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DONE BY:-
AKASH SHAH-45
TANIMA BANSAL-06
SIDDHANT NAGLE-38
MEHERVAAN SINGH KOHLI-25
BINOY MEHTA-31
PRANAV THURAKIA-60
PRERNA KANDHARI-21
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INDEX

01

TURNAROUND MANAGEMENT

02

TURNAROUND MANAGERS

03

CASE STUDY ON MC DONALDS

04

HISTORY

05

PRODUCT

06

TYPE OF RESTAURANTS

07

ADVERTISING

08

SWOT ANALYSIS

09

STRATEGY OF MC DONALDS

10

THE MC DONALDS TURNAROUND STORY

11

BIBLIOGRAPHY



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Turnaround Management

Turnaround management is a process dedicated to corporate renewal. It uses
analysis and planning to save troubled companies and returns them to solvency.
Turnaround Management involves management review, activity based costing, root
failure causes analysis, and SWOT analysis to determine why the company is failing.
Once analysis is completed, a long term strategic plan and restructuring plan are
created. These plans may or may not involve a bankruptcy filing. Once approved,
turnaround professionals begin to implement the plan, continually reviewing its progress
and make changes to the plan as needed to ensure the company returns to solvency.

Turnaround Managers
Turnaround Managers are also called Turnaround Practitioners in the UK, and often are
interim managers who only stay as long as it takes to achieve the turnaround.
Assignments can take anything from 3 to 24 months depending on the size of the
organisation and the complexity of the job. Turnaround management does not only
apply to distressed companies' it in fact can help in any situation where direction,
strategy or a general change of the ways of working needs to be implemented.
Therefore turnaround management is closely related to change management,
transformation management and post-merger-integration management. High growth
situation for example are one typical scenario where turnaround experts also help. More
and more turnaround managers are becoming a one-stop-shop and provide help with
corporate funding (working closely with banks and the Private Equity community) and
with professional services firms (such as lawyers and insolvency practitioners) to have
access to a full range of services that are typically needed in a turnaround process.
Most turnaround managers are freelancers and work on day rates, but there are a few
very high profile individuals who work for very large corporations on an employed basis
and usually get 5 year contracts.
Stages in repositioning of an organisation
1. The evaluation and assessment stage
2. The acute needs stage
3. The restructuring stage
4. The stabilization stage
5. The revitalization stage

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CASE STUDY ON MC DONALDS



McDonald's Corporation (NYSE: MCD) is the world's largest chain of hamburger fast
food restaurants, serving around 68 million customers daily in 119
countries. Headquartered in the United States, the company began in 1940 as a
barbecue restaurant operated by Richard and Maurice McDonald; in 1948 they
reorganized their business as a hamburger stand using production lineprinciples.
Businessman Ray Kroc joined the company as a franchise agent in 1955. He
subsequently purchased the chain from the McDonald brothers and oversaw its
worldwide growth.
A McDonald's restaurant is operated by either a franchisee, an affiliate, or the
corporation itself. The corporation's revenues come from the rent, royalties and fees
paid by the franchisees, as well as sales in company-operated restaurants. McDonald's
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revenues grew 27 percent over the three years ending in 2007 to $22.8 billion, and 9
percent growth in operating income to $3.9 billion.
McDonald's primarily sells hamburgers, cheeseburgers, chicken, french
fries, breakfast items, soft drinks, milkshakes and desserts. In response to changing
consumer tastes, the company has expanded its menu to
include salads, wraps, smoothies and fruit.

History
The business began in 1940, with a restaurant opened by brothers Richard and Maurice
McDonald at 1398 North E Street at West 14th Street in San Bernardino,
California (at34.1255N 117.2946W). Their introduction of the "Speedee Service
System" in 1948 furthered the principles of the modern fast-food restaurant that
the White Castle hamburger chain had already put into practice more than two decades
earlier. The original mascot of McDonald's was a man with a chef's hat on top of a
hamburger shaped head whose name was "Speedee". Speedee was eventually
replaced with Ronald McDonald by 1967 when the company first filed a U.S. trademark
on a clown shaped man having puffed out costume legs.
McDonald's first filed for a U.S. trademark on the name "McDonald's" on May 4, 1961,
with the description "Drive-In Restaurant Services", which continues to be renewed
through the end of December 2009. In the same year, on September 13, 1961, the
company filed a logo trademark on an overlapping, double arched "M" symbol. The
overlapping double arched "M" symbol logo was temporarily disfavored by September
6, 1962, when a trademark was filed for a single arch, shaped over many of the early
McDonald's restaurants in the early years. Although the "Golden Arches" appeared in
various forms, the present form as a letter "M" did not appear until November 18, 1968,
when the company applied for a U.S. trademark. The present corporation dates its
founding to the opening of a franchised restaurant by Ray Kroc, in Des Plaines, Illinois,
on April 15, 1955, the ninth McDonald's restaurant overall. Kroc later purchased the
McDonald brothers' equity in the company and led its worldwide expansion, and the
company became listed on the public stock markets in 1965. Kroc was also noted for
aggressive business practices, compelling the McDonald brothers to leave the fast food
industry. The McDonald brothers and Kroc feuded over control of the business, as
documented in both Kroc's autobiography and in the McDonald brothers' autobiography.
The San Bernardino store was demolished in 1976 (or 1971, according to Juan Pollo)
and the site was sold to the Juan Pollo restaurant chain. It now serves as headquarters
for the Juan Pollo chain, as well as a McDonald's and Route 66 museum. With the
expansion of McDonald's into many international markets, the company has become a
symbol of globalization and the spread of the American way of life. Its prominence has
also made it a frequent topic of public debates about obesity,corporate
ethics and consumer responsibility.

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Products

McDonald's predominantly sells hamburgers, various types of chicken sandwiches and
products, French fries, soft drinks, breakfast Items, and desserts. In most markets,
McDonald's offers salads and vegetarian items, wraps and other localized fare. On a
seasonal basis, McDonald's offers the McRib sandwich. Some speculate the
seasonality of the McRib adds to its appeal. Various countries, especially in Asia, are
currently serving soup. This local deviation from the standard menu is a characteristic
for which the chain is particularly known, and one which is employed either to abide by
regional food taboos (such as the religious prohibition of beef consumption in India) or
to make available foods with which the regional market is more familiar (such as the
sale of McRice inIndonesia). In Germany, McDonald's sells beer.


Types of restaurants
Most standalone McDonald's restaurants offer both counter service and drive-
through service, with indoor and sometimes outdoor seating. Drive-Thru, Auto-Mac, Pay
and Drive, or "Mc Drive" as it is known in many countries, often has separate stations
for placing, paying for, and picking up orders, though the latter two steps are frequently
combined; it was first introduced in Arizona in 1975, following the lead of other fast-food
chains. The first such restaurant in Britain opened at Fallowfield, Manchester in 1986.
[20]

In some countries, "McDrive" locations near highways offer no counter service or
seating. In contrast, locations in high-density city neighborhoods often omit drive-
through service. There are also a few locations, located mostly in downtown districts,
that offer Walk-Thru service in place of Drive-Thru.
To accommodate the current trend for high quality coffee and the popularity of coffee
shops in general, McDonald's introduced McCaf, a caf-style accompaniment to
McDonald's restaurants in the style of Starbucks. McCaf is a concept created by
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McDonald's Australia, starting with Melbourne in 1993. Today, most McDonald's in
Australia have McCafs located within the existing McDonald's restaurant. In Tasmania,
there are McCafs in every store, with the rest of the states quickly following suit. After
upgrading to the new McCaf look and feel, some Australian stores have noticed up to
a 60% increase in sales. As of the end of 2003 there were over 600 McCafs
worldwide.
Some locations are connected to gas stations/convenience stores,
[21]
while others
called McExpress have limited seating and/or menu or may be located in a shopping
mall. Other McDonald's are located in Wal-Mart stores. McStop is a location targeted at
truckers and travelers which may have services found at truck stops.
Since 1997, the only Kosher McDonald's in the world that is not in Israel, is located in
the Abasto mall, in Buenos Aires, Argentina




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Advertising
McDonald's has for decades maintained an extensive advertising campaign. In addition
to the usual media (television, radio, and newspaper), the company makes significant
use of billboards and signage, sponsors sporting events ranging from Little League to
the Olympic Games, and makes coolers of orange drink with its logo available for local
events of all kinds. Nonetheless, television has always played a central role in the
company's advertising strategy.
To date, McDonald's has used 23 different slogans in United States advertising, as well
as a few other slogans for select countries and regions. At times, it has run into trouble
with its campaigns.
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SWOT Analysis on McDonalds::
Strength::

McDonalds has built up huge brand equity. It is the No. 1 fast-food company by
sales, with more than 31,000 restaurants serving burgers and fries in almost 120
countries. Sales, 2007 (11,4009 million), 5.6% sales growth.

Globalization: 31,000 restaurants serving 120 countries. Of
the 31,000restaurants at least14,000 restaurants in the US

Good innovation and product development. It continually innovates to retain
customers in the business.

The McDonalds brand offers consumers choice, reasonable value and great
service

Large amounts of investment have gone into supporting its franchise
network,75% of stores are franchises

Loyal staff and strong management team.

Very strong brand name

Recognizable characters

Large target group

New stores almost 100% guaranteed to succeed

Ability to adapt when faced with criticism

Successful advertisement (im loving it)

Great partnership(coke cola)

Clean environment and play ground for kids

Professional training for employees(hamburger university)

Mcdonalds is able to generate more sales because of its brand recognition

Active Childrens Charity: The Ronald McDonald House

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Adjusted Ingredients and product offerings to comply with
upgraded healthstandards deemed necessary by the USDA

Earns revenue not merely by fast food sales, but also as a property investor,a
franchiser of restaurants.

Weakness:::

Many other similar competitors

Until recently, had very few options for eating healthy

Negative image due to Fast Food Nation and other media sources.
Advertisement techniques that target children

Consumers use disposable income to purchase fast food meals so when the
budget it treatened, consumers redirect these funds

Public perception: McDonalds has been impacted by negative press like the
documentary "Supersize Me" by Morgan Spurlock in which he contributed our
societies obesity to McDonalds and other fast food chains.
product development

Price management of franchisees/joint venture

Core product line out of line with the trend towards healthier lifestyles foradults
and children. Product line heavily focused towards hot food and burgers.

Seasonal

Quality issues across the franchise network.Unhealthy food image.

High Staff Turnover including management

Customer losses due to fierce competition.

Legal actions related to health issues; use of trans fat & beef oil.

Uses HCFC-22 to make polystyrene that is contributing to ozone depletion.

Ignoring breakfast from the menu.



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Opportunities::

Going green energy management, improving
packaging efficiency,environmentally friendly refrigerants, and partnering with
Greenpeace for rainforest protection

New store looks/styles McCafe coffee shop, and forever young redesign
Charity The Ronald McDonald House provides a cheap or free place to stay
for parents of sick children. Over 250 worldwide in 48 countries. Funded
primarily by donations and Joan Kroc (founder Ray Krocs wife)

Innovation: Continued adaptation to societies needs such as USDA and
Supersize Me upgrade.

Conservation: Researching green energies and green packaging solutions and
incorporating these findings as a part of their marketing strategy and
advertisements.

Exploration: Create new product offerings. Continue to use technology to
influence revenue strategy: possibly use text messages to deliver special offers
to individuals who sign up for such services.
internationalization

Growing dinning-out market(especially for young generations and middle
agegroup) Joint ventures with retailers (e.g. supermarkets).

Consolidation of retailers likely, so better locations for franchisees.

Respond to social changes - by innovation within healthier lifestyle foods. Its
move into hot baguettes and healthier snacks (fruit) has supported its new
positioning.

Use of CRM, database marketing to more accurately market to its consumer
target groups. It could identify likely customers (based on modelling and profiles
of shoppers) and prevent brand switching.







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Threats::

Current world economic standing: the company's revenue streams arediversified,
but depending on the the length of this "recession", they willinevitably be
negatively impacted by the trickle down effect.


More Casual Dining Restaurants increasing their "burger" offering and
decreasing the price: Restaurants like Ruby Tuesdays have $6 burger meals that
they strongly advertiseIf you're not in a hurry, which one would you choose?

Public Health Crisis: with a growing number of obesity cases among Americans,
fast food chains like McDonalds will continued to be over shadowed by their
previous product offerings (Supersized Meal, no fruits or yogurt, slim
salad selection).

Health professionals and consumer activists accuse McDonald's of contributing
to the countrys health issue of high cholesterol, heart attacks, diabetes, and
obesity.

The relationship between corporate level McDonald's and its franchise dealers.

McDonalds competitors threatened market share of the company both
internationally and domestically.

Social changes - Government, consumer groups encouraging balanced meals, 5
a day fruit and vegetables.

Focus by consumers on nutrition and healthier lifestyles.

Competitive pressures on the high street as new entrants offering value and
greater product ranges and healthier lifestyles products. E.g. subway
,supermarkets, M&S.

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Strategy Of McDonalds

THE 7 P's Of Mc DONALDS' Strategic Approach:


PRODUCT:
Mc Donalds product portfolio primarily comprises of vegetarian and non-vegetarian
burgers. The vegetarian burgers like Veg surprise, salad sandwich, McAloo Tikki
Burger, Mc veggie burger are offered to the customers. Non-vegetatarian burgers
include Chicken Mc grill, Mc chicken burger, Fliet of fish and chickenmaharaja burger.
Along with these french-fries, veg pizza mc puff, wrap chicken Mexican, wrap paneer
salsa, potato wedges, soft serve pineapple and choclate icecreams, Mc swirl soft drinks,
coffee and Mc shakes are also offered to increase the variety in the product portfolio.
Mc Donalds also provides mean combos with medium fries and medium soft drink,
happy mean with small soft drink, econo meals with small soft drink and value meals
with potato wedges and small soft drink.


PRICE:
Mc Donalds vegetarian burgers are priced between Rs 20 and Rs 48. Wrap paneer
salsa is priced at Rs 45-50. The non vegetarian burgers are priced between Rs 30and
Rs 60. Wrap chicken Mexican is priced at Rs 55. Medium French fries are price dat Rs
28, potato wedges at Rs 20, soft serves at Rs 35, mc swirl at Rs 12, medium soft drinks
at Rs 20 and medium shakes at Rs 45.


PROMOTION:
At Mc Donalds the prime focus is on targeting children. In happy meals too which
aretargeted at children small toys are given along with the meal. Apart from this,various
schemes for winning prices by way of lucky draws and also scratch cards are given
when an order is placed on the various mean combos. In fact, the various econo meals
and value meals also signal to the customer that buying separate items results in
greater value for money for the customer.


PLACE:
Mc Donalds outlets are very evenly spread throughout the NCR region. McDonalds
does not offer home delivery but its outlets are very readily accessible. McDonalds also
offers take away drive through facilities.


PEOPLE:
The employees in Mc Donalds have a standard uniform and Mc Donalds specially
focuses on friendly and prompt service to its customers from their employees.
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PROCESS:
The food manufacturing process at Mc Donalds is completely transparent i.e. the whole
process is visible to the customers. In fact, the fast food joint allows its customers to
view and judge the hygienic standards at Mc Donalds by allowing them to enter the
area where the process takes place. The customers are invited to check the ingredients
used in food.


PHYSICAL EVIDENCE:
Mc Donalds focuses on clean and hygienic interiors of is outlets and at the same time
the interiors are attractive and the fast food joint maintains a proper decorum at
its joints.


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THE MC DONALDS TURN
AROUND STORY

'Happy' Days Again
By the late 1990s, after years of declining earnings and poor customer ratings,
McDonald's Corp. (McDonalds), the largest fast food chain in the world, seemed to have
lost its claim to providing the 'Great American Meal'.

The company, which was once the favorite destination of fast food lovers around the
world, had been receiving low ratings on quality and customer satisfaction since the
early 1990s. Its trademark Big Macs and Happy Meals were the target of law suits as
critics claimed that McDonald's was responsible for ruining America's health. Matters
came to a head in January 2003, when it posted a loss of $343.8 million for the last
quarter of 2002, making it the first quarterly loss for the company since it went public in
1965. Following the announcement of the loss, the share price fell to an all-time low of
$12 and McDonald's seemed to have lost its magic. However, under the leadership of
Jim Cantalupo (Cantalupo), who was made CEO in early 2003, and Charlie Bell (Bell),
the president and COO, McDonald's managed a relatively quick turnaround.

In the quarter ended July 2004, the company announced a 25 percent increase in
profits over the corresponding quarter of the previous year, and sales reached a 17-year
high.

Analysts and company insiders attributed this to the successful implementation of the
'Plan to Win' turnaround program that was adopted by the company in early 2003.
Discussing the company's progress, Bell said, "We are encouraged by this progress
and confident that our service, food, value and marketing initiatives will generate steady
improvements over the long term."
4
Under the turnaround plan, McDonald's introduced
substantial system-wide changes that overhauled the company's products, operations
and marketing. The new plan eliminated the negative elements in the system, while
retaining and building on the positive aspects. The company moved quickly to tailor its
operations to the changing trends in the fast food industry, confounding critics who had
been skeptical about the company's ability to revive.

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Background Note
The McDonald brothers, Richard and Maurice, started their career in Hollywood,
working on movie sets. Not finding this career rewarding, they began to look for new
business opportunities and decided to set up a restaurant.

They opened a drive-in restaurant in San Bernardino, California, in 1937. Drive-ins were
a new concept at that time. To eliminate the hassle of managing carhops (the waiters
who served customers) and of having to wash the crockery and cutlery, the brothers
introduced self-service and restricted their menu to items that could be eaten without
plates or cutlery. Thus, the menu was pared down from 25 items to just nine:
hamburger, cheeseburger, three soft-drink flavors, milk, coffee, potato chips and pie.
French fries and milkshakes were later added to the list. The brothers designed their
kitchen for mass production, with assembly line procedures. The restaurant was
octagonal, a deviation from the normal practice.

The prices were kept low - 15 cents for a burger, and 10 cents for fries. The critical
success factors in the business were speed, service and cleanliness. The concept of
self-service soon caught the imagination of the American public. By the mid-1950s, the
restaurant's revenues had risen to $350,000.

As word of their success spread, franchisees started showing interest. The first
franchisee was Neil Fox, a gasoline retailer, who set up his drive-in in Phoenix, Arizona
in 1952. His restaurant was located in a gleaming red and white tiled rectangular
building. Like the original restaurant, glass construction was used from counter to the
roof, and the kitchen was exposed to the customer's view. The most distinctive feature
of the building was its two bright yellow arches, which later evolved into a new symbol
for McDonald's. (Refer Figure I.) The franchising system, however, failed for two
reasons. The McDonald brothers observed very transparent business practices. This
encouraged imitators and created competitors. The franchisees also did not maintain
the McDonald's standards of cleanliness, customer service and product uniformity.


No Longer the 'Great American Meal'
Through the decades, McDonald's had promoted itself as the provider of the 'Great
American Meal'. However, by the 1990s, it was clear that the company had lost its claim
to that title. Changing customer eating habits, increased competition and complacence
on the part of the company and its franchisees, were the main reasons for the difficulties
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experienced by McDonald's in the 1990s. (Refer Exhibit III on the Fast Food Industry)
Comparable store sales, a retail metric that measures growth obtained from stores open
for at least one year, had stagnated in the 1990s and towards the end of the decade
began to decline...

The Golden Arches Rise Again
After McDonald's announced its first quarterly loss in 38 years in 2003, the board
realized that big changes were required in the company's strategy and direction.

The board ousted Greenberg and installed Cantalupo as the CEO. Cantalupo had led
McDonald's international expansion through the 1980s and 1990s and had been one of
the contenders in the CEO race won by Greenberg. In 2003, he was brought back from
retirement to lead the company's turnaround.

Soon after taking over, Cantalupo prepared the 'Plan to Win', which outlined McDonald's
strategy for the next three years. The Plan streamlined the company's operations and
aimed to create a McDonald's that was more geared to the new conditions in the fast
food industry...

Will New Formats Work?
Analysts said that the fast food industry was undergoing a transformation in the early
2000s. Hamburgers, fries and soda, which epitomized fast food, were being replaced by
sandwiches and salads. Given this, analysts believed that diversification was the only
option available to fast food chains to ensure their long-term success. Most fast food
chains were diversifying into other areas or developing new concepts to protect their
interests...


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BIBLIOGRAPHY
www.google.com

www.wikipedia.com

The Mc Donalds journal

www.mcdonaldsindia.com

www.aboutmcdonalds.com/

www.facebook.com/McDonalds