Wek 3 Peer Review

6

McDonald’s New Organic Product Line

May 1, 2017

Petra Yurchich

McDonald’s New Organic Product Line

McDonald’s has been as America’s favorite fast food restaurant for decades. The problem is the stigma that fast food is junk food has turned many people away. In today’s modern world customers have nutritional facts at their fingertips and consumers are more health conscious than ever. We want to introduce McDonald’s new Organic Division. Our vision is to offer great tasting USDA-certified organic options to our customer at a fair price. Our mission statement, “McDonald’s strives to bring new healthy and innovating tastes to our customers while staying true to customer favorites. Our goal is to bring those health-conscious customers back by offering more healthy options while maintaining the taste they have grown to love. The vision, mission statement and company values will guide the division’s strategic direction.

USDA-certified organic and other healthy food products are estimated to reach 1 $trillion in 2017 (Galiardi, 2015). Healthy food options are a huge market and fantastic opportunity for McDonald’s grow revenue. According to recent polls, 88 % of consumers are willing to pay more for healthier food (Galiardi, 2015). Offering USDA-certified organic products will put McDonald’s ahead of the competition. In 2015, McDonald’s reported a 21% decline in quarterly profits (Kell, 2015). In the past McDonald’s biggest competitors where restaurants like Burger King and Wendy’s, but today consumers are turning to healthier fast food options like Chipotle and Panera (Kell, 2015). And although McDonald made a bit of a comeback with its all-day breakfast campaign, it is not enough. McDonald must look to the future and respond to customers’ needs. People are busy and love the convenience of fast food, but also want nutritious food for themselves and their families.

Maintaining a competitive advantage over an extended period is difficult. It takes strong leadership and strategic management. The purpose of strategic management is to direct the company toward overall organization goals and objectives (Dess, Eisner, Lumpkin & McNarara, 2014). Strategic management consists of analysis, decision, and action that create and sustain a competitive advantage (Dess, Eisner, Lumpkin & McNarara, 2014). It is important that employees and managers have the same vision and strive to meet the same goals. The purpose of our vision is to evoke a powerful and compelling mental image of our new organic products. Our goals for this new division must be measurable, specific appropriate, realistic and timely (Dess, Eisner, Lumpkin & McNarara, 2014). The new division will be responsible for creating a cost-effective marketing plan, building customer awareness, presenting product benefits, creating a competitive advantage and sustaining customer satisfaction.

McDonald’s takes immense pride in its values and culture. “From the start, we've been committed to doing the right thing. And every day, all around the globe, we put people, processes and practices into place to make quality food, more responsible sourcing choices, a stronger community and a better planet. ("Values In Action", n.d.). “Investing in organic products is not only good for our consumers, but for our local economy and environment. Culture sets standards for acceptable behavior and can lead to greater employee engagement and provides a common purpose (Dess, Eisner, Lumpkin & McNarara, 2014).

There are many benefits to eating organic food, such as better mental and emotional health ("Organic Foods: What You Need To Know," n.d.). The first line of organic products offered will be organic burgers, fries, milk, and juice. But we don’t want to stop there. Looking to the future, we plan on offering organic options for all customers’ favorites, such as chicken nuggets, chicken sandwiches, smoothies and organic breakfast choices. McDonald’s will invest in purchasing organic produce grown without the use of synthetic pesticides, bioengineered genes, petroleum-based fertilizers and sewage sludge-based fertilizers ("Organic Foods: What You Need To Know," n.d.). Organic livestock is animals that are raised outdoors and given organic feed and are not given antibiotics, growth hormones or any animal by-products ("Organic Foods: What You Need To Know," n.d.). Organic farming is not only better for McDonald’s customers it is also better for the environment. Creating a new organic line of products goes along with McDonald’s vision, mission, culture, and values. McDonald’s has a social and ethically responsibility to provide quality products to their customers.

McDonald’s stands by simple guiding principles. McDonald’s believes that the best customer experience comes from the best employee experience ("Guiding Principles," n.d.). A top priority will be education our employees on our new organic products. Education will include how to cook, handle and sell these new products. Employees will be encouraged to share their ideas and provide feedback about our new organic line. “McDonald’s success is dependent upon the creativity, competence, and leadership of our people. Therefore, we are committed to the personal and professional growth of our employees ("Guiding Principles," n.d.)”. It is important that are employees feel valued and an integral part of the team. Our employees are our front line, and if they believe in our product, that message will carry over to our customers.

Conclusion

McDonald’s has struggled with the stigma of being junk food, resulting in a loss of health-conscious customers. McDonald’s is introducing a new Organic Division with the goal of creating innovative and healthier products at a fair price while staying faithful to customer favorites. The vision, mission statement, values, and cultures are in line with the division's strategic direction. Maintaining a competitive advantage is the key to McDonald’s continued success. Strategic management will move the company and its employees toward the organization goals and objectives.

References

Dess, G., Eisner, A., Lumpkin, G &  McNamara,G. (2014). Strategic Managment (7th ed.).

Retrieved from The University of Phoenix eBook Collection database.

Galiardi, N. (2015). Consumers Want Healthy Foods--And Will Pay More For Them. Retrieved

from https://www.forbes.com/sites/nancygagliardi/2015/02/18/consumers-want-healthy-foods-and-will-pay-more-for-them/#11e5728e75c5

Guiding Principles. (n.d.). Retrieved from http://www.macpride.net/about-us/guiding-principles/

Kell, J. (2015). McDonald’s U.S. sales drop for fifth consecutive quarter. Retrieved from

http://fortune.com/2015/01/23/mcdonalds-us-sales-slide/

Organic Foods: What You Need to Know. (n.d.). Retrieved from

https://helpguide.org/articles/healthy-eating/organic-foods.htm

Values in Action. (n.d.). Retrieved from https://www.mcdonalds.com/us/en-us/about-us/values- in- action.html