MIS 712 E Business Strategies

Explain the supply chain processes of similar real-life firms, so that students get an idea of the type of supply chain partners involved and the processes they engage in for value creation in the supply chain.

Imagine you are running a small or mid-size business that is involved with exports or imports of raw materials or finished products. You can be a manufacturer, distributer, or wholesaler.

McDonalds Australia is the company that deals with delivering the fast food products to the customers. the food products that the company deals with are burgers, Mcpuff, Salads, beverages, shakes etc. as the company operates at global level thus it is required to maintain a great supply chain in order to have better delivery services. It has been analysed that McDonalds Australia has a very unique supply chain structure that solely depends on partnership and collaboration. McDonalds Australia believes in maintaining sustainability and thus it is required by the company to practice such activities that provide benefits to the company as well as its partners (Nadolny and Ryan, 2015). The company has to use ethical activities and practices in order to source the materials for manufacturing the products.

Structure of supply chain management

These are the elements that are involved in the supply chain system of the company called McDonalds Australia. It has been analysed that the company consists of two types of suppliers that is tier 1 supplier and tier 2 suppliers. Tier 1 suppliers are the suppliers that provides the processed products to the company such as chicken, bread, vegetables etc. on the other hand the tier 2 suppliers are those who grow the products or the materials required to be processed such potatoes, poultry items etc (Goulding and Lim, 2014). Both these suppliers need to meet out the requirements of the quality products by the company. The materials from the suppliers are shipped to the distribution centre through logistic facilities of the company. These are inbound transportation facility that supports these shipments. As per the requirements of the restaurant, the material is distributed by the outbound transportation system from the distribution centre to the restaurants. The refrigerated fleet trucks are used to transport the material from one place to another so that they can be kept in the required favourable temperature (Anaf, Baum, Fisher, Harris and Friel, 2017).

As per the supply chain analysis of McDonalds Australia is considered. It has been analysed that the proper flow of information and materials are being maintained between the different intermediaries taking part in the system. It has been analysed that two types of suppliers’ are involved and two types of transportation system are also there in order to transport the material from one place to another (Zhu, Anagondahalli and Zhang, 2017). In order to timely deliver the products, the company manage the accounts by the distribution centre, these centres are not owned by the companies and they act as the partners. The babe supply chain that has been analysed is not for all the materials that have been served by the company or supplier to the company. This is because the material like Coke is directly suppliers by the manufacturer to the company and thus no intermediaries of the company are involved in that. The above supply chain also discusses about the reverse logistic hat deals with transporting the materials that are used by the company such as plastic crates that needs to be reached back to the suppliers so that the next delivery can be transported to the company in those crates (Christopher, 2016).

Sustainability in supply chain:

The company believes that they have responsibilities towards their suppliers and the community in three areas such as

• Economic
• Ethical
• Environmental

Economic: McDonalds Australia prefers to support the partners and suppliers from Australia. The company tries to source the products and the materials from Australia itself. It has been analysed that McDonalds Australia has 94% of its functions of manufacturing and packaging done in Australia only (Gil, et al, 2010). McDonalds Australia does not own any of the particular business to provide them materials but the company maintain long term relationship with the suppliers such as Inghams and Quality bakers since many years.

Ethical: the company knows that only maintain the relationship and providing profits is not enough. It is requited to e ethical in the practices so as to be sustainable. The company runs social responsibility suppliers program. It is the program that deals with maintaining the workplace safety environment and providing rights to the owners and the suppliers.

Environmental: the company only deals with the suppliers who provide them with quality products so that they can reduce the impact of environment by their practices (Stadtler, 2015). The company use the scoreboard practices to rate the suppliers on the environmental performance of the supplier.

Type of partners involved:

There are many types of partners involved in the supply chain system of the company. It has been analysed that different intermediaries are included in the whole supply chain that supports the process of transportation of the material from one place to another. The major key partners that are involved in the supply chain are suppliers, transporters, distribution centres and the customers (Carter and Liane Easton,2011).  Two of them are upstream partners and there are downstream partners. It has been analysed that upstream partners are those partners or intermediaries who are in opposition of the flow of material. Some of the major key partners and the relationship of the partners with the company are discussed below:

1. Suppliers: Suppers are the one who supplies the materials or the processed material towards the distribution centre. In the above case there are two types of suppliers such as 1 tire suppliers and 2 tire suppliers. It has been analysed that 1 tire suppliers are the suppliers who provides the materials that are processed while the 2 tire suppliers provides the material that are grown on the field by them (Gualandris, Klassen, Vachon and Kalchschmidt, 2015). It has been identified that the company does not have any self-owned company that provides the materials but depends in different suppliers for sourcing the raw material. The company believes in maintaining long term relationships with their suppliers. There are many suppliers in Australia on which McDonalds Australia depends on. OSI is the supply partner for the company in order to supply chicken, beef and fish, Australian Food Corporation provides beef to the company, Simplot, McCain, Fonterra also provides various bread products, fries, buns etc.  
2. Distribution centres: These are the major partners of the company as most of the process of the company is done here. Any issue at the distribution centre can affect the delivery time of the products at the final destination that are the restaurants. It has been analysed that distribution centre act as the partners for the company but are not owned by the company (Hamprecht, Corsten, Noll and Meier, 2005). The approach of the company towards its distribution centres is very positive and this helps the company to have timely delivery of the products always. Although, the distribution centres are not owned by the company but the company have partial control over the operations. The company maintains an informal relationship with the distribution centres but the relationship sis maintained in ethical manner. The administration of the company aims at maintains the balance between the distribution centre delivery and the requirements of the products at the restaurants so that the customers can get better quality products on time. In the whole process, it has been analysed that the company has lesser role to manage the materials but the distribution centres are majorly responsible for the same.
3. Customers: customers are the major part of the key partners that are involved the supply chain system. This is because they are the one for whom this whole process is developed. Supply chain management system starts with suppliers from the one end and stops to the customers on another (Li, Ragu-Nathan, Ragu-Nathan and Rao, 2006). It has been analysed that McDonalds Australia target almost all the customers from kids to adults, from males to females, from high class to lower class people. It has been analysed that the customers can get the food products by two ways. Either the customers can visit the store or the restaurant to get the taste of the mouth eatery food products or they can use the facility of take away (Sheffi and Rice Jr, 2005). There is one more medium these days by which the okay can reach its customers that are through online ordering system. The company has started that system on the company website and the customers can order to order food online to get it delivered to their home.

Value chain diagram of McDonalds Australia:

Value chain analysis of the company deals with analysing the business activities of the company in order to identify the competitive advantage of the firm. Following is the discussion about the value chain analysis of McDonalds Australia:

Primary activities:

Inbound logistics: it is the process of value chain system that involves the supply of the materials from the suppliers to the distribution centre. It is logistic system that involves the transportation of the raw materials from the 1 tier and 2 tier suppliers to the distribution centre of the company. The fleet trucks or the refrigerated trucks are being used in this process so as to transport the materials with favourable temperature.

Operations: The major operations of the company involve the restaurant business that involves the food delivery and serves services at the store. It is the company that operates on the model of franchise. There are different operation of the company among which own of them is supply chain management (McDonald's AU.,2017). The company is very sustainable in terms of supply chain system. It has been analysed that there are three types of franchise on which the McDonalds Australia works. One of them is conventional franchise, developmental franchise and affiliates.

Outbound logistics: This is also the function that deals with transportation of the material from the distribution centre to the store or the restaurants from where the customers can have the food. The transportation also involves the food delivery system from the restaurant to the customers. All these activities of logistics fall under the category of outbound logistics.

Marketing and sales: It has been analysed that McDonalds Australia use almost all the medium to market its products. The company use advertising techniques, promotional campaigns, offers and discounts etc. to market the products. As far as the sales of the product are considered, the company make its sales through store, through drive thru facility for take way and for home delivery services. All these methods allow the company to make the sales high.

Services: as far as the services of the company is considered, it has been analysed that McDonalds Australia serves the market with many food products such as burgers, fries, shakes, coke etc. the company serves the customers through take away, home delivery and in store sales.

Support activities:

Firm infrastructure: the infrastructure of the company is very much sophisticated can be liked by kids as well as adults. The company is highly technologically advanced and thus provides the online services as well (McDonald's AU.,2017).

Human resource management: The HRM of the company is very well managed. The sakes staff of the dire are educated enough about the products and the services that the company offers.

Technology development: McDonalds Australia always focuses on maintaining the process with technological updates. It has been analysed that the company is doing great in terms of technology is updating its processes accordingly.

Procurement: McDonalds Australia uses the E-procurement method which supports its supply chain management system. The procurement system for the company is so efficient that it provides support to all the logistic as well as other functions of the company.

Recommendations:

It has been recommended to the company:

• The supply chain should involve better technologies to make the process fast.
• International supplies should be cut down and local suppliers should be contacted to have the raw materials.

Conclusion:

It has been concluded from the report that McDonalds is the company that serves the customers with various fast food products. The company is very specific with the quality ns thus require raw material from different places. They require the company to maintain a proper supply chain that helps the company to complete the process of raw material to processing and make finish products in order to serve the customers.

References:

Anaf, J., Baum, F.E., Fisher, M., Harris, E. and Friel, S., 2017. Assessing the health impact of transnational corporations: a case study on McDonald’s Australia. Globalization and health, 13(1), p.7.

Carter, C.R. and Liane Easton, P., 2011. Sustainable supply chain management: evolution and future directions. International journal of physical distribution & logistics management, 41(1), pp.46-62.

Christopher, M., 2016. Logistics & supply chain management. Pearson UK.

Gil, R., Gangopadhyay, D., Zhou, J., Gordon, S. and Nayak, S., Click Acqusitions, Inc., 2010. Supply chain management. U.S. Patent 7,761,319.

Goulding, E. and Lim, B., 2014. McDonald transvaginal cervical cerclage since 1957: from its roots in Australia into worldwide contemporary practice. BJOG: An International Journal of Obstetrics & Gynaecology, 121(9), pp.1107-1107.

Gualandris, J., Klassen, R.D., Vachon, S. and Kalchschmidt, M., 2015. Sustainable evaluation and verification in supply chains: Aligning and leveraging accountability to stakeholders. Journal of Operations Management, 38, pp.1-13.

Hamprecht, J., Corsten, D., Noll, M. and Meier, E., 2005. Controlling the sustainability of food supply chains. Supply Chain Management: An International Journal, 10(1), pp.7-10.

Li, S., Ragu-Nathan, B., Ragu-Nathan, T.S. and Rao, S.S., 2006. The impact of supply chain management practices on competitive advantage and organizational performance. Omega, 34(2), pp.107-124.

Nadolny, A. and Ryan, S., 2015. McUniversities revisited: a comparison of university and McDonald's casual employee experiences in Australia. Studies in Higher Education, 40(1), pp.142-157.

Our Supply Chain | About Macca's | McDonald's AU. (2017). Mcdonalds.com.au. Retrieved 10 October 2017, from https://mcdonalds.com.au/about-maccas/our-supply-chain/supply-partners

Sheffi, Y. and Rice Jr, J.B., 2005. A supply chain view of the resilient enterprise. MIT Sloan management review, 47(1), p.41.

Stadtler, H., 2015. Supply chain management: An overview. In Supply chain management and advanced planning (pp. 3-28). Springer Berlin Heidelberg.

Zhu, L., Anagondahalli, D. and Zhang, A., 2017. Social media and culture in crisis communication: McDonald’s and KFC crises management in China. Public Relations Review.