This document analyzes McDonald's corporate, international, and business level strategies. It discusses McDonald's use of diversification, vertical integration, and a cost leadership strategy. Strategic issues identified include keeping costs low while improving wages and incentives, adapting to health trends, and over-diversifying their menu. Recommendations include simplifying their menu, improving marketing to millennials, offering customer surveys, adjusting their international strategy, and moving from a pure cost leadership to a blue ocean strategy to improve value creation.

1. McDonald's Corporation
Case Study Analysis
MGT-490-30
Claudia Ron
(Google.com)

2. Introduction
Corporate Strategy:
• High degree of product
diversification with high number
and variety of menu items.
• McDonald's has diverse product
segments and international
markets.
• High degree of vertical integration
in their supply chain.
(Mcdonalds.com)
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3. Introduction
International Strategy:
•Pursues a geographic and product-market
diversification strategy.
• Follows a transnational strategy to combine
global configuration and coordination of
business activities.
•Uses its home-based core competencies of
the main menu and adjusts to match
regional cultures in international markets.
• High degree of geographic diversification
because stores are expanded beyond
national borders.
(GOOGLE.COM)
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4. Introduction
Business-Level Strategy:
•Follows the cost-leadership strategy.
•Firm keeps prices low and creates
similar value for its customers
compared to competitors.
•Using the cost-leadership strategy
helps to minimize costs to offer
products at low prices.
(McDonalds.com)
4

5. Strategic Issues
Cost-Leadership Strategy Issue:
• Keeping costs low and not investing it
for employee wages and incentives.
• Must keep product costs low to out
compete rivals.
• Some franchises might not be able to
match corporate employee
incentives.
(Google.com)

6. Strategic Issues
Health Trends and Product Quality Core
Competencies:
• Lack of core competencies to create a
greater perceived value of McDonald’s
brand.
• Using their internal resources in their R&D
department to keep up with health trends
regionally and globally.
• Combating challenges in their external
environment.
(Google.com)

7. Strategic Issues
BROAD RANGE OF MENU DIVERSIFICATION
•Up to 120 menu items offering too much
diversification.
•Using much more equipment takes more
time to prepare so many items leading to
lack of service expectations and long wait
times.
•Too many items caused issues in order
process, employee stress, and customer
frustrations.
(Google.com)
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8. Recommendation
Recommended Corporate Strategy:
•Simplify menu offerings to make it not
complicated.
•Improve vertical integration strategy with its
marketing to millennials that include items
that are nostalgic.
•Offer surveys with inceptive to improve its
operations and get customer feedback.
(Google.com)
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9. Recommendation
International Strategy Recommendation:
• Adjust transnational strategy to a
multidomestic strategy.
• Focus on local responsiveness and less pressure
for cost reductions.
• Utilize the R&D department for current health
trends in countries it operates in.
• Maintain better product quality from local
sources.
(Google.com)
SAMPLE FOOTER TEXT 9

10. Recommendation
Business Strategy Recommendation:
• Move from cost-leadership strategy to blue
ocean strategy.
• Make investments in employee wage and
incentives.
• Improve better value creation with better
service and differentiation. (GOOGLE.COM)
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