Planning and Control in the Operation Management of Mcdonald's Term Paper

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Applied Operations

Planning and Control in the Operation Management of McDonald's

"To provide unmatched consistency in operations in support of high product quality. This must be accomplished with adequate speed, low cost, and process innovation to accommodate changes in consumer tastes."

~Operations Strategy of McDonald's

Operations management is a critical aspect of business that helps govern and determine the success and general efficacy of the business itself. Operations management encompasses numerous aspects of business functions and can be divided into several elements such as marketing/sales, corporate strategy, organisational design, and operations & process management. For the purposes of this paper, the organisation of focus will be the international chain of fast food restaurants, famously known as McDonald's. This is a fast food chain that originates from the United States of America. To date, there are over 33,000 McDonald's restaurants in 118 countries on Earth. The author of this paper has been an employee of McDonald's for several months. Therefore, McDonald's is the selection for operational management focus in this paper because there are few other companies who can compete with McDonald's and because the author is personally affiliated with this corporate giant. The author will have a deeper insight and a more in-depth perspective on the operations management of McDonald's. The paper will provide a succinct description of operations management as it currently applies to McDonald's, with specific focus upon the aspect of Planning & Control within McDonald's.

Introduction & Background

Jain provides a concise description of operations management as follows:

"Operations management can be defined as the planning, scheduling, and control of the activities that transform inputs into finished goods and services…Operations management concerns making the most efficient use of whatever resources an organisation has so as to provide the finished goods or services that its customer need in a timely and cost effective manner. Operations management is related with the strategy of the organisation." (Jain, 2010)

Within every organisation, there must be clear identification of the product for the consumer. The inputs must also be clearly defined. The employees transform the inputs and produce finished goods, which in this case are the food items on the McDonald's menu and satisfactory customer service. The ways in which the employees are organised are a part of operations management. The processes by which the inputs are assembled and transformed into completed products for consumption falls under operations management. There are, in fact, not many business-related practices that are outside of the scope of operations management. Thus, effective operations management is vital to the success of a business. McDonald's, as a business operating for eighty-two years, must be a productive of outstanding operations management to be in business for so long, providing service to billions of customers worldwide.

Operations management has several responsibilities key to the business. Finances must be stringently and meticulously accounted for and documented. Operations management covers the economics and the accounting departments of the corporation. Through the past several decades, the field of organisational behavior and/or psychology has gained a reputation as an academic field and has seen great, documented successes in applied theories. This is also covered in operations management. All aspects of production from general engineering, industrial engineering, and strategy & marketing are included within operations management. From how the products are made and distributed; from where the company sources the equipment for manufacturing; to the ways the markets are cultivated and the products are advertised -- all of these keys processes are within the realm of operations management. The purchasing of resources and the logistics of everyday functioning are obviously within this realm. Finally, the information management technology that organizes, stores, and distributes all the data from the other aspects of operations management is a part of this domain. It is clear that operations management is the metaphoric nervous system for any corporation, especially one so vast and so influential as McDonald's (Slack et al., 2010).

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There are at least three generations of McDonald's customers that can recite any number of McDonald's jingles or full commercials from within their lifetimes. Though the affects of a business upon a culture or rather, a planet, cannot be predicted, certainly, the affect McDonald's has on humanity is by well-crafted design.

The resources in McDonald's are produce, grains, and food products. These resources, whether they are chickens, potatoes, or cheese, are the materials that compose McDonald's products. Within the facilities, the staff, with use of the equipment in the facilities, act as the transforming resources. The transforming resources such as the materials, the information (recipes, equipment operation), the customers (the orders), the facilities, and the McDonald's staff are the input. The transformation process is food preparation, storage, and distribution. The outputs are both the items on the menu as well as the McDonald's customer service experience. This is a basic model for the operations of a fast-good chain of restaurants such as McDonald's. There exist variations, but for the sake of this examination, this general model is adopted. The transformation process happens on a grand scale and it occurs on a localized scale. The chickens, cows, and fish must be raised, grown and subsequently slaughtered and made fit to be shipped. Within each individual McDonald's restaurant around the world, the chicken is fried and made part of a sandwich. The transformation process happens on the industrial, large-scale level, and the process must occur again on the localized level. Direct contact with the customer is vital to McDonald's success and marketing strategy.

Theory

At McDonald's making customer happy is what our business is all about. And we know it takes a lot to make that happen. We work hard to provide every customer with a choice of meals and an experience that exceeds their expectations."

~McDonald's Strongest Priority (Earley et al., 2004)

A theory that McDonald's has paid close attention to is queuing theory. Within operations management, the experience of the customer must be a factor. There is substantial time and effort put into crafting the best product possible that appeals to the customers in the strongest manner possible. The experience the customer has in the delivery of the product is an aspect that McDonald's has taken into great consideration. The design of products and process, the mapping of processes, such as the process of customer service and product distribution, are aspects of process design, a key element of Operations management. The queue is a mandatory experience in shopping in general. As McDonald's has sustained worldwide popularity, the queue is a mandatory aspect of the McDonald's experience. It is for this basic reason that McDonald's has devoted their efforts to designing a fluid, effective queue experience, acknowledging and applying aspects of queue theory.

The general design of the McDonald's restaurant space and in particular the queue is designed with specific intention. McDonald's is a company that takes prides in delivering quality products in a speedy manner:

"McDonald's competes on several bases mainly to make their customers happy by providing speedy, affordable, and nutritious foods. Through extensive market research and survey, the organization discovered that its customers desire speed as one of the restaurants' top priorities. Therefore, McDonald's vision aims to "provide fast, friendly and accurate service" ("McDonald's Worldwide" 5). McDonald's realizes that specific targets are necessary to measure the performance of speed, and continuously takes relevant measurements to compare actual performance with desired targets Specific measurements are detailed later in this report in the "Quality Management" section. To achieve efficient service times, the company utilizes proven, standardized training processes for its employees and new drive-thru layouts to reduce service times. Along with speed, McDonald's also competes by offering prices at a low cost." (Earley et al., 2004)

McDonald's serves great food very quickly. This is not an easy task, nor is it a feat that is accomplished with magic......

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