Environmental scan for McDonalds Company Term Paper

Environmental scan for McDonalds Company - Term Paper Example Environmental scan for McDonalds Company This paper seeks to conduct environmental scan for McDonald’s Company and General Motors Company. One of the organization’s internal environmental factors is its human resource strategy that has a specialized training program for its personnel. The company makes significant investments into this initiative to develop a strong human resource base for efficiency and effectiveness towards a quality driven competitive advantage. The company also has acculturated quality production that has established its admiration among consumers who are satisfied with the organization’s products. Similarly, the organization, in its management and operations, is dynamic and flexible to different cultural needs across its diversified market. As a result, the company is able to meet its customers’ needs and expected utility. The organization also operates under strict food safety policy in which raw materials are only accepted into production processes if they meet safety standards (Marketing, 2012). A number of challenges also characterize its internal environment. The company f or example faces a high employee turnover leading to more investment in recruiting and training new employees. Such a high turnover rate also destabilizes implementation of policies and organizational culture that has to be continually reinforced. The organization’s profitability has also been unstable and therefore unpredictable. This means that long-term financial plans cannot be established with certainty because it is difficult to obtain a reliable forecast of the organization’s profitability (Marketing, 2012). External environment External environment refers to factors that emanates from outside the organization and which the organization has no power to control. McDonald’s external environment includes political factors, economic factors, technological elements, socio-cultural aspects, physical environment, and competition among other factors. Political factors define to rules and regulations that control the organization in its operational localities. Bei ng an international organization, McDonald’s is subjected to different local laws and international regulations that shape its operations. As a result, the management should be informed of the laws and political systems in regions where the company’s branches operate. It should also be flexible to adjust to any changes in regional laws that will affect its subsidiaries (Vrontis and Pavlou, 2008). The organization’s economic environment defines demand for its products and trends in consumers’ spending habits. It is therefore susceptible to general economic trends such as recessions, periods within which the consumer’s economic potentials are constrained leading to low demand. Economic recovery periods however improve demand towards higher profitability levels. The company, through its subsidiaries operates under different economic potentials across regions. This affects pricing strategy of the company’s products and defines profitability acro ss different regions. Successful international venture however indicates the company’s success in implementing technology towards communication and coordination of its activities across geographical barriers. Application of technology also explains the organization’s standardization in its subsidiaries such as the franchises. Similarly, social and physical environmental factors are variables across the company’

Implication of the growth of services sectors Essay

Implication of the growth of services sectors - Essay Example rvices based economy revolves around provision of services like transportation, distribution or transfer of goods and money from one point to another. In more concrete terms, the services sector includes things like the provision of insurance, banking, retail operation, information access and entertainment or leisure services. The services sector is strongly linked to the other two sectors, for example, the provision of public utilities like water and electricity is often considered a part of the services sector while the installation, creation and development of means to provide those services come from the industrial economy. Moreover, an industrial economy can only be developed if there is a food surplus in the agricultural sector of the same country. This is the reason that the normal economic progression of a nation might go from a complete dependence on agriculture, to a boost in industry and finally towards a service based economic system. Historically speaking, the UK holds the position of being the first country to develop and exist as a services based economic system (Wikipedia, 2006). While it took the British Empire a few centuries to develop a services economy (helped in no small part by the colonies), modern economies are developing a services sector much faster than England. India for instance, is moving towards a services based economy at a rapid pace while the industrialisation of India is slower than the growth of the services sector (Economist, 2006). However, the UK is much more interested in the services sector since more than 70% of the British economy is based in services which means any dip in the economic indicators there will have a drastic effect on the overall economic conditions of the country (Economist, 2005). Similarly, the growth potential of the economy in the services zone is stunted because marginal growth would not only be difficult, it would also mean that government resources are being utilised inefficiently if the same