Organization Culture for McDonalds - Research Paper Example

 Organization culture for MacDonald’s Executive Summary The operation of an organization and the strategies advanced by the management are essential in determining the outcome of the corporation. Every organization outlines its policies and principle that acts as a guide to its operations. On the other hand, corporations set their culture and tradition towards its operations. The organizational culture influences the productivity of its human capacity. Therefore, in order to succeed in highly competitive economy, a firm must set a sustainable and feasible culture within its working environment to mark its boundaries. Some of the organization cultures include leadership policies, products and services, labor-force, technology, and non-human resource management. This paper aims at establishing the corporate and organization culture of McDonald’s Corporation. The paper further investigates the cultural policies practiced by McDonald’s and investigates the effectiveness of these cultures. The organization leadership is dedicated to its workers and recognizes dedicated individuals that share similar organization vision, having a sense of respect and being appreciated (Sara, 2008). It also has a hierarchy of staff members from CEO to crewmembers in the restaurant. Though the junior staff members must respect their managers, managers have close relationship with the juniors. The McDonald’s Corporation McDonald's Corporation is an international corporation that operates and franchises in restaurants and hotels industry. The company’s headquarter is located in Illinois, U.S. McDonald's Corporation commenced its operation as a small barbecue restaurant by 1940s. Maurice and Richard McDonald ran the company. The two brothers reorganized the business from barbecue restaurant to a hamburger stand. By 1955, the company enlarged its operations to cover franchise following the incorporation of Ray Krock, the franchise agent. The company operates in more than 119 countries globally with a proximately 33, 510 restaurants (Sara, 2008). More than half of these hotels and restaurants are licensed or franchised. The company operates the leading chains of fast food restaurants and hamburgers. It serves more than sixty eight million customers daily in the 119 countries of operation. The reason behind my choice of MacDonald’s is the fact that the company is found in many different locations and that means a diversified culture. I would like to learn on how the different restaurants are coordinated and how the organizational culture is coordinated among all the restaurants. Participants interviewed I undertook an interview with three members of the company who included the human resource manager, the compliance officer, and the retail manager. I choose the respondent because they were available at the time of the interview and because they had the relevant information that I deemed important for the analysis. Corporate culture analysis Question 1, mission, vision and core values According to all my respondents, the vision of the company encompasses the surrounding community and the firm’s employees at large. McDonald's believes that in order to deliver effectively, the employees must be satisfied. The company also maintains its commitment to the environment and the stakeholders at large. McDonald's is committed to satisfying their customers, employees, and the surrounding community. Besides, the company actively takes part in corporate social responsibilities including financing youth programs, education, healthcare, and sports. According to the retail manager, the company is founded on the culture of “do right.” "McDonald's has a people vision to be the best employer in each community around the world" (Sara, 2008). The human resource manager stated that the corporation believes that "people promise and people principles express [their] commitment to respect, recognition, openness, and employee development" (Sara, 2008). "Diversity is integrated into [their] business operations and planning around the world.” (Sara, 2008). The strength and active participation of the staff in the running of McDonald's is attributed to acceptance and support of McDonald's values, goals, and the willingness to move the company forward. "Organizational commitment includes active contributions toward organizational goals, it also represents job satisfaction" (Sara, 2008). The mission of the corporation is to provide excellent services to the entire stakeholder. McDonald's is driven by the transparency, accountability, excellent services, and quality. The vision of McDonald's is to become the domineering firm in restaurant and quick moving foodstuffs. The performance of the company has been very steady over the last couple of financial years. For instance, in the financial 2010-2011, McDonald has posted a 33% profit before tax. The company has also been very successful in meeting other principle objectives such as corporate social responsibility and meeting the demands of the employees. According to the human resource manager, "McDonald's is the Prime Example of Corporate Culture," (Sara, 2008) since it is dedicated to supporting all the stakeholders. The human resource manager stated that the core values of the company include professionalism, integrity, and quality delivery. The corporation also recognizes excellent characters and personalities with shared values and visions. The success of McDonald's is founded on the fact that it rewards and appreciates excellent performers, hence acting as a motivation for the rest of the staff to commit them fully to the organization. McDonald's also offers fair and competitive compensations and fringe benefits. In addition, the company heavily invests in personnel training to improve on the technical and professional skills of its labor force, a key factor behind the success of the McDonald's (Sara, 2008). the culture at McDonald's is supported by: improving animal welfare, ensuring quality food, high safety and health standards, protecting the interests of the stakeholders, and promoting health and nutrition through balanced dietary. Question 2. Culture of the organization According to the human resource manager, the culture of the organization involves around fair and equal employment to all. Employment is usually based on merit as opposed to gender or other affiliations. The interviewees usually undergo a monitored recruitment process in which the best candidate is picked. According to the compliance officer, the culture of the organization involves complying with the regulations made by the government concerning service delivery and staff welfare. The company usually complies with the regulations to ensure adherence to the government policies. About internal policies, the company ensures that the employees report to work within time. The employees should be decently worked and integrity and professionalism in the execution of duties is not a choice but rather a requirement. According to the retail manager, the culture of the company involves delivery of products based on a first come first served basis. There are no instances of bias. This refers to a scenario where some customers are given priority that may not be accorded to others. Question 3: major goals and objectives of the organization The goals of the organization include accessing worldwide coverage in its service delivery. The company aims at achieving and maintaining quality services that will make the company to be ahead of its competitors. Question 4: performance of the company concerning the goals Currently, the company is in progress in the achievement of global coverage. Currently, the organization has 33,510 restaurants that are located in 119 countries. That is a step forward in the achievement of the organization’s goal. According to the retail manager, the organization is ranking among the best organizations in the world. Question 5: The strengths and weaknesses Strengths: McDonald’s Corporation has been successful product branding because of the following strengths: Stability and Predictability: McDonald’s Corporation has been in the business of burgers for more than seventy years. This has enabled the company to be more predictable and consistent. The innovativeness and massive power and value of the corporation since its establishment in 1940s have been the key for the success of McDonald’s. Brand Loyalty and Recognition: McDonald’s Corporation has been successful in achieving popularity and loyalty of the customers. Through its golden arches logo and brand loyalty, McDonald’s Corporation has received recognition and popularity among the consumers globally. Consistent Growth: over the last three decades, McDonald’s Corporation has reported a growth in the revenue and asset portfolio. The trend is expected to continue to the unforeseen future, hence drawing interest of investors. Dividend Growth: the change in the dividend policy of McDonald’s Corporation to quarterly installments serves as one of the strength of the firm. Besides, McDonald’s boast of proven dividend payout consistency which has been on the rise following consistency in the revenue and profitability index of McDonald’s. Annually the firm pays out a dividend yield of 3.50%. Weaknesses: Despite the success reported above, the company has its internal weaknesses that affect the performance of McDonald’s. These weaknesses are as discussed below: Business Saturation: McDonald’s operates in more than 119 countries in the five continents of the world that offers cranny and nook of all nature and hence no run for expansion. Low Barrier to Market Entry: the industry has limited entry and exit barriers; hence, all the interested investors have the right and freedom to gain access into the market because it operates in liberalized sectors of the economy. Vulnerability to Rising Costs of Inputs: the rising cost of inflation, global economic contagions, and the soaring food prices has made the cost of essentials and industrial inputs to rise. This rising cost of inputs and production has resulted into increasing food prices, hence lowering the sales margin of McDonald’s. Recent Disappointment: with the challenging economic recession of the US, McDonald’s profits went one in the last few months. However, the company expects to regain its status in due course. Strengths Weaknesses Stability and Predictability Business Saturation and free entry Brand Loyalty and Recognition Low Barrier to Market Entry Consistent Growth Vulnerability to Rising Costs of Inputs Dividend Growth Recent Disappointment Question 6: Barriers to good performance According to the retail manager and the compliance officer, the barriers to better performance are the harsh police put in place by the government. The policies include tax laws in which the organization has to pay large amounts of taxes to ensure the continuity of the business. Optional questions. Question 1: Trust levels among employees According to the human resource manager, the company has a code of conduct that has to be signed by every employee at the inception of the working contract. The code of conduct sets the required standards at the work place and that ensures that the employees trust each other and the management trusts the employees. The human resource manager also stated that he rarely gets any instances of employee disputes and that may be attributable to the trust levels that exists. Question 2: Involvement of employees in decision-making According to the compliance officer, before the company can put in place a new policy, the employees have to e consulted to ensure that the policies work effectively? According to the retail manager, the employees have to be consulted before the company can open up a new restaurant. That includes filed research by the employees and the report given by the employees is considered in the making of a decision. According to the human resources manager, the officers found in the human resource department are involved in the selection of the best candidate in the recruitment process. Question 3: Feedback system There is system in place that ensures effective communication. The retail manager stated that the organization believes that communication is critical in the success of the business. The employees can be able to forward their complains if any. The company also has a feedback system whereby employees can offer their suggestions to the management in regard to the changes that they thing should be effected and the things that will enable the company to achieve its goals. Question 4: qualities of employees According to the human resource manager, all the employees must be honest. Honesty plays a prime role in the execution of tasks in a company. The other quality that was stated was creativity; an employee should be innovative and creative in a manner that he can come up with great new ideas that can be applied. The other quality that is required is professionalism. Professionalism should be applied in the execution of tasks in the company. References Sara, G. (2008). The Story of McDonald's: Built for Success. New York: The Creative Company Read More