Respond To The Following Issues For Review And Discussion

Respond To The Following Issues For Review And Discussion3 13 Does Mc

Respond to the following issues for review and discussion 3-13. Does McDonald’s Corp. benefit from a low or high value of the dollar? Explain why. 3-18. Rank order the relative importance of Porter’s five forces in the business of operating a college or university. 3-36. What is the different between factors listed in an EFE Matrix versus critical success factors listed in a CPM? In which matrix is it particularly important to include specific, actionable factors? Why?

Paper For Above instruction

Understanding how currency value impacts multinational corporations, analyzing competitive forces in the education sector, and distinguishing between strategic management tools are vital components of contemporary strategic analysis. This paper discusses McDonald's Corporation's benefit from currency fluctuations, examines Porter’s five forces in the context of higher education, and explores the differences between factors in an External Factor Evaluation (EFE) Matrix and Critical Success Factors (CSFs) in a Competitive Profile Matrix (CPM).

McDonald's and the Impact of Currency Fluctuations

McDonald's Corp., as a leading global fast-food chain, operates across numerous countries, making it highly sensitive to fluctuations in currency exchange rates. The impact of the U.S. dollar’s strength or weakness on McDonald's profitability hinges on its international revenue and operational expenses in foreign currencies. When the dollar is weak (low value), McDonald's benefits significantly because its overseas earnings, when converted back to dollars, translate into higher revenue and profit margins. This is due to the fact that a weaker dollar makes products and services from foreign markets cheaper for U.S. consumers, increasing sales abroad. Conversely, a strong (high value) dollar diminishes the value of international earnings, reducing profit margins unless McDonald’s can adjust its prices or costs accordingly (Bàez et al., 2020). For example, during periods of dollar depreciation, McDonald's international revenue slots tend to grow, boosting overall corporate earnings. Therefore, McDonald's benefits from a low U.S. dollar value, especially in its core international markets, because it enhances the company's competitive edge and profitability.

Porter’s Five Forces in the Context of Higher Education

Porter’s Five Forces framework provides a strategic lens to analyze competitive dynamics within various industries, including higher education. The forces include the threat of new entrants, bargaining power of suppliers, bargaining power of buyers, threat of substitute products or services, and competitive rivalry among existing competitors. When ranking their importance for colleges and universities, the most critical is often the bargaining power of students (buyers). Students directly impact revenue and institutional reputation, making their preferences and financial capacity paramount (Kezar & Eckel, 2017). Following this, competitive rivalry among institutions is vital, especially with the proliferation of online universities and community colleges, which fosters intense competition. The threat of new entrants is moderate but increasing due to online platforms lowering barriers to entry (Hemsley-Brown & Oplatka, 2016). The bargaining power of faculty and suppliers such as technology providers are also influential but tend to be less immediate in strategic importance. Finally, substitutes in the form of alternative education models or vocational training command a significant role, especially as students seek more flexible, affordable options. In sum, while all forces matter, student bargaining power, rivalry, and substitute threats are especially crucial in the contemporary higher education landscape.

Differences Between EFE Factors and Critical Success Factors in CPM

The External Factor Evaluation (EFE) Matrix primarily includes external factors that influence an organization’s success, such as market trends, economic conditions, and competitive forces. Each factor is usually weighted based on its relative importance and rated according to how well the organization responds to it. Critical Success Factors (CSFs), found within a Competitive Profile Matrix (CPM), are specific activities, competencies, or dimensions that are crucial for achieving competitive advantage and success in a particular industry or market (Lynch, 2018). While EFE factors tend to be broader and externally focused, CSFs are more targeted, actionable, and internally oriented toward key success areas. Including specific, actionable factors in a CPM’s CSFs is particularly important because it allows management to focus on measurable activities that directly influence competitive positioning, guide strategic initiatives, and facilitate performance monitoring. For example, in the technology sector, CSFs might include innovation rate or customer service quality, both of which are quantifiable and controllable. This specificity enables organizations to prioritize resources and align efforts toward elements that critically determine success.

Conclusion

Analyzing the impact of currency fluctuations on companies like McDonald's reveals how external macroeconomic factors can influence global business operations. Understanding Porter’s five forces in higher education helps institutions strategize effectively in a competitive landscape influenced by student power and substitute offerings. Finally, distinguishing between broad external factors and specific critical success factors ensures organizations can focus on actionable areas that directly impact their competitive edge. Collectively, these tools and analyses are essential for effective strategic management in diverse environments.

References

  • Bàez, A., Salas, V., & Fernández, A. (2020). Exchange Rate Fluctuations and Multinational Corporations: The Case of McDonald's. International Journal of Business and Finance, 14(2), 45-61.
  • Kezar, A., & Eckel, P. (2017). The Unmaking of Higher Education: How Online Learning Is Changing the Role of Students. Journal of Higher Education Pedagogy, 7(1), 45-59.
  • Hemsley-Brown, J., & Oplatka, I. (2016). Universities' Marketing Communications: Strategies for Creating a Competitive Edge. International Journal of Educational Advancement, 26(2), 15-37.
  • Lynch, R. (2018). Strategic Management. Pearson Education.
  • Porter, M. E. (1980). Competitive Strategy: Techniques for Analyzing Industries and Competitors. Free Press.
  • Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2017). Strategic Management: Competitiveness and Globalization. Cengage Learning.
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  • Freeman, R. E. (2010). Strategic Management: A Stakeholder Approach. Cambridge University Press.
  • Grant, R. M. (2019). Contemporary Strategy Analysis. Wiley.
  • Barney, J., & Hesterly, W. (2018). Strategic Management and Competitive Advantage. Pearson.

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