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Mcdonald's Case Study

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McDonalds
Operating System Evolution 1980 - 2003

Introduction
Although McDonald’s production processes continue to evolve, their strategy at a store-level granularity has been to make profit by exploiting their process as best they can to make quality burgers and other food quickly. In order to improve their process and product, they need to look at ways to decrease the lead times, enhance the quality of the product while still empowering employees to quickly prepare the product, and automate process to remove human labor costs (even if that would mean increasing capital labor costs).

Production Process (1980 - 2003)
McDonald’s VS. Burger King Operationally, the McDonalds and Burger King stores are quite similar, however, some …show more content…

Its advantages are clear: (a), it could avoid producing a lot of tension in busy time. (b) The customers do not need to wait for a long time.(c) It could support production continuity. Disadvantages: (a). some events could not be predicted exactly, so some waste may exist. (b) it need extra labor and cost. Make-to-order: is usually used during slow periods. Advantages: (a) have good suitability accounting to the orders. (b) It could reduce the cost of employing extra employees or predicting systems. (c) It could avoid waste. Disadvantages: (a) When the customers or ordered increase, a lot of tension will happen. (b) Customers will wait for a long time in busy time. (c) it is not easy to deal with unforeseen events happened. Cost and Profit As shown in Figure A, McDonald’s and Burger King had similar fluctuation for hourly sales for daily demand. The peak hours are around 1pm and 6pm. To compare the cost and profit, we found McDonald’s was underperforming related to Burger King. The number of customers served and the number of sandwiches sold in June in McDonald’s was almost twice than Burger King’s which due to the extra operating hours and higher sales number at peak time. In Table1&2, we can see McDonald’s had higher efficiency, lower cycle time and higher production than Burger King. In contrast, McDonald’s gained lower margin. We concluded that McDonald had relatively lower margin (Table C) but higher sales volume. The

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