Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction
This is a Darden case study.From the early 1970s to the beginning of the 21st century, multinational corporations (MNCs) had increasingly participated in the reduction of poverty as part of their business strategies. Such participation reflected an increasing awareness of the widening gap between rich and poor across the globe. McDonald's Corporation, despite myriad criticisms directed at it about dead-end jobs and the detrimental effects of fast food, had defied norms, however. The company used a combination of promotion-from-within strategy and benchmark employee training programs to develop an abundant pool of human capital. The company was deeply committed to its employees who "started as crew" rising through the ranks, receiving the necessary training at its Hamburger University. This case details the rise of McDonald's, its particular culture, and its emphasis on and pride in the "stared as crew" element, and illustrates these elements with stories of various employees who rose through the ranks to management and executive positions.
Authors :: Pat Werhane, Regina Wolfe, Laura Pincus Hartman, Justin Sheehan
Swot Analysis of "Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction" written by Pat Werhane, Regina Wolfe, Laura Pincus Hartman, Justin Sheehan includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Crew Mcdonald's facing as an external strategic factors. Some of the topics covered in Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction case study are - Strategic Management Strategies, Ethics, Human resource management, Leadership, Motivating people and Organizational Development.
Some of the macro environment factors that can be used to understand the Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction casestudy better are - – increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy, technology disruption, competitive advantages are harder to sustain because of technology dispersion, increasing energy prices, supply chains are disrupted by pandemic , central banks are concerned over increasing inflation,
increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing, etc
Introduction to SWOT Analysis of Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Crew Mcdonald's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Crew Mcdonald's operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction can be done for the following purposes –
1. Strategic planning using facts provided in Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction case study
2. Improving business portfolio management of Crew Mcdonald's
3. Assessing feasibility of the new initiative in Organizational Development field.
4. Making a Organizational Development topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Crew Mcdonald's
Strengths Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Crew Mcdonald's in Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction Harvard Business Review case study are -
Training and development
– Crew Mcdonald's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
High brand equity
– Crew Mcdonald's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Crew Mcdonald's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Crew Mcdonald's is present in almost all the verticals within the industry. This has provided firm in Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Sustainable margins compare to other players in Organizational Development industry
– Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction firm has clearly differentiated products in the market place. This has enabled Crew Mcdonald's to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Crew Mcdonald's to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Crew Mcdonald's are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Effective Research and Development (R&D)
– Crew Mcdonald's has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Organizational Resilience of Crew Mcdonald's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Crew Mcdonald's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Crew Mcdonald's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Crew Mcdonald's has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Crew Mcdonald's is one of the most innovative firm in sector. Manager in Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Low bargaining power of suppliers
– Suppliers of Crew Mcdonald's in the sector have low bargaining power. Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Crew Mcdonald's to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Crew Mcdonald's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Crew Mcdonald's has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Weaknesses Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction are -
Skills based hiring
– The stress on hiring functional specialists at Crew Mcdonald's has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Products dominated business model
– Even though Crew Mcdonald's has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction should strive to include more intangible value offerings along with its core products and services.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction, is just above the industry average. Crew Mcdonald's needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Capital Spending Reduction
– Even during the low interest decade, Crew Mcdonald's has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Aligning sales with marketing
– It come across in the case study Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction can leverage the sales team experience to cultivate customer relationships as Crew Mcdonald's is planning to shift buying processes online.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction, it seems that the employees of Crew Mcdonald's don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High bargaining power of channel partners
– Because of the regulatory requirements, Pat Werhane, Regina Wolfe, Laura Pincus Hartman, Justin Sheehan suggests that, Crew Mcdonald's is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
No frontier risks strategy
– After analyzing the HBR case study Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction, it seems that company is thinking about the frontier risks that can impact Organizational Development strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Crew Mcdonald's supply chain. Even after few cautionary changes mentioned in the HBR case study - Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Crew Mcdonald's vulnerable to further global disruptions in South East Asia.
Lack of clear differentiation of Crew Mcdonald's products
– To increase the profitability and margins on the products, Crew Mcdonald's needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Crew Mcdonald's has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Opportunities Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction are -
Manufacturing automation
– Crew Mcdonald's can use the latest technology developments to improve its manufacturing and designing process in Organizational Development segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Crew Mcdonald's is facing challenges because of the dominance of functional experts in the organization. Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Crew Mcdonald's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Organizational Development industry, but it has also influenced the consumer preferences. Crew Mcdonald's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Organizational Development industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Crew Mcdonald's can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Crew Mcdonald's can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Loyalty marketing
– Crew Mcdonald's has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Creating value in data economy
– The success of analytics program of Crew Mcdonald's has opened avenues for new revenue streams for the organization in the industry. This can help Crew Mcdonald's to build a more holistic ecosystem as suggested in the Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction case study. Crew Mcdonald's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Crew Mcdonald's can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Crew Mcdonald's to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Leveraging digital technologies
– Crew Mcdonald's can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Building a culture of innovation
– managers at Crew Mcdonald's can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Organizational Development segment.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Crew Mcdonald's can use these opportunities to build new business models that can help the communities that Crew Mcdonald's operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Crew Mcdonald's can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Threats Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction are -
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction, Crew Mcdonald's may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Organizational Development .
Regulatory challenges
– Crew Mcdonald's needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Organizational Development industry regulations.
High dependence on third party suppliers
– Crew Mcdonald's high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Easy access to finance
– Easy access to finance in Organizational Development field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Crew Mcdonald's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Crew Mcdonald's in the Organizational Development sector and impact the bottomline of the organization.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Crew Mcdonald's business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Crew Mcdonald's can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction .
Environmental challenges
– Crew Mcdonald's needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Crew Mcdonald's can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
Technology acceleration in Forth Industrial Revolution
– Crew Mcdonald's has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Crew Mcdonald's needs to keep up with the evolution of technology in the Organizational Development sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Increasing wage structure of Crew Mcdonald's
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Crew Mcdonald's.
Consumer confidence and its impact on Crew Mcdonald's demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Weighted SWOT Analysis of Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Crew Mcdonald's needs to make to build a sustainable competitive advantage.
Feel free to connect with us if you need business research.
You can download Excel Template of Case Study Solution & Analysis of Started as Crew (C): McDonald's Strategy for Corporate Success and Poverty Reduction