Faculty of Tourism and Hotel Management
McDonald’s
Subject: Human Resource Management
Lecturer: Dr. Tanachart Raoprasert
Name: SANN RAKSMEY
ID: 54011015023
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Contents
I. Preface…………………………...03
II.The company…………………….....04
III. The Job Structures…………...…...05
IV. Conclusion…………………….....16
V. References………………………..17
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Preface
What exactly is 'Human Resource Management'? Many people find HRM to be a vague and elusive concept--hot least because it seems to have a variety of meanings. This confusion reflects the different interpretations found in articles and books about Human Resource Management. A philosophy of people management based on the belief that human resources are uniquely important to sustained business success. An organization gains competitive advantages by using its people effectively, drawing on their expertise and ingenuity to meet clearly defined objective. HRM is aimed at recruiting capable, flexible and committed people, managing and rewarding their performance and developing key competencies.
Ideally, HR should find the best hires, nurture the stars, and develop a productive work environment. Instead, too often HR departments concern themselves with the administrivia of personnel policies and practices, with which companies are increasingly outsourcing to contractors who can perform more cheaply and efficiently. Frequently, HR mangers are seemed as more concerned with results less than activities--listing how many people were hired, the number of performance appraisals completed, and whether employees are satisfied with their orientation sessions or not but rarely does HR link those details to employee, managerial, and business performance measurement and metrics.
Last but not least, in order to identify what the HR is, we would like to show an example of one of the most international fast food restaurant in the world, McDonald’s. We select McDonald's to analyze its recruiting, training and benefits through overview its history and job structure.
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I. The Company
McDonald's Corporation is the world's largest chain of hamburger fast food restaurants, serving around 64 million customers daily in 119 countries. Headquartered in the United States, the company began in 1940 as a barbecue restaurant operated by the eponymous Richard and Maurice McDonald; in 1948 they reorganized their business as a hamburger stand using production line principles. Businessman Ray Kroc joined the company as a franchise agent in 1955. He subsequently purchased the chain from the McDonald brothers and ran its worldwide growth. A McDonald's restaurant is operated by a franchisee, an affiliate, or the corporation itself. The corporation's revenues come from the rents, royalties and fees paid by the franchisees, as well as sales in company-operated restaurants. McDonald's revenues grew 27 percent over the three years ending in 2007 to $22.8 billion, and 9 percent growth in operating income to $3.9 billion.
McDonald’s primarily sells hamburgers, cheeseburgers, French fries, breakfast items, soft drinks, and shanks & desserts. In response to changing consumer taste, the company has expanded its menu to include salads, wraps, smoothies and fruit.
McDonald's is the largest food service company in the world. In 1993, annual sales stood at 23 billion dollars. It is also one of the biggest employers in the United States, with over the half of million workers .The Company has roughly 10,000 locations which include the standard sit-in restaurants, drive through windows, and satellite sites. McDonald's dominance in the fast-food industry is not likely to disappear anytime soon. Tile Company is expanding continuously, as at December 2000, McDonald's and its franchises operated over 28,700 restaurants worldwide in 120 countries and territories, serving food and drab to over 45 million people daily and only fifteen to twenty percent of the restaurants are actually company-owned. The rest are franchises, run by 2,659 independent owners who pay a fee of between $400,000 and $700,000 for a franchise. McDonald's licensing department handles the fee structure on a case by case basis, and there are a wide variety of license fees determined by property and equipment costs.
II.The Job structure
An employees of McDonald's fall into three groups’ restaurant workers, corporate staff, and franchise owners. A local McDonald's restaurant usually employs between 50 and 65 people. Company staff members work either at the corporate headquarters or at one of 40 regional offices. In the restaurants, crew members constitute the entry-level position and are by far the most numerous. A large majority of staff are part-time workers, roughly three-quarters; their wages are low. Swing Managers constitute the first true managerial position in the hierarchy although their hourly wages are only slightly higher than crew member wages. There is one Restaurant Manager per McDonald's location. According to company literature approximately 12% of all teens currently have employed in the U.S. working for McDonald's. Turnover at the crew-level employees are teenagers. The remainder includes seniors, working mothers, and "transitional" workers in the 20-25 age range.
The McDonald brothers’ first restaurant founded in 1937 from sitting on an outdoor stool or in their cherished new autos to in indoor restaurant and from the hot dog to the Big Mao and Happy Meals, it's tremendous differences. Along the way, it built one of the world's best-known corporate icons and its most ubiquitous store. Why McDonald's becomes increasingly popular and successful? The philosophy was neatly summarized: “Whatever people ate, McDonald's would be the ones to sell it”. Furthermore, it’s famous even due to its quality food and the ways of management.
Here we just focus on the ways of management at McDonald's, such as recruiting, selecting, retention, training, education, benefits and so on.
E Recruiting Suitable applicants: To make sure the company is right for each other, they have designed a two-step application process for potential Crew Members. The first phase of the application is an online application. If successful, the candidate will be invited to a restaurant for an On Job Evaluation (OJE) and interview. The OJE serves two purposes: it gives a good opportunity to evaluate the candidate’s customer service skills against what’s needed to be a successful member of the McDonald’s team, and it allows the candidate to see if the McDonald’s high-energy environment suits their preferred style of working. During the process, which only lasts about 15 minutes, the candidate will work in one of our customer facing areas and will be given full instruction on what to do. In addition, they will have an interview with the Business Manager. The whole process should take about 30 minutes. Finally, once Crew Members have been hired, they will attend a welcome meeting at their chosen restaurant or recruitment center. This meeting will last an hour and is designed to engage and inform new starters. It involves viewing a DVD which gives important information about the company, and also allows for manager/new starter interaction. The second part of the orientation is a compulsory online Health & Safety and Food Safety test that the new starter completes in their own time. The first shift begins with a tour of the store highlighting key Health & Safety and Food Safety procedures. It is recommended that this should last for the first two hours of the shift.
E Selection: The Company wants to make sure that the candidate and McDonald’s are right for each other, so the candidate goes through a four-step selection process.
§ The first stage is the initial screening process which ensures that the candidate meets the basic criteria.
§ If the candidate is successful, they will be asked to complete the next stage, an online personality questionnaire. This will ensure that the candidate has the desired attributes and that the McDonald’s environment is suited to their preferred style of working.
§ The next step will be the restaurant based ‘On Job Evaluation’ or OJE. The candidate will do the job for real for a day and discover what it’s really like working in a McDonald’s restaurant.
§ The final step of the selection process is an interview with a Senior Manager.
E Training: Employee training at McDonald's is highly structured. Ends-level workers are first taken through the basic Crew Training System. The program consists of on-the job-training and is largely vocational. Each stage of advancement beyond the crew level then entails a new training program with the skills becoming more complex and generalized. Training begins immediately with a one-hour orientation on the company. Each restaurant has its own video player and training room. Step--by--step manuals and video tapes cover every detail of the operation, everything from how to make a Big Mao to a shake. Each restaurant has 25 stations from the grill area to the front counter. Trainers use a series of checklists as new crew members move through the restaurant. A level of competency is demonstrated and the activity is checked off on the SOC--Station Observation Checklist. There is a follow-up SOC to get certified on the station.
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E Retention: McDonald's believes that the success of the restaurants and the company is achieved through the people it employs. Therefore, McDonald’s Europe decided to do something about this perception. In September 2006, it launched its McPassport program, an official certification program designed to support the movement of restaurant employees throughout the European Union. “The McPassport is a physical document, resembling a real passport, that certifies crew competencies and thus enables a McPassport holder to be eligible for a McDonald’s job in the 25 countries of the European Union,” says Carmen Vroonen, spokesperson for McDonald’s Europe. To earn McPassport certification, employees must be trained and earn a “good” rating or above in the following stations: service, dining area, hospitality, production, fried products, grills, buns, and dressing. No minimum seniority is required to apply for certification. McDonald’s Europe hopes the McPassport program will appeal to its employees and that they will see it as a tool to help them with long-term goals.
E Education: McDonald's is a quick service restaurant business committed to 100% satisfaction. Macdonald's independent Franchisees and Company-owned restaurants serve over 22 million customers every day around the world. Each and every one of these customers deserved great services from the moment they approach the counter or drive-thru window until they leave the restaurants. The Company depends on the employees in the restaurant, whether employed by an independent franchise or by McDonald's Corporation, to provide a fast friendly and courteous experience to all guests so they will visit us again and again. That's why McDonald's Independent Franchisees and McDonald's Corporation look for:
· Individuals who like to have fun while delivering fast accurate
· Individuals who would like to help or provide service to customer
· Providing friendly services with smile
· A good service provider
· Person who meets the customers’ needs or wants
However, the job specification of the company is quite different from others because the company is providing services to people so they need the employees who have the characteristics above for the service providers’ position. The others, supervisor or management, still need the bachelor or master degrees including experience as well.
E Benefit: McDonald’s benefit program is designed to attract, energize, reward and retain talented people who will produce superior business results and enhance their leadership position.
These are some benefits that McDonald’s provides to their crew members:
• 24 days paid holiday per annum (rising to 28 days from April 2009)
• Free private health care after three years’ service
• Stakeholder Pension Scheme
• Restaurant performance related bonuses
• Argos, Thomas Cook, Debenhams, Marks & Spencer and House of Fraser vouchers awarded at service milestones
• Opportunity to sacrifice up to £110 per pay period in exchange for Childcare Vouchers. (This is taken from gross salary therefore saving on tax and NI payments.)
• Annual pay reviews
• Great discounts, currently including:
• Up to £13 discount at Alton Towers and £12 discount at Thorpe Park
v 10% off at dress-for-less.com
v Up to 25% off many short breaks and holidays
v Exclusive prices at CD Wow!
E Rewards: The rewards are given on the basis of the performance. There is a raise of 10% in salary and if performance is also counted then 20% increment given at any time of the year. Moreover, McDonald’s will provide the candidate with a package of professional rewards that includes a starting salary of up to £21,500 including London weighting (£3,000 in inner London and £1,500 in our South East region). Within weeks of joining, there is the potential of a quarterly bonus. In under three years, the candidates could be running their own restaurant and earning a salary and package worth £45,000.
In addition, the successful candidate would expect:
• Five weeks holiday per annum, rising to six weeks (from April ‘09)
• Annual performance related pay review
• Life assurance cover
• Optional contributory pension scheme
• Private healthcare cover available after six months services (Also extended to the employee’s spouse and any dependent children up to 21 years of age.)
• Company car or cash alternative after six months as a Business Manager
• Home telephone bill assistance
• A paid sabbatical leave of eight weeks for every 10 years of service
EHuman Resource Management System: The McDonald’s Management Development Curriculum takes new recruits from Trainee Manager to Business Manager. The curriculum consists of on-the-job training and open learning development modules supported by courses and seminars at National and Regional Training Centres. The Shift Management Development Curriculum is divided into four key programmes:
Ø Shift Management - Enabling Trainee Managers to develop the skills and techniques required to become effective in all aspects of running a shift.
Ø Systems Management - Targeting Second Assistant and newly promoted First Assistant managers, this programme covers all areas of McDonald’s systems, increasing the manager’s business knowledge. It also develops the individual’s management skills.
Ø Restaurant Leadership - Introducing managers to the key skills needed to become effective leaders, e.g. team-building, decision-making and communication.
Ø Business Leadership – Focuses experienced Business Managers on the need to develop a business strategy that encompasses both internal and external factors.
Most departments offer Business Managers opportunities to be seconded to work in a regional office. This gives an experienced manager a chance to develop and learn new skills, to see a different side of the business and to experience how each department’s strategies have a role in achieving the company’s goals. A training curriculum is available to office based employees that combines online learning, IT training and soft-skills development to help individuals further develop and progress in their roles.
E Cultural Differences: Offers managers solid diversity training, including workshop designed to help managers so that they have full advantage of what everybody brings & also want to ensure that people at all levels of McDonald’s bring their energy and creativity into the work environment. At McDonalds, the corporate culture and management system are strictly imposed, detailed operating manuals followed to the letter and an extensive field organization checks on each store to enforce standards.
McDonald's develop a deep connection between McDonald’s and the local communities in which it operates. This is an example of the Comparison between US McDonald's and China McDonald's.
Everyone has to eat to live. However, more and more eating fast has become a way of life. People in the United States have eaten fast food for many years. This habit is moving to other countries as well, of course, including China. When McDonald's enter China market, for the fear of lagging behind and to satisfy with the curiosity, everyone goes to have a try what the taste of Big Mao is. After tasting it, you will know why it is so popular because they have critical quality control inspection, guaranteeing sanitation and quality. And also their success mainly depends on their advanced management not the food itself. Most people are satisfied with the quality of the food Which McDonald's Produces. However, the management of China McDonald's is slightly inferior by comparison. The McDonald's management in China is quite so young-just few years. Take training, for example; entry-level workers are first taken through the basic Crew Training System. Each stage of advancement beyond the crew level then entails a new training program, with the skills becoming more complex and generalized. Each restaurant has its own video player and training room. Step-by-step manuals and video tapes cover every detail of the operation, everything from how to make a Big Mao to a shake. Trainers use a series of checklists as new crewmembers move through the restaurant. A level of competency is demonstrated and the activity is checked off on the SOC. Furthermore, if you are promoted to be a manager, you have chance to go to Hamburger University, the Company's worldwide training center for management personnel. However, in China, there is not any Hamburger University for crewmembers or managers to enter. Here the crewmembers just taught easily on how to do the procedure, not a complete training program. That means it is not a professional program. China McDonald's are just aware of the quantity not the quality. Another concern is that at China McDonald's, a job is just a job, perhaps half of them think that working in McDonald's just for the money, just few of them think that working at McDonald's restaurant provided them with a wealth of experience and skills. But I think that the benefit is important as same as training. Because good benefits can keep the employee working for McDonald's and making progress. There are some benefits the china McDonald's employees don't have, such as educational assistance. China McDonald's don't Provide any program or scholarship for employee; profit sharing is strange for China McDonald's employees, I think the Chinese employees just only have their own initial salad and life insurance and perhaps paid vacation; perhaps employees don't know much about the stock options for eligible employees and stock purchase plan.
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III. Conclusion
The work offered by McDonald's may have some positive elements, but workers are often choosing employment at McDonald's in the context of having few other attractive options. Almost regardless of what people think of the work itself, working at McDonald's could be said to offer advantages for some employees who want flexible hours and are engaged in other activities and responsibilities. For those marginalized in the labor market that have few chances of a job elsewhere, McDonald's offers much needed work.
From a Business Process Parspentive Caker and Bititci (2001) states that:
“One many summarize that the 80's were all about automation .The 90's have been about people, this is evident in the development of Tom concepts throughout the 90's focusing on delegation, involvement ownership cross functional teamwork, self-managed works teams and so on. Therefore, HRM (People Management) is a critical nigh advancing the business results.”
This report primarily focuses on Human Resource Management. It shows us what the usage of human resource management and how does it work in the company.
Now we know the importance of HRM. According to the teacher's requirements and after a careful research, we just take McDonald's for an example to write a report about HRM at McDonald's. The information and the material mainly came from the internet; a few of them came from either our textbook or others.
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References
- David K. Hayes & Jack D. Ninemeier “ Human Resource Management in the Hospitality Industry,” first edition 2009, page 03-2009
- John R. Walker “ Introduction to hospitality Management,” third edition 2010, page 350-365
- Cathy A. Enz “ Hospitality Management (Concept & Cases),” second edition 2010, page 01-34
- Shirley A. Gilmore “ Case in Human Resource Management in Hospitality,” first edition 2005
- Robert L. Maths & Ghee Soon Lim & John H. Jackson “ Human Resource Management,” an Asia edition 2010
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