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Financial analysis of the support activities shows that in the financial year 2019, there was a growth in the finances and revenues. According to MacDonald’s Corporation (2020), the company witnessed a 5.4% growth in product sales. This was accompanied by a 4% growth in consolidated revenues. Distribution is an essential aspect of value creation as shown by the 7.2% increase in sales in the International Developmental License Segment; a 5.0% increase in sales in the US and the 6.1% increase in the internationally operating segment. As such, looking at the financial dimension, distribution plays an important role in value creation.
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The non-financial aspects are also vital in the company’s value chain. Because of the growth in the company’s market base, there is an increasing need to enhance the use of technology in the supply chain. The use of artificial intelligence (AI), as an example, will be important in reducing the waiting times at the company’s drive-through. The technology can also be used to improve customer satisfaction through menu recommendations. Additionally, through vertical integration, the company has eliminated the challenges associated with suppliers. It has enhanced service delivery by ensuring that the raw materials are per the company’s standard requirements.
Accordingly, the value created from the supportive activities can be analyzed through the VRIN framework. To begin with, using vertical integration, McDonald’s can manage the raw materials and the final product. This is valuable as it ensures that raw materials are consistent with company standards. Secondly, the use of AI to customize its food menu and manage the drive-through services is rare. For inimitable, the company’s product menu is unique and cannot be easily imitated by other companies. However, it is arguable that the company’s products can be substituted. This is due to the increase in the number of fast-food restaurants.
McDonald’s Corporation. (2020). Mcdonald’s Reports Fourth Quarter and Full Year 2019 Results and Quarterly Cash Dividends. Web.
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