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Case Study: McDonald’s

Case Study: McDonald’s


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Business organizations operate in a very turbulent and unpredictable environment that is characterized by currency fluctuations, political instabilities, changing consumer tastes and preferences, and discovery of new technologies. These occurrences make it impossible for an organization to implement a fixed strategy that will work best in all situations. As such, anticipating, embracing and effectively managing change has become one of the key functions and responsibilities of managers in the modern era. Using the case study of McDonald’s, this paper explores the role that leadership and globalization play in shaping a company’s culture and change management process.

Current Trends and Research in the Company’s Culture and Change

McDonald’s is reputed as the largest restaurant chain in the fast-food industry worldwide (Hayes, 2014). A large part of the company’s success is attributed to its corporate culture, which emphasizes value, quality, cleanliness, and service (Ferrell, Fraedrich & Ferrell, 2010). It has grown rapidly over the years, although it is reported to have experienced slowdowns during the 2000s. Thankfully, the company’s management team took appropriate measures to restore the firm back to its position. One of the actions that were taken to this effect was the appointment of a team of new managers that was charged with the responsibility of implementing a new strategy. As Synnot (2014) records, the new strategy sought to, among other things, introduce novel product lines while also adopting a new marketing strategy with a focus on healthier foods. An important deduction made from this move is that McDonald’s is very keen on responding to change, the change in question here being that the current generation is becoming more conscious of the food they eat.

In response to the technological advancements of the modern era, McDonald’s has reportedly automated many of its operational processes. For example, it uses beverage dispensers that are fitted with buttons instead of levers. This means that instead of the person using the dispenser holding the lever, he/she only pushes a button. Similarly, McDonald’s is trialing self-order kiosks (Synnot, 2014). This latter development will help the company to effectively achieve its goal of providing quality effective service to customers. Still on the aspects of quality and value, which are emphasized in the company’s culture, McDonald’s has introduced the wireless technology of hot spot; guests can access the internet from their computers and mobile phones as they take their food from the company’s restaurants (Synnot, 2014).

To be able to deliver value and quality service to customers, McDonald’s maintains a very healthy relationship with its suppliers. According to Aswathappa (2006), McDonald’s holds its suppliers in high regard, treating them as partners. The company understands that suppliers are very important to its success, which is why it has a long-term commitment towards ensuring that suppliers have all the resources they need to operate efficiently. Specifically, McDonald’s provides managerial assistance as well as capital to suppliers whenever these are needed. In short, McDonald’s corporate integrates suppliers together with franchisees.

Role of Globalization in the Company’s Culture and Change

A crucial observation that can be made from the above discussion is that the changes that McDonald’s has made to its operations and processes are largely occasioned by demands from the external environment. For example, the shift in marketing strategy to healthier food options was driven by the society becoming more conscious of their diets. Likewise, technologies such as button dispensers and self-order kiosks may be said to have been inspired by customer demands for quick service. The implication of this is that a company’s culture and change management strategy are greatly influenced by globalization. This is clearly illustrated in the statement that McDonald’s changes its menu from time to time as a way of “adapting itself to countries in which it operates” (Parker, 2005 p.207). This is to say that in order to be successful in foreign markets, McDonald’s has to change its menu and way of doing things so that these align with the culture of that particular market.

Earlier, it was mentioned that McDonald’s position in the global market started declining during the 2000s. Some of the reasons cited for this slump include increased competition, especially from new players, consumers demanding a wider variety of food products, and concerns about obesity. Regarding the latter, it is reported that the government of the UK was considering imposing restrictions on the content of advertisements that are targeted to children. In order to curb the manufacture and sale of unhealthy foods, the government was also contemplating imposes taxes on unhealthy foods (Hayes, 2014). In response to these forces and pressures, McDonald’s was compelled to review its product offering and make necessary changes. Consequently, in the year 2004, the company expanded its product lines, launching the ‘Salads Plus’. At the same time, the company trained 70,000 of its staff to equip them with the skill and knowledge of preparing and serving healthy meals. On the same note, restaurant managers were trained on ordering and storing raw ingredients (Hayes, 2014). It can correctly be said that these changes were very much in line with the company’s culture, especially on the areas of quality, service, value, and cleanliness.

Role of Leadership in the Company’s Culture and Change

It goes without saying that an organization’s leaders play a vital role in developing and implementing its culture. Likewise, leadership has a special role to play in the change management of any organization. With reference to McDonald’s, there is evidence that senior leaders in this company are at the forefront in strategic change management. Still in regard to the turbulences that the company face in the 2000s, Beech and MacIntosh (2012) disclose that while most of the pressures were emanating from the external environment, McDonald’s faced severe criticism for its leadership or management approach. It is documented that McDonald’s was “criticized severely for its approach to the natural environment [and responded by giving] franchises more freedom to innovate” (Beech & MacIntosh, 2012 p.92). Even with this change, the company still encountered problems. Despite the increased innovation together with freedom that was enjoyed within the restaurants, chief production operations still remained mechanistic.

To avoid further loss of market share as well as decline in stock prices, McDonald’s changed its leadership, appointing a new team of managers. Beech and MacIntosh (2012) state that the new team that was selected was one that was oriented towards an organic structure. The previous structure was abolished and replaced by a decentralized one. In addition, the new managers were given freedom to test new products and ideas on customers, besides being greater responsibility for environment protection and maintaining the company’s image. In short, McDonald’s has reviewed its leadership structure in response to globalization challenges and their impact on the company’s profitability. This makes it clear that leadership plays a key role in the way in which companies manage change.

Public Perception of the Company’s Culture and Its Ability to Change

It is expected that consumers and other stakeholders would be happy with the idea of McDonald’s customizing its product offering to suit local tastes together with preferences. This can be said to be the general response to the company’s culture and change. Nonetheless, some negative perceptions have been documented among members of the public. For instance, an article appearing in the Financial Times reveals that in China, consumers are still skeptical towards the brand; they are yet to be convinced that the company’s supply chain management is effective. Such concerns are reported to have been fuelled by a media report alleging that in 2014, the company sold expired meat to Chinese consumers (Financial Times Reporters, 2015).

The Company’s Digital Footprint

As said earlier, McDonald’s embraces the latest technologies in order to maintain competitive edge. This may be taken to mean that pursuant to its culture of delivering value and quality service to customers, McDonald’s is one of the firms that believe in going digital.


McDonald’s offers a good illustration of the fact that effective change management occurs when companies adopts strategies that align with their culture. To be more precise, responding adequately to environmental changes means that corporate culture must be the focal/reference point for any new ideas and action plans. In light of the truth that globalization heavily impacts today’s business organizations, it may be necessary for firms to review their culture so that any opportunities and threats emanating from market demands are capitalized or addressed properly.


Aswathappa, A. (2006). International business. New Delhi: Tata McGraw-Hill.

Beech, N., & MacIntosh, R. (2012). Managing change: Enquiry and action. Cambridge: Cambridge University Press.

Ferrell, O. C., Fraedrich, J., & Ferrell, L. (2010). Business ethics: Ethical decision making and cases: 2009 update. Mason, OH: South-Western Cengage Learning.

Financial Times Reporters. (2015, January 29). McDonald’s and its challenges worldwide: a market-by-market look. Financial Times. Retrieved from https://www.ft.com/content/f8ac22fc-a7c1-11e4-8e78-00144feab7de

Hayes, J. (2014). Theory and Practice of Change Management. Palgrave Macmillan.

Parker, B. (2005). Introduction to globalization and business: Relationships and responsibilities. London: SAGE.

Synnot, B. (2014). Why change organizations? Bill Synnot.

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