Current Issues in Hospitality and Tourism Management Critically analyze the micro and macro environmental factors affecting

an organization of your choice and how the organization is adopting to the changing factors in terms of strategy development and implementation.
McDonald is a USA based fast food chain industry operating in different countries through out the world. It is serving approximately 58 million customers on daily basis. It is operating as franchise, an affiliate or corporate by itself. The operations of McDonald are greatly affected by Macro and Micro environmental factors. The Macro factors include political, legal, technological, sociocultural, environmental, and economical factors. The political factors affect the operation of Mcdonalds.So; its international operations are greatly influenced by individual country policies imposed by each government. For example, there are many groups in United States and Europe which scream for the state actions regarding health implications of eating fast food items. It is shown by them that there are harmful basics like obesity and cholesterol which are affecting consumer health. In contrast, company is being controlled by regulations of operations and individual policies. There are different markets that focus on areas of concern like that of environment, work protection and health. This all can be seen in government control of licensing of restaurants in respective states. For example, in near future, there is legal dispute in India McDonald franchise where certain violation of religious right is observed. The use of meat as an ingredient in McDonald product is offensive to Hindu Religion in a specific market. Study has shown that there is also infringement of the McDonald stores related to employment laws in target market.So, as to succeed in foreign market, McDonald stores have to contend with issues of tax obligations as well as employment procedures. It is clear that McDonald is continuously expanding. It is good to directly deal with proper authorities in particular market where they do their operations. It will be helpful in creating good relationship with the state government. McDonald should comply with government rules and to do this, they have to accomplish all prescribed acts and satisfy all prerequisites for doing the business; McDonald must be well familiar with the laws and regulations in order to know their liabilities and possible responsibilities.

Fast food industry organizations are not excused from any kind of troubles and disputes. Specially; they have their own individual concern involving the economic factors. McDonald franchises and branches experience hardship in instances where economy of respective country is hit by changes in exchange rate and also by inflation. Customers are faced with a stalemate of seeing their individual budgets that they should or should not use up more on foreign fast food outlets. Due to this, the fast food chains have to put up with these issues of effect of economical environment. These problems rely on response from the customer side and it influences their sales. In case of McDonalds, it imports much of raw material into a specific country if death of supply is there. A fluctuation in the exchange rate also is vital in operation of organization. McDonald in order to succeed has to give high consideration with reference to their microenvironment. The firm existing exchange rate as well as international supply is just a part of overall procedure required to guarantee victory for foreign operations of the McDonalds. It is also very important that company be aware of existing tax needed required by individual states where they are working. It helps in smooth running of McDonald operation of its franchises. The company also considers economic standing of country where they operate. The purchasing power of consumer in a country is determined by the rate at which economy of that particular company grows. If a franchise is working in a country that is economically weak, then its products will cost higher than other products available in that particular market. So, in order to succeed, a franchise has to take certain adjustments for the maintenance of economies of scale. McDonald must carry out a well conducted market research for movements in economic environment before entering into a particular market. As the operations of company is affected by frequency of fluctuations in the exchange rate as well as shifts in inflation rate. McDonald in order to establish a positive mind set from their customers gives special attention to the socio cultural factors. It treats a variety of customers with different personalities. It has been seen that McDonald for markets like UK, regards to their dining needs has given them particular options. It tries its level best to adjust to its environment in order to satisfy its core customers. McDonald has initiated a valued set of variety of food which tenders a considerable amount of quality for the particular market. McDonald franchises most frequent consumers are those who aged just below bracket of thirty five. McDonald creates a good system for determining needs of the particular market. The concepts of consumer behavior, purchasing decision and product personality are used by McDonald for its own benefit. It is important to understand prospective performance in a particular environment of an organisation.Mcdonald has shown great efforts for localization its menu to satisfy local taste but it must in order to satisfy customers conduct

surveys and learn about the local traditions and cultures and should product as per their need and wants.So,Mcdonald for its successful operation should obtain relevant information from target market .This is very important that a comprehensive and well drafted market research should be conducted before a franchise is granted to a particular market. It will be helpful in creating acts which will conform to good morals, public policies and good customs of the desired state. McDonald should also be well are of shifts in purchasing patterns of market and consumer behavior. It is a main condition for establishing a well defined customer relation management process. McDonalds use modern technology in order to cope with the competition. It creates demand for its own product by different means. The company main tool used for marketing is television advertisement. It is been argued that McDonald focus on younger population more than others. The presence of toys as well as play spots in the meals presented by company shows this reality. New technology has been infused in the operations of McDonalds. Components like management of the value chain of company and inventory system allows for trouble free payments for their vendors and suppliers .Value is added to McDonald products by integration of technology in operation of McDonalds. This is clear and very obvious in its value chain improvement. The development in supply chain and inventory system allows McDonald to operate successfully in an international environment. Management can be more effective and cost saving in long term by implementation of new technology. This will also effect on customer satisfaction if cost savings leads to price reduction. Real time effects of communication, interactivity and cost effectiveness are good ways to find the supplies. This is a better way to communicate with respective headquarters of McDonalds present in every country. To enhance their inventory operations, McDonald should also look into use of Information Technology. McDonald will expect significant reductions of costs and savings in operation as the operations in its inbound and outbound logistics will improve. Legal issues are also affecting working of McDonald chains. This has forced McDonald to concentrate on its corporate social responsibilities .It had developed the requirement to form the corporate reputation to a more socially responsible and a more positive company. McDonald reputation is a big matter to discuss. It has been seen that they have obtain strides to take in hand key social censures which they have been berating in past decades, after seeing their website. McDonald has given their consumers relevant information about the nutritional substance of their products and all other data required by their core consumers. It is an attend for arguments about obesity charged against their products. So, now consumers are in a clear view and are free to

choose whether to purchase McDonald products. It is related to socio cultural attributes of the market where they work. For example, McDonald operations in Muslim countries need their meat to conform to be Halal. In the same way, McDonald franchises operating in European Union should conform to exiting laws stopping use of genetically modified meat used in the products. Other legal issues like quality requirement, employment standards, and tax obligations are vital elements company has to consider when it is operating in an international perspective. Or else smooth operation will not be easy and this will make operation of McDonald hard to survive in a different environment. McDonald for its successful operation should hire the local counsels to deal with legal conflicts in markets. Social responsibilities of the McDonald are prominent in the operation of company. McDonald had been critics for world environmentalist, as it is one the world largest consumer of chicken, potatoes and beef. It is because high use of beef is causing green house effect by the methane gasses from cows ranch. There is also lost of green forest opening for plantation activities and large scale plantation has effect the environment. The fast food giants like McDonalds are criticized by vegetarian environmentalist for slaughtering and cruelty to animals. McDonald wanted to introduce whale burger in Japan but it was faced by an issue as whales species are endangered species there. By using polystyrene based packaging for its food, McDonald has been criticized for being insensitive to pollution. There are millions of McDonald consumers who purchase from its operator and they impact on world environment by throwing away packaging that is hard to recycle. World is becoming more aware of environmental issues and business operate in this environment should also care for this factor. McDonald is doing its best to be more careful regards to the environmental factor. One of the most vital factors comes from internal company or more accurately management itself. In order to boost McDonald efficiency and sales of operation, marketing manager must work closely with the other departments to make a well designed marketing plan. McDonald management has a clear objective of retaining the customers by giving satisfaction to all of its consumers. It is not the work from the marketing department but it includes understanding, cooperation and hard work of different departments. Marketing people may have initiated the customer delight program but Human resource department is also working to its great extend to train the employees to provide customer with their preferred demands. The finance department of McDonald should analyze closet on cost benefits for marketing program started and purchasing of raw material and different products should closely be working with the suppliers to guarantee that marketing plan is on the proper track. It is therefore, very important that all employees must

work together with full cooperation for successful operation of McDonalds. The top management should have well laid plan and clear understanding of ever changing business environment and should have clear goals on the future direction of McDonald. The suppliers are playing an important role in relation to McDonald with its core consumers. McDonald must build a strong relationship with suppliers to have a good continuous and no disruption supply. McDonald is also well aware that it is competing with other fast food operators in business market environment. McDonald in order to ensure it will not effect its bottom line performance, it should closely monitor any supply shortages, any strike and increasing of prices in market. McDonalds suppliers play a vital role in the success, giving quality products at a reasonable price. There are marketing intermediaries that helps the other companies to distribute, sell and promote the goods to the final consumers. The McDonald is a franchise based organization and its headquarter is in United States and it has franchisee all over the world. To popularize, distribute and expand McDonald business concept around the world, Franchise system is part of marketing intermediaries to actual McDonald in United States. The financial intermediaries are vital to ensure insurance coverage, assistance, financial transaction for business of McDonald. Like in United States, McDonalds cannot source funds to expand its business or finance its marketing programs at will without its finance intermediaries. McDonald in order to provide ease to customers is promoting cashless card transaction. McDonald also need physical distributor firm or logistic especially to help in transportation and distribution of materials and goods around the country to its outlets. It is a non disruption logistic and efficient process that is vital to have for smooth and efficient restaurant operation to serve customers better at anytime and anywhere. So, all marketing intermediaries are very significant to help McDonald distribute, promote and sell its products to the final consumers. The fast food industry has a broad range of competitors from small to big size in case of financial capabilities. McDonald has also facing different competitors and McDonald has to compete with them by offering differentiation in term of satisfaction and value to its consumers. Any benefits and values that McDonald can use to differentiate it apart from all can be a well built marketing point to conquer and reach the market. Strategies should be developed to strengthen company positioning in domestic market and customers ever changing need should be known by marketers.

When we want to evaluate McDonalds strength. It is clear from the point that McDonald stress importance to meet the customers expectations in terms of pricing and time of delivery. The perceptions about quality differ from person to person and McDonald pays special attention to this factor. So efficient delivery and drive thru concept really saves consumers time and customers dont wait in queues and just get the order in a very fast manner. So McDonald is moving from just a fast food chain to value service provider for its customers. They are now able to provide customers what they need at the right time and at a right place in a proper systematic manner. McDonald is getting closer to consumers by introducing fast ordering concepts like McDelivery that will not only increase McDonald business opportunities to those who are unwilling to go to its outlet but will also attract the consumers by its fast process. In some places, McDonald has started 24 hours service and also drive thru that has increased its customer loyalty a lot. One of the strength of McDonald is customer delight program that is a proof that shows McDonald care for its customers. The efforts like making the waiting line for the needy, serving free refills of soft drinks, casual contact with customers is an additional service of McDonald to its customer in order to differentiate it from its competitors. McDonald products are not standardized as they make menu that is acceptable by the people of a specific country. Like they introduce veggie burger in India and dont use beef in its product as per the demand of Hindu communities. For Muslims, they take special attention for providing Halal chicken.McTurco kebab in turkey, Green tea flavored milkshake in Japan, Mclobster in Canada, McLaks salmon sandwich for Norway. Avocado sauce is served in Chile at McDonald outlet. McDonald does not force American value to the different countries, but it tailors its products as per the requirement of the customers due to which it is gaining high reputation and earning huge profits. This is one of its strength by which it has increase number of loyal customers. McDonald is providing customers with genuine information about the nutrition facts related to their food in their website and consumers can make their own decision. It is able to identify trend for healthy lifestyle and balance nutrients are heavily promoted and McDonald is promoting itself as a nutritious food provider. There is also the concept of hotline to react and to response to customers complaint. McDonald is offering special seating arrangement and Wi-Fi access to consumers who eat in the outlet and also offering more elegant looks to its layout design. One of the most important strength that McDonald has is the proper training process it gives to its employees. They are giving proper training according to the culture of a particular area to ensure they can deal with customer in an excellent manner and create good brand image for McDonald. One more strength is that McDonald is capable of dealing with its own outlets and franchise in a proper systematic manner. To ensure its volume and quality standard, McDonald always built a long lasting relation

with its vendors and suppliers. Knowledge sharing with suppliers and connecting local suppliers with international reputation has help McDonald to get the highest quality material delivery to its door and successful operation of its outlet through out the world. When we come to weaknesses, McDonald is having poor publicity of unhealthy fast food. McDonald meals with toys is condemn by the public as children want to buy food just for toys and unbalance and unhealthy intake has resulted in obesity .Marketing tactics like Big size is also criticized as it is motivating people to eat more without taking care of calories intake. Fast food products have high contents of sugar and fat, high cholesterol and oil that increase risk of heart related disease, obesity, and diabeties.The rebranding is costly and its association with America has played a negative role in some countries like Saudi Arabia, China, Indonesia etc and has affect on the business by boycotts and even physical damaging of the outlets. McDonald test marketing for pizza failed to give a preferable profit so it is not able to compete with fast food pizza chains. There is a high employee turnover so lot of money is being utilized for training new workers. McDonald has yet to capitalize on the trend of using organic products. McDonald is not concentrating on providing organic foods. There is also a large fluctuation in McDonald net and operating profits that is making impacts on investors. There is not so much variation in the seasonal products which they offer and McDonald is only focusing on Burgers and fries and is not looking for healthier products for their core consumers. As far as opportunities are concerned, McDonald can take great advantage by utilizing its brand image. In today health conscious environment, if they introduce a healthy hamburger, then they would be the first one to do this and can earn lots of profits. McDonald has Formica restaurant settings, so to appeal to a more upscale target market; they could provide more upscale restaurant settings as they have in New York City on Broadway. They can provide allergen free food products like peanut free and gluten free. McDonald has the opportunity to open joint ventures with many different retailers. They can establish more play place for children in their restaurant. They can create a more upscale appearance to persuade more upscale clientele. McDonald can be more responsive to casual changes for the healthier options. They can expand their operations in newly developed parts .They also have the options to add more beverages choices to their menu. There are major threats to McDonald in form of competition by KFC, starbucks, Wendys, Burger King. McDonald is also criticized by people as they motivate children to buy products by offering those toys and stuff. The food is unhealthy and cause obesity. This concept can stop the operation of McDonald in countries like Malaysia which is becoming very health conscious. The

economy of a country can also affect the operation of McDonald and government rules and regulations changes can affect directly on the McDonald working in a particular state. The local brand can also be threat to McDonalds in different countries and people mat not like to switch to McDonald as they are already satisfied with the local fast food services. Consumers are becoming more health conscious; this may result in fewer intakes of fast food products of McDonald. Based on McDonald performance, it can be seen that it has been successful in implementing new strategies for success, but however, it should concentrate on opportunities and threats. It should also consider the increasing competition in the market as its competitions are providing customer with same products. It should introduce new products and should launch healthy ingredients and products. It should also focus on corporate social reasonability which will help to boost its strength and will create good reputation and brand image.

REFERENCES:
1) Enz, A. (2009). Hospitality Strategic Management: Concepts and Cases. John Wiley and Sons 2) HanOlsen, M. and Zhao, J. (2008). Book of Hospitality Strategic Management. ButterworthHeinemann 3) Olsen, D., Tse, E., and West, J. (2008). Strategic management in the hospitality industry. Pearson Prentice Hall

4) Enz, C. (2010). Outlines & Highlights for Hospitality Strategic Management: Concepts and Cases.
Academic Internet Publishers ISBN: 047008359x 5) Wood, R. and Brotherton, B. (2008). (The Sage handbook of hospitality management. SAGE Publications Ltd 6) Love, John F. (2008). McDonalds: Behind the Arches, Paw Prints