Free Report On McDonald’s Corporate Strategy
McDonald’s is one of most renowned corporations in the world. The company has a presence in about 119 countries in the world and on every single day, it is estimated that the company serves more than 68 million customers. McDonald’s had managed to be a leader in the world’s fast-food industry and has been increasingly growing since it was first established in 1940 as s a single restaurant. The fast food industry is one that is highly competitive with both new entrants as well as already recognizable brands fighting for the market share (Yuece 12). Some of the fiercest competitors of McDonald’s include Burger King, Steers, Pizza Hut, Starbucks, Wendy’s, KFC among other private fast food chains (Yuece 12). However, one of the things that has propelled the company to its leadership status is brand loyalty. The company is constantly adjusting its recipes and food menus in order to meet the changing demands of its customers and this has created a huge sense of loyalty The company has about 2 million employers placing it only second to Walmart in terms of the largest private employers in the world. As mentioned, the company has braches all over the world with each branch having a store manager. The store manager is primarily responsible for all the business activities within the store including the hiring practices as well as coordinating with the senior management of the organization. With such a huge workforce or human resource, human resource management is a key aspect of the company’s overall functionality and operations (Yuece 18).
McDonald’s exists in the food industry whose key tenets include quality, customer satisfaction service and hygiene (Mello 49). The company has been able to consistently identify and select a workforce that is not only able to meet these demands but that is also able to deliver on the company’s philosophy and maintain its brand image (Aswathappa 192). The company realizes that for it to achieve its goals, its workforce must be motivated and committed, and there must be constant improvement and learning in the employees and this is, in fact, one of the key HR strategies in the organization.
There exists several unique HRM practices a McDonald’s. One of the most distinguishable HRM practices at the company is training and development. McDonald’s offers continuous training and development to its employees. This occurs through several activities that include day to day mentoring and coaching as well as technology assisted training and learning (Aswathappa 192). Managers in the different stores across the world are also taken through refresher management courses in order to be taught and gain crucial skills necessary for the daily and efficient running of the various stores belonging to the company (Aswathappa 192).
When it comes to employees, the company aspires to for them to have experience in all field of operations and therefore, it is not unsure to find employees being moved from one area of the company to the other. This is primarily aimed at assisting the employees to acquire relevant experience in all area of business and ensure that they can perform satisfactorily regardless of where they are placed (McDonald’s Corporate Careers n.p).
As mentioned earlier, McDonald’s understands that in order to obtain maximum productivity from its employees, they have to remain motivated. The company does various things to motivate its employee including giving them relatively good perks. In addition, the company is always promoting its employees. In fact, the company has a very well defined strategy of promoting from within. Whenever vacancies in management or supervisory positions arise, the first priority or the first people who are considered are the in-house employees (Aswathappa 193). The company is also constantly rewarding its employees and giving them various benefits including life insurance plans, recognition awards and even giving them a chance to invest in or buy the company’s shares. These are all HRM practices that are meant to motivate employees.
The company also has a very transparent and unbiased hiring and selection strategy. The store manager is usually responsible for all the hiring and selections taking place within a given branch of the company (Bowen 372). The hiring practices are however quite standard with the employees being expected to exhibit sufficient knowledge of the company as well as various skills and abilities to navigate through various situations with customers and in fact, some recruitment sessions may involve simulation of restaurant situations where the applicants are required to detail how they would act and react towards a certain situation and how they would resolve a certain problem within the organization’s ranks (McDonald’s Corporate Careers n.p). The company is therefore always striving to ensure that it hires only the best when it comes to employees. Employees are crucial to the company’s success and the management realizes that the goals and objectives of the company can only be met if the company hires a highly qualified workforce and puts in place strategies that are meant to motivate this workforce to ensure that it is performing to the optimum, This way the company is propelled towards the achievement of its main goals and objectives.
Interview with managers, supervisors, and other important stakeholders reveal that these individuals have great hopes and expectations for the company. A common vision among these individuals is for the company to become the most profitable organization in the world and to be the leading employer. These managers and leaders also feel and believe that human resources are key to the achievement of the organization’s goals and objectives and the company should therefore keep on looking for and enacting new strategies that are meant to develop employees both personally and professionally so that they can continue working in the organization and be part of its growth. The same sentiments are shared by employees who also feel that the organization should perhaps do even more that it is currently doing in terms of catering for their development so as to ensure that it is not only the goals of the company that are being pursued but that the employees goals are also met as part of this journey. However, it is important to note that most of the employees contend that the company is doing its best to try to cater for their well-being or welfare although there is obviously so much more that can be done.
According to one of the managers in the company, satisfying the internal customers who are the employees is the first step towards satisfying the outside customers.
These feelings are echoed by the mission of the company’s HRM which states that the company hugely value the growth, as well as the contributions of the human resource (McDonald's Mission and Corporate Values n.p). These feelings are also espoused by the core values of the company which express that the company only seek the people who are able to think, feel as well as express themselves and who are willing to learn and grow together with the company (McDonald's Mission and Corporate Values n.p).
There are various challenges that are faced by the various stakeholders in the company including the leaders, the senior management, and supervisors. The food industry is a service industry and mainly involves dealing one and one with customers. Customer complaints and misunderstandings are common at the workplace, and the managers have to effectively deal with these. A lot of times, disputes emerge because of minor disagreements or misunderstandings and the supervisors and managers in the workplace have react appropriately. In addition, the huge brand loyalty that the company enjoys means that many McDonald’s stores are often filled to the brim and the managers have to coordinate with the employees to ensure that service is delivered to the highest level and that quality is not comprised.
A major problem that faces the senior management in regards to HRM in the company is relatively high turnover rates (Yuece 15). There has been relatively high turnover rates in the company and the management has been trying to overcome this problem by adequately looking at employees’ needs and trying to meet them as well as encouraging employees to speak out on their desires and the things that they feel should be changed at the company (Yuece 16). This is all aimed at ensuring that the challenge and problem of high turnover that has affected the company negatively over the years is effectively resolved.
In future, the company hopes to grow and expand even more, and this means that it will increase its overall human resource. The company hopes to refine its hiring and recruitment strategies to ensure that it only hires highly qualified and motivated individuals who will be committed to the achievement of the organization’s goals. The company also hopes to give more independence and autonomy to employees and actively involve them in high-level decision-making in the company.
It appears that in terms of HRM initiatives, there is a slight gap between what this being said and what is being practiced although the company is trying its best to close this gap. The company, for example, claims to hire only highly qualified and committed individuals yet turnover rates speak otherwise. In addition, there is a still a minor discrepancy in hiring practices as unqualified and unmotivated individuals are still managing to find their way into the company.
This case study on MacDonald’s is a huge learning experience, and there are, in fact, several things that van be learned from this organization. The first thing is that employees must constantly be motivated if they are to perform at the optimum level and if they are to maximize their productivity. It emerges that motivation can be enhanced in employees by giving them various benefits and perks, promoting in-house promotions and giving recognition rewards.
The second thing learned is that an organization that helps to have a highly performing workforce must put in place hiring and recruitment practices that can sieve only the best employees and incorporate them into the company. However, this is not the end. The goals of the company and those of the employees must be aligned if the employees are to remain committed to the company and if maximum output is to be obtained from them.
Aswathappa, K. Human resource and personnel management. Tata McGraw-Hill Education, 2005.
Bowen, David E. "Managing customers as human resources in service organizations." Human resource management 25.3 (1986): 371-383.
Mello, Jeffrey. Strategic human resource management. Cengage Learning, 2014.
"McDonald’s Corporate Careers: AboutMcDonalds.com." McDonald's Official Global Corporate Website: AboutMcDonalds.com. N.p., 2015. Web. 5 Apr. 2015.
"McDonald's Mission and Corporate Values: AboutMcDonalds.com." McDonald's Official Global Corporate Website: AboutMcDonalds.com. N.p., 2015. Web. 5 Apr. 2015. <http://www.aboutmcdonalds.com/mcd/our_company/mission_and_values.html>.
Yuece, Ilhan. "SWOT Analysis of McDonald’s and Derivation of Appropriate Strategies." (2012) McDonald's Mission and Corporate Values.
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