Performance Assessment and Management in McDonalds - Case Study Example

PERFORMANCE ASSESSMENT AND MANAGEMENT Executive Summary The current report addresses, recognizes, integrates, and cites relevant theories, concepts, and ideas of performance assessment and management model used in McDonalds’ with a brief overview of the human resource practices in employee selection and appraisal initiatives of McDonalds. The paper also identifies and explores the established culture of employee selection and appraisal criteria in this organization to state that employee turnover rates are rather high and employees’ output needs improvement. The paper ends with a reflection by the writer over the analysis carried out. 1. Introduction Organizational operations, in both profit making and ‘non-profit’ making enterprises, require evaluation for reconciliation with set objectives as well as for comparison with operations with other enterprises in a similar industry. Assessment is the process of evaluating a subject, which can be a process, in order to ascertain its potential or quality. Management on the other hand refers to the act or responsibility of controlling people or activities. Assessment and management are therefore critical elements in the life of an organization. This paper seeks to discuss performance assessment and management of McDonalds Company. The paper will explore the established culture of employee selection and appraisal criteria that McDonalds applies in its human resource management. The paper will, with this respect, offer an overview of McDonalds human resource practices in employee selection and appraisal initiatives and then further analyze the processes. 2. Review of employee selection and appraisal processes in McDonalds Company McDonalds is a multinational company that operates in a number of cultures across the world. Its human resource management is however converged to a uniform culture. With an overall workforce of more than thirty thousand employees, McDonalds has its personnel management strategies incorporated in its core objectives. In order to achieve its goal of being the best service provider in the food industry, the company’s ensures that it has a diversified cultural base with excellent employee management. 2.1 Employee selection McDonalds has a broad based approach in selecting its employees. This includes a special consideration to disabled people who may have some specialized capacity to service delivery. The company has also adopted a universal program for handling older employees more than 55 years of age that follows a criterion of being fair and ‘non-discriminatory’. It has therefore been open to different categories of cultured workforce. As far as recruiting is concerned, the company relies on the theory that customer utility relies on the efficiency and effectiveness of the employees that the company has employed. As a result, the company takes initiatives that place the best employees with respect to a fully matched job description. The recruitment process for McDonalds has always used different approaches to recruiting employees where the most preferred has been advertising for positions. Other approaches used occasionally are the local job centers and professional exhibitions. After receiving the applications, the applicants are then subject to an interview. The process furthers with a selected committee to review the applicant’s responses before identification of most suitable candidates for the job. 2.1.1 Orientation Once the selection is made of the employees, they are then welcomed and introduced to the company through a ‘well-defined’ orientation process. The orientation process involves briefing the employees about their expected roles in the organization as well as the organization’s safety procedures. Similarly, a brief regarding the organizations policies, structure, and the human resource system that includes training and reward criteria is also given to the new employees. Based on its employee retention objective, the company ensures effective training of its employees so that they are fully equipped with necessary skills in operations, leadership, and even management. 2.1.2 Appraisal rewards and benefits As far as appraisal rewards and benefits are concerned, the organization applies two methods; one is the graphical ratings scale, and other is the‘360-degree’ feedback. The company’s reward system is a percentage increment of salary for employees whose performances are satisfactory upon evaluation. Similarly, the company has a benefit program for its senior employees that display outstanding performance. The benefits include medical insurance cover, education schemes, and childcare among others. 2.1.3 Analysis and diagnosis Interviews and tests McDonalds has a predetermined employee selection criterion. The recruits are subject to interviews whose evaluation revolves around skills, knowledge, and experience. Further, this process holds two perspectives; one is the observed results of the progress made by the selected employees and second is the theoretical approach from existing results of what the subject company has experienced with its employees. The experience is thus apparent through the rate of employee turnover. While a high rate of turnover implies weakness in the selection method, a low turnover rate will indicate a successful selection process that identified good features of the selected employees. The core tools in evaluating a selection process are validity and reliability of the process. Validity refers to the level of accuracy that the process attains in selecting employees while reliability implies consistency of the process (Snell & Bohlander, 2012) and (Friesen, 2010). A research initiative is considered to be valid if it succeeds in measuring “attitudes and behavior” of the employees (Friesen, 2010). Considerations of whether a recruit would try to be honest in a selection process or whether there will be fabrication of character in order to win consideration for the job is therefore important in choosing the selection criteria. The method used in this respect, should have the capacity to analyze the recruits’ inner potentials and motives in order to obtain the most accurate potential to fit into the organization. Reliability of a process can also be ascertained through existing information, either theoretical opinion or experiments and experience (Snell and Bohlander, 2012) and (Weiten, 2008). Therefore, the selection criteria of McDonald can be easy to evaluate if the above-mentioned criteria is in discussion. A review of the organization’s employee turnover rate is one of the tools that are applicable in evaluating its selection process. High employee turnover implies that the company has not been able to clearly point out the characteristics of its employees during interviews. If this had been possible, then the organization would have been able to understand the types of employees who would work for it over a long period. Though the company uses predetermined approach to its selection process, the inability to identify suitable traits of employees that can ensure low turnover rates imply that positive consistency is not in the picture of the organization in its selection (Kusluvan, 2003). Based on Kusluvan’s observation of managing employees by their behavior, a combination of selection approaches is suitable in ensuring a reliable process. The author argues that interview alone cannot ensure reliability and recommends application of tests by the employer. Reliability and validity of the selection criteria at McDonalds is therefore relatively weak. This is because it has a high rate of employee turnover and is mainly dependent on interviews that, if considered independently, cannot ensure reliability (Kusluvan, 2003). Possible ethical, legal, and practical issues The company’s recruitment and selection method poses many ethical issues that need consideration. The interview process, for instance has a possibility of infringing privacy of the candidates as they may be required to respond to personal questions such as sexual relations. The company’s appraisal culture is also likely to impose ethical issues. While the appraisal process may aim at rewarding hardworking and efficient employees in the organization, an ethical approach to appraisal should also focus on appreciating employees through offering rewards to motivate even those who did not shine to the top (Fernando, 2009). The company’s objective to widely source for personnel may also lead to issues such as “exploiting cheap labor and using child labor” as it offers employment programs to individuals who are as young as sixteen years of age (Rose, 2007). Similarly, a number of legal issues are likely to arise from the company’s selection process. Condrey explains that employee selection processes are subject to a number of legislations such as anti discrimination laws that might force managers to contract employees against the company’s predetermined criteria. The need to hire specific talents based on the company’s predefined selection method may also impose discrimination against legal provisions (Condrey, 2010). Use of interview in the selection process may also induce elements of harassment as a legal issue. This arises when a member of the interviewing panel gets more specific and personal with a potential employee (Belk, 2011). Chances of false information by recruits during the selection process may also have legal impacts for consideration by the management. Presentation of falls information by recruits in order to fit the company’s specific and predetermined criteria is also a practical issue (Snell and Bohlander, 2012). Need for adjustments in the company’s approach to employee selection The organization has been relying on interviews as its basic approach to employee selection. Based on its trend of high employee turnover rates, it is apparent that the selection approach has not been effective with respect to validity and reliability. Similarly, the organization has not been able to identify employee characteristics that suitably match its culture. Snell and Bohlander however present a variety of options that the company can adopt in order to improve on its selection criteria. McDonalds should therefore consider application of other approaches such as “references and psychological tests” to help it identify more suitable candidates for its culture (Snell and Bohlander, 2012, p. 255). 2.2 Performance appraisal program 2.2.1 Application of appraisal program McDonalds appraisal program is formal. It is well defined and understood among employees as well as the management. Specific methods, which include graphical rating scale and ‘360-degree’ feedback are used by the company in its appraisal (Snell and Bohlander, 2012). 2.2.2 Clarity of appraisal goals Appraisal goals focus on either facilitating administration of an organization’s processes or enhancing improvements in operational processes (Snell and Bohlander, 2012). McDonalds however lacks ‘well-defined’ appraisal objectives. Its appraisal initiatives push through by results of employees’ output rather than pulling back by defined goals. Relationship between strategic goals of the organization and standards used in appraisal Appraisal standards are supposed to have features that reflect on the overall objectives of the organization. Features such as “strategic relevance, criterion deficiency, criterion contamination, and reliability” for instance define the relationship between organization’s goals and appraisal standards (Snell and Bohlander, 2012, p. 369). Having lacked clarity in appraisal goals and hence standards, the relationship between appraisal standards and the organization’s goals can be concluded as weak. 2.2.3 Evidence of criterion contamination or deficiency While criterion deficiency refers to lack of the appraisal’s ability to cover all responsibilities of employees, contamination of a criteria refers to the inability of the system to identify external forces that non uniformly affect employee performance. Both criterion contamination and deficiency are evidenced in McDonalds system because it is not structured for efficiency (Snell and Bohlander, 2012). 2.2.4 Measures of reliability The high employee turnover rate and unstructured appraisal system implies that McDonalds has not put measures in place to ensure reliability (Snell and Bohlander, 2012). 2.2.5 Legal issues for consideration Since legal provisions govern appraisal, just like selection, the organization should develop a program that will align its appraisal procedures against illegal activities such as discrimination (Snell and Bohlander, 2012). 2.2.6 The pros and cons of appraisal The company majorly relies on rating technique in its employee appraisal. More specifically, the management normally does this over quality and efficiency in operations by individual employees. While the rating method is simple and easily understandable, its subjectivity may not result in an accurate state of employees’ performance (Acas, 2005). 2.2.7 The appraisal method, common rating errors, and sound feedback McDonalds has an unstructured appraisal system, which lacks measures for training to eliminate rating errors and to ensure sound feedback methods. 2.2.8 The organization’s appraisal method Appraisal method that most closely matches McDonalds is manager appraisal based on rating. This is because the company uses ratings approach, which relies on past records, an approach that defines manager appraisal (Snell and Bohlander, 2012). 2.2.9 Strengths and limitations of manager appraisal While manager appraisal has the strength of professionalism in rating employees, it has a number of weaknesses and limitations. The managers are occasionally busy and do not have sufficient time with employees. Similarly, the method may suffer from lack of validity and reliability (Snell and Bohlander, 2012). 2.2.10 The appraisal method, diversity, and effective operation in a multicultural market place The manager or supervisor appraisal method, when properly checked, encourages diversity and promotes operations in a multicultural market place. This is because the method is free from bias thereby eliminating cultural boundaries in interactions. It therefore promotes unity and harmony for smooth operations (Snell and Bohlander, 2012). 3. Conclusions and recommendations Even though McDonalds Company strives to attract and retain quality personnel, its employee turnover rates remains to be high. The organization can be characterized by a weak interview based employee selection method, which is inaccurate and lacks positive consistency. Similarly, the company lacks a ‘well-defined’ appraisal method. This paper therefore recommends that McDonalds review both its employee selection and appraisal methods that will allow the company to reduce its employee turnover rates and to improve its employees’ output. 4. Reflection: As a future leader in this industry, from the current analysis carried out, I have realized that the performance management acts as a tool that caters to nearly all levels in an organization. Thus, the processes that have been under discussion are necessary to be implemented as there is always a need to link the organizational, team, and the individuals’ objectives at all levels. Other than that, I have also realized that this assessment and management process needs to a sound implementation so that good performance is recognized and awarded and bad ones effectively managed. References Acas. (2005). Employee appraisal. Retrieved from: http://www.acas.org.uk/media/pdf/o/q/B07_1.pdf Belk, M. (2011). Legal issues in human resource management. Retrievd from: http://www.ucop.edu/ucophome/businit/boi/presentations/2011/15-legalissues-hrm-belk.pdf Condrey, S. (2010). Handbook of Human Resource Management in Government. San Francisco, CA: John Wiley and Sons Fernando, A. (2009). Business Ethics: An Indian Perspective. New Delhi, India: Pearson Education India Friesen, B. (2010). Designing and Conducting Your First Interview Project. New Jersey: John Wiley & Sons Kusluvan, S. (2003). Managing employee attitudes and behaviors in the tourism and hospitality industry. New York, NY: Nova Publishers Rose, A. (2007). Ethics and human resource management. Retrieved from: http://highered.mcgraw-hill.com/sites/dl/free/0077111028/536508/EHR_C02.pdf Snell, S. and Bohlander, G. (2012). Managing Human Resources. Mason, OH: Cengage Learning Weiten, W. (2008). Psychology: Themes and Variations. Belmont, CA: Cengage Learning Read More