At the advent of problems, McDonald’s is torn between choices of actions. Finally, it learned to adopt to change and impose innovation in its system which in turn brought positive effect on the company. Upon the advice of the Public Relations agency, the company made necessary action to counteract against bad publicity; and the most important among the strategies is the Heart and Tick Approval.
Globally, McDonald’s offers what people need in this period of globalization. The American culture of fast food chain as a place for people who could not afford to prepare foods at home since both parents are working began to penetrate Asian culture. In the same thought, McDonald’s became a place to celebrate birthdays and to engage in conversation. Generally, fast food chains like McDonald’s is a good place to go for busy people who seek the comfort of living. Mc Donald became part of the culture of the modern times.
For some, this symbol on the label of every product of McDonald’s is a kind of exploitation because they use it as their promotional strategy. The heart of the Foundation itself gives a subconscious message that stirs the mind of the consumers trying to deceive them by telling that McDonald’s product are good when they are not.
Though in previous years, McDonald’s had been perennially successful, yet due to the decline of its shares and sales in 1998, had devised a strategic plan that brought change to the company’s perspective in response to the controversy. This leads for the introduction of the Health choices and the tick approvals known as the Heart Foundation.
The changes that have been taken by the company are the result of the many controversies that challenged the popularity and sincerity of McDonald in its ethical obligation to environment and to its consumers. This is because the company is resistant to any forces that may alter change.
Generic Change Tools or Solutions Applied
The “Super Size Me” ads brought a big controversy on McDonald’s everywhere in the world and the media identified it or linked it to ‘obesity.’ Therefore, the company had finally decided to impose innovation to counter bad public publicity of the McDonald’s and adopted changes in their menu offerings. In a forum organized by Liberal Senator Guy Barnett, Mr. Peter Bush, the CEO of McDonald’s Australia, explained that their company takes on a new food offerings that will absolutely health-friendly (Burton, p. 30). The writer further emphasized that McDonald’s added a new range of salads to their meal, with the cutting of sugar content in the buns and less calorie count from all the foods. It has also lessened its advertising by sixty percent every hour.
The particular solution to this controversy is giving in to the public demand which is related to obesity that is associated with other illness common to people nowadays such as high blood pressure and heart failure. The company itself adopted the principles of the Tick Program of the Heart Foundation. In Australia, The Heart Foundation Tick is the solution to the growing obesity rates among children and adults. Healthy choices of food became the consumers’ demand in many industrialized countries like Australia. In a latest survey, 93% of Australians food had the greater role in producing overweight children and adults (Heart Foundation).
Modified or abandoned to suit organizational requirements.
Robert Dransfield explained in his paper that the strategic planning that McDonald’s had undertaken is a response to all the challenges that the company is facing including its competitors in the burger business (p. 460). This is very important because competitive advantage is created by combining strengths which means Mc Donald can exploit competencies and advantage at different points in the value chain to add more value in different ways. In other words, the value of the product which McDonald’s produces such as hamburger, drinks, fries and other food products, is the perceived benefit that customer would be kept coming back. It also means that value comes from product differentiation, product cost, and the ability of McDonald’s to meet clients’ demands.
The writer also noted that strategic planning is very critical because it shapes the future of the organization as it must meet the customers’ demands and needs. Dransfield emphasized that McDonald developed competitive strategies that differentiate it from its rivals (p. 461), in which it recognizes the need to respond to the greater demand to increase competitive gap by: “adding greater value through innovation, making the process of visiting a McDonald’s less routine and controlled, and enhancing the overall in-house experience” (p.461).
In particular, McDonald’s provides appropriate solutions such as “(a) providing a more balanced offering that includes fruits, sugar-free fruit drinks for children and more chicken products, and (b) by creating an Extra-Value Meal and a McChoice menu offering that provides excellent value for money” because price is critical to decision making (p. 461).
McDonald’s has to strategically cut the prices of their product as a respond also to the “burgers wars” with the Burger King’s attack. Thus, McDonald’s “sought worldwide leadership on the global fast food market through low cost production of a standardized menu” (Grant, p. 1117). Robert Morris Grant explained that McDonald’s strategy is founded on a central belief that is to be willing to cut price in order to boost volume growth.
Another strategy which McDonald’s undertook was using the persona of Ronald McDonald that looked lovable and laughable to children. This figure as a part of Public Relations strategy of McDonald’s conveys a marketing motivation. According to Bob Burton, the clown suit means: “Ronald loves McDonald’s and McDonald’s food” (Burton, p. 34).
This quotation indicates “that you should do everything you can to appeal to children’s love Ronald and McDonald’s” (p. 34). The clown is also used in charitable activities of the company; it is seen in many hospitals across Australia and other charitable places. Burton emphasized that in one of McDonald’s document, the overall objective of the company is not simply to give something back to the community but also to help differentiate McDonald’s from its competitors (p. 34).
Alternative Strategies and Change Tools
There are plenty of strategies that McDonald’s company had take into consideration and its tools are Public Relation and mass media. The strategies such as the price reduction, affiliation to Heart Foundation, and using the clown Ronald McDonald became effective in bringing back the positive image of the company. There are other strategies that were employed but these three are very important factors in the process.
Its Public Relations group – the Golin/ Harris Communications -played an important in the overall task. They figured different strategies and brought McDonald’s closer to its consumers once again. This event in the life of McDonald’s is the turning point for it to become once again a giant in business and at the same time responsible enough in its obligation to public. The mass media made things possible for McDonald’s for bringing all promotional activities to the public in a split of a second.
Change or innovation is very important in a company in order to adapt to the demand of the customers. Change may be planned or unplanned, but any problem would beget another problem if not attended to. This is the case of McDonald’s has learned its lesson; it should not remain confident in many challenges but be ready always for the challenges. Organization such as this must adopt new strategies and employ change from time to time. Innovation and creativity are the words that can help the company moving and growing.
Burton, Bob 2007. Inside Spin: The Dark Underbelly of the PR Industry. Australia: Allen and Unwin
Dransfield, Robert 2004. Business for Foundation Degrees and Higher Awards. Heinemann Educational Publishers
Grant, Robert Morris 1998. Contemporary Strategy Analysis. Blackwell Publishing.
National Heart Foundation of Australia 2006