Management and Organisational Behaviour: McDonalds

McDonald

McDonald’s (McDonald’s Corporation) is a large chain of the hamburger fast food restaurant, with approximately thirty thousand branch stores in the world, and more than 58 million customers every day to use the service. McDonald’s Business began in 1940; a restaurant opened by brothers Richard and Maurice McDonald in San Bernardino, California. They recommend the “Speedee Service System” principle to create the modern fast-food restaurant, established in 1948 (Wiki 2010).

McDonald’s first proposed for the United States and the name of McDonald’s on May 4, 1961, with the description of “Drive-In Restaurant Services,” which is still by extending the end of December 2009. In the same year, on September 13, 1961, the McDonald’s filed a logo band on the overlap, double arch “M” symbol. Overlapping double arch “M” symbol logo are being unwelcome by the September 6, 1962, when the brand was applied for a single arch, shaped many of the early McDonald’s in the early days. Modern double-arch “M” symbol, which continues to use of McDonald’s restaurants but did not occur until November 18, 1968, when the company is now well-known brand in the United States of symbols, which is still in use in the end of 2009 (Wiki 2010).

McDonald’s main sells hamburgers, French fries, chicken products, shakes, soft drinks, ice cream, and salad. McDonald’s restaurants to be find everywhere more than one hundred countries on six continents in the world. McDonald’s has become most valuable brands in catering trade. McDonald’s is represents an American way of life in many countries. McDonald’s is the largest international fast food franchise company. But McDonald’s is become corporate ethics and consumer responsibility focus, because there are food lead to obesity, and then the company has changed its menu. In addition to its well-known restaurant chain store, McDonald’s company held a minority interest in preterit manager until 2008, and that was a important investor in the Chipotle Mexican Grill until 2006, and owned the restaurant chain Boston Market until 2007. McDonald’s restaurant is operated by a franchisee, an affiliate, or the company itself. The company incomes come from the rent, royalties and money paid by the franchisee, and sales in company-operation restaurant. McDonald’s income grew 27% over the three years ending in 2007 to $22.8 billion, and 9% growth in operating income to $3.9 billion (Wiki 2010).

Business Background

Burger King

Burger King, often referred as BK, is a world-wide chain store of hamburger fast food restaurants headquartered in America. Burger King Holdings is the parent company of Burger King; in the United States it operates under the Burger King Brands title of internationally it operates under the Burger King Company banner. The company begins as a Jacksonville, Florida-based restaurant chain store in 1953. At first that called Insta-Burger King. After the company across into financial difficulties in 1955, its two Miami-based franchisees, that is include David Edgerton and James McLamore, and they buy the company and change the company name to Burger King. Across the next half century, the company would trade four times, with its third set of owners, a partnership of TPG Capital, Bain Capital, and Goldman Sachs Capital Partners, taking the company to enter the market in 2002. The current ownership group, 3G Capital of Brazil, acquired a mass stake in the company in a trade valued at $3.26 billion in 2010 the end of the year (Wiki 2010).

At the end of 2010, Burger King has reported that more than 12,200 point in 73 countries; 66% are in the American and 90% are personal owned and operated. The company has serving employees more than 38,800 and approximately 11.4 million customers every day. In the course of its company history, they have used some variations of franchising to grow its operations. In North America, franchises are licensed on an every store basis, there are sold in several international locations licenses on a regional basis with the patentee has exclusive development rights for the place or country. This area are referred as master franchise, and is responsible for opening new restaurants, the licensing of new third-party operators, and the implementation of standards monitor of all restaurants location in these countries, For the example the largest of the main franchise Hungry Jack’s, which is fully owned, operated or sub-license more than 300 restaurants in Australia. Although it relies on most of the revenue of its franchisees, Burger King’s relationship with its franchise is not always harmonious. Occasionally spats have caused many problems between the two countries, and in certain circumstances, the relationship between the company and its licensees have degenerated into precedent setting court cases (Wiki 2010).

Burger King’s menu has evolved from a basic product of hamburgers, French fries, soft drinks, milk shakes in 1954,to a bigger, and more diversified of products, that including several variations of chicken, fish, salads and breakfast. The first major addition to the menu is the Whopper, a sandwich development for McLamore in 1957; it has become Burger King’s signature product. Not all have success introducing of Whopper; the burger King has promotion many products but failed to catch the market held. Some products in US have not seen success in foreign markets, where Burger King the menu has dedicated shallow area of the taste. After the purchase of the company in 2002, Burger King began to vigorously target the 18-34 male demographic with a bigger product, often carry large amounts of unhealthy fats and the corresponding trans-fats. This tactic will eventually hurt the company’s financial base and cast its negative earnings (Wiki 2010).

Organisation Structure of McDonald’s

In figure 1, that is show the McDonald’s organisation structure in every chain store. McDonald’s managing organisational structure looks at chart 1, at the top are the restaurant manager, and under that are the first and second assistant managers. And the assistant is executive the trainee manager, below that are the floor manager, that include the shift running floor manager, floor manager and the trainee floor manage. In this floor manager, the shift running is the top, and trainee is the low. Finally, the floor manager is managing other employee.

In figure 2, this chart is talk about McDonald’s international organizational structure. In the international, the company is talking about how to executive other country chain store. The organization structure of McDonald’s is pyramid-shaped, to ensure consistency of service delivery across all country. Look at the chart 2, at the top are the chairman and CEO to managing USA and international, below the president and CEO international are executive other all location.

Motivation

McDonald’s

The McDonald’s is Full utilization of human resources of an organization is one of the most momentous advantage, which the company is occupies the leading position in the world market.in the ‘McDonald’s’ company flourishes to the logical integration of the employee into the problem solving. The Company insists on principle: ‘The result is through by a person. ‘McDonald’s’ is checking the main source of their employees to progress in the field of quality and productivity. This organization is based on the motivation of its success has changed some aspects of them, ‘McDonald’s’ insist to four simple principles, given the possibility to increase the performance of their employees:

The Company must elaborate different systems and departments motivation.

Must have clear and achievable goals. It is better to have a common goal to everyone.

The aim must change: managers should have a common goal for half of a year

The rise of salary amount must be sensible for an employee.

‘McDonald’s’ application of the three components of motivation system: financial encouragement, non-financial encouragement, and social policy. All the three factors are described in Maslow’s hierarchy of needs motivation theory. The architecture has five levels of human needs and that must be completed in order to move to the next level. Start with the physical level is basically a normal need. Once this has completed a next level of security, where the employee must feel personally the financial and security, to move to the next level of needs, this is the ‘social demand’, and then the self-esteem and self-realization. However, Maslow said that all the needs must be complete one by one. The study of the ‘McDonalds’ company, its strategy and structure that only meet to needs of employees will increase employee performance. It is not necessary to meet the needs of all levels.

McDonald also applies to the ‘two-factor theory’ written by Frederick Herzberg, which clearly define between satisfaction and dissatisfaction with the two factors’ motivators’ and ‘hygiene factors’. Just improving the wages, safety and status, that do not motivate the staff. It just makes staff less dissatisfied with their work; it does not help to improve output. In order to increase production, managers need to give sure feedback to staff to encourage them to do the best they can. This shows the staff who were recognized for their work to do, thus enhancing their motivation.

(Renu & John 1976)

Motivation

Burger King

Leadership

McDonald’s

The McDonald’s companies of the leadership development include five factors that are below:

Annual Review of Management Performance – Independent directors in consultation with the Chairman of the Compensation and Governance Committee shall approve the annual goals and objectives of the CEO, which should be consistent with the aims and objectives of the Company relating to the establishment of remuneration of the CEO annually by the Remuneration Committee in accordance with its Charter. In order to ensure unity in these discussions and evaluation of the performance of CEO, Chairman of the Remuneration Committee should be the governance committee.

Succession Planning – The Board should periodically review the initiatives and leadership development, and succession planning short-and long-term chief executive and other senior management positions, including the unexpected event of vacancies in these offices.

Board Self-Evaluations – Governance Committee should annually assess the performance of the board as a whole. Individual directors should be regularly assessed, but in any case little more than each time they are scheduled for re-election. Upon completion of these assessments, Governance Committee may choose to base the practice on the other board directors; flow surveys, questionnaires and evaluation forms; to engage external consultants and advisers

Committee Self-Evaluations – Each audit, compensation and Governance Committee should annually evaluate the performance of the Commission. The responsibility of each enterprise and the Finance Committee should periodically to assess the performance of the Commission.

Director Orientation and Education – new non-management Dectors should participate in a direction, shall address the company’s operations, strategic planning performance and corporate governance practices, and should include too company’s senior management and their individual responsibilities.

(Mc 2010)

Leadership

Burger King

Learning & Knowledge Management

McDonald’s

In the University of Hamburg, from around the world to provide training courses, there are 19 full-time professors and restaurant operations expertise. McDonald’s employee is training, to adjust their specific career path, Restaurant Manager progress the way through the change management and systems management courses. Once these courses completed, they learn more knowledge and skills in the Hamburger University.

The middle management learning to builds on their leadership and counseling skills, teaching individuals how to effectively operate, and how to consult with other coaches and to run a large restaurant.

Take action implementation of learning paths help to consolidate the ongoing development of business and leadership skills, senior management staff.

(Mc 2010)

Burger King

Human Resource Management

McDonald’s

McDonald’s is the largest fast food restaurant in the world and second biggest employer in the US. The company have 500,000 employees are serving more than 90,000 branches all over in the world, McDonald’s great leaders need more knowledge and skills of human resources management than any other company. Its human resources management skills extend far past the normal administrative capacity, such as the management of trade union work force and design benefits.

With the job market rebounds and staff re-evaluate there are choose, the chief executive is placing a greater premium on the ability of the HR senior management to preserve talent, and to set up succession planning. In order to remain competitive, companies need the full range of human resources experience and talent, the skills in enlist and retention. McDonald’s use science recruitment, retention strategies and approaches to employee performance management, development and reward.

(Hackman & Oldham 1976)

Burger King

Culture & Diversity

McDonald’s

Around the world, McDonald provides inclusiveness and diversity for everyone to equal opportunities and contributes to the success. Such as the integration of diversity initiatives into our day by day business convention, with a strong diversity of educational course, employee business networks, external partnerships and minority organisation.

McDonald’s constantly evaluate a performance, so that have a strong representation to ensure diversity at all levels, that including gender, race and nationality.

In addition, we are proud that we have the bigger quantity of minority and women owners of the franchise in the fast-service industry. Our National Black McDonald’s Owners Association is one of the most successful African American business organisations in the country.

And then McDonald’s suppliers are diverse. On average, we spend four billion U.S. dollars annually in food, paper packaging, and restaurant operating supplies, uniforms and toys from the minority businesses.

(Mc 2010)

Burger King

Information Technology

McDonald’s

McDonald’s is considered one of the most successful to use Improve the application’s menu.

Transaction processing, records and financial management is one of the most important factor, the company is use application of information technology to help improve customer relationship management, sales and marketing activities, there have a real-time transmission system . It is used in order to handle customer orders and payments efficiently, that is a fast way. And then the data has been collect in their POS machines can be used to understand the buyer behavior of customers, can help companies satisfy needs of their customers.

In addition, the company also uses the Internet and Intranet, so that can connect to their stakeholders. The Internet is used to start the different marketing strategies, and can connect to their potential and loyal customers. On the other hand, the intranet as a private communication channel of the internal

(Thinking 2010)

Burger King

Communication

McDonald’s

McDonald’s is design a new communication to change a large number of people eating behavior. McDonald’s new communications is referred as “”Happy Exercise and Love Touch Health” project, with the World Health Organization, nutritionists, local communities, fitness centers and a variety of media channels. McDonald’s health movement including organisation, communication-based interventions for different populations and social marketing efforts, service on two objectives:

Change the image of the McDonald from junk food to become friendly and healthy food restaurant. The purpose is attract those who are health-oriented, focusing on healthy food and healthy lifestyles, and expands the market.

Change behavior of existing consumers and know who are taking junk foods, convince many fast food users to change the lifestyle by buying balanced meal with McDonald’s, and the traditional foods and healthy foods together. McDonald’s will interest more on how consumer explain particular messages in the media and on what types of messages are more effective with which types of target viewer from the perspectives of communication.

(Tianbai 2009)

Burger King