It has become clear to upper management that the way McDonald’s has been operating over the past decade is not helping in moving the company forward. Upper management feels that the company is falling behind, and changes must be made immediately. The changes need to start with how the organization is structured. Once proper changes in structure are made, it is believed that McDonald’s will then be able to implement plans that will lead McDonalds into a successful future. The purpose of this paper is to make recommendations as to what changes in organizational structure would help McDonalds become more sufficient. Along with changes in structure the paper will also determine what work needs to be done, how it is to be done, and the approach that should be used to bring success back into the organization.
There have recently been talks between upper management about making necessary structural changes to the McDonald’s organization here in the U.S. The first recommended change is eliminating levels of management. Numbers of the past have shown that the old traditional way of communication and barriers of so many levels of management had become a barrier to decision making (Jennings, Maze, 2014). The team agrees with this change and believes that the change should be implemented as soon as possible. The basis for this change is that it will help in bring the company closer to the customers.
With so many layers of management it seems as if there is more time being spent arguing and talking to each other, rather than talking to the customer and making decisions. McDonald’s marketing has shown that they need to adapt to the current customer’s needs of what they want. McDonald’s president has worked for McDonalds for the last ten years, and he has seen numbers drop drastically which means, it is time for change (Jennings, Maze, 2014). Essentially it is safe to say that McDonalds is losing its relationship with its customers.
Another huge change that McDonalds has been thinking about is changing the number of divisions here in North America from three to four. It is believed that grouping the regions into four divisions, as well as eliminating some levels of management will allow for regional leaders to have more autonomy, and will allow leaders to set a menu based on the restaurants geographic location. According to the McDonald’s website, Jennings, Maze, (2014), “The changes are highlighted by the elimination of layers of management, giving leaders of its 22 U.S. regions more autonomy in setting the menus and making marketing decisions.” These changes will also allow McDonald’s leaders to restructure the menu to be more diverse to any one’s eating habit. They will be allowed to market more things on the menu than just burgers and fries. Change is good, and they are excited to embrace it.
How to do Work Effectively
Every organization has its’ own structure to follow. McDonald’s current structure is failing when it comes to the customers’ wants. This is why upper management has been talking about restructuring the design by dividing McDonald USA into four divisions. These divisions would include, Northeast, South, Central and West (Jargon, 2014). Each region would have a president in charge. Under each president there should be different types of managers who know the culture of each region. This will allow for the company to deliver the right product to the customers. They also need to remove some of the managerial levels because having too many managers’ results in decisions not being made. Eventually leading to a lack of growth in the business. McDonald needs to adapt according to the changes that are taking place in the world such as; the economy, competitors and technology.
They need to have basic meals that fit all regions; in addition to that, they need to create new products to fit with the culture of each region. Sweet tea is a good example of a product that fits in with the culture in the south. Therefore it would be good for McDonalds restaurants in the south to promote sweet tea. However, sweet tea is not very popular in the Northeast so it would be pointless to spend money promoting a product that no one is interested in. This is where the president of the region would need to find another product to promote. One that will fit the culture, and interest of the people in the Northeast. This means that management in each region needs to focus on research and development in order to make the right decision. In addition, technology is really important nowadays that is why McDonald needs to work with Apple to create an account in Apple Pay. Customers can pay quickly and order their food ahead of time.
This will satisfy their customers because most of them do not have the time to wait to pick up their meal. It will take both an individual and team effort for McDonalds to complete the work. Upper level managers will need to work individually to make the right decisions. For instance, upper level manager should study the region and try to figure out how they can enhance the product or create a new product to fit the culture. Lower level employees need to work in teams so they can satisfy the customers.
For example, the worker operating the grill cooks the meat and when it is done he or she passes it to another worker to make the sandwich according to the customers preference. Each team member is important because if they are not motivated to do their work the whole team will fail to deliver the product to the customer. It is very important that there is manager in each branch to motivate and coach the employees. Managers must be able to fill the role of an employee if the branch was crowded and direct them to do the right job. The manager should focus on increasing the sales by satisfying the customers.
McDonald’s Corporation needs to embrace that changes that are set to take place. Upper management will need to stick by their decisions, and have faith in their management. This means allowing the presidents in each of the four new divisions to take full control of operations within their regions. The division’s presidents must look to regional managers for input on necessary changes. It is up to them to find out what the customers want, and what the customers want is what they should get. Ideally McDonalds is looking to do two things when making these structural changes. The first is to keep the same basic product menu in every region, but allow for different regions to add certain products that cater to the customers in that region. Second is to allow for decisions to be made more efficiently and effectively.
The planning for these changes has already begun and sometime in the immediate future the changes will be implemented. These are good changes and the team feels that they will eventually make a significant difference in the overall success of McDonalds Corporation. It is going to take time, but we feel these changes will lead us into the future on the right path.
Jennings, Maze,, L.J. (2014). McDonald’s Reorganizes US into Four Regional Divisions. Retrieved from http://nrn.com/mcdonalds/mcdonald-s-reorganizes-us-four-regional-divisions Jargon, Julie, (2014). McDonalds Plan to Change U.S. Structure.
Rettrieved from http://online.wsj.com/articles/mcdonalds-to-change-u-s-structure-1414695278