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Title: Case Study McDonalds Corporation
Tags: case analysis, case study analysis, company analysis, McDonalds case study, food industry
analysis, fast food industry case analysis, case study assignment help, assignment help, McDonalds,
HRM management assignment, management assignment help McDonalds
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Global Human Resource Management Case Study: McDonalds Corporation
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Introduction
Global human resource management refers to the art of balancing people and processes in
an organisation. This process involves recruitment, selection and training individuals at the
management position in an organisation. In other words, global human resource management
refers to the process that recruits candidates, offer efficient training, improve their skills and
prepare them for their services according to the requirement of the organisation (Werner,
Schuler, Jackson, 2012). The overall objective of effective recruitment and selection process is to
make sure that an organisation is able to achieve its objectives and goals through its workforce.
The main aim of this analysis is to systematically investigate the processes and practices
associated to human resource in McDonalds Corporation. The human resource management at
McDonalds Corporation aims at escalating its distribution network by implementing its global
HRM strategies effectively, based on their professionals and resourcefulness to attain certain set
objectives.
Importance of HRM Strategies
Human resource management strategies enable an organisation to retain skilled, talented
and committed employees that it demands for. The process of recruitment involves application of
effective and efficient strategies to assess and meet upcoming demands of an organisation and
create a number of employment opportunities by making constant development in practices and
policies. Attracting, hiring and retaining a talented workforce are one of the most important
functions of HRM strategies (Bianca and Media, 2014). A good recruitment and selection human
strategy has the potential to develop organisational performance by offering employees with
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wide and extended responsibilities, so that they successfully make proper use of their skills and
abilities.
Examine HRM goals of employee commitment, flexibility, equality and strategic integration
It is the workforce in an organisation that is responsible for carrying out a number of a
number of work activities. Managers and HR professionals of McDonalds Corporation perform
the most crucial job of managing people so that they can successfully conduct these work
activities. This demands perceiving people as human assets, not costs to the company. Perceiving
employees as assets is part of global human resource management and global human capital
management. The global human resource management team of McDonalds Corporation explains
various effective strategies to the management team to strategically organise employees as
business resource (Barrows and Powers, 2010). These strategies involves managing recruiting
and hiring candidates, maintaining employee benefits and proposing employee training and
improvement strategies. In such way, HR professionals perform as consultants, not workers in an
isolated business environment as they recommend managers on many issues associated to
employees and also help the organisation in attaining its objectives.
Managers and HR professionals of McDonalds Corporation work in coordination at all levels
to develop required skills in employees of an organisation. For instance, HR professionals give
advice to managers and other executives at the time of assigning various roles to employees in
the organisation, thus helping the company adapt effectively to its environment. It has been
observed that in a successful organisation, employees are assigned to various business processes
based on employee preference and business priority. HR professionals also recommend strategies
and policies for boosting employee commitment to the organisation. This commences with
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applying the recruiting practice or matching employees with the appropriate positions based on
their qualification or experience (Grandori, 2002). Once recruited, employees need to be
dedicated to their professions and feel motivated throughout the year by their managers. Global
human resource management team facilitates an organisation in developing a competitive
advantage, which involves creating the potential of the organisation so it can provide a dynamic
set of products or services to its customers.
Figure 1: Recruitment as a strategic HRM tool
(Source: Compton, Morrissey, Nankervis and Morrissey, 2009)
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The chief and important goal of global human resource management in McDonalds
Corporation is to make sure that all employees carry out their work processes well in order to
fulfil the demands of the organisation. Moreover, the global HRM are accountable for utilising
the full advantage of the potentials of the employees and keeping the right employees in the
required job positions. Global HRM consist of a number of business schemes and policies
required to manage the employees within a business organisation. The human resource
management strategies of McDonalds Corporation mainly encompass the anticipations that
managers demands from their employees, as well as the benefits and compensation given to the
employees. Some of the main important business work done by human resource professionals are
the selection of employees, employee training and the retention of desired employees.
The global HRM of McDonalds Corporation creates programs and policies designed to make
sure that the performances of the workforce within the company supports the mission of the
organisation. HR managers and supervisors investigate the aim of the goal and create policies
and practices to manage the selection and improvement of the employees in organisations. Along
with applying the policies and practices to attract and retain desired employees, the global human
resource management analyse the most crucial job responsibilities based upon the objectives of
the company and categorize job profiles, as well as the duty for each job profile. HR managers
and professionals are responsible for managing the diversity in the business organisation. In the
era of globalisation, majority of business organisations consist of candidates with different
backgrounds, experience and qualifications. Human resource maintains employee objectives
with the motive that differences in employees are valued and respected. Such types of issues are
usually mentioned in employee personnel manuals, which may also involve other company
formalities.
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Evaluate the effectiveness of HRM strategy in achieving these goals
An organisation is unable to establish a good team of working professionals in the absence of
good human resources. The global human resource management advances the bottom line of an
organisation with its wide knowledge about the human capital and organisational factors. The
HR managers and other professionals of McDonalds Corporation have proficiency in HR
strategic management involve in company decision-making focuses on current staffing
assessments and plans for future employees based on business requirement. Realistic
compensation frameworks are developed by HR compensation experts to decide company
earnings competitive with other organisations in the area, in the similar industry or organisations
competing for candidates with same skills. They carry widespread salary and wage surveys to
preserve compensation costs aligned with the current financial status and set revenue of an
organisation.
The global human resource management of McDonalds Corporation motivates the people in
a business organisation, to perform according to their skill and offer them guidance that can
assist them to bring about changes in it. This result in better communication with the workforce
individually from time to time and offers all the required information associated with their
processes and also describes their respective roles. Employee relations experts in HR assist the
organisation attain high performance, confidence and satisfaction levels throughout the
employees, by developing ways to fortify the employer-employee relationship. They conduct
employee opinion surveys, administer focus group and receive worker opinion related with job
satisfaction and practices the worker can maintain effective working relationships.
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The main objective of human resource management of McDonalds Corporation is to achieve
the organisational goals and objectives. It ensures the efficient and effective implementation of
resources and guides the utilisation of human and non-human resources in order to achieve the
organisational goals and objectives. Business organisations aspiring to consume their resources
efficiently encourage the HR professionals and supervisors to develop required aims and
objectives. Training program which is an essential part of recruitment and selection procedure
proposes measures for enhancing employee commitment to the organisation. The HR
professionals of McDonalds Corporation make sure that employees, after hiring, will remain
committed to their jobs and feel motivated throughout the year by their seniors. The global
human resource management of McDonalds Corporation aims at intensifying its distribution
network by effectively implementing its HRM strategies, based on their professionals and
resourcefulness to fulfil certain defined objectives. At the time of issues and disputes in an
organisation, human resource strategies act as a consultant and mediator to solve those conflicts
in a successful manner.
In other words, HRM of McDonalds Corporation implements timely action and avoid things
from getting bad. It has been seen that the art of building successful and good public relations
depends on HRM to a large extent. The HRM department is responsible for organising business
meetings, conferences, seminars and different official gatherings for the organisation with the
motive of building relationships with other business organisations. Sometimes, the HRM also
plays a crucial role in creating the marketing and other business plans for the organisations.
Human resource training and development officers of McDonalds Corporation manage new
employee orientation, an integral aspect in implementation of successful and effective employer-
employee relationship. The human resource strategies implemented by these officers assist in
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providing training that aids the organisation’s fair employment schemes and employee
development programs to develop aspiring employees for management and supervisory roles.
An organisation without an appropriate setup for human resource management is likely to
suffer from severe issues while coordinating its daily work activities. HR experts and
professionals adopt efficient measures in reducing the organisation’s costs related with abrasion,
turnover and hiring replacement employees. They are vital to the organisation as they have the
talent and skills essential to consult group benefit packages for workers, within the set budget
and reliable with economic conditions. They also are well aware with employee benefits need to
attract new employees and retain skilled employees. Human resource strategies of McDonalds
Corporation ensure that the organisation works in accordance with federal state employment
laws. This is the main reason that today a number of organisations need to put a lot of efforts
and energy into establishing a strong and effective global human resource management.
Relationship between HRM and Organisational Performance
HRM and Organisational performance are inter related and are the most significant aspect
of McDonalds Corporation. Organisational performance is associated with various factors such
as operation, strategies, aims, management and challenges. It is considered as a fundamental and
crucial component of an organization functioning. Organisation performance is typically
organisational behaviour and development occurring in an organisation both internally and
externally. The McDonald’s Corporation is one of the famous fast food chains in the world, and
it is an important part of the life of a number of people of all age groups. The iconic American
restaurant has been implementing various techniques and human resource strategies for
encouraging employees and teaching leadership techniques and skills. All these factors in
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McDonalds have provided an excellent opportunity to the management to hire a number of
desired and talented employees.
Theories related to HRM and Organisational Performance (diagram)
It has been observed that employees in the McDonald’s Corporation exhibit quality
leadership as HR managers and professionals of the company adopt significant measures to
influence and motivate employees. The work culture of the company is basically dependent on
the specific line manager in charge at a specific period of time. The HR professionals of the
company use effective leadership skills to encourage young or inexperienced workers. These HR
professionals and experts successfully conduct business operations in a machine like manner,
specifically at the time of high business. Nevertheless, it has been also experience that lot of
business managers of the company seem comfortable, and sometimes, behave in the same
manner like other employees of the company. The business managers of the company apply a
number of leadership theories in their working style. In the McDonalds Corporation, human
resource managers and professionals applied Situation Leadership Theory (SLT) and Path-Goal
to motivate the working pattern of employees.
Figure 2: Relationship among Leadership Variables
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(Source:
http://www.mc.edu/rotc/files/9213/1471/9571/MSL_202_L09b_Situational_Leadership.pdf )
Situation Leadership Theory (SLT): Situation Leadership Theory (SLT) is implemented
continually by human resource managers to fulfil the necessary requirements of employees in the
organisation, based on the specific situation (Wagner, 2006). Through the implementation of
SLT, managers of the company work to introduce changes and innovations in their recruiting and
selection process and do not motivate employees to follow managers’ style rather encourage
them to introduce their own style. SLT focuses mainly on two types of organisational behaviour
in an organisation; Task behaviour and Relationship behaviour.
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Figure 2: Situational Leadership Model
(Source: http://www.kenblanchard.com/getattachment/Solutions/By-Offering/Situational-
Leadership-Development/Situational-Leadership-II/The-SLII-Experience-Sample-PW.pdf )
According to this theory business environment and the willingness of employees
determine to a great extent, how managers will perform in specific situations. The human
resource managers by determining the relationship between environment and the willingness and
inspiration of employees, can strengthen the leadership skills, achieve experience and self-
esteem in their own leadership style. This theory typically relies on the ways employees respond
to working and being associated in groups. As per the modern theories of situational leadership
proposed by P. Hersey, K.H. Blanchard, and D.E. Johnson, employees cannot be influenced by a
one single way (Situational Leadership, n.d). These theories suggest that the leadership style
selected by human resource managers of McDonalds Corporation depends on the environment
and the willingness or the capability of employees working in an organisation.
Path-Goal Theory
This theory was created to define the way that leaders motivate and assist their employees
in attaining the objectives they have been set by offering the path that seems clear and easy.
Path-Goal Theory is used by human resource managers of the McDonalds Corporation to
motivate their subordinates and HR executives. This theory is applied by managers or leaders of
the company to encourage and motivate employees by following leadership styles and behaviour
of their leaders. This theory states that the behaviour of leaders is followed by employees of the
company as they perceive it as a source of inspiration, motivation and job satisfaction. This
theory also states that the perception of employees is influenced by the behaviour and leadership
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styles of leaders or managers of the company. The McDonald’s Corporation applied this theory
to motivate employees to perform well as it offers many opportunities, such as promotion,
incentive, and paid holidays, to enhance job satisfaction and motivation.
Figure 3: Path-Goal Theory
(Source: http://www.managementstudyguide.com/images/houses-path-goal-theory.gif )
In the area of organisational performance and human resource management, the path-goal
theory determines the impact of behaviour of leaders on employee’s job satisfaction, motivation
and effectiveness. This theory consists of four leadership behaviours which are supportive
leadership, directive leadership, participative leadership and achievement-oriented leadership.
The aim behind these leadership behaviours is to enhance employee motivation and confidence
by identifying the influence of both environmental factors and employee characteristics in work
activities. Moreover, this theory states that achievement- oriented behaviour of HR managers and
professionals concentrates on motivating performance excellence by aiming objectives and goals
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that challenges employees throughout the year. According to this theory, the main concern of the
HR managers is to support and maintain the psychological well being of employees of the
company. It also involves leaders or managers consulting with workers regarding individual
choices in executing job requirements.
Impact of HRM on Organisational Performance
Over the last few years remarkable steps have been made in discovering the impact of
HRM on organisational performance. McDonalds Corporation is specifically aim at expanding
their sales to customers who are not yet familiar with company’s food items. The HR managers
of the company achieve their objectives not only through advertising, but by expanding their
distribution network as well. The strong human resource management of the McDonalds
Corporation has created on effective association between strategy and performance of employees
as well as HR professionals. The fundamental reason that keeps McDonalds Corporation apart
from other organisations of its type and discovers the scope of its operations in product and
services is described as the mission of the company. Effective set up of human resource
management enables an organisation to develop consistency, which results in offering employees
a clear direction to fulfil customer demands and achieve higher satisfaction.
An effective management of strategic human resource of McDonalds Corporation is
focussed on the harmonisation of organisational work activities and practices to the business
strategy. The HR professionals and other managers of the company assist in identifying the
business strategy by converting it into effective HR practices and processes. To meet the
challenges in the highly competitive world HR managers and employees need to constantly
renew their knowledge, skills and work activities and also invest highly in the improvement of
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their human capital. It has been observed in a number of researches that investment in training
employees is responsible for bringing profitable organisation level outcomes.
McDonalds with the aim of development of desired worker behaviour and skills
implements the use of appraisal mechanism. The implementation of performance appraisal by
the McDonalds Corporation involves promotion, termination, assessments and performance
improvement. As a result of which, development of performance appraisal is considered among
the highest priorities of the McDonalds Corporation. Performance appraisal system in
McDonalds Corporation has the capacity to bring lots of benefits for the organisation such as
promoting more communication, increasing employee attention through promoting trust,
improving performance, and estimation of training requirements.
Employee empowerment in McDonalds Corporation is considered as the process of
enabling employees to think, behave, adjust, take proper action, coordinate work and decision
making in an effective way to enhance work productivity and efficiency. The process of
employee participation and involvement in decision making enables employees to boost their
confidence and self-esteem. This strategy is used by human resource management team to
promote motivation in employees in different ways to attain the specific goals and objectives of
the organisation. Another human resource strategy which promotes employees to work is the
process of compensation. It has been observed by the management of HRM of McDonalds
Corporation that compensation has an important impact on performance of employees.
Global Issues influencing the development and implementation of global HRM strategies
Organisations seeking new opportunities in new markets face many challenges and issues
so human resource management of the organisation plays a crucial role in order to tackle these
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challenges. In this context, some of the challenges faced by organisations are differences in
social, political and economic environment, resistance to change in the organisation, recruiting
high quality employees, developing a long term HR plan and aligning HR strategies with the
overall corporate objectives (Snell, 2011). In the world of 21st century, a high number of
companies have been trying to compete globally; there is a high demand for employees, leaders
and managers. HR managers have to find staff with global skills, as well as, offer appropriate
training and skills to them.
Organisational, National and cultural Issues
Organisations generally deal with a number of issues and problems while conducting its
recruitment and selection process. The quality and talent of employees hired by an organisation
depends on its valuable recruitment and selection human resource strategy (Berman, 2006). The
process is not always smooth as employers face a lot of problems and conflicts such as cost
offered for advertising job openings and various other barriers such as improving communication
between recruiters and hiring agencies (Tan and Nasurdin, 2011).
The human resource department generally faces issues related with executing department
audits, collaboration of performance management system and creating policies on worker
attitude and behaviour. The HR professionals face issues related to employee conduct involve
low employee morale, high voluntary and involuntary revenue, and analysis of workers
complaints filed with state enforcement organisations. The global HRM of McDonalds
Corporation is also responsible for handling of diversity conflicts and partially responsible for
diversity management (Stanleigh, n.d.). The compensation experts in human resource department
are equipped with the duty of ensuring the McDonalds Corporation offers competitive salary and
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gives attractive inclusive benefits packages. Moreover, the compensation experts also build
networking relations with their competitors and counterparts. These experts usually face
challenges and issues that demand them to explain budget increases to stay competitive and hire
the best, highly skilled job candidates. Even if salary and benefits are not considered as the
priorities for few job searchers, they are aspects to be critically considered when searching at a
potential employer.
In the recent few years, the HRM of McDonalds Corporation has been highly criticized
for offering low wages to employees. Employees were feeling frustrated and stressed with the
increasing responsibility and constant promotions. The company also faces complaints regarding
slow service, high calorie food, etc (Huang, 2000). The famous fast-food company has been
questioned for not offering overtime rates even when employees work in double shifts. In this
high competition, the human resource management of the company was working with the
strategy of high profits and low wage costs, resulting in understaffing wherein all employees are
required to work harder and faster. This results in causing frustration among company’s
employees and they start criticizing the company in public.
In context to McDonalds Corporation, where the achievement and accomplishment of the
company depends on three factors i.e., hiring, training and developing creative workforce, the
organisation is constantly facing challenges such as employee’s dissatisfaction and less retention
level (Mieth, 2007). The company’s HR strategy has been again dealing with issue of retention
of talented and skilled employees after the criticism for health food has been faced by company.
As a result of, the company lacks succession planning that requires to be achieved in order to
retain the talented employees and handle other major issues and conflicts associated to the HRM
department. The company has been highlighted in public many times for its inability to treat its
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employees fairly. For instance, the employees of the company believe that the main reason for
them to leave the job is that they are being offered low compensation.
Systematically Analysis of Organisational, National and cultural Issue
Training and selection programs assist an organisation to understand different aspects of
culture education and represents a good image of employees’ significance and value to the
organisation. Human resource managers work hard to hire candidates who adjust with culture of
an organisation. They need to keep their focus on diversity and equal opportunity as well as both
moral and lawful hiring policies. At the time of issues and problems, the HR professionals need
to resolve issues between the requirements of organisational culture and those of ethical practices
(Adler, & Gundersson, 2008). HR professionals need to perform the process of screening at the
time of hiring. The process of screening leaves few candidates out and allows others to move in
the company. When the culture of an organisation focuses minimum observance to the law, the
HR professional sometimes experience an ethical issue while suggesting a highly qualified
employee who does not adjust in the background required for an organisation quota.
Privacy is always an integral aspect of the McDonalds Corporation. Even though the
company has a friendly culture and motivates employees to openly discuss personal information
and lifestyles, the human resource managers of the company has a moral responsibility to keep
such information private and confidential. Human resource challenges generally face by HR
team includes maintaining productivity, hiring employees, executing training processes, keeping
employees safe, resolving conflicts and avoiding discrimination (Catano, 2009). Creating and
offering benefits, motivating and managing diversity, and maintaining outsourcing are important
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aspects as well. Each and every organisation faces specific human resource issues based on the
HR manager as well as policy of the organisation.
An important and major objective of a human resource department of McDonalds
Corporation is to handle and manage employees to keep them productive, which results in high
revenue. HR managers, therefore, adopt specific measures regarding the number of employees
per shift, team tasks, motivational offers such as bonuses, incentives, and keeping morale high.
These elements can have powerful relationships, so the problem is how to do improvements in
one area without highly affecting other (Nichols, Rourke, and Vlachopoulos, 2011). It is very
challenging and difficult for HR managers to make modifications and correct arrangements that
do not align with the budget of the company.
Human resource managers of the company are responsible for employee recruitment and
selection. They need to work hard to discover processes, such as attending job fairs, forwarding
promotional mailings, to produce interest in specific openings and the organisation as a whole. In
the context of McDonalds Corporation, the HR professionals deal with lots of issues in this area
because of globalisation as companies are competing with each other globally than in just one
small region or country (Burnes, 2009). Well qualified employees are searching for jobs that
offer more of stability between family and employment. In such cases, HR managers of
McDonalds Corporation need to provide high in terms of profit packages or incentives, as well,
because talented candidates constantly searching for jobs that minimise their risk in unfavourable
economic situations.
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Recommendation for addressing Organisational, National and cultural Issues
The main issue that McDonalds Corporation is facing today regarding its recruitment and
selection procedure is that the organisation is still focussing on traditional methods of HR
practices and policies. Thus, it is vital that the company need to emphasis on using print
advertisements and agencies while recruiting large number of skilled and talented
employees. Moreover, the organisation can also implement other measures of effective
recruitment processes for example job boards and virtual social networks (Compton et-al.
2009)
The company can also take further efforts and measures in this area such as making use
of referrals. This will assist the organisation to choose those employees who are highly
qualified and skilled from leading college and university. In terms of recruiting young
and skilled employees, referral system is considered to be the most efficient method as it
assists the organisation to meet its talent demands.
The company is recommended to work on fast innovation technology and thus meet the
needs of its customers across the globe with its creative menu and healthy food items.
The implementation of referral system will aid the company to monitor its core activities
and processes.
Other than this, with the help of private consultancy companies with the aim of recruiting
the individuals, the organisation can be benefited as these agencies will be able to find
more talented and efficient people (French, 2011). Even this activity demands high cost,
but the process is appropriate for the organisation to make the talent acquisition process
to be more successful and effective.
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For the recruiters who are appointed for the recruitment campaigns of the organisation, it
is vital that the organisation should hire trained recruiters in their organisation. This is
because efficient and skilled recruiters will help in maintaining the significant aspects or
queries of the applicants who are placing their resume for employment in the company.
Along with this, the recruiters of the McDonalds Corporation are recommended to be
able to identify other factors in the candidates such as technical qualifications, high skills,
innovation and creativity. This can be achieved by appointing a specialised team that
consist of both human resource specialist and experts who are dedicated to generate high
recruitment output for the organisation.
Furthermore, the recruiters need to be responsible, helpful and technically competent
(Barrows and Powers, 2010). The HR professionals and recruiters of McDonalds
Corporation should be willing and should possess the information about the current
changing business environment they are facing with, the competitors, the demand and the
requirements of the candidates and necessity and demands of the current markets. This
will assist the company to achieve a productive and effective workforce.
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