5. industrialización-mcdonaldlization

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64 INTERNATIONAL JOURNAL OF CONTEMPORARY HOSPITALITY MANAGEMENT 7,2/ 3

In t roduc t ionToo many service companies have been slow to invest in thenew market opportunities and flexible technologiesavailable to them. They have stayed with their old conceptstoo long and have concentrated on cost-cutting efficienciesthey can quantify rather than on adding to their productvalue by listening carefully and flexibly providing theservices their customers genuinely want[1].

In a recent publication,T he McDonaldization of Society,Ritzer[2] has argued that the principles behind thesuccessful McDonalds fast-food empire are neitherrestricted to that organization nor to the fast-food sector.

They are, he believes, a blueprint for the organization ofall manner of social enterprises from medicine to familyholidays; from higher education to hotel chains.Commentary on the industrialization of service is notnew[3,4], but concern about the implications is extendedby Ritzers work. McDonaldization is both a literalcritique of food production/service arrangements and ametaphor for standardizing forces in the wider society. Inan earlier article[5] we took issue with Ritzers thesis andargued that, in looking for examples to prove the point,contradictory evidence had been overlooked especiallyfrom the hospitality field. In this article, we develop the

critique in terms of mass customization and give thoughtto the implications of the points raised.

McDonald izat ionMcDonalds has had a tremendous impact on high-streetdining patterns. It is remarkable not only for its spreadfrom the USA to all parts of the world, but also in itspropensity to spawn a range of similar restaurants. Majorcompetitors/clones are also widespread:

Few people can be unaware of the McDonalds system offood production and consumption. If you want a

standardized product wherever you are and you want itwithout delay, then the fast-food restaurant has manyadvantages. The customs of food consumption embedded in

traditional eating houses are pared away to a newminimalism of finger food, fast-moving queues and DIYtableclearing[5].

Ritzer sees also the development of a model, or paradigm,for other organizations, and industries and definesMcDonaldization as the process by which theprinciples of the fast-food restaurant are coming todominate more and more sectors of American society aswell as the rest of the world[2, p. 1].

At the heart of this movement, there is a self-reinforcingcycle:

In the world of mass production, consumers acceptedstandard goods; their acceptance facilitated the extension ofthe market and the reduction of prices, through increasingeconomies of scale; and the growing gap between the priceof mass-produced goods and that of customised goodsfurther encouraged the clustering of demand aroundhomogeneous products[6].

A number of principles underpin this self-righteousmanagement system. These are summarized in Pines[7]mass production reinforcing loop (see Figure 1).

At the heart of this paradigm is the quest for efficiencythrough stability and control. But, like Henry Ford and

his Model T or Ray Kroc and the technocratichamburger[8], we have become seduced by the means andforgotten its ends. The genie has become the master andwe its slave. This corresponds to Ritzers use of the termiron cage for McDonaldization, which is but a particularmanifestation of the mass-production principle. To thisextent, Ritzer has a point but, in our view[5], he makes anumber of awkward assumptions which limit the validityof the critique. The first is that McDonaldization isinexorablewe confront a future of acceleratingMcDonaldization[2, p. 158]It[McDonalds]will beremembered as yet another precursor to a still more

rational world[2, p. 159]. Second, McDonaldization isbad because it tends to limit alternatives. Thisoverlooks the positive role served by fast-food operations.Millions of people use them[9,10] and they are part of alonger-term social change in which domestic eatingassumes the status of a weekend and special-occasion

Pa ra d igm lost : t he r i se a nd f a l lo f M cDona ld iza t io nStephen Taylor and Phil Lyon

Ma ss custom iza t ion o f f e rs an a l te rna t i ve para d igm to M cDona ld iza t i on

International Journal of Contemporary Hospitality Management, Vol. 7 No. 2/3,1995, pp. 64-68 MCBUniversity Press, 0959-6119


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65PARADIGM LOST: THE RISE AND FALL OF McDONALDIZATION

hobby[11]. Further, standardization of production canrelease staff to concentrate more on service quality. Arecent confession indicates a growing realization thatthere may be benefits in crafting a more positivecustomer experience and not just focusing on the speed oforder processing:

Customerstold McDonalds they were loud, brash,American, successful, complacent, uncaring, insensitive,disciplinarian, insincere, suspicious and arrogantWethought we knew about service. Get the order into thecustomers hands in 60 seconds that was service. Notaccording to our customers. T hey wanted warmth,helpfulness, time to think, friendliness and advicewe hadfailed to seethat our customers were now veterans in thequick-service market and their expectations had gonethrough the roof. What was revolutionary in the seventieswas ghastly in the caring nineties[12].

The third point is that McDonalds only adapt their

products in a superficial way. The system is all-important. Ritzer, however, fails to see the clear evidenceof some substantial changes in McDonalds andMcDonaldized organizations. For example, in McDonaldstoday the average menu contains 33 items. That is 25 percent more than in 1980. Even more radically, McDonaldsis currently test-marketing a new Golden Arches Cafconcept and a McDonalds Express concept[13].

Finally, there are those who have lost faith in increasingrationalization as the answer to production inefficiencies.Warnecke[14] suggests that further automation, or even

industrialization, of service will not provide the answersunless the benefits of such production changes are usedintelligently. Although the argument uses the language offractals and chaos theory, the message is reassuringlystraightforward systems must be dynamic and adjustto their often turbulent trading environments with

flexibility rather than brittleness. There are echoes ofBurns and Stalker[15] here for those with long memories.

Looking at these criticisms of Ritzer, we suggest thatperhaps the greatest single deficiency in Ritzers analysisis that, while he correctly delineates the weaknesses ofmass production, he fails to see that inherent within thisprocess is a potential which is both very exciting andliberating. Like a phoenix rising from the ashes is thebrave new world of mass customization.

The new p arad igm: ma ss custom iza t ionAs with every other mass producer, the fast-food sectorhas reached the limits of the old paradigm. McDonalds,once the archetypical traditional and conservativecompany, saw that the old rules no longer worked. Pricecompetition had become fierce, its core market wassaturated, its traditional price/value relationship erodedowing to rising costs coupled with shifting demographicsand changing eating habits[16,17]. Mass production forhomogeneous markets is no longer enough and, asCrawford-Welch observes:

The emphasis on new product development andintroduction in the hospitality industry was, in essence, aresponse by corporations to the plurality of the marketplaceand the diverse price/value needs of multiple market

segments. In todays hospitality industry there is no suchthing as a mass market. Mass markets are a vestige of thepast[18].

Todays successful companies are dancing to a new tunein this age of diversity[19]. At the core of this newparadigm is the creation of:

Var iety and customization thr ough f lexibili ty[20]and quickresponsiveness[21]. This is the controlling focus ofmasscustomization[which shares]the goal of developing,producing, marketing and delivering affordable goods andservices with enough variety and customization that nearlyever yone f in ds exactl y what they want[emphasis in

original][7].Ultimately this becomes another self-reinforcing cycle:meeting customer demands leads to higher profits, whichin turn facilitates the organizations ability to increase itscustomization capability, which in turn stimulates furthermarket fragmentation[22]. This reinforcing cycleidentified by Pine[7] is shown in Figure 2.

Mass customization, as the originator of the phrase,Davis[23], acknowledges, is an oxymoron the combiningof apparently contradictory concepts. In the good olddays things were very straightforward: low unit costs

required high volumes, thus standardization; customiza-tion was driven by low volumes and high unit costs. Theadvancements in technology and the contemporarymanagement approaches it underpins allow us to realizethe impossibility of customized outputs on a mass basis.Mass customization is ultimately an umbrella for a large

Newproducts

Massproductionprocesses

Low-costconsistent

qualitystandardized

products

Homogeneousmarkets

Longproduct

developmentcycles

Longproduct

lifecycles

Stabledemand

R

Source:[7, p.27]

Figu re 1. T he paradigm of mass production as a dynamicsystem of reinforcing factors


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number of other elements within the firm. These include,for example, new business strategies such as kanban,kaizen,TQM, empowerment, internal marketing, supply-

chain management, electronic data interchange, IT-linkednetwork organizations[24], lean production and businessprocess re-engineering. Mass customization is theproduct of the interplay and mutual reinforcement ofmany such elements.

At the core of this enlightenment is a shift away from themechanistic parts/wholes interpretation of the universeas exemplified by Newton[7, p. x]. Simply, when applied tobusiness, the argument is that the organization is the sumof its parts. An alternative approach and one that anyhospitality professional intuitively embraces is that the

parts (e.g. the employees) are the whole (the organization)from the perspective of the customer. In short, the customerperceives the organization in holistic terms. Theintellectual challenge is thus to perceive that mass is towhole what customization is to parts[7, p. xi].

The extensive standardization of McDonalds, vilified byRitzer, has experienced the same sources of discontinuityas other mass producers, creating extreme pressure forchange. Arch rival Burger King, having failed to beatMcDonalds at its own game, changed the rules andembraced the principles of mass customization Have it

your way! and sometimes youve gotta break the rules!.Here the focus is on the hamburgers and fries but thiswas simply a foretaste of a much more significant shift.

The fast-food sector became increasingly competitiveduring the 1980s, and companies such as Pizza Hut,

Dominos, Kentucky Fried Chicken, and Taco Bell allvaried their output and began to exert significantpressure on McDonalds. The competitive response began

with the introduction of a special breakfast menu (EggMcMuffin), then in the latter part of the 1980s outputvariety mushroomed throughout the sector. In the 1990s,in the USA at least, McDonalds offer has expanded toinclude: pizza, chicken fajitas, breakfast burritos,submarine sandwiches, spaghetti and meatballs, bone-inchicken, a grilled chicken sandwich, carrot and celerysticks, fresh-ground coffee and even bottled water[17, p.117]. Indeed the total number of existing menu items ornew products currently being test-marketed is estimatedat over 150[7].

To achieve this radical expansion in its output varietyMcDonalds underwent a paradigm shift characterized byshorter development and production cycles[25],flexibility, autonomy, process innovations and theadoption of a true customer focus[7]. The process of newproduct development is now undertaken at both aheadquarters level and at individual unit level.Franchisees can innovate to ensure a closer fit with theirown unique customer environment[17]. Now, even atMcDonalds, customers can have it their way. Youdont want pickle?, You got it!

Just how different is mass customization from massproduction? The key differences are highlighted in TableI. A critical aspect, and arguably one that really lies at thecore of the difference between the two paradigms, is thereversal of the importance of products and processes. Inmass production the product is developed first and thenthe focus shifts towards the process needed to producethe product so that the process becomes permanentlycoupled to the product. The most graphic illustration ofthis is Fords Model T. In 1927, in the face of a huge slumpin demand, Ford had to cease production and spend thenext one-and-a-half years re-tooling his factory for a newproduct the Model A[26]. With mass customization, it is

the processes which are created first not the products and these remain permanently decoupled from theproducts. Whereas mass production essentially lowerscosts through economies of scale, mass customizationutilizes economies of scopeas its main lever on costs.Many of the recent advances in management previouslyalluded to e.g. kanban, lean production, compression ofthe new product development process and so on are themeans by which this can be achieved.

It should be obvious given the clear differences betweenthe two approaches that a successful shift from mass

production towards mass customization requires asubstantial refocusing within the organization ashighlighted in Table II. Ultimately, the pressures ofincreasing competition cause a realization that optimalperformance requires a sharper focus on its distinctive orcore competences[27-30]. This in turn, is linked to a firms

Low-costhigh qualitycustomized

products

Masscustomization

processes

Newproducts

Heterogeneousmarkets

Shortproduct

developmentcycles

Shortproductlife

cycles

Demandfragmentation

R R

Producttechnology Processtechnology

Source:[7, p.45]

R

Figu re 2. The new paradigm of mass customization as adynamic system feedback loop


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67PARADIGM LOST: THE RISE AND FALL OF McDONALDIZATION

resources and the generation of revenue[31]. T hisresource-based view of the firm, which is rapidly gainingpopularity among academics, views a firms capability asresiding upstream from the end-product it resides inskills, capacities and a dynamic resource fit which mayfind a variety of end uses[32]. This is the essence ofPines operationalization of the mass customizationconcept.

Ful l cir cle?Has the industry ended up where it began?

McDonaldization replaced the variability of productioninherent in the Mom and Pop operations of the 1950swith a standardized process which output a qualityproduct at a reasonable cost. McDonalds QSC (quality,service and cleanliness) was a source of customerreassurance, an invitation to a known experience. For

nearly three decades this approach worked, but thewidespread success of the process set the scene for itsdownfall as customers expectations rose through thevery act of consumption itself. We predict that futuresuccess will be enjoyed by those organizations thatunderstand the need to reassert the importance ofdifferences among hospitality consumers rather than

seek mass similarities.Vive la di ffrence!

Notes and r e ferences

1. Quinn, J.B. and Gagnon, C.E., Will services followmanufacturing into decline?,Har vard Business Review,November-December 1986, pp. 95-103.

2. Ritzer, G., T he M cDonaldization of Society: AnInvestigation into the Changing Character ofContemporar y Social Li fe, Pine Forge Press, NewburyPark, CA, 1993.

3. Levitt, T.,T he Marketing Imagination, Free Press, New

York, NY, 1987.4. Teboul, J., De-industrialize service for quality, in

Johnston, R. (Ed.), T he M anagement of Ser viceOperations: Proceedings of the Operations ManagementAssociat ion (UK ) Annual International Conference, IFSPublications, Bedford, 6-7 January 1988.

5. Lyon, P., Taylor, S. and Smith, S., McDonaldization: areply to Ritzers thesis, Int er nati onal Journ al ofHospitalit y Management, Vol. 13 No. 2, June 1994, pp. 95-9.

6. Piore, M.J. and Sabel, C.F.,The Second Industr ial Divide:Possibil it ies for Prosper it y, Basic Books, New York, NY,1984, pp. 190-1.

7. Pine, B.J.,Mass Customizati on: T he New Fronti er inBusiness Competi ti on, Harvard Business School Press,Boston, MA, 1993.

8. Sasser, W.E., Olsen, R.P. and Wyckoff, D.D.,Managementof Service Operati ons: Text, Cases, and Readings, Allynand Bacon, Boston, MA, 1978, pp. 61-4.

Tab le I . Mass customization contrasted with mass production

Mass production Mass customization

Focus Efficiency through stability and control Variety and customization through flexibility and quickresponsiveness

Goal Developing, producing, marketing, and delivering Developing, producing, marketing, and deliveringgoods and services at prices low enough that nearly affordable goods and services with enough variety andeveryone can afford them customization that nearly everyone finds exactly what

they want

Key features Stable demand Fragmented demandLarge, homogeneous markets Heterogeneous nichesLow-cost, consistent quality, standardized goods Low-cost, high-quality, customized goods and services

and servicesLong product development cycles Short product developmentLong product life cycles

Source:[7, p. 47]

Tab le I I . Cri ti cal shif ts in functional focuses under masscustomization

Functional Critical shift in focus required in movingarea from mass production to mass customization

Production From production or operational efficiency

towards process efficiencyResearch and From breakthrough innovations towardsdevelopment continual incremental innovations

Marketing From selling low-cost, standardizationproducts to large, homogeneous markets,towards gaining market share by fulfillingcustomer wants and needs

Finance and From external financial reporting towardsaccounting manager and worker useful information

Source:[7]


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9. MSI Databr ief: Fast Food UK , Marketing Strategies forIndustry (UK), London, 1991.

10. T he T imes, McDonalds, (special feature), 30

September 1994.11. Blair, K., Appetite for bigger slice of pizza sales,T he

Scotsman, 18 October 1994.

12. Donkin, R., No relish for cheese and pickle sandwich,Financial T imes, 28 October 1994.

13. Crawford-Welch, S., Product development in the foodservice industry, in Teare, R., Mazanec, J.A., Crawford-Welch, S. and Calver, S. (Eds),Marketing in Hospitalityand Tour ism: A Consumer Focus,Cassell, London, 1994.

14. Warnecke, H., T he Fr actal Company: A Revolution inCorporate Cultur e, Springer-Verlag, Berlin, 1993.

15. Burns, T. and Stalker, G., T he M anagement of

Innovation,Tavistock, London, 1961.16. For example, the healthy eating trend has led to lower fatproducts such as McDonalds McLean Burger andKentucky Fried Chickens Liten Crispy skinless friedchicken.

17. Scarpa, J., McDonalds menu mission,RestaurantBusiness, 1 July 1991.

18. Crawford-Welch, S., Product development in thehospitality industry, in Teare, R., Mazanec, J.A.,Crawford-Welch, S. and Calver, S. (Eds),Marketing inHospital it y and Tour ism: A Consumer Focus, Cassell,London, 1994, p. 169.

19. McKenna, R., Marketing in an age of diversity,Harvard

Business Review,January-February, 1991, pp. 65-79.20. The term flexibility and its operationalization can be

problematic. See Upton, D.M., The management ofmanufacturing flexibility,Cali forn ia M anagementReview, Vol. 36 No. 2, Winter 1994.

21. There is a paradox here in being able to tailor output yetretain the responsiveness associated with a standardizedoutput. For tactics on how to resolve this seeMcCutcheon, D.M., Raturi, A.S. and Meredith, J.R., The

customization responsiveness squeeze, SloanManagement Review,Vol. 35 No. 2, Winter 1994.

22. For a discussion of market fragmentation and, in

particular, psychographic fragmentation see Mueller-Heumann, G., Market and technology shifts in the 1990s:market fragmentation and mass customization, Journalof Marketing Management, Vol. 8 No. 4, 1992, pp. 303-14.

23. Davis, S.M., Future Per fect, Addison-Wesley, Reading,MA, 1987.

24. The development and deployment of American AirlinesSABRE system is an excellent illustration of this. SeeHopper, M.D., Rattling SABRE new ways to competeon information, Har vard Business Review, May-June1990.

25. The launch of McDonalds McLean Burger is a case inpoint. Although the development process took threeyears and cost $2 million, the test-marketing prior to fulllaunch was an incredibly short four months. McDonaldshistorically utilized a very protracted roll-out process fornew product launches (see [18]).

26. McNamee, P.B., Tools and Techni ques for Str ategicManagement, Pergamon, London, 1985.

27. Andrews, K., T he Concept of Corporate Str ategy, DowJones-Irwin, Homewood, IL, 1971.

28. Ansoff, H.I.,Corporate Strategy: An A nalytical A pproachto Business Policy for Growth and Expansion, McGraw-Hill, New York, NY, 1965.

29. Selznick, P.,Leadership in Admini str ation: A Sociological

Perspective, Harper & Row, New York, NY, 1957.30. Prahalad, C.K. and Hamel, G., The core competence ofthe corporation,Har vard Business Review, May-June1990.

31. Penrose, E.T., T he T heory of the Growth of the Firm,John Wiley, New York, NY, 1959.

32. Mahoney, J.T. and Pandian, J.R., The resource-basedview within the conversation of strategic management,Strategic Management Journal, Vol. 13, 1992, pp. 363-80.

Stephen Taylor is a Lecturer in Marketing and Phil Lyon is a Senior Lecturer. Both are based at the University of Dundee,Dundee, Scotland, UK.

5. industrialización-mcdonaldlization

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