GB570 Managing the Value Chain : Value Chain Analysis - Kaplan University

Name: GB570 Managing the Value Chain : Value Chain Analysis - Kaplan University
Brand: Kaplan University School of Business and Management
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Author: Julian Cooper

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VALUE CHAIN ANALYSIS 1
Value Chain Analysis
Unit 4Individual Project Assignment
Paige Harward
GB570 Managing the Value Chain
Professor Jerry Haenisch
Kaplan University
In your analysis of McDonald's value chain, how does the company integrate its demand chain,
supply chain, and value drivers to maintain its competitive advantage and ensure customer
satisfaction? Provide a detailed response (750–1000 words).

VALUE CHAIN ANALYSIS 2
Value Chain Analysis
Since 1955, McDonald’s has opened 34,000 outlets, employs 1.8 million people, and
serves 69 million people a day on average in 118 countries. McDonald’s Corporation (NYSE:
MCD) is headquartered in the United States and was originally owned by Richard and Maurice
McDonald and business partner Ray Kroc.
All McDonald’s restaurants have the option to be franchised, affiliates or owned by the
corporation. Revenues come from the franchised restaurants by way of rent, royalties, and sales.
McDonald’s revenues have increased from 22.7 billion dollars in 2009 to 27.6 billion in 2012.
With the increase in demand, it is assumed that McDonald’s will continue to increase revenue
over the next 5 years. (Value chain and competitive, 2012)
Demand Chain Analysis
The demand chain consists of three parts, marketing, sales and service. McDonald’s has
had to consider how to create a demand for their product that is not available anywhere else.
With this in mind, they have identified the customer and market wants and needs. They have also
done a market opportunity analysis and identified value drivers.
In this they have discovered the consumer wants a laid back atmosphere in a fast past
world. The consumer also wants healthier food in a pretty package. In addition to the consumer
wants, according the market analysis, McDonald’s has the opportunity to add convenience to an
economy that needs them. The company has also discovered how to drive value by retaining and
maintaining employees as well as continuously analyzing data with a state of the art database.

VALUE CHAIN ANALYSIS 3
Identification of Customer, Market, Wants and Needs
Over the years, McDonald’s has identified several wants and needs of the consumer.
They have tried to maintain this through services such as free Wi-Fi and “Arch Cards”. Free Wi-
Fi turns the fast food atmosphere into more of a laid back café style. To go along with the Wi-Fi,
they also started the McCafe brand of coffees and lattes in 2008. McDonald’s also has gift cards,
Arch Card, that are pre-paid and come in several denominations to allow them to be given as
gifts and used through the drive-through.
McDonald’s has also recognized consumer wants for healthier food and odd hours. MCD
has begun to change their food brands to offer healthier choices such as, grilled chicken
sandwiches, yogurt parfaits, and apple snacks in the kids meals. They are now open 24 hours in
many locations offering a midnight menu with smaller, cheaper options. (Value chain and
competitive, 2012)
Market Opportunity Analysis
MCD has taken the time to look at the current food trends. They have begun to see that
while what the consumer wants is quality food at a reasonable price. They are noticing a trend in
society in which the consumer no longer wants to eat just to survive, they want to consume for
enjoyment. This means the consumer is looking at prices, convenience, and value. The consumer
wants to know where their food came from. Taking this into consideration they have created a
sustainability supply chain.(Sustainable supply chain, 2011)

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Kaplan University School of Business and Management

Subject

Business Management

GB570 Managing the Value Chain : Value Chain Analysis - Kaplan University

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