OB McD Finished!

McDonald’s Corporation

Ariyani DeborantyJumranOphy QuamillaPatrick Braun

Agenda

Brief History Company Overview The Company’s Strategies Accomplishments Conflicts Human Resources Issue Managing Cultural Differences

Brief History

1948: Was founded in California by Dick and Mac McDonald 1954 - 1955: Ray Kroc became McD’s franchising agent and opened the restaurant in Illinois 1961: Ray Kroc bought the company1967: McDonald opened the 1st franchises outside U.S., in Puerto Rico and Canada1999: Already opened nearly 40.000 restaurants in 120 countries

Company Overview

Financial Information: Total revenues in 2003 increased 11% and net income increased 65%90% of total revenues came from U.S., Europe, APMEA, Latin America and Canada.

Growth: adding restaurants, maximizing sales and profits at existing restaurants, improving international profitability

Company Overview

Products: burgers, chickens, breakfasts, salads, snacks & sides, beverages, McCafe, desserts & shakes

Employees : 314, 000 (1999); 400, 000 (2008)

Turnover: down from 170% to 130-135%

Philosophy: Q.S.C. & V.

Vision: World’s best quick service restaurant

Strategies

Customer Satisfaction: “do whatever it takes to make a customer happy” Provides healthier foods with nutritional information Larger menus Allowed individual stores to experiment with their formats Nonfood-related products for kids

Strategies

Market: Diversification in home market International growth in Europe, Latin America, Asia Pacific.

Strategies

Social Responsibilities: Education

Children’s charities Environment

Human Resources Strategies

Managing DiversityMcDonald’s has created program:

McJobs for disabled people age of 16-60 McMasters is a nationwide program that identifies, recruits, trains and retains workers who are 55 years of age and older Employment opportunity

Human Resources Strategies

RecruitmentRecruitment, Selection and Retention

Training and DevelopmentHamburger University

BenefitProfit Sharing

Accomplishments

Domination of IndustryGrowthInternational sector

1. Discuss the inherent conflicts that exist between McD’s Company philosophy and its reformed organizational structure?

2. Discuss the many human resource issues that may arise and how the company may manage difference in culture

Conflicts

Q.S.C & V vs Restaurant Diversity

Differences in standard for their employees Differences in qualities and services Human resources strategies cannot be

applied in all franchisees around the world

Conflicts

McD Philosophy

McD Concept Conflict

To be the best employer for its people in each community around the world.

Using students as worker, short work hours.

For some areas, the concepts were not working and led employee to dissatisfaction.

Example: Brazil

Conflicts

McD Philosophy

McD Concept Conflict

To deliver operational exellence to its customers in each of its restaurants

Franchise structure reduces control, makes monitoring performance more difficult

A tight control system with strict regulations is difficult to run in a company with franchise organisation

Human ResourceIssues

McDonald’s is the world’s largest chain of hamburger fast food restaurant. If they want to continue expand internationally, they will face different culture of an other country and it may become some problem.

Human Resource Issues

The issues:1.Indonesia vs America: cultural perception of

time.2.China vs America: the different culture

between to country impact to the management of the business.

3.Brazil vs America: disgruntled franchisees and unhappy employees.

How McD manage cultural differences?

Solid diversity training Workshop to help managers and employees

so that they have full advantage of what everybody brings

Ensure that people at all levels of McD’s bring their energy and creativity into the work environment

ANY

QUESTIONS?