QUALITY MANGEMENT OF McDonald’s – A CASE STUDY

Quality management is the management of activities and functions which are involved in

determination of quality policy and its implementation. It ensures that the relevant
organization, product or service is consistent. The four main components of quality
management are quality planning, quality control, quality assurance and quality
improvement. The aim of quality management is not only to focus on product and service
quality, but also pay attention to the different ways to achieve it. The main principals of
quality management as defined by International Standard for Quality Management (ISO
9001:2008) and other organizations are following:

 Customer focus
 Leadership
 Process approach
 Involvement of people
 Benchmarking
 Continuous improvement
 System approach to management
 Factual approach to decision making
 Mutually beneficial supplier relationship

In this work, a detailed analysis of quality management of McDonald’s is presented. The

report include the history, strategy, quality control and the supplies , logistics and inventory
management of the stated company.

McDonald’s HISTORY
McDonald’s Corporation was established in 1940s (McDonald’s, 2014). It was the only fast
food industry in the whole world who has started a chain system in global market. The main
menu of McDonald’s includes some of the global world renowned foods like Big Quarter
Pounder, French Fries and Chicken Nuggets. In breakfast they serve Sausage McMuffin with
egg. Today it is one of the famous and leading food service retailer. IT has more than 35,000
local food chains (restaurants) in more than 100 different countries (McDonald’s, 2014). The
total employees of McDonald’s are approximately 1.9 million and it serves more than 70
million customers every day around the world (McDonald’s, 2014) (Steve, Dudley, Hazen,
2012). A pictorial description of quick facts of McDonald’s is shown in Fig. 1. The
corporation has distributed sale approach and more than 80% of its restaurants are ran by
independent and local distributors. The restaurant was started by only two brothers Dick and
McDonald’s in 1940, they were beginners but now McDonald’sCorporations is one the main
stakeholder of fast food industry of today world. The beauty of this chain is that they did not
only sale their main products but they also change the product type and its ingredients
according to the local country or region requirement. Also every year they introduce new
products and schemes to attract their customers. Their recent menu includes a wide range of
Burgers & Sandwiches, Chicken & Fish, various Breakfast options, Salads, Snacks & Sides,
Beverages, and Desserts & Shakes (McDonald’s, 2014). For competing and to be a main
stakeholder of today competitive international market, McDonald’s is using an operational
management system (William, 2008).

Figure 1 Quick overview of McDonald’sCorporation

COMPANY STRATEGY

The brand mission of McDonald’sis “To be our customer’s favorite place and way to eat and
drink” (McDonald’s, 2014). The global world operations of McDonald’sare aligned around
the worldwide strategy called “The Plan to Win”. This strategy is centered on the best
exceptional experience for the customers. The organization follows the motive of “People,
Products, Place, Price and Promotion” (McDonald’s, 2014). McDonald’s wants to become
the world’s best quick service fast food chain which provides high quality food to its each
and every customer every time, in a clean environment with extraordinary service and great
values.

The adopted strategies by McDonald’s are differentiation and cost leadership strategies
(Operations Management in McDonald’s, 2014). McDonald’s is committed to its people. It
provides equal opportunity to each employee. They develop leaders and reward them
according to their achievements. This firm believes that a team of well-trained individuals
with different background and experiences, working together in a competitive environment
with high level of commitment is their key to success.

QUALITY CONTROL

McDonald’s has a set of management teams for the inspection of food item quality and their
control for the successful business. Quality service and quality control are properly checked
by the management team. The quality management team deals with the quality service and
quality control as given below.

Quality service

 The food- The quality of meat, bun, vegetables etc should be good and up to the
standard.
 The Employees- The quality management team has a look at the timing, neat dress
and cleanliness of an employee. The team work is always preferred in the
McDonald’s to get maximum benefits.
 The Restaurant- The management team looks that the restaurant should be clean, tidy
and sparking. While they also tried to provide the fast, accurate and friendly service.

Quality control

The quality management team makes it sure to fulfill the basic criteria set for the operation of
McDonald’s. They also listen and get feedback from the customer to make their business
improve. They also have a relationship with the scientific community to provide best and safe
food among the people. They tried to have solutions for special health issues among children,
and prepare a hygienic food for them.

There is no compromise on quality and quality control, the one of the reason for the
successful development of McDonald’s all around the world. The inspection is done on all
McDonald’s franchise and it is also a part of their strategy. HACCP (Hazard Analysis &
Critical Control Point)is the applied system of McDonald’s to keep nice and good food items
to the customers. The quality management team also looks at the diet contents and nutrition
of each food items and is given in Table 1. The health related issues are handled by the
quality management team and nutrition is properly controlled.

Table 1 Nutrition of McDonald’s food.

SWOT ANALYSIS

The pictorial description of SWOT is shown in Figure 2. On the basis of environmental

analysis of McDonald’s, the structural analysis of fast food industry, and the assessment of
internal resources of the company, following strengths, weaknesses, opportunities and threats
are there for McDonald’s:
Figure 3 SWOT description  

(S)trengths

 McDonald’s holds a very strong brand name worldwide.

 They have large partnerships with other companies that provide them with their
desired products; this increases the goodwill of the company.
 McDonald’s is one of the most reputed firms who are socially responsible.
 Self-service criteria save a lot of cost.
 Loyal employees & management & customer are their biggest strength.
 McDonald’s makes sure that cultural & regional barriers are kept in mind while
providing food to different countries.
 Clean environment and play areas for children where they can enjoy their time.

(W)eaknesses

 The weakness that hits the list of employee turnover rate. Every year many of their
employees are fired out of the restaurant.
 McDonald’s mostly advertises products and food items that targets children.
 Health conscious people often complain that they do not provide us with the organic
and healthy food. This becomes their weakness when they get in the complaints.
 They also face quality issue at times. This affects the business as they are running the
outlet worldwide, if one franchise gets affected others also get a bad name.
(O)pportunities

 It can open up online services for their customers so that they can easily order their
desired meals sitting at home.
 Discounts given on every food item may help them gain more customers.
 They can go for a joint venture with the retailers they work with.
 They can introduce healthy hamburgers and healthy drinks for the people who are
health conscious.
 In order to be environment friendly, they can use packing material which can be
recycled later or material that does not create pollution.

(T)hreats

 Emerging competition of similar outlets is becoming a problem for McDonald’s.

 Health issue also becomes a problem when it comes to food.
 As it is a multinational food outlet, fluctuations in the currency of other countries
becomes a problem for such companies.
 Recession in any country would definitely affect the whole outlet worldwide.
 People facing heart problems and obesity accuse McDonald’s for not providing them
with the healthy food.
 They have a threat of local food outlets in different countries.
 McDonald’s is operating in a fully-fledged economy where competition is increasing
day by day therefore they should work effectively to overcome their drawbacks
because of the recession.

Recommendations

Reduction of employee training spending (lowering employee turnover).

In order to reduce of employee training spending and to lower turnover, I would like to
suggest:

 To give the job just for highly motivated people. It means, that they are going to be
loyal and not to leave job so fast;
 New employees would be trained by employees, who are working longer. In this way,
company reduces training spending, new employees are trained by the people, who
are working inside the company and do the same things every day.
 To motivate employees and always take care about their expectations. It can be
money premiums for good working in the end of the month (or year), some
employees parties, ’’Employee of the week (month)’’ competition.
 To make a line of organic food in their menu and take a look what is more popular
and healthy for their customers. If it is going more popular than usual menu food, it is
more worth to make all food in organic way, even it is more expensive. First of all,
people like what is natural, and then they are interested in the price.
  To make big advertisement companies declaring organic food pluses and make it
more popular in such way. Many people loves McDonald’s food, so it has an
authority and can show good example of necessity of organic food in people life and
compare how organic and usual McDonald’s food effect customers’ health and all the
nature about them.

Advantages of human health problems (improvement of products)

McDonald’s is big food supplying company, and all of us know, how food affects our health.
It is one of the main factors, what built our body and strength our brains. Knowing that,
McDonald’s should:

 Suggest just high quality, improved products, which is full of vitamins and minerals.
So, it means that the company must improve their products, all the food must be
certificated and fit for all healthy food standards.
 Be in a contact with suppliers, who supply products for McDonald’s food and always
check if the products is natural, high standard and healthy for all of age customers.
 Contact with doctors, scientist and improve their products to fit for all of age
customers, even they have some problems with their stomach. It means to make
measures and find what the best is for all possible customers.

More Healthy Choices

McDonald’s should develop menu choices that are healthy and socially acceptable.

It is possible to develop a menu that people will enjoy and that also fits into the original
“Speedy Service” model the company introduced in the 1950’s.

Use local food sources where possible.

Using local sources decreases the time to market, and also decreases the use of fuel to
transport goods.

Increase presence in Asian countries

 McDonald’s has most certainly had a profound effect on China.

 When the first McDonald’s opened in Beijing more than a dozen years ago, 40,000
people lined up to observe a Big Mac and get their picture taken with the infamous
Ronald McDonald.
 McDonald’s is growing faster in China than in the United States.
 McDonald’s owns & operates more than 600 stores across 105 cities in China.
 More than 100 more McDonald’s stores will be added annually to Chinese cities
within the coming years.

CONCLUSIONS

McDonald’s is operating in Pakistan as very profitable organization. In this project we

struggled to study the management behaviour of McDonald’s starting from its history to its
vision and mission statements in which explained the historical of McDonald’s of how it
entered Pakistan’s market and the expansion of its business in various cities. Moreover we
also explained about its and services which are offered in Pakistan by McDonald’s as their
revenue generating products and services. I addition to that we researched all their product
line.

We also explained the organizational structure of McDonald’s. In that we explained the

hierarchal structure of McDonald’s. As a gigantic organization of the world need to build
their strong organizational structure so does McDonald’s. Its works on the basis of vertical
and horizontal coordination. All the executives from up to the lower management on making
it a successful organization.