To determine if McDonald’s has competition when it comes to having a business that is profitable and where diversity and career opportunities is what help put McDonald’s way ahead of the competition.
The article McDonald’s Corporation describes McDonald’s as the world’s largest restaurant chain and has been in business since 1948 where Dick and Mac McDonald opened up McDonald’s Bar-B-Que restaurant in San Bernardino, California. Ray Kroc, the man who made McDonald’s a household name became a franchising agent for the McDonald’s brothers in 1954 and opened his first McDonald’s in Illinois in 1955. The brothers sold the company to Ray Kroc in 1961 for 2.7 million. Revenues reached a record high of 22.8 billion in 2007. According to its website, McDonald’s is the leading global foodservice retailer with more than 32,000 local restaurants serving more than 60 million people in 117 countries each day. More than 75% of McDonald's restaurants worldwide are owned and operated by independent local men and women. I will examine if McDonald’s is truly a company that has a strong HR methods in order to stay on top.
1) What should McDonald’s do to further reduce turnover and improve its HR management?
According to the article, McDonald’s turnovers have decreased from 170% to 130-135%. They have developed hiring tools that reduce subjectivity in the selection process and weed out poor prospects with a questionnaire that the applicant fills out that correlates well between high scores and future success. They estimate that they receive over 1 million applications a year. According to the textbook Human Resource Management by Anthony, Kacmar, and Perrewe, companies like McDonald’s should us the incremental approach when faced with a high turnover rate. The approach include increasing wages by $1 per hour, implementing career tracks and promotions for all employees, increasing benefit packages, and allowing for a more flexible work schedule. This step-by-step method could be used to determine whether a step affects the turnover rare and is and would be less costly (pg. 119). I think that because McDonald’s is a fast food restaurant, their turnover will tend to be on the high side because the majority of their employees are teenagers to people who are in their early twenties and may be in college. Most of the teenagers can only work during the summer and on weekends and this could also be why their turnover is so high. McDonald’s would need to have a better training and development programs for its employees. According to the textbook, a decision regarding training and development involves the extent in which the firm will train and develop employee’s verses hiring already well-trained and developed persons (pg. 266). With a company as large as McDonald’s, they could continue to train the employees that they have in order for the company to continue to grow and to make their turnover decrease even more. They could also encourage creativity among their employees and this would help to develop and market new products and ideas (pg. 266). McDonald’s would also need to improve its recruitment tactics. According to the article, McDonald’s periodically uses employment applications as placemats, while this may be an ingenious idea, most people really don’t pay attention to a paper placemat and the placemat will eventually end up in the trash. With technology being as it is today, McDonald’s does have online applications on its website for corporate opportunities, restaurant opportunities, and internships Depending on the job that is posted, McDonald’s could recruit from the inside to fill positions this would help to fill positions that are posted as well as give an employee an opportunity for growth within. They could also recruit from the outside for fresh new ideas. McDonald’s would also have to improve on retaining their star employees by being a company where people want to...
Cited: Anthony, W., Kacmar, K., & Perrewe, P. (2010) Human Resource Management: A Strategic Approach. Mason: Cengage Learning.
McDonald’s (2011) Values in Practice Report
Retrieved from http://www.aboutmcdonalds.com/mcd/csr/report/employment
Your Guide to Indian Food (2011). Retrieved from http://www.food-india.com
How McDonald’s Work. Retrieved from http://money.howstuffworks.com/mcdonalds.htm/printable
Bahaudin, M.G., Patel, B. (2007). Nova Southeastern University: McDonald’s Success Strategy and Global Expansion through Customer and Brand Loyalty. Retrieved from http://clutinstitution-onlinejournals.com/PDFs/115.pdf
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