CU-YMBA 15/2

1. 2011-2013 Strategic Management Group 6

2. Introduction-1 McDonald's Crisis: 1998-2003 Ray Kroc 1955-1973 Realized McDonald’s formula of self-service, paper-service, quick-service 1962 McDonald’s introduce the world famous Golden Arches logo

3. Introduction-2 Fred Turner 1973-1987 Management Science: established quality control measures, Turner’s manual Training: Hamburger University Supervising franchisees: Field visit report Management style: Expanded the authority of regional manager Advertising: “Ronald McDonald” McDonald’s under attack: Franchisees’ Rights McDonald’s under attack: Union Rights

5. Customer service: McDonald’s service enhancement program

6. Cost Cutting: redesign restaurant, efficient construction method, Open franchisee to choose insurance company, mini-McDonalds’ and expand small-size non-traditional site

7. International expansion: Joint venture with the local partners (Start with “Big six” country)

8. 1992 open the first restaurant in Beijing, China

9. McDonald’s in Crisis: No new success menu, Shop similar hurting each customer, McDonald’s loosing market share

11. Recasting the image of McDonald’s

12. New menu: Made for you project

13. Acquisition and attacks on McDonald’s: Selling unhealthy food, exploiting Children, mistreating worker, destroy rain forests and torturing animals

15. Improving stores’ operations

16. Substituted healthier food choices

19. External Analysis: Environment Analysis

20. External Analysis: Environment Analysis

21. External Analysis: Environment Analysis

22. External Analysis: Environment Analysis

23. External Analysis: Industry Competitiveness Analysis

24. External Analysis: Industry Competitiveness Analysis

25. External Analysis: Industry Competitiveness Analysis

26. External Analysis: Industry Competitiveness Analysis

27. External Analysis: Industry Competitiveness Analysis

28. External Analysis: Industry Competitiveness Analysis

29. External Analysis: EFAS + ICFAS

30. Internal Factors Analysis

31. Internal Factors Analysis

32. Internal Factors Analysis

33. Internal Factors Analysis

34. Internal Factors Analysis

35. Internal Factors Analysis

37. Strong Brand name, Image and Reputation.

38. Location & No. of Branches

39. McDonald’s Standard

40. Capability of CEO

41. Economies of Scale

43. McDonald’s Standard – no innovation.

44. Attack from a variety of public interest groups.

45. Unhealthy, fatty foods

47. Lifestyle – Fast, Work outside

48. World’s Economic Rebound

50. Many direct/indirect no. of competitors

51. Mad Cow Disease, H1N1, Swine flu outbreak

54. พัฒนาเมนูอาหารที่หลากหลาย เพื่อตอบสนองต่อความต้องการของลูกค้าและกลมกลืนไปกับวัฒนธรรมท้องถิ่น

57. Customer visit 2% / year

58. franchise operated to be 85% of all

59. ROIIC >45% by 2013

61. Corporate Strategy GE McKinsey Matrix

62. Corporate Strategy BCG Model

63. Corporate Strategy ADL Portfolio-Planning Matrix

64. Corporate Strategy Ansoff Growth Strategy Matrix

67. Strengthened MCD’s Standard

69. Launch campaign that Encourage people to exercise

71. Business Strategy SBU1: U.S.

72. Business Strategy SBU2: Europe

73. Business Strategy SBU3: Asia Pacific, Middle East, Africa (APMEA)

74. Business Strategy China Operated in China since 1990 World’s fastest growing emerging market No. 1 growth market for McDonald's Goal by 2013 ROA 10% Sale growth 20% Sales (company & franchise) 50% Operating Cost 5% Increase to 2,000 branches

75. Functional Strategy

76. Marketing Strategy: Segmentation Segmented by “Usage Type” Focus on “Usage Rate” Reduce ‘coz Nutrition, Fat and Standard Menu Time Taste Trendy

78. เมนูให้เลือกหลากหลาย และ Localize จำนวนสาขา ครอบคลุม Marketing Strategy : Positioning

79. Marketing Strategy : Product Menu Nutrition added ex. Vitamin, calcium and selected oil New localized Menu

80. Marketing Strategy : Product McDonalds’ Menu

81. Marketing Strategy : Price More Quality, but Same Price Depend on Income per Capita

82. Marketing Strategy : Place Existing Renovation New Branches Expansion Drive Thru Delivery

83. Marketing Strategy : Promotion Above the line (TV Ads theme) Family Time : confident Teenagers : get more Child to Parent : Let’s try

84. Marketing Strategy : Promotion Below the line Localized Menu In-Store Ads. Nutrition Labels Mobile Kitchen

85. Marketing Strategy

86. Marketing Strategy: People Service people Training: Operation man, Countermen Quality Control: Field Service report (service, quality, cleanliness andoverall performance) McDonald’s Best Practice: Restaurant, Country and Region McDonald’s staff: Competency in carrier McDonald’s culture: Each of employee should have McDonald’s culture mindset

87. Marketing Strategy: Process Service blueprint McDonald’s code of conduct

88. Marketing Strategy: Physical Evidence Standard Restaurant

89. Marketing Strategy: Physical Evidence Standard Cleanliness Standard dressing

90. McDonald’s CRM Ronald Club

91. McDonald’s CRM Social Network

92. McDonald’s CRM Moms’ quality respondents program

93. McDonald’s CRM McDonald’sRecall the good old day

94. McDonald’s CSR Ronald McDonald house charities

95. McDonald’s CSR Greener than ever

96. McDonald’s CSR I’m lovin’ it’ I’m lovin’ China

97. McDonald’s CSR McDonald’s Community

98. Operation Strategy Franchise Management Quality Control R&D Supply Chain Management

99. Operation Strategy Franchise Management GOAL “2,000 stores in 2013” Current situation: 1,146 stores in Q1/2010

100. Operation Strategy Franchise Management IN ACTION Traditional : Satellite : STO = 25:40:35 Joint Venture with Sinopec Petro&Chemical

102. Expand Capacity of existing Franchisees

103. Support “Star” franchisees

104. Incentive

105. Reduce Company-Owned and open only in new area as a model

106. Franchise Management IN ACTION Increase Geographical Divisions Seeking for new franchisees Manage and Control stores Provide Support Systems Located in Shanghai (Head) Beijing (Sub Unit) Sichuan (Sub Unit) Operation Strategy

107. Operation Strategy Franchise Management IN ACTION Support Systems Training Marketing Supplier Management HR Management Financial Management Properties & Location System Management Restaurant Management Business Management Preparing for Ownership

109. Sale and Cost Analysis (per month)

110. Compare among stores in each Franchisee

111. Compare among Franchisees

112. Compare among Countries

113. Best PracticeRed Area Green Area Black Area

114. Operation Strategy Quality Control IN ACTION “Standard in Food, Service and Cleanness” Control by …GROIP (Global Restaurant Operation Improvement Process)

116. Fast, Accurate and Friendly Service

117. Cleanness

118. Treatment of employees

119. Semi-Annual Performance Review (announced)

120. Monthly mystery shops (unannounced)

121. Semi-Annual Customer Satisfaction Survey

122. Weekly Comments Monitoring

123. All restaurants (front counter and Drive Thru) How? When? Where?

124. Operation Strategy Quality Control IN ACTION Performance Score + Mystery Score = Grade of each restaurant Rewards and Renew Contract

126. Market Research

127. Employees

128. Test with focus group

129. Coordinate with other teams

130. Supplier Management

131. Nutritionist

132. Engineer

134. Operation Strategy Supply Chain Management IN ACTION “From Farm to Fork”

136. HACCP certified by specialist

137. Raw materials

138. Farm & Ranches

139. Primary Processing Plants & Production Plants

140. Training & sharing best practice

141. McDonald’s Supplier Performance Index SUPPLIER SELECTION

143. Many-to-one

144. RFID technologies

145. Distribution centers

146. Leasing

147. Building near government Distribution centers

148. Outsourcing LOGISTICS & INVENTORY

149. Operation Strategy Supply Chain Management IN ACTION In-restaurants Speed, Cleanness and Conveniences Off-restaurants GPS technologies Customer satisfaction response DELIVER

156. Always seek opportunities that provide Low risk, High return

157. Consider Risk & Return

159. Balance Score Card (BSC)

160. BSC: Financial

161. BSC: Customer

162. BSC: Internal Process

163. BSC: Learning and Growth

164. BSC: Social Responsibility

165. % ROA = +10 % Growth Strategy Financial Perspective Cost Leadership Comparable Sales Growth = +20% System-wide sales increase = +50% Operation costs = -5% Attitude toward branding = Good+ Brand Loyalty Distribution Channel = 2,000 Off-stores repeat purchase within 1 month = 40% In-stores guest visit = +2% Customer Perspective PR + CSR Customers Satisfaction = 90+ CRM Marketing Mix Franchise Management Global standard Staffs Satisfaction Store Management Internal Process Supplier Relation = Good+ Performance = Good+ Operation hour = 24 hrs? Q.C. SCM R&D Localize menu = 4 / year Learning & Knowledge Training Code of Conduct KM + LO

166. Question & Share Answer