CHINA:The strategy used by McDonalds in China is quite different from the way the restaurants are otherwise managed in the United States. The organizational structure is in sync with the strategy used by McDonalds to be ahead of its competitors. McDonalds franchising process is that of a strategic network (Hitt, et.al 2007). I was an overnight success all right but 30 years is a long, long night. Today, on average, McDonald's opens a new restaurant every three hours. There are many reasons for companies to go global or expand overseas. A long history of expanding into new territories has given McDonald s the ability to mold its menu according to the tastes of the local population. However Kroc, 53, persisted, securing a deal with a plan that involved him taking responsibility for setting up restaurants throughout most of the country while Maurice and Richard focused on California and Arizona. Porter’s Five Forces is utilized to critically evaluate the international strategy adopted by Coca-Cola. McDonald’s, which makes up 0.64% of the iShares Core S&P 500 ETF (IVV), is planning to add 1,500 new units across China, Hong Kong, and Korea in the next five years. 2. 1. The massive and aggressive expansion strategies that McDonald’s took up in India was with the sole objective of establishing its presence indelibly in the sub continent and to prove to the world that if … Kroc had heard that his milkshake machines ran continuously to cope with demand at the restaurant and was anxious to see what all the fuss was about. Sensing an opportunity he approached the brothers, who had opened for business in 1940 and were doing quite nicely, thank you. McDonald’s survived only due to keen understanding of the Indian economy. Please see our Privacy Notice for details of your data protection rights. What is the secret to the company’s international success? Adaptability: It is one of the major strengths of McDonalds. BURGER OUTLET THAT BECAME A GLOBAL PHENOMENON. The McDonald's Corporation is one of the most successful global restaurant chains around the world. • The original McDonald's mascot Speedee was a chef with a hamburger for a head. There are a lot of emerging markets particularly in the BRIC countries such as Brazil, Russia, India and China. It doesn't matter if you're visiting a McDonald's in California or Connecticut, America or Australia—you're going to have a similar experience wherever you are.This highlights Ray Kroc's vision for McDonald's from the beginning. • Generally the cooperation is at pains to offer a selection of standardized core 5. They have successfully implemented international strategies where in they have used localization and customization processes to adapt to the foreign countries along with maintaining its American origin by having centralized procedures as well. Increased global competition, customer needs, potential opportunities, declining foreign trade barriers, increasing expenses in domestic markets are some of the reactive reasons for companies going global. McDonald’s, the most renowned fast food chain of the world, started in 1955 by a visionary named Raymond Kroc (McDonalds : The Ray Kroc Story, 2010-2011). McDonalds can look at diversifying into other areas of food industry for example; McDonalds Hotel in Zurich is a distinctive venture. Porter’s five force analysis approach to the industry plays a very crucial role, according to him international business has lot of competition in the international arena (Porter, 1986). McDonald's Corporation (NYSE: MCD) is the world's largest chain of fast food restaurants, serving around 68 million customers daily in 119 countries. Studies have shown that a combined effect of a heavily saturated domestic market, and high market potential for foreign markets, prompts many businesses to expand internationally (Hackett 69). 1. Registered Data Controller No: Z1821391. We will use your email address only for sending you newsletters. Ray Kroc’s vision was that there would be 1,000 McDonald’s restaurants solely in the United States. In some countries it is still a status symbol to go and have a meal at McDonald's. Its Glo-cal strategy to serve the customers in a better way & enriching their experience with local menus is the smartest step that proved critical to McDonald’s … McDonald's traces its origins to a 1940 restaurant in San Bernardino, California.After expanding within the United States, McDonald's became an international corporation in 1967, when it opened a location in Richmond, British Columbia, Canada. But they approached with a strategy by controlling standardized products, clean and green environments and American origin. McDonalds should work on increasing these facilities in a lot of high profile, metropolitan cities across the world. Unwitting staff would often receive a phone call late at night telling them to make sure to clean up properly. When he arrived in Southern California, he was intrigued with what he witnessed. Customers identify with the brand name and “the Golden Arches” are recognized not only in America but in foreign countries as well (McDonald’s Fact File 2007, 2007). McDonald’s is an example of a company that gained tremendous benefits from globalization. McDonalds is the industry leader in terms of sales, market cap, employees, gross and net margins. If one market never gains or loses interest in your offerings, you can pick up the slack with success in other countries. Around 85% of the restaurants are operated by franchisees. The road ahead for McDonalds should be to increase the nutritive value of the burgers and look at certain health aspects to control the increasing waistlines among children because of high consumption of fast foods especially burgers (Consumer lifestyles- Australia, 2009). Therefore, there are superior number of drive-through as compared to Australia and United States. 20th Jul 2017 McDonald’s has set its sights on Asia, with the plan of adding over 1,500 new restaurants in China, Hong Kong and South Korea within the next 5 years. While understanding the organizational capabilities and the external environment, it is crucial to understand the organizational structure of McDonalds. South Africa: A relatively unique strategy has been used by McDonalds to serve customers where they can enjoy their meal while shopping and playing. Saudi Arabia: Another example of adaptation to the local culture is the way McDonalds has managed the business in Saudi Arabia. It shows the uniformity of a branch in United States and India. Kroc's first branch opened on April 15, 1955, in Des Plaines, Illinois. McDonalds believes in having sustainable supply chain consisting of 3 E’S: Ethical Responsibility, Environmental Responsibility and Economic Responsibility (Sustainable Supply Chain, 2010-2011). It is one of the most widely recognized icons of the world in the fast food restaurant industry. Some of the other ways the approach in China was different as compared to the United States was that McDonalds customized the menu by adding teriyaki burger which gave locals the flavour of their native food taste (McDonald’s Fact File 2007, 2007). To export a reference to this article please select a referencing stye below: If you are the original writer of this essay and no longer wish to have your work published on UKEssays.com then please: Our academic writing and marking services can help you! For example in Germany, McDonalds has a tie up with T mobile for hot spots. • McDonald's is seen as the number one representative of the all American lifestyle, which at the time when the expansion began was very popular. Also, the processes or the way every country operations are managed are innovative in a way that they are suited to fulfill the local needs. BA 654 Lesson #1, Assignment #2: Chapter 1 Case Study Review Case 1-1 on pages 35-38 of your text and address the following questions in a brief essay of 250-300 words: CASE 1-1: McDonald’s Expands Globally While Adjusting Its Local Recipe Today, McDonald’s golden arches are one of the most recognized symbols in the world, just behind the Olympic rings. Let’s take a look at why the company stagnated and failed to expand in Vietnam. Entrepreneur Ray Kroc extended the McDonald's empire Much later his company became a symbol of rampant globalisation and got caught up in the obesity debate. 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