Top 3 Supply Chains of 2017: McDonald’s (#2)

In this 3 part blog series, we look at the Top 3 Supply Chains of 2017 as ranked by Gartner. In the last blog, we talked about Inditex (Zara) which holds the third position. In this post, we will look at the no. 2 Supply Chain of 2017. If you haven’t already guessed it (…from the title and the image), then lo and behold! it is none other than your favorite fast food chain: McDonald’s.

Key to Success

With well over 36,000 stores around the world, McDonald’s is estimated to serve more than 69 million customers daily. McDonald’s has restaurants in 100 countries and each of these countries enjoy a customized menu. The chain does not produce a single item in house and is still able to maintain consistency in their food. It is not an easy accomplishment to achieve, but they have managed to do it. The success of McDonald’s supply chain is credited to their supplier relationship management practices.

Transparency
The company aims to achieve transparency throughout their operations for their suppliers. To build a transparent chain, you need to establish a code of conduct that every supplier should abide by, which is exactly what McDonald’s did. And if you want to sustain that transparency, implementing audit capabilities in your operations  is very important to:

  • Keep an account of every transaction that happens on any given day
  • Identify the responsible party performing a given function along with date, time and quantity

In fact, having this information will allow you to hold your suppliers accountable to the set guidelines.

Collaboration
McDonald’s relies heavily on collaborating with their suppliers. This means sharing all their data with relevant parties, including POS data, inventory levels, restaurant stock metrics and more. Your organization’s needs may or may not be as extensive as McDonald’s. Regardless, to collaborate successfully with your suppliers, you need to:

  • Track your inventory at each stage in the supply chain using RFID or Barcoding technology
  • Consolidate all your information in a centralized location using a cloud based system
  • Give the same access to your suppliers and vendors based on their role

Communication
McDonald’s is proud of the strong ties they have built with all their suppliers over time. Since their supply chain is 100% outsourced, maintaining good relations is important . Streamlining communication with your suppliers will help you in doing so:

  • Offer your partners a say in the operational decisions that affect them
  • Establish an open line of network between and with all your vendors and suppliers

In conclusion, McDonald’s supplier management has transformed their supply chain into a better system to work in. As a result, customers will get the same consistent food and service from “Arkansas to Alaska and from Argentina to Azerbaijan”, making McDonald’s a deserving recipient of no.2 spot.

Stay tuned to find out who bagged the #1 spot on the list and how their supply chain works.