Globalization of Mcdonald"S on China

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Globalization of McDonald’s in China

Executive Summary

McDonald’s is one the largest fastest growing fast-food restaurant in the world. McDonald’s have become a household name across the world. The fast food giant has come a long way from being just a burger stand in San Bernardino, California in 1940. The original owners were two brothers, Richard and Maurice McDonald. The hot dog stand evolved into a restaurant offering 25 items on the menu. In 1947, Richard and Maurice (going forward the “McDonald Brothers”) decided to shutdown the restaurant to renovate to improve the business. The McDonald Brothers wanted to meet the demands of their customers, young and on the move. The idea was to create a Speedee Service Systems, known today as Fast-Food. These brothers had no Idea the level of success that was to come, but they knew what they had was great. In 1953, based off the practices of White Castle, the McDonald Brothers decided to franchise their successful restaurant. Always looking for ways to improve, in 1954, the McDonald Brothers came in contact with Ray Kroc, a Multimixer milkshake machine salesman. They wanted a milkshake machine that could make more than one shake at time. Ray Kroc noticed the success of this restaurant and wanted to seize the opportunity to become a part of this great franchised organization. Ray Kroc took McDonald’s to Des Plaines, IL and began opening new restaurants all over Illinois. Today, McDonald’s touches lives every day all around the world. Now in 2011, McDonald’s has over 32,000 restaurants worldwide and are in over 119 countries. McDonalds has saturated the U.S. with restaurants and maximized their growth opportunities. It is important for McDonalds as a company to pursue globalization investments. China is one country that has been great for McDonalds but challenging as well. China is the largest populated state in the world with over 1.3 billion people. China is the fastest growing major economy and also the second largest importer in the world. China is one country that is critical for McDonald’s to nestle in and grab a stable market share of the fast-food industry there.

In China, McDonald’s have encountered a few challenges that have hindered their progress. Globalization in China has proven to be one of the most difficult challenges. In China McDonald’s is a symbol of westernized way of living. The Chinese people are very traditional and loyal to its heritage. Many in China see McDonald’s as an invasion of their culture. McDonalds in China must make an effort to blend in with the culture and not seem like the great westernization invasion. Through a more diversified menu, McDonalds can begin creating that seemless culture transition. McDonalds must become more creative with their menu in China. Diversifying their menu is another challenge McDonalds must overcome in China. Not only is the customer perception and liking a great challenge for McDonalds but the way of doing business in China has presented yet another challenge. McDonalds has designed a very detailed processes and unique procedures to maintain quality control and food safety. Unlike in the U.S., where the government has an entire department to make sure manufactures and restaurants are all following the same guidelines, China has no such department. McDonalds as a company must take additional steps to ensure their product is as safe to eat as possible.

Summary of findings/results –In China, the name McDonalds mean more to them then it could ever mean to an American. McDonalds in China is not just a restaurants but a life style. The idea of McDonalds designing a menu that is to the Chinese people liking may prove to be challenging. However, McDonalds efforts will give the illusion of blending in with the culture, which is key to their success in China. Through the gathering of data through the internet, print text, and organizational behavior course text, I would advise...
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