McDonald's - Organizational Analysis Using the Nadler and Tushmans Model - Case Study Example

Running header: McDonalds Student’s name: Instructor’s name: Subject code: Date of submission Organizational analysis using the Nadler and Tushman’s model Introduction The McDonalds group of companies is the largest hamburger fast food chains in the world. It has expanded over the years since it first started its operations. It was founded back in the year 1940 as a barbeque restaurant. It has continually developed and advanced over the years to become the second largest employer in the world. This is dueto the over 440,000 employees reported asat 2012. Throughthe acquisition of a worldwide status, the expectations that are placed on them by the customers and other players are high. The improvement of the standardscan be replicated by increases in the returns that are made. The analysis of an organization is important. This is because it enables one to be more conversant with the factors affecting its operations and which facilitate good performance. The model facilitates this through an in depth analysis of the problems that are encountered by the organization (Beach and James, 2001). Through having knowledge on the problems, it becomes easy to come up with remedies and solutions. This is crucial tofacilitate the operations of a company. The analysis willhelp develop a better knowledge of the McDonalds Company. The company has been subject to many changes and this has affected how it performs in the global arena. By finding solutions to the problems that it is experiencing, it will be well positioned to get better returns from its operations. The operations of the company are directed towards the achieving the best returns possible. This is from the process where input of the company is worked upon and transformed to arrive at the output. The intention in this case is to arrive at the best quality of output possible. The input of the company can be categorized into different categories. The different categories are either internal or external to the business. They involve the important factors that the company has to work on in order to arrive at the final output. This isa crucial factor as it determines the quality and the level of output that the company makes. The objective of the company goes ahead to indicate the intent of the company in the ensuring of utmost environmental maintenance. This is through improvement of the performance in the environment. it is also through strict adherence to the set environmental rules and regulations. The company has also gone an extra mile in seeking for programs and partnerships that seek to promote positive environmental results and outcomes. The company putting in place efficient means of energy consumption has fostered this. There are also measures in place to reduce wastage of water in the processes. This is because water wastage and energy consumption have been problems that result to increased expenditure for the company. The company has also put in place grease arrestors that arrest grease and other materials from entering to the wastewater. Other measures have also been put in place. This is in order to control the waste materials from the company premises. This is in a bid to minimize the environmental impact that they have. One factor into this is the use of recyclable materials in the cups and boxes used. There are also many pans in place to develop a recyclable waste stream. This is in order to facilitate the control of the waste. Recycling also has the impact on reducing the costs that are incurred by the company in the purchase of new commodities and equipment. The first input aspect is the environment. The company has put in place environmental strategies. This are aimed atimproving the environment around it.The company is also subject to much competition. Competition makes up the external environment of the company. The main competitors to McDonalds include among others Burger King and Wendy’s. These two are the main competitors of the company. They are second and third largest burger chains respectively only falling behind to McDonalds. They are competitors due to the similarity in the output they have and the customers. The company therefore need to put in place mechanisms to see to it that they counter the competition present. Competitors have the effect of reducing the returns that are made by the company. Through dealing with the competitors translates to even better returns for the company. The only way to counter the competition is through the offering of exemplary services to the customers. Customer satisfaction is crucial for the prosperity of any business. It is also the best and most efficient way of dealing with the competition eminent in the market. The environment of the business is also made up of the markets. Markets are the target of the business. It is through the satisfaction of the needs of the consumers who comprise the market that incomes are made by the company. The markets have different demand patterns that they show to the company. The company on its part strives to meet the demand of the market but at a profit. It is therefore crucial to identify the tastes and the preferences off the market to be able to offer only the required specifics aresupplied. The company also havethe role and dutyto identify new market niches and gaps that exist. The new gaps include in new cities and in other countries. Through the identification of new markets, the levels of customers will be greatly increased. This further translates to an increase in the incomes and returns that aremade by the company. The new markets include the developing countries of the world and in other emerging cities of the world. It is however crucial to have a deep analysis of the markets to know the cultures and means of life of the people making up the markets. The environment around the new markets also matters. This is due to such things as the weather conditions of the new markets. Environments in extreme conditions have different demand patterns as compared to theother extreme. An example of this is environments in very cold places. In such, the demand for warm drinks is higher as compared to that in warms environments. Technology has also had an upper hand in the external environment of the company. Technology has come with many benefits to the company. Some of the benefits include that it reduces the time spent in the preparation of some foods. Through reduction in time, it facilitates the increase in the quantity of output that is produced from the inputs. Technology has also helped reduce the number of procedures of preparation on certain dishes. This has helped reduce the amount of work that is undertaken by the staff of the company. Through this, their welfare is kept well at check. Technology also has another advantage of reducing the overall costs ofproduction of output. This is beneficial to the company in that the amount of expenditure incurred is lesser. This translates in more income at the disposal of the company. Another attribute of technology is that it has created an environment where more output which is of better quality produced at lesser costs and lesser periods of time. Another important factor and actor in the environment of the business is the financial institutions. This is because they offer both long term and short term financial aid to the company. This is crucial especially in cases where he company experiences periods of exceedingly high demand. In such a case, the amount of cash that is required to for a consistent supply of input that is required is made available. It is also through this amount that the company is able to hire temporary staff to aid in its processes. This will help in the maintenance of the quality of the products of the company. The government also makes up the environment of the company. Its role is in the setting of standards that are to be adhered to by the company. Such are in the composition of the output produced. It also sets health standards that the output of the company must stick to. This is in order to maintain the safety of the consumers of the products of the company. Through the ensuring of safety standards, the governments makes the consumers have access to safe products. The government is also responsible for imposing taxes to the company for its continued operations. It is through such taxes as this that the government is able to raise the level of infrastructure of the country. It is also through this that the security levels are also improved. Other players in the environment are labor unions. They have the sole purpose of looking after the welfare of the employees. This is in order to reduce the chances of them being over worked. They also air the grievances of the staff to the company and to the government. They are hence the voice of the employees. They affect the company in that they have power over the welfare of the employees’ rights. If they feel that the right has been broken, they raise the issue to the relevant groups. The environment can be said to affect the company in a couple of ways. The first way is that demands are imposed. This is through the customer preferences and the demands of the markets. The company strives to meet these demands. The second way in which it affects the company is through the imposition of constraints. Such constraints include those by the government on the quality of output of the company. Other constraintspresent include technological constraints imposed by the technological environment. the third way itaffects is through the creation of new opportunities for the company to operate under. This includes the new markets that are there for the business to operate in. they act as new ventures where profitability is imminent. The second input factor is the resources. Resources of a company include both physical and human resources. They facilitate the everyday running of the activities of the company. The company has over 440,000 employees. They act as a strong backbone for the continued development of the company. The company also had an asset value of 36.6263 billion dollars as at the end of the year 2013. This is a very strong basis for the company to embark on a successful product development and business expansion. How the company manages its resources determines how it will be able to get returns from them. The McDonalds company has put in place a human resource management framework which seeks at addressing the needs and the demands of the human resource. There is also an asset management process in place. This is designed to have a better control of the assets of the company. It helps in the reduction and elimination of such vices as misuse and wastages. This is through putting in place personnel to monitor the daily usage and maintenance. The third part of the input of a company is the history of the company. An organization is shaped by its past activities. How the organization has been undertaking its past activities determines how it will continue to be in the future. Since its founding, the McDonalds Company has had a culture of utmost professionalism in its activities. The company by being in operation since its founding back in 1940 has achieved much. It has developed a long standing relationship with the customers which can be described as a permanent one (Bernstein and Ronald, 2004). This is due to the exemplary service levels and trust that they have shown. The customers have grown to have brand loyalty to the services and the products of the company. It has continually adopted technologies that are all aimed at seeing to it that maximum results have been obtained. The second process after the analysis of the input is the strategy formulation. This is the process of transformation of input into output for the company. Strategy can be categorized as eithercorporate or business. The difference between the two is that corporate strategy deals mostly deals with the legislative mandate. On the other hand, the business strategy deals with the decision making process as to how the resources of the organization will be organized to be able to meet the demands of the market. It is made up ofseveral elements. The first element is the customer selection. It deals with the selection of the customers of the company. The McDonalds has identified its key customers. Through this, it has opened up branches in areas where they can be easily accessed by them. Through this, they will be able to make even more returns as compared to being in other places where the customers do not consume their products. The second element is the unique value proposition. This is where the copay is able to identify the main reason for the continued existence of the customer. The company has in effect to this identified the major selling products. It has increased their array and quantity in the stores. It has also perfected them in order to increase the preference for them by the customers. The third element is the value capture. This involves the creation of a balance between attaining profitability and at the same time maintaining the quality of the output. This is a tricky issue because excess of one aspect may result to the reduction of the other. The company has in effect to this, put in place control measures to ensure that it is able to profitable satisfy the needs and demands of its customers. Strategic control is the other element. It deals with the protection of the bestselling products from the imitation by the competitors. This is donethrough branding and patenting the products that are produced. The company has also employed means to see to it that the customers are loyal to the products of the company (Goldstein, 2000). This is in order to limit the chances of success of the competitors. The success of these strategies will help see to it that the company has well dealt with the competitors. This will increase the returns due to increased customer numbers. The final element is the scope of the operations of the company. This refers to the area of operations of the company that it engages in. the company when it first started its operations, only dealt with the sale of burgers to the customers. With time, it enlarged its scope to cater for other related products. In the recent days, it deals with the sale of such things as, chicken, French fries, soft drinks, milkshakes, salads, desserts and breakfast. This is an indicationof an enlarged scope of operations. This has the advantage of increasing the flow of customers as different people have different demands. Through the expansion of the services which it renders, it has been able to get even more revenue. This is as compared to the earlier figures recorded when it only dealt with the sale of burgers. The expansion of the scope however has several things attached. There is an increase in the production costs. This is due to increase in the number of specialized staff to produce the extra commodities. There is also an increase in the amounts of input required for the operations. This however, is well met by the profits made. In order to achieve the desired output, there are certain organizational aspects that must work together. It is through this that best results are achieved. The first is the work. This can be defined as the day to day activities of the organization. They define the effort that is put in place to achieve the desired quality of output. It deals with the product designs and the subsequent rewards that are considered under the element. The other aspect is the people that comprise the organization. This is about the skills and the qualifications that the people in the organization possess. It is through the special skills that they are able to make the desired quality of output. The expectations of the people in the company are very high (Daniel, 2000). Through this, they have a high degree of motivation. Motivated people have better quality of output as compared to the people who are not motivated in their work. Through this, the goals that are set by the management of the company are easy to attain. The management that is made up of senior people in the company goesan extra mile to see to tit that they put in place strategies to improve the degrees and skills of the staff. This is through motivational sessions and adequate training facilities. The final phase is the output. This is the final product of the company thatis issued to the customers. It is the result of the transformation of the input of a company. It is through the quality of the outputthat a company is rated and preferred by its customers. It can further categorized as both the formal organization and the informal organization. The formal organization on its part can be defined as the structureand the systems that are in place. This is the formal organization of the company (McDonalds, 2011). It is comprised of a streamline flow of management. The streamline flow is also the type of the flow of decisions in the business cycle. It is also the organization of the people in the company and their coordination of the activities that they undertake in order to achieve the objectives and goals of the organization. The informal organization of the other hand is made up of all the unplanned and the other unwritten activities that come to formation over a period time. They include the valuesand norms of the company. The values are passed from one generation of the employees of the company to the other. They are the uniqueness attributes which they possess different from their competitors. The informal organization is also composed of other things such as power and influence in the company set up. It is through this, that the senior management is able to monitor its progress over time. It is through the analysis of such, that the company is able to achieve higher heights. The congruence model is hence essential in the analysis of the dynamics of the organization. The problem identification process is also a crucial part of the system. It has given room for change to occur to the company. This is through the gathering of data and relevant information that is used in analysis (Wilbur, 2007. Through the analysis, the data is matched. This is through comparing the actual results with the estimates earlier set in the company Conclusion The benefits of this model is that it has enabled the company to identify the faults of its systems, both social and technical. The model has also enabled an analysis of change in the company. This is because once the problems are identified, the development of solutions always results to changes in the systems of the company. The changes are very crucial to the company due to the various benefits of change. They include that they result to brand perfection of the outputof the company. Through this, the company is able to deal with the competition that exists in the market. Through dealing with the competition, the company is able to boost the returns that it makes from its operations. Problem identification has resulted to the alignment of the resources of the company to meet the demands that exist in the market. It has made it also possible for the company to see and deal with the faulty areas of the operations. With this, the benefits of the model can be clearly seen in the McDonalds Company. References Beach, W&, James O2001, Defensible Policies: Developing, Writing, and Implementing Valid Policies for Problem Oriented Policing, Springfield Ill, Charles C Thomas. Bernstein, C& Ronald, N2004, Winning the Chain Restaurant Game: Eight Key Strategies, New York: John Wiley. Goldstein, H2000, Problem-oriented Policing. Philadelphia: Temple University Press. Daniel, D2000, The McDonalds. Plymouth, Lighthouse. McDonalds, 2011, McDonalds, Creative Paperbacks Inc. Wilbur, T2007, Top Secret Restaurant Recipes: Creating Kitchen Clones from America's Favorite Restaurant Chains. New York, Plume. Read More