Strategic Management and Business Planning
In this essay, need to describe the strategy of the organization first, which is the main point of understanding about the organisation that the organisation is having what kind of planning regarding the political, economic, social and technological situations. “Strategy is the direction and scope of an organisation over long-term.” Nowadays this is the competitive business environment in which we need to do planning in a large scale. The firm should be engaged in strategic planning which defines the objectives, progress and implementation of strategy and should make adjustments as to stay on track. The selected organization “McDonalds” has the strategy to provide fast food to their customers and satisfy them by providing high quality food and good clean environment to enjoy it.
The SWOT analysis is an extremely useful tool for analysing and understanding all sorts of business and organization’s terms and situations. The SWOT analysis stands for Strengths, Weaknesses, Opportunities and Threats. The SWOT analysis provides the framework to review the strategy, direction and position of the company or an organization, or any other idea. The SWOT analysis can be use for the business strategy, business planning, marketing, competitor’s evaluation, business and product development and research reports. The first two factors, Strength and Weaknesses are the internal factors and concerned with the organization and the other two factors, Opportunities and Threats are the external factors which are largely identified by the PESTEL analysis.
The PESTEL analysis measures the business’s market according to the external factors; Political, Economical, Social and Technological, Environmental and Legal. The PESTEL analysis is more helpful and external factor as compare to the SWOT analysis. The PESTEL analysis is a useful measurement tool for understanding the external environment of the company and market growth or decline which shows the direction of the business whether it is growing or declining.
A commonly used and a valuable technique of research is PESTEL analysis which divides the overall environment of an organization into four areas such as political, economical, social and technological. It provides the environmental factors to tackle the problems through public relations techniques which effecting the organization. This analysis helps to find out or identify the issues which affect the organization’s political, economic, social and environmental angles.
The PESTEL analysis is the brainstorming technique. Brainstorming is the group of the people which is the powerful technique. It creates the new ideas, motivates and solves problems; it gets a team working together. In this case, the group of people decide and define the objective and agree on the issue then they put their brainstorming ideas and suggestions on it in a time limit. Afterwards, they categorise and combine their ideas. They focus their efforts in achieving best results whether their ideas will b successful and beneficial for their organization or not.
The brainstorming group of people access and analyse effects and suppose the results on the basis or their decision. They first allocate the options for running the organization and rank the list as it is appropriate. They first demonstrate the prior options to get the best results step by step. The brainstorming group agree the options and timescale in which they have to do their tasks and activities.
Brainstorming enables the people to suggest their ideas randomly and the people should encourage everyone to participate and prevent others to contribute in the mission or goal. During the random collection of ideas the facilitator must record all suggestion on the flip chart. All the participant agree the actions and take decision what the next action should be. They agree a timescale and who’s responsible. After the session they monitor all the task and at the end give feedback.
The organizations do not exist in the hidden thing. They operate within a competitive business environment. In the organization, the business related people analyse its competitors not only enable the organization to identify the strengths, weakness .opportunities and threats of their own organization to compare their organization with their competitors to compete and analyse the situation of the business. SWOT analysis is the way of analysis to analyse the factors and the strategy or planning of the organisation. McDonalds is the most famous and largest company in the world. It provides the fast food for the busy customers those who don’t have time to cook at home and they don’t have interest to make food.
McDonalds is the most busiest store which is also famous that they provide good clean environment and all other facilities like WI-FI connection, newspapers, facility to get chance to meet new people. There are 40 million customers are visiting McDonalds (Mchowr, 2010). It has over 30,000 branches in 120 countries (Nelson, 2010). From most of the countries, McDonalds get its revenues. The bigger image of this food chain was creating the concept of fast food in the world. The core strengths of the McDonalds are the speed, customer care and cleanliness. They created a highly successful quality of food and services to the customers and created a logo and advertised their brand image to the millions of the customers. McDonalds have two main competitors which are KFC and Burger king. Its marketing strategy is concerned with internal and external resources and environment. The main concentration of the company is to satisfy their customers by providing the good quality food and fast service.
There are some factors which are consider as the strengths of the company but they also become the weaknesses of the company if we observe performance.
Customer change their mind with the passage of time and according to the demand of advance culture or all requirements. So McDonalds try to advertise and promote the new types of brands every month. The new promotions are for the time being and for the limited time period. Moreover they maintain their standard by providing the good service the huge quality fast food. If the quality service is not good in the store then it effects the whole brand of the organisation.
The main purpose of organisation is to achieve their goal. McDonalds has been chosen their target very carefully. In the case of McDonalds the targeted audience are the kids. Here , the health conscious women and the senior people should be preferable to concern about the target audience but the target was kids and kids grown up to become adults so the most preferable and helpful target was kids. This helped in the popularity of the McDonalds but the major change related to health related product was on the demand of the customers as required the needs of today’s trend so that is why, it has decreased the popularity of McDonalds. These all are external weaknesses of the company. The internal factors of the company also affect its performance. McDonalds at one stage concentrated the growth of the business at the higher level to make a position in the market to b stable and the main focus of the company was maintenance, growth and Research and Development (R&D).
One major threat of the McDonalds is the relationship with the management and franchise dealers which can be difficult for the organization as a whole and the organization’s strengths help out to overcome the strength because the strength is the back bone of organization if it goes down the whole system will collapse. McDonalds is trying to recover all the weaknesses. Using internet system it is easy to communicate and use the systematic process to improve their service. These latest technologies help to prevent the new issues in the market. These are the issues for the improvement of the company. Companies develop their strategies and having the competitive advantages. These are depend on the firms ability. It creates the better economy and economic value in the market. Some companies have their brand name and are very famous in the globe. Michel Porter (1990) proposed a modal that called the “National diamond” modal. It identifies four characteristics related to the firm, its strategy and all the environment.
Porter’s modal has the proper way to describe how the company and it competitive have shapes and how they can cope with these. Among the countries , this analysis shows the differences in the system. These system may be environmental and can be business environment. Particularly, this modal is based on the premise that government can play an active and constructive role to maximize the level and growth of the nation’s living standard. In which economic role of the company is idealistic. National characteristic divide into two factors macro-level and micro-level. Macro-level factors are institutions like the political, legel and market systems and government policies to support businesses. Micro-level factors have the ability of nation company to grow up and get the awareness of competencies and competitive strategies that how can make a strategy to achieve their goal successfully. The company’s best strategy and planning make the company successful and role model in the business world. This model has the significance effect on the business market. This framework helps the company to make the best plan and strategy to get better result to make a position in the market.
The basic thing of competition in an industry is affected by the Porter’s diamond four factors. However, these factor demonstrate that how firm cope in the market unless the structure of the company will also not play the affective and important role in the market. There is an economic theory which allocate the performance and structure of the company. In the organization, according to this modal, would be expected to compete and make higher profits. However, as the researchers conclude that the important factor of competitive behaviour is history and culture of the organisation.
The Porter’s modal is to understand the strategy and it is a simple tool to analyse. The power of the business lies in a business situation and this modal help to analyse the strength of a firm. The achievement of goal by having the access to meet all the requirements from the company.
Porter’s modal also identify new products, services or business which have to b profitable. However, it also may help to understanding the basic level. It is important to understand that this modal has limitations in market environment or relatively market structure. This strategic framework helps for the SWOT and PESTEL analysis. This approach can be used for every business modal. Some issues of this modal are very important for the organization to build long-term business strategy during implementation of this modal.
As the world has changed the requirement and the taste of the customer also change so the McDonalds policy changes as the demand of people. Because the same brand every year or every month may fed up their customers so their company decided to change their brand and introduce new innovations to develop the interest of the customers in their company.
Now, analysing the sustainable competitive advantages (SCA). SCA is the advantage of the company which is difficult or impossible for the companies to break it. The advantage can be the brand, customer care and cost structure. Other three aspects of advantages which are helpful for SCA, these are:
The organisational criteria should be good interrelated and coordinated. The common goal should be strong. The organization should learn and bring the new innovations and changes as per the demand of the customer considering the environmental changes and the customer trends’, legal or goverment restriction and developments in technology. Now, McDonalds is concentrating on this advantage by concentrating on the organizational behaviour and the expertise of the management system. Previously this advantage was ignored but when they observe the weaknesses and suffered a loss then they protect themselves by these weaknesses and overcome on these.
Structure, technology and financial assets of the company should be very good market position these can helps in the SCA. McDonalds is having these aspects like structure, technology and finance.
The company start their mission with an aim and the determination of achieving their goal. Same McDonalds started with the aim of helping the people to get fast food who had very little time to cook and those who are busy to get into a proper restaurant. So the vision was to provide fast food, quick service, cheap products and quality satisfaction.
In summary, SCA is the best strategy which uses all the way for advantages and helpful for the organization and cannot be copied by the other companies or competitors. The importance of the SCA is investment portfolio in the business environment.
Nowadays there is not any single organisation which can handle all sort of problems and work. It is not possible for McDonalds also to handle and sort out all the weak points to overcome. But the great concentration should be core competencies of this company. The general advantages of McDonalds are cheap service, knowledge of markets core competencies, flexible resources, quick service and low cost. Recently, McDonalds has tested the drive through order facility where they get satisfaction that the order placed is accurate and these order sent to the home restaurant where they can see the order on the display system and can ready their food within the minutes and serve quickly. These call canters has a facility of digital camera. It point out the vehicle on drive through and the delivery man inside the store can ready the food and the person place it to the car whom order is.
Although, McDonalds faced a lot of risks and difficulties in past and also face competitors. But the term which makes it still strong in the business is, its core competencies.
A complete analysis of McDonald’s in which the company operates is the PEST framework analysis of the company. The analysis of the company includes all the history and framework of business segments, the analysis on the geographical situation and analysis of the company’s major competitors.
There is no particular competitive strategy to achieve success at all times. Because sometimes the company have to face a lot of problems and competitors in the market. Risk attitudes also change and vary by business situations and environmental uncertainty and several internal and external conditions which may weak the business situations.
There are the main considering points which consider the strategy of the market. These point are four p points like product, place, price and promotions. These point may help to make decisions and to make the business strategy. It consult the customers demand. Price of the product consider in this strategy. Product design, modal, shapes etc also consider and allocating the market product. In many organisation there should be shape, size and order processing which are important.
Pricing is the complex issue because it is related with the cost, volume and tradeoffs. Pricing policy changes to get the competitors response which is usually hard for all the participants.
Marketing has received a greater attention in the competitive business since modern era and marketing has concentrated on the modern types of strategy to promote their product selling. The old concepts carried out for the product and considered marketing to selling and promotion according to new style and demand of the customers to satisfy their customers and seek to earn more profit through customer satisfaction.