Beruflich Dokumente
Kultur Dokumente
Is the leading global foodservice retailer with more than 30,000 local restaurants
serving 52 million people in more than 100 countries each day. More than 70% of
McDonald's restaurants worldwide are owned and operated by independent local men
and women
Is one of the world's most well-known and valuable brands and holds a leading share
in the globally branded quick service restaurant segment of the informal eating-out
market in virtually every country in which we do business.
Serves the world some of its favorite foods - World Famous French Fries, Big Mac,
Quarter Pounder, Chicken McNuggets and Egg McMuffin.
Our rich history began with our founder, Ray Kroc. The strong foundation that he
built continues today with McDonald's vision and the commitment of our talented
executives to keep the shine on McDonald's arches for years to come. To read more
about McDonald's history, vision and executives, click on their links in the left menu.
The business began in 1940, with a restaurant opened by siblings Dick and Mac
McDonald in San Bernardino, California. Their introduction of the "Speedee Service
System" in 1948 established the principles of the modern fast-food restaurant. The
present corporation dates its founding to the opening of a franchised restaurant by Ray
Kroc, in Des Plaines, Illinois on April 15, 1955, the ninth McDonald's restaurant
overall. Kroc later purchased the McDonald brothers' equity in the company and led
its worldwide expansion.
With the successful expansion of McDonald's into many international markets, the
company has become a symbol of globalization and the spread of the American way
of life. Its prominence has also made it a frequent topic of public debates about
obesity, corporate ethics and consumer responsibility.
1
Products
MCDONALDS IN INDIA
McDonald's opened its doors in India in October 1996. Ever since then, our family
restaurants in Mumbai, Delhi, Pune, Ahmedabad, Vadodara, Ludhiana, Jaipur,
Noida Faridabad, Doraha, Manesar and Gurgaon have proceeded to demonstrate,
much to the delight of all our customers, what the McDonald's experience is all
about.
Our first restaurant opened on 15th April 1955 in Des Plaines, Illinois, U.S.A.
Almost 50 years down the line, we are the world's largest food service system with
more than 30,000 restaurants in 100 countries, serving more than 46 million
customers every day. Click here for more information on the history of
McDonald’s.
2
What is supply chain management
The definition one American professional association put forward is that Supply
Chain Management encompasses the planning and management of all activities
involved in sourcing, procurement, conversion, and logistics management activities.
Importantly, it also includes coordination and collaboration with channel partners,
which can be suppliers, intermediaries, third-party service providers, and customers.
In essence, Supply Chain Management integrates supply and demand management
within and across companies. More recently, the loosely coupled, self-organizing
network of businesses that cooperates to provide product and service offerings has
been called the extended enterprise.[1]
Some experts distinguish Supply Chain Management and logistics, while others
consider the terms to be interchangeable.
3
Supply chain management at MCDONALDS
Organizations increasingly find that they must rely on effective supply chains, or
networks, to successfully compete in the global market and networked economy.[2]
In Peter Drucker's (1998) management's new paradigms, this concept of business
relationships extends beyond traditional enterprise boundaries and seeks to organize
entire business processes throughout a value chain of multiple companies.
In the 21st century, there have been a few changes in business environment that
have contributed to the development of supply chain networks. First, as an outcome
of globalization and the proliferation of multi-national companies, joint ventures,
strategic alliances and business partnerships, there were found to be significant
success factors, following the earlier "Just-In-Time", "Lean Management" and
"Agile Manufacturing" practices.[3] Second, technological changes, particularly the
dramatic fall in information communication costs, which are a paramount
component of transaction costs, have led to changes in coordination among the
members of the supply chain network (Coase, 1998).
Many researchers have recognized these kinds of supply network structures as a new
organization form, using terms such as "Keiretsu", "Extended Enterprise", "Virtual
4
Corporation", Global Production Network", and "Next Generation Manufacturing
System".[4] In general, such a structure can be defined as "a group of semi-
independent organizations, each with their capabilities, which collaborate in ever-
changing constellations to serve one or more markets in order to achieve some
business goal specific to that collaboration" (Akkermans, 2001).
One could suggest other key critical supply business processes combining these
processes stated by Lambert such as:
5
a) Customer service management process
b) Procurement process
Strategic plans are developed with suppliers to support the manufacturing flow
management process and development of new products. In firms where operations
extend globally, sourcing should be managed on a global basis. The desired outcome
is a win-win relationship, where both parties benefit, and reduction times in the
design cycle and product development are achieved. Also, the purchasing function
develops rapid communication systems, such as electronic data interchange (EDI)
and Internet linkages to transfer possible requirements more rapidly. Activities
related to obtaining products and materials from outside suppliers requires
performing resource planning, supply sourcing, negotiation, order placement,
inbound transportation, storage, handling and quality assurance, many of which
include the responsibility to coordinate with suppliers in scheduling, supply
continuity, hedging, and research into new sources or programmes.
Here, customers and suppliers must be united into the product development process,
thus to reduce time to market. As product life cycles shorten, the appropriate
products must be developed and successfully launched in ever shorter time-
6
schedules to remain competitive. According to Lambert and Cooper (2000),
managers of the product development and commercialization process must:
e) Physical distribution
f) Outsourcing / partnerships
This is not just outsourcing the procurement of materials and components, but also
outsourcing of services that traditionally have been provided in-house. The logic of
this trend is that the company will increasingly focus on those activities in the value
chain where it has a distinctive advantage and everything else it will outsource. This
7
movement has been particularly evident in logistics where the provision of transport,
warehousing and inventory control is increasingly subcontracted to specialists or
logistics partners. Also, to manage and control this network of partners and suppliers
requires a blend of both central and local involvement. Hence, strategic decisions
need to be taken centrally with the monitoring and control of supplier performance
and day-to-day liaison with logistics partners being best managed at a local level.
g) Performance measurement
Experts found a strong relationship from the largest arcs of supplier and customer
integration to market share and profitability. By taking advantage of supplier
capabilities and emphasizing a long-term supply chain perspective in customer
relationships can be both correlated with firm performance. As logistics competency
becomes a more critical factor in creating and maintaining competitive advantage,
logistics measurement becomes increasingly important because the difference
between profitable and unprofitable operations becomes more narrow. A.T. Kearney
Consultants (1985) noted that firms engaging in comprehensive performance
measurement realized improvements in overall productivity. According to experts
internal measures are generally collected and analyzed by the firm including
• Cost
• Customer Service
• Productivity measures
• Asset measurement, and
• Quality.
8
Supply chain management components integration
The SCM components are the third element of the four-square circulation
framework. The level of integration and management of a business process link is a
function of the number and level, ranging from low to high, of components added to
the link (Ellram and Cooper, 1990; Houlihan, 1985). Consequently, adding more
management components or increasing the level of each component can increase the
level of integration of the business process link. The literature on business process
reengineering,[5] buyer-supplier relationships,[6] and SCM[7] suggests various possible
components that must receive managerial attention when managing supply
relationships. Lambert and Cooper (2000) identified the following components
which are:
10
5. For outsourcing: Includes the primary level component of management
methods, and the strategic objectives for particular initiatives in key areas of
information technology, operations, manufacturing capabilities, and logistics
(secondary level components).
11
Traditional and Supply Chain Management Approaches Compared
______________________________________________________________
Approach
Element Traditional Supply Chain
Inventory management Independent efforts Joint reduction in
approach: channel inventories
Total cost approach: Minimize firm costs Channel-wide cost
efficiencies
Time horizon: Short-term Long-term
Amount of information Limited to needs of As required for
sharing and current transaction planning and
monitoring: monitoring processes
Amount of coordination Single contact for the Multiple contacts
of multiple levels in the transaction between between levels in firms
channel: channel pairs and levels of channel
Joint planning Transaction-based Ongoing
Compatibility of Not relevant Compatible at least for
corporate philosophies: key relationships
Breadth of supplier Large to increase Small to increase
base: competition and spread coordination
risk
Channel leadership: Not needed Needed for coordination
focus
Amount of sharing of Each on its own Risks and rewards
risks and rewards: shared over the long-
term
Speed of operations, “Warehouse” “Distribution Center”
information and orientation (storage, orientation (inventory
inventory flows: safety stock) interrupted velocity)
by barriers to flows; interconnecting flows;
Localize to channel JIT; Quick Response
pairs across the channel.
12
Supply chain management at McDonalds (India)
Did you know that every year, Rs. 50,000 crore worth of food produce is wasted in
India? This is mainly because of the lack of proper infrastructure for storage and
transportation under controlled conditions. McDonald's is committed to providing
quality products while supporting other Indian businesses. And so, we spent a few
years setting up a unique Supply Chain, even before we opened our first restaurant
in India.
When there is a balance in the finished product ordering, the Supply Chain operates
at its best. Any major fluctuation in the product ordering pattern causes excess /
fluctuating inventories, shortages / stock outs, longer lead times, higher
transportation and manufacturing costs, and mistrust between supply chain partners.
This is called the Bullwhip Effect.
Depending on the situation, the Supply Chain may include major product elements,
various suppliers, geographically dispersed activities, and both upstream and
downstream activities. It is critical to go beyond one’s immediate suppliers and
customers to encompass the entire chain, since hidden value often emerges once the
entire chain is visualized. For example, a diesel engine manufacturer may be able to
integrate a GPS locator system into its engine control system. Its immediate
customer, a heavy truck manufacturer, may see no need for this functionality.
However, the downstream customer, a trucking company with a large fleet, may be
very interested in a locator system. Understanding the value to the downstream
customer is part of the supply chain management process.
13
Supply Chain Management Problems
Activities / functions
14
or more cost effectively. The effect is to increase the number of organizations
involved in satisfying customer demand, while reducing management control of
daily logistics operations. Less control and more supply chain partners led to the
creation of supply chain management concepts. The purpose of supply chain
management is to improve trust and collaboration among supply chain partners, thus
improving inventory visibility and improving inventory velocity.
Strategic
Tactical
15
Operational
• Daily production and distribution planning, including all nodes in the supply
chain.
• Production scheduling for each manufacturing facility in the supply chain
(minute by minute).
• Demand planning and forecasting, coordinating the demand forecast of all
customers and sharing the forecast with all suppliers.
• Sourcing planning, including current inventory and forecast demand, in
collaboration with all suppliers.
• Inbound operations, including transportation from suppliers and receiving
inventory.
Make Buy
• Manufacturers produce in house • Manufacturers outsource
• Cost of acquisition > cost of • Cost of manufacture > cost of
manufacture acquisition
• Company has the capacity to • Company cannot afford to block
invest huge capital
• Company has no plans to divest • Company plans to divest and focus
or focus to core competencies on core competencies
• L & T forges ahead into LTITL • SBI out sources its 17 functions
• Requires 5 M's • Not Required
- Men
- Material
- Machinery
- Method
- Money
• When secrecy in involved • No secrecy involved
16
Findings of study
Every organization, no matter how big or small in size , has its own forecasting
techniques. This is because without forecasting the demand and supply
requirements, the orders can’t be fulfilled. Similarly, for order processing, Mc
Donald’s forecast its requirements on a daily basis.
The study that we did in Indore, where there are three outlets of Mc Donald’s,
each one in a multiplex, revealed that their forecasting depends on a few
factors like the upcoming movie release in that week and its response.
17
Radhakrishna Foodland had been working with Mc Donald’s for the past ten
years and the terms & conditions for choosing the network design was
decided by the headquarters of Mc Donald’s itself. The food items are
transported via air conditioned trucks having different chambers. Each
chamber is designed for the different kind of stock at different temperature
levels, as per the suitability and requirements of the stock. All the raw
material comes in a frozen form. The trucks have pre-defined destinations to
reach each day. The sources at Mc Donald’s told us that the trucks from
Mumbai reach Indore on Monday, Pune on Tuesday, Hyderabad on
Wednesday and so on at Bangalore and Gujarat too.
The items which are to be procured from foreign territories comes to India
via ships, like the french fries are obtained from new Zealand via shipments.
They do assess their daily requirements via safety checklists. The rounding
and scheduling of ouput and input is done manually and through computer
based software’s too.
With the evolvement of the new technologies and convenient softwares, the
conventional methods of maintaining suplly chain records are now a passe`.
Mc Donald’s too use a standardized visual FoxPro based program via which
the outlets are linked with the head office and the Radhakrishna Foodland
too.
Mc Donald’s believe in the saying "Customer is the King" and thus the
complaints , if any, from the customers end are duly heard and resolved as
per the need of the situation.
18
BIBLOGRAPHY
www.scribd.com
www.managementguru.com
www.wikipedia.com
19