Mcdonald's Life Cycle Case Study

Corporations go through life cycles, just as humans do. This life cycle concept also relates to other areas in business such as the products and services, and even entire industries. The number of stages in a company’s life can vary from at least five up to as many as ten. The five most accepted stages are startup, growth, maturity, decline and death. Each stage creates unique challenges for the organization and requires diverse strategies to continue operating at a profitable level. The startup stage, which includes seed and development, is the very beginning of the business life cycle. The brilliant idea for the business venture is merely a thought and requires further research and testing to find out how sustainable it will be. This

Extending the life cycle may also require changing business leadership to bring in new ideas. Furthermore, acquisitions are an opportunity for a failing company to gain new resources allowing it to recapture lost growth. The life cycle extension often occurs when the organization executes a turnaround stategy. McDonalds has been around since the 1940’s and gone through many life cycle stages. The company is somewhere between the maturity and decline stages, known as the the revival stage. In this stage a company pursues rapid growth through innovation and significant risk taking. New leadership and increased investment are necessary to effectively implement this stage. McDonalds began executing it’s turnaround plan in 2015. The plan was designed to give McDonalds a “customer-centric” focus. First, corporate restructuring was completed to bring in fresh ideas and lower overhead costs. The second plan initiative is to begin refranching by selling many of the corporate owned restaurants. The refranchising plan was developed to lower costs and create a more predictable revenue stream (McDonalds Corporation, 2018, p.

(n.d.) GE Six Sigma). Decisions are made based on data which improve the process capability, in turn eliminating defects causing the sigma to rise. This concept takes the work smarter, not harder philosophy approach. Six Sigma is implemented by using two approaches: DMAIC and DMADV. DMAIC or Define, Measure, Analyse, Improve and Control is used for existing processes. DMADV which stands for Define, Measure, Analyse, Design and Verify is used for new processes (Harris, A., (2013). Six Sigma offers six strategic advantages to an organization once implemented. First, customer satisfaction is improved due to the purchasing experience and employee attitude which develops customer loyalty and return business. Second, a well-organized company and increased employee productivity results from helping employees understand how to manage their time effectively. Third, cycle times are reduced when a team from different departments and levels are given a task to indentify elements that negatively affect a company project. The team is now able to develop solutions to these potential problems. Employee motivation is the fourth advantage to employing Six Sigma. Teaching employees the problem solving tools and techniques creates personnel