I am a student of management, especially when it comes to systems. I’m especially interested when hospitality is involved. The other day, I was reading about some management changes at the upper tier of McDonalds. In conjunction with this article, I read about McDonald’s “Plan to Win.” It was captivating reading.
According to Larry Light and Joan Kiddon, authors of Six Rules for Brand Revitalization: Learn How Companies Like McDonald’s Can Re-Energize Their Brands, brand management is not a marketing concept; it is a business management concept. The McDonald’s Plan to Win was built on this mindset. It could not be a regional initiative. It had to be global: consistent across geography, across time.
Stated simply, the Plan to Win is a business construct that is built on three pillars:
Brand direction—Where do we want to be?
Freedom within a framework—How do we plan to get there and what actions will we take?
Measurable milestones—How will we measure performance?
The Plan to Win is designed to guide brand thinking, the setting of priorities, and the development of a viable and feasible action plan. It is a business concept, crossing functions and geographies and organizational boundaries. It is the most powerful tool in a manager’s toolbox. It affects every aspect of the business. The Plan to Win at McDonald’s has four goals at its base:
Attract more customers.
Convince customers to purchase more often.
Increase brand loyalty.
Become more profitable.
In other words, more customers, more often, more brand loyalty, more profitable; these are the bottom-line goals for brand revitalization.
The Plan to Win is based on a disciplined thought process McDonald’s calls the Eight Ps. The Eight Ps of the Plan to Win represent eight critical areas for brand and business success: Purpose, Promise, People, Product, Place, Price, Promotion, and Performance.
Eight Ps of the Plan to Win
Purpose
Promise
People
Product
Place
Price
Promotion
Performance
Purpose and Promise define the brand direction. The brand purpose defines the overarching mission of the brand, and the brand promise is the contract with our customers. It is a promise that if you buy this brand, you will get this experience. A brand promise answers the question “what kind of brand experience do we wish to promise and deliver to every customer every time?”
The final P in the Plan to Win is Performance. Performance is the definition of the measurable milestones to assess our progress in brand revitalization.
What are the actions McDonald’s takes to achieve the measurable milestones? The five action Ps: People, Product, Place, Price, and Promotion.
According to the authors, delivering the brand promise is not determined by good intentions. It is accomplished by the actions the food service takes. The five action Ps define how McDonald’s plan to achieve the bottom-line goals of more customers, more often, more brand loyalty, and more profit. How McDonald’s expects to deliver its promise across each of the five action Ps (people, product, place, price, and promotion) is articulated in the Plan to Win.
McDonald’s Plan to Win continues to drive growth. As reported by Yahoo Finance on November 12, annual sales growth has increased, as has the numbers of customers served, same store sales, annual operating growth and return on incremental invested capital. Additionally, McDonald’s has plans to open 1,000 new restaurants and re-image 2,300 existing locations worldwide in 2010.
In thinking about and analyzing the “Plan to Win,” it is apparent (at least to me), that its tenets and philosophies are applicable to just about any industry, especially those involving the delivery of goods and services. The Plan to Win has obviously scored many touchdowns for McDonald’s within the last several years. As its successes become more widely known, it is perhaps safe to assume that many other companies will be looking to the Plan to Win as a blue print for rebranding and retooling their respective operations.
Helpful links: http://www.whartonsp.com/articles/article.aspx?p=1324692&seqNum=8
http://www.aboutmcdonalds.com/mcd/investors.html
http://www.businessweek.com/magazine/content/07_06/b4020007.htm
http://finance.yahoo.com/news/McDonalds-Plan-to-Win-prnews-1740485569.html?x=0&.v=1
