Operations and outbound logistic help
McDonald contain cost because these to
activities go hand in hand, the both of them use
the help the firm stay on top of what they spend. Operations make sure that the employees are happy as well
as keeping both the workstation and cold station temperatures adjusted
accordingly. Outbound focuses on quality control and keeping the trucks in good
working order.

Service and inbound logistics will probably provide the most value
for the customer. Service because it provides Mac
delivery, operation hours from 11 am to
1 am, birthday parties, free Wi-Fi, and service of fast food. Inbound logistics is very valuable to the customer because McDonald received a lot of fresh food instead of frozen products.

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Support activities are firm infrastructure
because over time McDonald has changed
their look by giving all stores a facelift
to modernize.  Also, HRM plays a huge
role in the support because it can give flexible hours, add incentive for
holiday pay, determine salary and award vacation days, as well as coordinate
benefits. Technology is the leader in all successful businesses because there
is always constant change in software. The upgrade of headsets and the just in
time delivery has been a huge success for the firm. Procurement helps them to
stay in and give guidance through the franchise agreement, and the farmer’s

The value chain for McDonald’s consist of
the primary activities and the support activities. The primary activities are
inbound logistic, operation, outbound logistic, marketing and sales, and
service. The support activities are firm infrastructure, HRM, technology
development and procurement. Inbound logistic is where McDonald purchase most of
their products fresh. McDonald’s make sure that the temperatures of the
workstations are adjusted according to outside temperatures which is part of
the operation. Outbound logistics play a role in
making sure the freight trucks are inspected, quality control, random audits
are conducted. Marketing and sales are done by giving kids books with their
happy meal, offering birthday parties. Service
is important to McDonald’s because they have the Mac delivery service, long operating hours, information on parties
in advance, free Wi-Fi and the opportunity to receive the food at a fast pace
(Nisam, n.d.).


It is in the best interest of the company
to study the internal resources, activities of a firm, and capabilities. This
is imperative because it gives the firm the opportunity to evaluate their core
capabilities and see what their strongest and weakest points are. The use of
the internal resources give the company
an edge to build on and extend on products
or services and add value. Recognizing that the firm’s structure is in the
culture and routine (Rothaermel, 2017).

Question 4.1.

The high-end
clothing giants such as David’s bridal a 60-year-old
wedding apparel and accessories saw a dip
in sales in 2017 mainly because of a website redesign. Nine West, J. Crew, Sears, Neiman Marcus, Eddie Baur
and Vince all showed losses during the financial meeting in Washington D.C. (Unglesbee, 2017).  It is not cleared stated why these giants
struggled to keep their competitive advantage, but one might assume that it is
because of online giants such as Amazon, Aliexpress, and others that sell at discounted price. This is an example of the
strongest force the buyer’s power because
it either forces companies out of business or causes them to lower their price.
All of the forces are gaged towards competition.

The threat of entrant sends a threat to
the industry by either additional capacity or additional competitors. Each one
forces an organization to either drop their prices or spend more money to keep
the customers happy (Rothaermel, 2017). Bargaining power of suppliers causes a reduction in the firm’s ability to
have a superior performance because they
can raise the price of production, and reduce the profit potential (p.75). On
the other hand, the bargaining power of
the buyers can either demand a lower price or a better quality. The buyer’s power lie
in the hand of the consumers, but more significantly in the hands of larger
industries. The threat of substitutes gives hope that outside products or
services might meet the same satisfaction as the current industry. This force
is a threat because it reduces industry profit by limiting the price that can
be charged for the products and services (p.82).   Rivalry among existing competitors places a
threat because it creates a competitive industry structure, such as perfect competition, monopolistic
competition, Oligopoly, and monopoly. Organizations must be aware of exit
barriers too when dealing with rivalry
among existing competitors.

            Porter’s explanation of the broad
competitive force sheds some light on the fact that being competitive is not
always a forceful factor. It is in the best interest of the business to
understand the five forces and how it could affect the business. The five
forces are rivalry among existing competitors, bargaining power of suppliers,
the threat of substitute products or
services, bargaining power of buyers, and the threat
of entrant.

Question 3.2

is very important that all organizations pay close attention and understand the
power of external environment. The external environment has a lot of forces that can impact the organization. The forces
such as politics, economic, sociocultural, legal factors and ecological, all
which are consider demand shifters. All of the above could affect the income,
the prices of content and substance, the customer’s preference, and
expectations; all causing a decrease in the demand for products or services
(Rothaermel, 2017). If an organization want to keep a competitive advantage,
they must understand and be aware of the importance and threats to the environment that they are surrounded.

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