The story about McDonald’s Essay
The story about McDonald’s
McDonald’s was a big organization in Malaysia and their name is very famous especially for the teenagers. McDonald’s is well known as an organization that served fast food such as hamburgers, French fries and other consumable items as their main business. McDonald’s was established in 1940 by two brothers, Dick and Mac McDonald and they opened their first restaurant in California. Before they owned the restaurant, they only sell the hotdogs but their restaurant becomes very famous when they served around 25 items which mostly are barbequed. Now, they operates in over 100 countries and has over 30, 000 restaurants worldwide. They can maintain their success because of their goals and objectives that motivate them to be a successful organization in the world. Their goal is to serve good foods in a friendly and fun environment, to be a socially responsible and to provide good returns to its shareholders. They are functioning to serve foods that are mainly burgers, fries, shakes and a variety of other food items. In McDonald’s, there are a mission and vision that helps them to achieve their goal so that all the people in the organization can work hard to ensure their work place can achieve the target.
In McDonald’s, they are using matrix organization or multi – level organizational structure which is headed by the CEO and the board of directors. Then, CEO will lead a group of line managers who are in charge in different aspects of the company such as supervisor, human resources and operations. The organizational structure of McDonald gives a big impact in helping the restaurant to have an effective performance and to help them to achieve their goal. McDonald’s also use the motivation as one way to encourage the subordinates to work harder according to their job specification. They use a lot of method in motivation such as Maslow’s Hierarchy of needs and Herzberg two factor theories. They trust that to gain a productive and positive behaviour through its employees, management needs to create a sound motivational environment within the entire organization. When they can motivate the employees to do their job, it will lead the McDonald’s to be one of the competitors in business. In all the organization, there was a leader that will monitor and control all the process in the organization so that the entire problem that occurs can be solved quickly. McDonald’s also use the leadership process in their organization. Firstly, in their work culture, they seem highly dependent upon the particular line manager in charge at any given point in time. It means that the manager would use their power and style of leadership in training the inexperienced employees.
They used the middle – of – the – road management which is they concern about people and also their task because they want to ensure the customers satisfied with their services towards them. They also used task – oriented style which is they are more concern with getting the job done. McDonald’s used a lot of method in leadership to ensure that their business is running smoothly. This organization is very alert with their business and they always control the organization so that they can detect the problem and solve it before the other problem occurs. They used feed forward action or preventive control that is used before the process is star. Concurrent control is used on the transformation stage to ensure they conform to the organizational standards while corrective control is used after the process is finish to create a better quality in performance and production. One organization cannot be complete if in their organization doesn’t have the communication. Communication is a medium to communicate with other people. McDonald’s use vertical communication because their organizational structure is not a flat structure. So, in their organization, there will a downward communication and also upward communication. This communication is very important because it can make the information disseminate quickly. McDonald’s is one organization that we can take as an example when we want to establishes our own business because they are committed with their work to ensure their objectives and goals are accomplished. They also always motivated to do their job efficiently so that they also can get more rewards.
McDonald’s is one of the leading restaurant chains in the world that served fast foods. They also had known as the largest food retailer because they have more than 30 000 local restaurants in more than 100 countries. McDonald’s was establishes in 1940 by two brothers, Dick and Mac McDonald’s in San Bernardino, California but in Malaysia, McDonald’s opened its first restaurant at Jalan Bukit Bintang, Kuala Lumpur on 29 April 1982. The headquarters of McDonald’s in Malaysia is Golden Arches Restaurants Sdn. Bhd. which is located at Damansara Uptown, Petaling Jaya, Selangor. The strength of the alignment among the company has been key to McDonald’s success. Usually all the organizations have their own objectives and goals that they want to achieve. McDonald’s also have their own goals that was establishes when they want to start their business. Their goals are to become a customer’s favourite way and place to eat and drink by serving core favourites such as the world famous French fries, Big Mac, Quarter Pounder and Chicken McNuggets. They also want to serve good foods in a friendly and fun environment, to be a socially responsible and to provide good returns to its shareholders because they want to be the best in the world. Furthermore, they also have the functions that can make people know more about them because they are responsible to serve foods that are mainly burgers, fries, shakes and a variety of other food items.
As we know that McDonald’s is one of the world’s largest chains of hamburger fast food restaurants and they served almost 47 million customers daily. A McDonald’s restaurant is operated by a franchise, an affiliate or the corporation itself and they primarily sells hamburgers, cheeseburgers, chicken products, French fries, breakfast items, soft drinks, shakes and desserts but because of the obesity problem that occur in the certain places, they modified their menu to include healthier alternatives such as salads, wraps and fruits so that people also can enhance their balance diet. As we know, McDonald’s is a corporation that mainly sells fast foods. So, their products predominantly sell hamburgers such as Big Mac, Quarter Pounder with cheese and Double Cheeseburger. Besides that, they also have other product such as French fries, soft drinks, breakfast items that served a lot of healthy food such as fruit and maple oatmeal, hotcakes and fruit and yogurt parfait and desserts. Not only that, they also served desserts so that they can offer variety type of food to the customers but at the some other places, they also served salads and vegetarian items such as Premium Bacon Ranch Salads, Premium Caesar Salad and Premium Southwest Salad. They also got a new product to gain more customers to try their restaurants.
The new product from them is wrap and other localized fare. If we explore about McDonald’s especially their products, we can find that McDonald’s will always create a new recipe so that the customers will enjoy with McDonald’s. McDonald’s also having the services that can be as an attraction to attract the people to come to McDonald’s. They served us with wireless connection so that we can surf the internet easier while eating. McDonald’s also have the arch card and play places and parties. We can see that the McDonald’s also allow the parents to make a surprise party for their children with a lot of activities and gifts. So, they can gain income from customers by having all this services. Their line and staff responsibilities started with restaurant manager which his or her have to control for every aspect of the restaurant’s performance. After that, there are first assistant manager that have the responsibility to consistently demonstrate the ability to evaluate the restaurant’s performance.
Second assistant manager will take secondary responsibilities such as crew training, workplace safety and ordering stock. They also have the trainee manager that will demonstrate and reinforce the leadership behaviours and basic people skills necessary to gain commitment from crew and other shift managers. They also have their own department in their organization such as functional departmentalization, product departmentalization and customer departmentalization. In functional departmentalization, McDonald’s will separate the sales and marketing with the operations so that the staff can perform better based on their work divisions. Besides that, McDonald’s also practice the product departmentalization. They separate the activities and costs related to the preparation and serving of food and in customer departmentalization, they will divide the organization around the types of customers.
MAIN BODY OF THE REPORT
All the organizations in this world will have their own plan to ensure that they achieve the goals and objectives. Planning is an important managerial function that must have in one organization. Manager must play their role to plan ahead to get things done through his subordinates. With planning, managers can inform the subordinates about the organization’s goals and objectives. Usually the goals and the objectives will be establishes before they start their operations. Planning is a process that we set goals and we define the actions necessary to achieve those goals whereas plan is a method of doing or making something and consisting of goal and a course of action. First step in planning is we must establish the objectives and goals. The goals will be set by the top level management and will be disseminate to the middle level management and lower level management so that the subordinate also can understand deeply about their job and they will struggle to make the objectives can be realized. In planning, they also will set up the vision, mission statement, goals and also the objectives. McDonald’s also practice this planning and we can see that they are struggling to achieve their goals. A vision is a mental picture that you have and want to turn it into reality in the future.
Their vision that is established is to be the world’s best quick service restaurant experience. They want to provide the outstanding quality, services, and cleanliness and value so that they can make their customer in their restaurant satisfied with their services. Mission also will be establishing before we start our business. Mission is a specific goals that unifies the organization. McDonald’s mission is to be our customer’s favourite place and way to eat and drink. So, they are committed to continuously improving their operations and enhancing their customer’s experience so that their profit also can improve. Goal refers to a future target or end result that an organization wishes to achieve. McDonald’s also having their own goals like other organizations. Their main goal is to serve good foods in a friendly and fun environment, to be a socially responsible and to provide good returns to its shareholders. They also have other goals that they want to achieve. Firstly, they want to improve McDonald’s reputation within the industry and reinforce McDonald’s image with a new communication focus.
They also want to promote their new initiatives to new potential customers and to gain support from the customers for their new aim. Objective refers to narrower targets or shorter time frames. There is one type of objective that McDonald’s used in their organization, which is organizational objective. Organizational objective is the formal targeted of the organization. McDonald’s objective is to be the world’s best quick service restaurant experience. Besides that, they also have other objectives that support them to be the best organization in the world. First is profitability. McDonald’s is a large corporation and because of that they must remain profitable to stay in business. To remain that, McDonald’s offers quality products at affordable prices. Second is the quality service.
They aim to offer quick, efficient products, at a reasonable price. For example, McDonald’s has expanded their menu that containing fruits and vegetables and has increased the awareness of the fruits and vegetables. Next is customer satisfaction. For them, customer loyalty is very important because without customers, their reputation can be decrease. They will identify the needs of the customers and because of that, they are the organization that almost people choose because they are very friendly and they served a comfortable environment especially for the family that have kids. They also want to strive to increase their financial and volunteer support to Ronald McDonald’s House Charities through the community outreach. Mission statement is written document developed by the management that is normally based on input by managers and non – mangers. McDonald’s have the mission statements to help their management focus on human effort in a common direction. Their brand mission is to be our customer’s favourite place and way to eat. With this mission, we can describe their values.
They place the customer experience at the core of all we do which means that they provide customer with high quality food and superior service. Second is they are committed to the people with provide them opportunity, recognize talent and develop leaders and they believe in the McDonald’s system. Besides that, they operate their business ethically with conduct the business to the highest levels and give back to their communities with helping them to build a better community. For example, they establish Ronald McDonald’s House Charities. They grow the business profitability and they want to strive continually to improve which means that they consider as a learning organization that is green and growing. These are the values that enhance them to be the best organization that served fast foods. They used a strategic plan that is called “Play to Win” which is designed to create a consistently excellent customer experience in McDonald’s restaurants. In this strategic plan, they focus on 5 P which is people, products, place, price and promotion.
Organizing is the process of determining the task to be done, who will do them, and how those tasks will be managed and coordinated. Other that, organizing also defines as to structure or arrange the relationship between people, the work to be done and facilities so that goals are achieved. In McDonald’s, they are using matrix organization or multi-level organizational structure which is headed by the CEO and the board of directors. Then CEO will lead a group of line managers who are in charge in different aspects of the company such as supervisor, human resources and operations. The organizational structure of McDonald gives a big impact in helping the restaurant to have an effective performance and to help them to achieve their goal. McDonald’s also use the motivation as one way to encourage the subordinates to work harder according to their job specification.
The organizational structure has a big impact in helping the restaurant to have an effective performance and also help it to meet its objectives. The production function helps McDonalds by ensuring that there are enough food products, packaging for foods in order for the restaurant to operate each day, and to meet the need of the customers’ needs are met. To do this McDonalds order the food that it needs from the suppliers in bulk whenever needed, this is essential due to McDonald serving over a thousand customer a day, the restaurant need to be well equipped with food products of packaging for the food so that it can run successfully and not have customers complaining due to the lack of food this way the customers need are met because they would be getting the food they order. In other hand, product function also ensures that McDonalds maintains and improves the quality of both the food and the service that is provided for its customer.
SPAN OF MANAGEMENT
Can be defines as a number of subordinates who report directly to a given manager of supervision. It is also called as “span of control “. In theory, when task are very complex span of control should be relatively narrow.
CHAIN OF COMMAND
Define as separate line of authority among all position in an organization.
LINE AND STAFF RESPONSIBILITIES
Line authorities are those organizational members that are directly involved in delivering the products and services of the organization. Firstly is a Restaurant Manager. As a Restaurant Manager, he or she will be responsible for every aspect of the restaurant’s performance. This includes managing all restaurants employees and their development, overseeing restaurants operations, meetings sales and profits targets and business planning. The development does not stop here because he or she will complete stage four of MDP, attend the Business Leadership Course (BLP) and will receive regular formal and informal feedback and training from the Operations Consultant (area manager) or licensee. With the completion of the four stage of the MDP program, the associated courses and the required restaurant experience make this person to apply for an Advanced Diploma in Business Management. Second is the First Assistant Manager. The First Assistant Manager, he or she expected to consistently demonstrate the ability to evaluate the restaurant performance and will develop and implement goals and actions plans designed to bring about performance improvements.
As a leader by he or she peers, this person will train and develop future manager in all aspect of the restaurant’s systems and performance. Then this person will complete the third stage of the MDP and attend the Restaurant Leaderships Practises Course. After gaining success at stage three of the MDP program, the associated courses and the required restaurant experience make this person eligible to apply for Diploma of Retail Management. Other than that, when a person successful completion of level one of the McDonald’s MDP and having demonstrated the ability to maintain a consistently high level of QSC, this person will promoted to Second Assistant. This provides the platform to take on secondary responsibilities such as crew training, workplace safety, and ordering of stock. As a manager, this person will contribute to the retention of crew who are enthusiastically dedicated to customer satisfaction. This person also will start with second stage of the MDP which, depending on his or her ability may include attending various courses such as Advanced Shift Management (ASM) and System Management. Each person’s suitability to be considered for a Trainee Manager’s position will be assessed on their ability to supervise people, product and equipment to deliver outstanding Quality, Service, Cleanliness & value (QSC&V) on assigned shifts and their motivational desire to perform.
This person should demonstrate and reinforce the leadership behaviour and basic people skills necessary to gain commitment from crew and other shift manager. This person will develop a thorough understanding of McDonald’s Management Development Program (MDP) culminating in this person attending the First Management Course at Head Office. After completion of the first stage of the MDP program, the associated courses and the required restaurant experience makes this person eligible to apply for a Certificate III in Retail.
A restaurant is likely to use a combination of different groupings. Location is likely to be used in a restaurant chain, where more than one branch of the same chain exists in a region, city or country. As an example, the 25% of McDonald’s restaurant that are not franchises are managed by a hierarchy of staff, including area supervisors. Each area supervisor is responsible for the performance of a group stores in a specific geographical area.Functional departmentalization in a restaurant can operate by separation of sales and marketing versus operations. Operations in the restaurant context apply to the preparation food, while sales would apply to the serving to the customers. In this scenario, management maybe have difficulty deciding where to include staff that makes and serves drinks at the restaurant’s bar, because they involved in both activities. The departmentalization according to the product type could work in a licensed restaurant is by separating the activities and cost related to the preparation and serving of food from those that applied to preparing and serving drinks. In this type of departmentalization, the bar becomes a separate department from the dining area, a logical method of categorization in this industry. Chain of command departmentalization works when the restaurant is large enough to required more than one management division.
For example, if a management role for one or more people exists on the same level as another management role that oversees different staff or customer groups, such as the operations and the finance, then these can be said to be departmentalized by chain of command.Customer departmentalization works by dividing the organization around the different types of customers. In a restaurant environment, this could take the form of individual customers versus catering for corporate clients and group events. One group of staff may handle the day-to-day operations of the restaurant, while separate group manages the catering arm of the company, whether on the premises or outside. Departmentalization like would effectively also be functional and possibly chain-of-command departmentalization at the same time.
The McDonald’s company applies three components of the motivation system, financial encouragement, non financial encouragement, and social policy. All the three factors are described in Maslow’s motivation theory. However, Maslow states that all the needs must be fulfilled one after another. The research of the McDonald’s company, its strategy and structure shows that only a simultaneous fulfilment of employee’s needs will increase an employee’s performance.
Financial encouragement is McDonald’s give a rewards to employees. For example, increase compensation after McDonald’s profits is so healthy that it could afford to raise wages. Besides that, McDonald’s will give quarterly bonus to its crew and manager’s instead of yearly. If any employee stays at McDonald’s for a long period, he or she could advance into an assistant manager or manager position. He or she could easily move into manager position and continue his or her career with the company or gain experience to move into another job without a formal education.
Non financial encouragement is encouragement from positive perspective middle manager to lower manager. For example, managers were also instrumental in helping out struggling team members by motivating them. The commitment and positive attitude towards a given task are derived from the employees’ motivation and leader behaviour. Besides that, connected with employee’s satisfaction of needs such as his or her recognition.
Social policy is implement policies that ensure employees follow procedures, not to mention riding crew and other manager’s asses in regards to training those procedures and following up with them on the procedures all the time. For example, McDonald’s establish the punch card system to discipline their worker time management.
In this observational study, we sought to discover what leadership techniques and group skills were actually practiced by McDonald’s employees. Besides that, we could observe the behaviour of managers and employees and customer
interactions without interfering with normal operations. Due to the fact we were restricted to a small sample of McDonald’s restaurants, we could not capture the complete spirit of the corporation. However, we were able to relate our findings to leadership and organizational behaviour theories and some of McDonald’s corporate values. Though a series of observations and corporate research we discovered that McDonald’s employees demonstrate quality leadership and that the organization as a whole puts significant effort into motivating and working for its employees. In leading, there was a leader, leading and leadership. Leader is the people that can influence other people while leadership is the process of directing and influencing the task – related activities of group members. When analyzing an organization’s leadership and teamwork skills, it is useful to first analyze the organization’s work culture and how this culture maintained. The work culture of McDonald’s seems highly dependent upon the particular line manager in charge at any given point in time. One would imagine that the manager would almost always use position power and would in time. One would imagine that the manager would almost always use position power and would use a telling style of leadership since the typical employee is young or inexperienced. Indeed some managers were observed as running the operations in a machine like manner, especially during peak business periods. However, in the majority of cases the managers were relatively relaxed and sometimes were indistinguishable from the other employees.
In general, the managers did not try to put any strong vertical barriers between themselves and their employees. Managers usually seemed to display real concern and interest in the emotions and well-being of their employees, which was not expected in this environment. For examples, one manager was observed asking an employee cleaning the floors about her weekend and her kids. There seems to be legitimate efforts in order to motivate employees even at the line worker level. McDonald’s believes in training and leadership at all levels through Hamburger University. They take the quote by the founder of McDonald’s and it shows that McDonald’s does not believe its crew but based on the corporate policy, the employees should be paid at or above from the local market and they also have the rights to get benefits from the organization.
The leadership that is showed by the line managers are more to informal and relax atmosphere because they want the subordinates are not in stress condition while working. McDonald’s used the managerial grid or leadership grid. Managerial grid is a two dimensional matrix developed by Robert Blake and Jane Mouton to help measure a manager’s concern for people and task. We identified that McDonald’s used the Middle – Of – The – Road Management or also known as Organization Man Management which manager shows a moderate concern for employee satisfaction and production. They concern about people and at the same time they also concern about the task. So, they will balance both of this concern so that they can serve customer and in the same time they are still having their commitment to work. They practice the task oriented behavior. For example, the line managers in McDonald’s seemed to be very expert and they can solve all the problems with giving the directions to the subordinates.
There were no conflict between leaders and followers while the process. Task – oriented is more concerned with getting the job done to his satisfaction and this type of managers would closely supervise to employees to ensure that the task is carried out satisfactorily. According to the Path – Goal Theory, McDonald’s used supportive behavior as a medium to ensure that the subordinate can do their work in the friendly environment. Supportive behavior is aimed at being friendly with followers and shows the interest to them as human being. They believe that success can be gain from the talented crew and because of that, they only explain to them their work and they will not disturb them to do their work unless there is a problem. In the Life Cycle Theory, it is known as Delegating style which is the leader only provides the subordinate with a few tasks. Usually, in this style, the workers are skilled and experienced.
Controlling is a process through which managers regulate the organizational activities to make them consistent with expectations and help them to achieve predetermined standards of performance. In an organization, we must control all the activities so that it will happen as what we planned. Planning and controlling is different. Planning is a process we identify the timing and scope of all our actions but it is not enough if we do not follow it. One mistake can make us fail to achieve our goals and because of that we need to control. So, we can develop the methods of measurement and control so that we can take corrective actions when our plan is fail. McDonald’s also practice control in their organization because their aim is to serve the good foods to the people. They use three types of control method.
First, they used pre – action control. Pre – action control focuses on the inputs that are material, financial and human resources to the transformation process. It is initiated before the start of production or service activity. For example, McDonald’s will control the ingredient in their food because they have their own specification in their food such as the colour of the buns must be uniformed. Second is concurrent control. It is used on the transformation stage. It is purpose to regulate the activities to ensure that they conform to the organizational standards. It also monitors the ongoing activities to ensure that the transformation process is functioning properly so that the desired result is achieved. For example, McDonald’s will constantly observe what is taking place even though while helping out the work. They are trained to correct the actions on the spot. Next is corrective control or feedback control. In this stage, they will take corrective action that needs them to check the products whether it meets the standards or not. McDonald’s trying to pass cost on the operators in an aim to cope with slow sales.
The franchisees claim McDonald’s is charging them too much for things like rent, training and software which is making it difficult for operators to turn a profit and is also discouraging them from making improvements to their eateries, exacerbating the slow sales problem. The growing disconnected among franchisees comes as comes as McDonalds faced with increased competition and a tough global economic environment, looks for away to spark sales. This is increasingly tough balancing act, as customer tastes change, McDonalds’ needs to increase the range of new products it offer, so the challenge of reducing waste becomes even greater. They ordered stock using their local knowledge as well as analysis of data indicating what the store sold the previous day, week and month. For example, if the previous week’s sales figures showed they sold 100 units of coffee, and net sales they rising at 10% weekly, they would have expected to sell 110 units in the present week.
Communication is a process by which a person, group or organization transmits some type of information to another person, group or organization.
McDonald’s utilizing vertical communication to spread the information to their workers. This way easier to McDonald’s to transfer the information from the top level to lower level. McDonald is a big organization in Malaysia. Besides that, they use this communication to get closer with customer. This way will keep their performance much better than before. The vertical communication has two flows. The first flow is downward communication. The downward communication is the message from manager (the top manager) of McDonald’s are passed down to the subordinates (the lower manager).It’s provide direction and control for the employees. This communication is more formal and easier to the middle manager of McDonald’s to spread the information for the lower level manager of McDonald’s. The middle manager of McDonald does can give the direction directly or instead to the lower manager or subordinates. For example, McDonald has a middle manager such as supervisor for every department. The task of the supervisor is give order from the top level to the lower manager. The second flow is upward communication. The purpose of upward communication is to provide feedback on how well things going right in McDonald’s company.
This communication is important because they can keep their performance continuously good. McDonald’s have created “Customer Satisfaction Service” to the customer express their dissatisfaction via online. This medium the way of McDonald accomplish their mission and vision goals. The customer can express their dissatisfaction about the cleanliness, the workers attitude or their delivery of service to the customer. This medium also the faster way to the customer expresses their dissatisfaction on the McDonald’s performance.
McDonald’s is a multinational corporation, which is perceived as many different things to different people. Some people see McDonald’s as a decent, fast and inexpensive meal. Others may view the company chain as a low quality restaurant that employs uneducated and unskilled people. Nevertheless, McDonald’s has a cheery corporate image that prides itself on quality and cleanliness, as well as good food and good service. The company employs state-of-art technology to help its workers in their tasks and makes the production process faster, attending to the customers in a prompt manner. In terms of leadership, McDonald’s makes a strong corporate effort to develop leaders. There are growth opportunities within the corporation for those who are willing to work hard and develop their leadership skills. There is a great upward mobility for Macdonald’s employees. From what we observed in our field study, the work culture displayed in the McDonald’s stores is aligned with the firm’s corporate values.
Siti Hawa Kasim. Julai 2010. Fundamentals of Management.
Norlida Kamaluddin. Za’faran Hassan. Rabiah Abdul Wahab. Rohaya Mohd Hussein. 2011. Principles of Management. First published. Oxford Fajar Sdn. Bhd.
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