McDonalds Global Supply Chain Case Essay

Published: 2020-04-22 15:24:05
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Category: McDonald’s

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McDonalds Corporation: Managing a sustainable supply chain Food safety should always be the top priority. Minimizing cost is important since it is McDonalds profits that allow them the flexibility to focus on making a more sustainable supply chain. Sustainability helps build consumer trust and brand loyalty there is an economic insensitive for MD to try and be as sustainable as possible with its supply chain. However do to the nature of their purchasing it is within their best interest to make suppliers as sustainable as possible, sustainable in terms of long-term ability of supplier to supply high quality and sustainable within environmental and animal concerns.

MD cannot walk away from their suppliers without feeling big affects. Since they purchase so much from a single supplier, as they can only find certain suppliers capable of meeting their standards and supply the quantities needed. Because of these constraints MDs commit to sustainability is an important aspect of their supply chain efficiency. Stated in the case was that there was a three legged stool that supported MD, its suppliers, its workers and its consumers. The communication and commit to each other between the three lead to the success of MD. Therefore if it is within the best interest of MD and the desire of the consumer to have sustainability as a priority in supply chain then MD must focus on sustainability.

Due to the incredible global nature of MD, servicing 118 countries the requirements and cultures of each country affect the supply chain. There are region managers which are giving freedom within a framework to adjust their supply chains so as to meet local and national cultural practices. However since a large portion of their sources get spread out throughout the world there has to be an overall framework. MD has set up a global framework that AWOs have to stick it, and create local supply chains that match up and support that global framework.

With the soya incident MD didnt understand the complete picture of how sourcing chicken affected the Amazon Rainforest. It is within a understanding of suppliers suppliers that risk can be avoided. MD did a good job with their beef, and have a clear contract in regards to beef sources, the same should be done (expensive) to other major animal sourcing. This way they can avoid being pointed at or targeted for an issue that they can help solve.

However MD should not be responsible for solving everything. They are business who competes on convenience and low-cost. Consumers wont pay higher costs for more sustainable products. This will limit the areas that MD can focus on for sustainability, it has to be areas that have economic benefits to the company.

MD should engage in discussion with experts or people who work up close with the issues so they can gain a clear understanding of all related issues and sides of a potential problem. Again they cant focus on every issue they can open the floor for discussion. In order to continue the undisruptive supply from their suppliers MD has to have an open ear and mind to problems that suppliers might be facing.

Activist and NGOs can often be difficult to work with as they only focus on a single issue and usually disregard how the end goal would affect the parties involved. It is up to MD to talk and consider how such end goals would affect themselves, their suppliers, consumers and the environment as a whole. When an issue arises, or MD is being proactive in its risk management, they should reach out to all affected parties and NGOs that can help them shine a light on the issue.

MD has to be careful about its relationships with its suppliers as their futures are tied together. As such relationships go they require a lot of work and effort, communication on both sides. In terms of sustainability MD has found a good way of dealing with issues that arise and not have to walk away from their suppliers. Since MD is willing to work with their suppliers, it improves their relationship and helps reach an end goal.

It is important for any company to listen to all sides of a story and attempt to find the winningest solution to a problem without creating enemies, or losing suppliers. With larger companies the risk of losing suppliers is great and therefore even more important to discuss with all affected parties.

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