International operations of McDonalds

Introduction

In order to survive the cut throat competition prevailing the markets, more and more companies are expanding their businesses on international scale to maximize profits and earn revenues. Such companies aiming for global expansion need to cater the consumer needs and choices which vary country to country. Companies operating on this basis are said to follow the principle of “glocalization” which is a combination of two concepts: global and local (www.businessdictionary.com). McDonalds is one such organization, which operates on the same principle and therefore it is chosen for this study.

International Operations of McDonalds

History of McDonald's Operations

McDonalds started its operations back in 1940 as a single drive in restaurant in USA; and with the aim of opening more than 700 restaurants countrywide, it managed to open the first restaurant as a franchise in 1955. The company made its first stock offering in 1965 and became a public limited company. It started its international operations in 1967 with its first international restaurant in Canada and now has its franchises in around 119 countries across the globe.

Mission and Guiding Principles of McDonald's Global Operations

The global operations of the company are centered on a strategy called “plan to win” which it pursues for its international operations in order to provide unparalleled experience to its customers. The company believes in continuous improvement of its operations in order to enhance the experience of its customers. Therefore, it considers consistency and excellence in delivering customer services at the core of its operations. It also staunchly believes in a diverse workforce and providing them with a well tailored environment to bring about results. The company has devised its business model as a three legged stool encompassing its operators, suppliers and employees as its corner stone's. It also firmly believes in integrity, wellbeing of the society, sustainable profitability and innovating constantly (www.aboutmcdonalds.com).

McDonald's Global Operations: Assessment of the Structure & Modus Operandi

In order to operate in various markets, McDonalds successfully employs a franchising model with around 80% restaurants running as franchises; and three agreement options namely Conventional Franchise, Business Facilities Lease and Joint Venture (Gerhardt, Dudley & Hazen). However, the ownership of the land the franchisees operate has made McDonalds the largest real estate owner of the world (Kiyosaki, R. & Lechter, S. 2009). Also great vendor relationships like that with Coca Cola have been built by McDonalds by involving it in joint planning which is done ...