Leadership Strategy of McDonalds - Assignment Example

Leadership Strategy of McDonald’s INTRODUCTION The concept of leadership can be defined as the notion of competence which tends to influence a group towards the accomplishment of organizational objectives. In accordance with the present business environment, it is firmly observed that the leaders of the modern organizations must possess the capability of dealing with potential challenges and effectively managing the entire workforce to achieve the desired objectives of the organizations (Pearson Education, “Organizational Behavior”). In relation to the present rapid development of the fast-food industry, McDonald’s recognized itself as one of the leading and most successful players which has been performing in 119 global nations in excess of 30,000 fast-food outlets. The company is well-known for its exceptional offerings of fast-food items in accordance with the need and desires of its global customers. The company has been regarded as one of the dominant brands in the respective industry through its well-built managing capabilities of its different business operations. In this context, leadership plays a vital role for McDonald’s to perform its unbeaten performance in the global fast-food and restaurant industry. The company possesses a well-built and consistent leadership approach which further empowers the company to achieve its desired goals and objectives. In this context, it is often observed that the aforesaid leadership approach extensively supports McDonald’s to obtain superior competitive position as compared to others in the respective industry (McDonald’s Corporation, “2012 Annual Report”). THESIS STATEMENT Emphasizing upon the continuous success along with dominant nature in the global fast-food industry, the primary purpose of this report is to reveal the leadership systems or approaches relating to McDonald’s. The discussion of this paper will also encompass the core leadership approaches of McDonald’s which enables the company to attain greater competitive position in the respective global business industry. Moreover, the discussion of this paper will further focus on demonstrating the major strengths as well as the weaknesses of leadership approaches of McDonald’s and providing significant suggestions towards improving the approaches perform by the company while performing different operational functions. LEADERSHIP AAPROACHES OF MCDONALD’S In accordance with the business strategy of McDonald’s, it is often observed that the company tends to focus on targeting consumers by offering a range of quality based fast-food products in accordance with the tastes and preferences of the customers. With this regard, it can be apparently identified that the organization significantly focuses on complying with an effective leadership approach which leads to perform organizational operations in a more exceptional way as compared to other competitors within the global business markets (McDonald’s Corporation, “McDonald's Reports Growth In Fourth Quarter And Full Year 2012”). In order to perform the dominant nature in the global fast-food industry, the leadership approach of McDonald’s significantly focuses on developing business strategy along with employee motivation. As a result, it has been viewed that the company possesses an exceptional leadership approach with the intention of raising greater customer value and accomplishing desired business targets by a considerable level. With this regard, a transformational leadership approach is significantly observed within the company i.e. McDonald’s facilitating the company to continuously improving its global business performances. Moreover, the transformational leadership approach further leads to develop the employee’s skills and performances through which the company attained superior competitive position in the growing fast-food industry (McDonald's, “Continuing to Build a Values-Based Culture”). Transformational leadership is duly regarded as one of the promising aspects of leadership style which enables the business leaders to transform their capabilities of developing the organizational processes at large. It has been witnessed from the last few decades that the notion of transformational leadership approach proved to be quite successful for the marketers in terms of developing human traits along with advancing various forms of organizational behaviors. With regard to the present emerging business processes of the global marketers, it has been apparently observed that the execution of transformational leadership approach significantly influences the achievement or breakdown of the organizational processes. The practice of transformational leadership approach impressively supports McDonald’s to appropriately manage and efficiently control the overall operations of its broad assortment of global fast-food outlets. Moreover, the role and nature prevailing in the transformational leadership approach is significantly focused on promoting creativity of each individual belonging to McDonald’s to develop its range of business operations effectively. In addition, the aspect relating towards decentralizing the operational responsibilities along with possessing the tendency of accepting risks also boosts the organization to attain higher competitive position within the worldwide business market (Boje & Rhodes, “The Virtual Leader Construct: The Mass Mediatization and Simulation of Transformational Leadership”). In addition, it can also be recognized that a practice of charismatic leadership approach also enables McDonald’s to independently perform its dominant nature in the global fast-food industry. In this regard, the concept of charismatic leadership approach can be identified from justifying extraordinary or exceptional capabilities of the leaders in terms of improving the performance of the workforce by a greater level. This particular leadership model executes the notion of charisma by maintaining an optimistic vision influencing the followers to become more productive towards the attainment of organizational goals (Pearson Education, “Organizational Behavior”). Therefore, on the basis of the above discussion, it can be stated from a broader perspective that the practice of transformational and charismatic leadership approach within the business operations of McDonald’s can be regarded as the pivotal factors leading the company particularly in the global fast-food industry. Due to its stable business along with financial position and superior brand image within the global fast-food industry, it is becoming more effective for McDonald’s to implement transformational and charismatic leadership approach to strengthen its competitive position by a significant level. Moreover, the bureaucratic and decentralized business structure of the company also emphasizes to efficiently perform transformational leadership approach and obtain greater control along with manage the performance of its range of fast-food outlets in various geographical locations. In accordance with the business operations of McDonald’s, it has been viewed that the fast-food outlets belonging to the company tend to deliver exceptional range of products through the integration of creativity of the employees. The fast-food outlets of McDonald’s significantly involves practicing product diversification which enable the organization to meet the needs and desires of the global consumers. The integration of transformational leadership approach supports McDonald’s to efficiently control the bottom line employees and ensures to improve their operational performances at large. Moreover, it is to be stated that the practice of charismatic leadership approach facilitates the company to effectively direct and interact with the workforce and promote individual opinion and ideas in terms of its decision-making procedures. Contextually, the notion of charismatic leadership also improves the loyalty and the willingness of the employees towards performing their assigned roles and responsibilities within the organization. The leadership trait in the transformational approach significantly focuses on motivating and encouraging workforce towards striving the potential goals and objectives which further enable the organization to attain its desired business goals (McDonald’s, “Continuing to Build a Values-Based Culture”). STRENGTHS AND WEAKNESSES The inclusion of transformational strategy as a leadership system or approach has found to be more effective for McDonald’s in terms of strengthening its leadership capabilities of managing, controlling along with empowering the performance of its range of business activities. Due to the extensive implementation of transformational and charismatic leadership strategy within the fast-food restaurants, McDonald’s succeeded to compete with its major rivalries and also attained superior competitive position over its chief business market contenders. However, the company has also faced certain crucial challenges concerning the extensive integration of these leadership approaches which resulted as the major weakness of the company in the global fast-food industry. Few of the major strengths and weaknesses of McDonald’s have been demonstrated in the following discussion (McDonald’s Corporation, “2011 Annual Report”). STRENGTHS In respect to determine the major strengths of implementing transformational as well as charismatic leadership approach, it has been apparently observed that certain important factors have enabled the company to perform its dominant nature in the fast-food industry. Few of the major strengths that McDonald’s acquires from adopting its exceptional form of leadership approaches are transforming vision, increasing employee morale along with emphasizing more disciplines within the organization (McDonald’s Corporation, “2011 Annual Report”). In relation to measure the benefit of transforming vision, it has been identified that the practice of transformational style enables the business leaders of different organizations to formulate futuristic vision which further leads to enhance the communication process with their entire workforce by a greater level. In relation to McDonald’s, the leaders of the organization tend to focus on formulating vision in accordance with the cultural preferences along with encompassing the changing trend of the customers in terms of preferring fast-food products (Boje, “The Leadership of Ronald McDonald”). Moreover, the transformational and charismatic leadership approach also provides effective support for McDonald’s in terms of enhancing employee morale and value. In this regard, the transformational leadership approach in McDonald’s tends to energize the morale of the employees and make them more productive and determined towards effectively performing their roles and responsibilities (Boje, & Rhodes, “The Virtual Leader Construct: The Mass Mediatization and Simulation of Transformational Leadership”). In addition, the practice of charismatic leadership further empowers McDonald’s in terms of renovating the discipline of the employees. In accordance with the performance of the leaders, McDonald’s able to create well-built teams in different regions of the world. The notion of charismatic leadership approach consists of short-term goals which tend to revitalize the performance of the employees at large. In this concern, the approach helps the organization to achieve its short-term goals and promotes continuous development of the overall functions (Boje, & Rhodes, “The Virtual Leader Construct: The Mass Mediatization and Simulation of Transformational Leadership”). WEAKNESSES Apart from the significant strengths, the practice of transformational leadership approach also possesses certain limitations which generates significant challenge for McDonald’s to maintain its continuous growth. According to the present competitive business environment, the business performance of McDonald’s has been facing different challenges in terms of attaining its long-term goals in the respective industry (Boonaier, “The influence of Transactional, Transformational Leadership on Leader-Follower Value Congruence and Leadership Success”). Due to the short-term nature in the said leadership approach i.e. transformational leadership, it has been affecting McDonald’s to attain its long-term goals. Additionally, the said leadership approach of McDonald’s is also generating certain difficulties for the managers to strengthen its corporate structure (Boje, & Rhodes, “The Leadership of Ronald McDonald”). Although the practice of transformational leadership strategy improves the organizational business performance, it also hinders the environmental policies that are occurred while conducting operational activities (Boonaier, “The influence of Transactional, Transformational Leadership on Leader-Follower Value Congruence and Leadership Success”). In this similar context, charismatic leadership approach substantially strengthens the overall process and functions of McDonald’s. However, the notion of practicing such leadership approach also involves certain limitations that are significantly affecting the overall functions of McDonald’s. The concept of charismatic leadership significantly involves the process of motivating the followers towards achieving multiple goals. Therefore, it can be a major limitation for McDonald’s to sustain its primary goal and objectives because the practice of charismatic leadership often motivates the employees to accomplish their personal goals. Moreover, the charismatic leadership approach can also negatively impact on the organizational culture because it tends to create competition among e each employee within the organization. Therefore, such type of leadership can reduce the amount of coordination among the team members and hinder the overall functions of McDonald’s by a greater level (Robbins & Judge, “Organizational Behavior”). After acquiring a brief idea about the strengths as well as the weaknesses of the leadership approaches relating to McDonald’s, it can be stated that the approaches like trait and behavioral theory can be related to McDonald’s. This can be justified with reference to the fact that the idea concerning trait theory generally involves various significant facets like demographic, intellective, self-confidence and personality which have been viewed to be broadly supported by McDonald’s. Conversely, the aspect concerning behavioral theory generally engages influencing and motivating the people towards the attainment of organizational objectives. Similarly, relating to this aspect, McDonald’s also influences as well as motivates its entire workforce by offering attractive compensation packages along with reward programs for the purpose of developing their performance and ultimately for attaining its predetermined business targets (Boje, & Rhodes, “The Leadership of Ronald McDonald”). RECOMMENDATIONS In relation to the fiercely growing competition especially in the global fast-food industry, it can often be observed that the organizations seek to develop their respective leadership styles to attain better control of their broad array of business activities. Moreover, the global firms also tend to transform organizational processes through incorporating effective leadership approaches enabling them to attain superior competitive position over their major competitors. However, it is also important for the marketers to improve their corporate structure in terms of practicing transformational leadership approach. In this regard, the following discussion of this report will represent the effective suggestions for McDonald’s to improve its different challenges that are occurred due to its extensive implementation of transformational leadership approach. From the very beginning, McDonald’s often practices an effective transformational as well as charismatic leadership approach that enables the company to attain greater competitive position. However, the company should need to focus on valuing the effectiveness of its employees which can support the organization to enhance as well as raise its competitive position in the global business environment. With this regard, the organization tends to follow a greater decentralization of organizational responsibilities which can make the organization to face certain difficulties concerning managing the overall functions of the organization. Therefore, in order to enhance the efficiency of transformational approach, McDonald’s should need to empower its managing capabilities to address potential issues which might arise from decentralizing organizational responsibilities. It can be recognized that the leaders often tends to adopt different risks which can hinder the overall process of the organization. In this context, it is highly important for the leaders of McDonald’s to clearly mitigate the potential risks that can be generated due to the practice of transformational leadership approach. Moreover, rationalizing and evaluating risk assessment processes can also facilitate the leaders of McDonald’s to effectively implement transformational leadership and thus improve the overall functions of the organization. In order to minimize the potential risks, McDonald’s should also need to focus on potential impacts which might occur due to the extensive practice of transformational strategy. Therefore, rationalizing and evaluating different potential risks can enable McDonald’s to develop its transformational leadership initiatives and the processes can also support the organization to gain its competitiveness in the fiercely growing fast-food industry. As previously discussed, the implementation of transformational leadership approach is not equally effective for all situations of an organization because of its personal traits. Therefore, the leaders of McDonald’s should implement this leadership approach when they can directly interact with the employees along with the working environment of the organization. This process can enable McDonald’s to efficiently implement transformational leadership and improve the performance of the employees by a considerable level. In this regard, the organization should focus on frequently interacting with its employees in order to effectively perform its transformational leadership approach. For the purpose of accomplishing its expected business targets, McDonald’s can adopt as well as follow the aspects concerning the approach of contingency theory, situational-leadership theory and path-goal theory among others. CONCLUSION An effective practice of leadership approach within the organizational process is viewed to be one of the major and effectual process which can enable an organization to effectively control, operate along with manage the overall functions performed by the organizations. Moreover, a well-built leadership approach can enable an organization to strengthen its competitiveness and minimize the potential risks as well as constraints within the growing global business environment. According to the present day context, it has been observed that the leadership approach performed in McDonald’s is considerably focused on transformational strategy which enables the company to attain substantial growth in the global fast-food industry. Moreover, the leadership style of the organization also ensures to efficiently accomplish the organizational goals through appropriately managing each of its business or operational function. In addition, from the above discussion, it can be stated that the notion of transformational leadership approach empowers the competitiveness of McDonald’s in terms of raising employee productivity resulting in reinforcing the competitive position of McDonald’s in the global business environment at large. However, the organization should need to incorporate different strategic decisions concerning the implementation of transformational leadership strategy in its different business situations. According to the unstable growth of the global economy, McDonald’s should highly focus on practicing its transformational leadership approach in accordance with the changing face of the global fast-food restaurant markets. Moreover, identifying and evaluating different potential risks can also enable the company to implement its transformational leadership approach which further help the organization to raise its competitive position by a greater level. 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