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HRM Issues in McDonalds - Essay Example

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This paper tends to examine the HRM practices in McDonalds giving specific focus to its high staff turnover issues based on a good volume of literature evidences and research. McDonald’s recruitment and selection policy with reference to training and development, and rewards and benefits seems strategic…
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HRM Issues in McDonalds
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McDonalds Corporation is the largest network of fast food restaurants headquartered in the United States. The company was founded in 1940 by brothers Richard and Maurice McDonald. Currently the organisation has it active presence in 119 countries across the world with franchisees, affiliates, or the corporation’s own restaurants. The firm’s main sources of revenues include rent, royalties, and fees from franchisees, and sales revenues from company’s directly-operated restaurants. As stated in its website, the corporation’s product lines include hamburgers, chicken, cheeseburgers, french fries, soft drinks, and desserts (McDonalds.com). The strategic position of McDonald with regard to the recruitment and selection, training and development, staff turnover, and reward and benefit has been a topic for academic discussion for decades.

High staff turnover has been criticized as the indication of low staff morale in McDonald, however, a BBC report (28 January 2008), says that McDonalds specifically focuses on the issue of staff turnover as a strategic gap to be bridged (BBC News, 2008). The challenges involve the following; first, recruitment and training of new employees is an expensive task. Hence employee turnover contributes to the firm’s operating expenses. Secondly, due to this issue the organisation has been losing experienced and skilled employees and thereby it causes productivity declines. Most of the Multinational Corporations confront the issues of rising labour costs, staff turnover, and staff shortage. As Smith (2006, p. 175) points out, in order for keeping the labour costs low, McDonalds and other fast food chains have lobbied government and legislative bodies against worker benefits many times. And the result was high turnover which in McDonalds alone reached 300 percent per year in some of its outlets (Ibid). A recent report in Wall Street Journal dated April 10 says that McDonalds is striving to address the mounting complaints against its rude and unprofessional employees (Jargon 2013). The problems with low employee morale also have to be counted as the indication of high staff turnover that can be attributed to some HR failures. Evidences suggest that employee turnover has been pertinent in the industry for several years. For instance, a Chicago Tribune report (May 15, 2007) by Schmeltzer also describes what McDonalds did for retaining its employees in Chicago outlets. It launched a career campaign highlighting the employment in McDonalds as McCareer instead of McJob. According to the Fast Food Nation statistics (as cited by Lubin & Badkar Dec 7, 2012), McDonalds hires more than 1 million workers in the US every year with 700,000 domestic workforce and with 150% turnover rate. Msn Money report by Berr (Apr 11, 2013) also reveals that McDonalds has been recently facing numerous issues associated with staff shortage. Another report of the sort by Chittum (April 12, 2013) appeared on Columbia ...Download file to see next pagesRead More
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