goods or

services. For many years McDonald's mostly targeted the young people, however
this has changed in this decade; McDonald's has turned towards a more general
market. By doing this McDonald's concentrates on the family, targeting a diverse
market which includes consumers ranging from children to elderly people, using
products such as the happy Meal for children and Egg McMuffin for the elderly.
McDonald's also realized the changing world we live in and the need for healthier
food, since there is an ever changing demographic group, who demand fast, top
quality food that is low in calories. McDonald's responded to this opportunity and
introduced a new and innovative product. This new product was a regular
hamburger that tasted like the real thing but was made of plant material like Soya
beans. This same product also targets another demographic group, vegetarians.
McDonald's mostly uses psychographic segmentation targeting the working and
middle classes. These are the people that are more susceptible to enter a fast food
restaurant, since these are the people that lead a fast moving life and thus require
a fast meal. In brief McDonald's customers are of all classes, but largely working
and middle classes, and people of all ages.

COMPETITORS:

A competitor is an organization that competes with other organizations for

resources. In our findings, McDonald's has two types of competitors in the Lebanese
market: ..Indirect ..Direct Indirect Competitors: Indirect refers to firms producing
one or two products that compete with McDonald's products and therefore be a
threat to the company. We have identified four indirect competitors: Henry J. Beans,
T.G.I. Friday, K. F. C. and Popeye's. Henry J. Beans offers hamburgers and fries on its
menu, therefore competing with McDonalds for customers of these products.
However, Henry J. Beans also known as Hank's is a more of a bar restaurant and
therefore a hang out place, as a result charging more money for its products.
Hank's targets middle to upper class customers, so where most of these customers
overlap are in the middle class. T.G.I Friday is another indirect competitor reflecting
the same characteristics as Henry J. Beans. Other indirect competitors are K. F. C.
and Popeye's, both competing for the chicken nuggets and fries customers. In brief,
Hank's and T.G.I. Friday's competes with McDonald's by offering hamburgers and
fries, whereas K. F. C. and Popeye's compete with McDonald's by offering chicken
nuggets and fries. Direct Competitors: Direct competitors refers to firms producing
the same products or services as McDonald's does. Here we found that McDonald's
has three direct competitors: Burger King, Wendy's and Hardee's. McDonald's
closest rival is Burger King, which operates a total of 9644 restaurants in 110
countries. Wendy's is McDonald's second largest rival, which is also in the fast food
business, where Wendy's operates 6776 restaurants in 32 countries. Hardee's,
McDonald's third largest rival is also in the fast food business and is the only direct
competitor apart from Juicy Burger in the Lebanese market. Hardee's operates 3080
restaurants in 20 countries. As we have illustrated McDonald's faces stiff
competition from three major competitors, Burger King, Wendy's and Hardee's.
Suppliers: Suppliers is an organization that provides resources for other
organizations. McDonald's has practiced a backward vertical integration, by
replacing most of its suppliers. It has done so for two reasons, 1) To reduce costs,
and 2) To ensure that its products are of top quality. These supplies include beef
and milk to be used in its products, which it gets from its farms. Other suppliers
include local grocery stores that supply McDonald's with fresh vegetables. Soft
drinks are supplied exclusively by Coca-Cola, which is also its ally. McDonald's
supplies also include raw material such as flour, sugar, yeast, etc.,.
Strategic Allies:

A strategic ally is an organization working together with one or more other

organizations is a joint venture or a similar arrangement. McDonald's has formed a
strategic alliance with: Wal-Mart, Chevron, Amoco, Disney and Coca-Cola. Wal-Mart,
which is a large shopping mall chain in the U.S. and several neighboring countries,
is allied with McDonald's, which offers great opportunities for both companies.
McDonald's has restaurants in each Wal-Mart, offering its customers conveniences
and excellent fast food at a low cost ease of accessibility. McDonald's corporation
describes it best in this scenario: Imagine a busy shopping day at your local Wal-
Mart and having the ability to sit down with the kids and enjoy many of our
McDonald's favorites, like 'Big Mac' sandwiches, world famous fries and kids favorite
'Happy Meal'. McDonald's understands your busy lifestyles and the demands on
your time. That's why we are making it easier for you to do more things in less time.
McDonald's is engaged in an alliance with two petrol companies, Chevron and
Amoco. This alliance represents the ultimate in convenience. At these locations, one
finds a full-menu McDonald's restaurant with dining room service. Nothing can be
more convenient, because one can fill up the car with gas and get a meal all in one
stop. Another important alliance that McDonald's has is with Disney. Here
McDonald's has the sole right to sell fast food in Disney's theme parks around the
U.S. and other Disney operations in the world. Under the terms of the agreement,
McDonald's will operate restaurants and Disney will promote its films through
McDonald's.

Regulators:

Regulators are groups or governmental agencies that can control and influence the
organization's policies and practices. An example is Lebanon a few years ago when
the U..S. government banned all U..S. citizens and organizations to come or operate
in Lebanon. Another good example would be the embargo imposed on Iran where
U..S. organizations were banned to operate in this country. Another group of
regulators called interest groups can and have influenced McDonald's to treat its
animals (cow and chickens) in a much more humane manner, which resulted in the
restructuring of McDonalds' farms throughout its operations around the world. The
summary of the task environment which is by definition a specific organizations or
groups that affect the organization, which includes competitors, suppliers,
customers, strategic allies and regulators. Here we described the task
environment's importance to McDonald's, where McDonald's faces both
opportunities and has threats in its environment.

Workforce Diversity:

Diversity exists in a group or organization when its members differ from one
another along one or more important dimensions such as age, gender, and
ethnicity. Diversity is very important for McDonald's. Here millions of teens start out
by working at McDonald's. Here some of the teenagers move on to get various jobs
such as movie stars, skilled workers, famous athletes, management positions and
other educated positions in society. At McDonald's two thirds of middle and upper
management started out as crewmembers in a McDonald's restaurant. There are
opportunities for everybody in McDonald's from teenagers to elderly workers, and
from people just entering or reentering the job market. Moreover, McDonald's offers
special jobs for people who have disabilities, such as people who are in wheel chairs
and those who must use crutches permanently. Furthermore, McDonald's offers
their workers flexible working hours. For example, hours for people seeking just a
few hours of work per week and those who seek full time positions. The work force
at McDonald's also have some say in their working hours, such as if they prefer the
morning, mid-day, or evening shifts in the restaurant. So, McDonald's uses diversity
to create a good atmosphere in their work places among workers and management.
Here they offer work to all kinds of people without discrimination and the workers
have flexible hours that provides customer satisfaction.

Top Quality Management:

Quality is the totality of features and characteristics of a product or service that

bear on its ability to satisfy stated or implied needs. For McDonald's, total quality
management (TQM) involves that the employees are at work on time, are neatly
dressed, and are clean. The employees must make sure that the customers
constantly receive safe food, which implies that the employees must wash their
hands often to remain clean. Moreover, the employees must follow certain Standard
Operational Procedures, so the customers always receive exceptional quality and
service. This includes the employees using plastic gloves when they prepare the
food, that the meat and fries are properly fried, and that the vegetables are
thoroughly washed when used in the food. Another TQM is that the employees rely
on teamwork and high energy to get the job done, so that the customers do not
have to wait long for their food. Furthermore, McDonald's management emphasizes
that their restaurants should be clean. This involves that the restaurants are tidy,
sparkling and spotlessly clean. As McDonald's illustrates the quality is that the
employees delivers fast, accurate and friendly service with a smile.
DAIMLERCHRYSLER Introduction: Daimler and Chrysler which have recently merged
to form the company Daimler Chrysler resulted in the company becoming the fifth
largest auto maker in the world with an estimated annual revenue of $130 billion.
This merger resulted in a workforce of 421, 000 employees worldwide. Mission: Our
companies share a common culture and mission. We are both clearly focused on
serving the customers by building world class cars and trucks. Task Environment:
Competitors, customers, strategic allies, suppliers, and regulators.

COMPETITORS:
Due to its product diversity, Daimler Chrysler faces strong competition from all car
manufacturers. Daimler Chrysler's scope varies from small passenger cars through
luxury cars to vans and trucks. However, Daimler Chrysler's strongest competitors
are GM, Ford Motor Company, Toyota, and Volkswagen because they are the
leading car manufacturers in the world respectively. CUSTOMERS: Due to its scope,
Daimler Chrysler enjoys a wide variety of customers ranging from the working class
up to the upper class. Daimler Chrysler also targets the young and sporty people
with its sports utility vehicles. The luxury models target the elderly and richer
population. SUPPLIERS: Daimler Chrysler's suppliers include electronics, plastics,
rubber for tires and steel.

ALLIES:

Daimler Chrysler's allies are tire manufacturers, which include Bridgestone,

Michelin, and Dunlop. REGULATORS: They are environmentalist groups such as
Green Peace and others that place Daimler Chrysler under pressure to reduce
pollution in the air by reducing CO, CO2 emissions by cars. Governmental agencies
also regulate Daimler Chrysler in that it requires Daimler Chrysler to reduce
pollution and increase safety features in the cars' design such as side impact
beams, air bags, three point seat belts in rear seats and safety features that
accommodate young children.

TOTAL QUALITY MANAGEMENT in BENZ

INTRODUCTION:

Benz is the biggest industrial firm in Germany. They feature mostly simple
passenger cars to luxury cars. In order to stay number one, they must practice TQM.

TQM:

Benz concentrates on car quality, stability, reliability, safety, high performance and
luxury. All these combined result in an effective program of TQM. Benz must
constantly emphasize that its cars are stable and reliable, which means that there
are no defected cars in their production. Next, the safety should include rear three
point seat belts, special seats for children, and bumpers on cars made of special
composite materials to absorb great impacts to the cars, thereby protecting the
cars' occupants. The luxury in TQM is that the cars constantly have automatic
features such as automatic windows and gears, automatic climate control,
electronically adjusted seats with heaters installed in them.
COMPARISON:

As we have shown, McDonald's, Daimler Chrysler , and Benz are large corporations
with a common goal: to provide its customers with top quality products. These firms
are very highly customer oriented, taking into account their customers' needs and
wants. Also the companies are growth oriented shown by Benz's merger with
Chrysler and McDonalds opening of three new restaurants every three hours. In
addition, these companies are decentralized resulting in high employee morale and
thus motivation. Another important aspect is that these companies operate on a
global scale. Also, these companies follow an Analyzer Strategy by constantly
innovating new products. These firms also became diversified in that McDonald's
uses a backward vertical integration, thus replacing its suppliers, while Chrysler and
Daimler have merged to become a more diversified company. These companies
also differ. For example, Benz uses a differentiation strategy emphasizing its high
quality and high value of its products. On the other hand, McDonalds uses an overall
cost leadership strategy to reduce costs and increase sales. Similarly Chrysler uses
an overall cost leadership strategy to reduce costs and to sell a much larger
amount.

CONCLUSION:

In conclusion, we have explored a large corporation such as McDonald's and shown

how its Task Environment, Workforce Diversity and Total Quality Management can
have a profound effect on the organization. In order for such a corporation to
remain a leader in its field, it must stay growth oriented and constantly have
contingency plans to overcome turbulence. Another important factor is the type of
strategy that it follows. McDonald's, Daimler Chrysler and Benz follow an analyzer
type of strategy, constantly introducing new products while defending their existing
products.