Discuss about the HR Challenges Faced by McDonald.
The report argues upon the newspaper article which states about McDonalds’s employee dissatisfaction and steps to be taken to resolve these issues. Background of the company is been discusses along with organisational structure it follow, its business performance, HR practices and policies that company use to follow. The entire problem is figured out and challenges suffering by McDonald’s is been discussed.
‘The Guardian’ on 28th November 2017, posted an article in its newspaper quoting about workers exploitation in McDonald’s, Malaysia. The workers were appointed by the way of certain agent and particular salary was confirmed to them before joining McDonald’s. But afterward the promise was not fulfilled. They were getting 60p per day as salary and their basic wage was deducted by 25%. Nepal workers feel much more cheated as their passports were also seized by employment agency and even after completion of their contract they were not allowed to move to their homes. The workers were not given appropriate accommodations and argued that one room was shared by around 18 people. Further, they argued that these employees are of employment agencies and not of McDonald's. The company’s employee expatriates, as well as natives, should treat them equally and they must fulfill their duties regarding the employee's comfort and satisfaction at work (Pattisson, 2016).
McDonald’s was founded by Raymond Albert Kroc (normally stated as Ray Kroc). Ray Kroc was a distributor of Multimixer. Richard and Maurice McDonald were two brothers who used to sell hamburger. Ray came to know about these McDonald brothers and the way they were using the Multimixer. Later on, Ray took the franchisee of McDonald’s and from that step, till now McDonald’s is growing with every passing moment. The first restaurant of McDonald’s was inaugurated in 1955 in Des Plaines, Illinois. In present times, McDonald’s own around 33,000 restaurants in about 119 countries adding on varieties of burgers and soft drinks (McDonalds, 2017).
Major HR challenges faced by McDonald’s
In today’s market where there is cut throat competition, every organisation is facing multiple challenges and one of the major challenges that all kind of organisations faces are HR issues (Lawler, 2014). Some of the challenges that McDonald’s faces are stated under:
- Demographic changes: There are different kinds of employees working for the organisation. It is difficult to create balance between each and every member of staff. It is tough job to understand the cultural and traditional aspect of each individual and it is even hard for the employee to grasp the entirely new environment.
- Skill gaps: Equal treatment should be given to every employee on the basis of skills. Advanced skills need to be taught to new employees. There is a general conflict between employees who are less skills and one who is highly skilled standing on the same pay and same platform. This gap should be bridged up smartly.
- Retaining the workforce: The major challenge that prevails is retention of employees. Measures need to be undertaken to figure out the reason of frequent turnover and quick actions are required to repair those gaps. They should be made to learn new things.
- Matching the pace with technology: Technology is the crucial aspect in all sought of business. Though McDonald’s is highly technological but still it need improvisation and updating to render quick services and making the employees even more advanced.
- Managing the global operations: Since globalisation has took over the market there is a need to maintain and increase the speed so that coordination can be developed with the world (Future HR trends, 2017).
Organisational structure and business performance of McDonald’s
As studied earlier, McDonald’s is the largest food chain operating. It has selected the market entry in different countries by the way of franchising. Its aim is to satisfy the customers and providing them the best place to sit and have something great to feed one. The stakeholders attached with the McDonald’s are first of all its customers, employees and competitors. It follows the macro environment conditions. At the time of recession it faced loses as the operational unit have to co-operate with the countries in which it is operating. Also legal norms of distinct countries need to be learned and those rules and regulations should be obeyed as well. Since it is the broad and expanding company the span of control is also wide ranging from one department to another department. The information passes from departments to sub-departments and then from supervisor to its staff. The system is entirely centralized and employees can perform certain administrative tasks. They could update the personal information and could take leaves by performing self-services. The company tracks the flat organisational structure where the manager has responsibility of small bunch of employees. The staffs revert to the dynamism in positive manner. This system gives right to every level of employees from top level to middle level and from superior to low level employees each one consists of certain liberty and sense of specific responsibility beyond which they cannot perform the activities. Quoting below the chart of McDonald’s depicting the flow of work in the company:
Figure1.1 Organisational structure of McDonald's.
(Source: Merinachhetri, 2014).
There is a predefined hierarchy that is prevailing in the McDonald’s, starting from General Manager and ending up on the crew members.
Figure1. 2 International hierarchy of McDonald's.
(Source: Merinachhetri, 2014).
HR Policies and Practices of McDonald’s
Human resource practices and policies involve enormous measures. There are labour law which the company abides of. Employment laws need to be followed so as to prevent the workers exploitation and build an authentic and trustworthy image in the external environment (Gould, 2013). Thus, the HR policies and practices used by McDonald’s are:
Employee retention program: Employee retention is the measure to lower the employee turnover rate. It assists in decreasing the rate of absenteeism. For initiating the retention program appraisal should be opted. There are two type of appraisal program, one is performance appraisal and other one is potential appraisal which enhances the feeling of belongingness and faith in the organisation.
Hiring process of McDonald’s: McDonald’s undertakes efficient recruitment by selecting the appropriate method. First of all the application form is filled up along with completion of quiz. In second step interview is conducted and lastly reference check is made in which background of the candidate is scrutinized. The diagrammatic process goes as under:
Figure1. 3 Recruitment and Selection at McDonalds
(Source: Johnason, 2009).
Training and development: Appropriate provision of training and development are provided to employees. The newly appointed are given induction program and followed by training session so that new employee could gain expertization.
Salary offered: Adequate and reasonable salary is provided to the employees who are appointed. They are appointed on the genuine salary along with many benefits.
Others: Other practices and policies that are followed are: career development, soothing working environment, performance measurement is done and provision of adequate bonus and compensation to the employees.
Gould. A. (2013). McDonald’s HR practices. Viewed on 3rd august 2017. <https://www.hrmonline.com.au/section/hr-capability/mcdonalds-human-resource-practices-still-order-day/>.
Johnason. P. (2009). ‘HRM in changing organizational contexts’. Human resource management: A critical approach. 19-37.
Lawler. E. E. (2014). What should HR leaders focus on in 2014. Viewed on 3rf August 2017. <https://www.forbes.com/sites/edwardlawler/2014/01/15/what-should-hr-leaders-focus-on-in-2014/#67c6b332352a>.
McDonald’s. (2017). History. Viewed on 3rd august 2017. <https://www.mcdonalds.com.my/company/history>.
Merinachhetri. (2014). Blog 1- Organisations and behaviour. Viewed on 3rd August 2017. <https://merinachhetri.wordpress.com/2014/10/24/blog-1-organisations-and-behaviour/>.
Pattisson. P. (2016). Workers for McDonald’s in Malaysia say they were victims of labour exploitation. Viewed on 3rd August 2017. <https://www.theguardian.com/global-development/2016/nov/28/workers-for-mcdonalds-malaysia-claim-labour-exploitation>.