Mcdonald's Resources and Capabilities

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What are the particular resources and capabilities that McDonalds has been relying upon for its recent turnaround? After longstanding growth within the fast food industry, McDonald's began to experience a decline in their annual earnings in the late 90's. Prior to the decline, McDonald's was a segment leader within the fast food industry and was widely recognized for its outstanding service and quality. Once known as the benchmark company by industry insiders, McDonald's began to lose sight of their strategic vision, which, was to provide the "world’s best quick service restaurant experience". In order to improve their financial performance and once again satisfy their customer base, McDonald's chose not to emulate their competitors. Instead, they chose to use their existing resources and capabilities to identify emerging asymmetries during the turnaround around between 2003 and 2007. By using a combination of their current infrastructure, human capital, marketing capabilities and new product introductions, the management team was once again able to pursue market opportunities that built on these leveraged capabilities. One of the first resources used to initiate their turnaround was the infrastructure of their current restaurant base. After realizing that rapid franchise growth was providing stagnant returns and substandard performance as well as jeopardizing their customer’s restaurant experience due to poor food quality and service, the company decided to focus on generating sales from its existing outlets and revamping the outdated look of their older restaurants. Revamping and remodeling the inside to fit within today’s culture allowed McDonald’s to be more inline with savvier consumer tastes and trends. Another way McDonald's was able to increase sales in these newly decorated restaurants was to introduce new products that matched the cultural trends such as premium coffee as well as adding several stores which had bakeries. While many of the prior...
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