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Perhaps one of the worst personal insults talent searchers ever dished out on international television is: “you’ll never be worth more than a job at Mc Donald's!” Denigrating because the statement perpetually boxes in the more than 1.6 million people employed under the arches in over 100 countries as busboys, order takers, or food delivery crew—jobs, which some people condescendingly categorize as fit for the not-so-bright, or those who can’t find work anywhere else. (“HR challenges... I'm lovin' It, 2005”)
But David Fairhurst, vice-president for people at McDonald's UK, says this is the farthest thing from the truth. "People do come in with a 'job' mentality, but after three months or so, they become evangelists because of the leadership and community spirit that exists in stores.” () Fairhurts’ claim is backed up by the fact that 80 percent of store managers were former crew members who were paid hourly wages; and that the average length of service for a McDonald's manager is 10 years. (“HR challenges... I'm lovin' It, 2005”)
MC Donald’s is a top retailer of food products and services all over the globe. With over 30,000 restaurants, serves nearly 50 million people in more than 119 countries each day. It was founded by Raymond Albert Kroc, a first-generation American of Czech descent. He was a salesman whose family ran a small restaurant and inn near the Czech village of Plzen. Kroc’s original business was distributing the five-spindled milk shake maker called the Multi-mixer. In 1954, he heard about a hamburger stand in California that ran eight multi-mixers at a time and became interested. (“Mc Donald’s History, n.d.”)
There he met with brothers Dick and Mac McDonald and broached the idea of opening a chain of “Mc Donald’s” restaurants---the perfect market for his multi-mixers. A year later, he opened the first “Mc Donald’s” restaurant in Des Plaines, Illinois. (“Fascinating Mc Facts, 2005”) From the outset, Kroc advocated franchising as the company’s principal mode of doing business. Worldwide, some 73% of its restaurants are operated by roughly 5,400 independent business people. Mc Donald’s corporate structure was specifically “decentralized” and rooted in the specific markets they serve. (“Mc Donald’s Corporate Responsibility Report”)
McDonald’s employs more than 1.6 million people, but only 398,000 of these are directly employed by the company. The rest of the workforce is under the management of Mc Donald’s independent owners and operators, but with training, guidance and technical support from the corporation, franchisees handle all aspects of restaurant operations. While each restaurant is responsible for individual policies they may have on bringing in, compensating and rewarding their employees, franchisees or independent owners, are required to promote a general set of “people practices” espoused by the company. This is checked through regular assessment of restaurant operations and recommendations by corporate specialists on training and research. (“Mc Donald’s Corporate Responsibility Report 2004 (Supplement)”)
Roughly 60% of Mc Donald’s staff is aged 16-21. These are the “crew” whose tasks may include mopping floors, taking orders, flipping burgers and assembling sandwiches. For majority, Mc Donald’s is their entry point into the workforce—these are teenagers who were enticed by free meals and the idea of earning hourly wages—but eventually ended up staying
With the company for at least 1.6 years, which is twice as long as their peer-groups employed in other companies. (“Tootelian, n.d.”) Mc Donald’s accounts this low employee turn over rate to its well-developed Human Resource policies and training aimed at developing their basic workplace skills and attitudes.
As they grow in their jobs, the crew gain experience and are given escalating opportunities for leadership and management. Some of course move on to careers in other fields, but a significant number make their way up into the company’s system. More than 1,000 U.S. restaurant owner/operators were former employees. “Even Mc Donald’s President and CEO Charlie Bell, Chief Restaurant Operations Officer, Claire Babrowski, and McDonald’s Ventures Managing Director, Mats Lederhausen, all started as crew members” (“Corporate Responsibility Report 2004”)
The Mc Donald’s system prides itself with its diversity program that gives equal opportunities to marginalized sectors of society. It is a proud member of the US Business Leadership Network, a group that advocates the sharing of best practices and resources in the area of employing people with disabilities; and supports the inclusion of minority groups (Hispanics, African-Americans, Asians) in the roster of employees. Mc Donald’s also recognizes the sensitivities and needs of its gay and lesbian employees. (“Corporate Responsibility Report 2004”)
With regards to ethical, business and training standards, Mc Donald’s restaurants all over the world follow a strict code of ethics, as well as the Management Development Program and its training classes. However, a centralized orientation program for new employees is the base of their training efforts.
Crew members training is traditionally passed on by experienced crew members, using a trainer’s guide, a handbook and a broad range of other materials. Each rookie must learn the basics of safety and security in the workplace before moving on to cleanliness, food safety, customer hospitality. The next step is closely observing aspects or levels of production, which may require that he be assigned to different restaurant stations. Finally there’s training on effective customer hospitality and coworker relations. (“Mc Donald’s Training, n.d.”)
For those who exhibit leadership characteristics, a management program has been set up and focuses on “people practices”. Apart from advanced training, mentoring, basic supervision and leadership and basic shift management, potential managers are taught how to create a positive work environment; support a workplace where individual differences are respected, utilized, valued and appreciated; find ways to enhance crew and customer satisfaction as well as evaluating the restaurants people practices.
Most crew members who aspire for a management career at McDonald’s do succeed and progressively work their way up to higher-level positions throughout the organization. From crew or team leader, they train for the position of MT or manager trainee whose primary duty is to assimilate the company’s policies and procedures in order to prepare for managing shifts in a restaurant. This early stage, potential managers must develop a keen sense for human relations as he or she must be maintain an open line of communication between the staff and would be required to follow-up on their progress. He is also asked by his superiors to establish an individual development plan that focuses on his or her own personal career development objectives. The basic question asked is: how far do you want to go in your career with Mc Donald’s? (“Mc Donald’s Carreer Paths, n.d.”)
From Manager Trainee one move to the Second Assistant Manager position who is responsible for managing people, products and equipment and ensure Quality, Service, Cleanliness and Value (QSC&V) on all assigned shifts. Mentoring also begins here as the second assistant manager is given crew members to train and motivate. More than paperwork handling, he is also placed in charge of controlling food components, labor, waste and cash flow while managing specific areas. After learning to handle people, the next level prepares the employee to run the Mc Donald’s business. (“Mc Donald’s Carreer Paths, n.d.”)
First Assistant Managers are directly responsible for recruiting, staffing, scheduling and retaining employees, and more importantly, demonstrating and reinforcing leadership behavior and people standards. It is necessary for him to build trust and earn commitment from his crew and other shift managers apart from building sales, and keeping down costs to deliver optimum business results in the different restaurant areas. Moreover, first assistant managers must effectively maintain the Mc Donald’s standards of product quality, service speed and quality, cleanliness and sanitation; and controlling assigned profit and loss line items. (“Mc Donald’s Carreer Paths, n.d.”)
Through all of these, the employee’s performance, attitude as well as the amount of time it took him to progress from manager trainee to first assistant manager, are all taken into consideration and weighed by HRD. A final evaluation is conducted to determine whether he or she is fit to assume the role position of Restaurant Manager. Some outlets, in fact, have “steeper” corporate ladders for their employees to climb. In California, for example, managers in company owned restaurants, follow a unique management career path that requires him to work on the restaurant’s different “zones”. The aspirant begins as a Front Counter Zone Manager responsible for client hospitality within the restaurant. From there, one moves to Drive-Thru Zone Manager, responsible for service, profit and labor; then Grill Zone Manager who focuses on restaurant production. Each step is accompanied by a prearranged training program, with the goal of becoming a Restaurant Manager. (“Mc Donald’s Carreer Paths, n.d.”)
As Restaurant Manager, he or she must oversee the entire operation of a McDonald's restaurant. He or she is tasked with training and developing assistant managers; must be able to measure external customer satisfaction and execute plans to increase brand loyalty. Apart from this, he must implement and conduct in-restaurant procedures, and ensure the execution of all security, food safety and maintenance of the restaurant. Apart from these, he or she must monitor and accomplish different procedures in the restaurant-among these the pay, incentives and personnel records. The restaurant manager is also responsible for forecasting profit and keeping losses to a minimum. (“Mc Donald’s Carreer Paths, n.d.”)
But career growth doesn’t stop there. Experienced restaurant managers may eventually become business or operations consultants—in other words, full time expert resources for restaurant managers and owners/operators. One such position is Operations Supervisor, who must provide leadership, coaching and direction to the restaurants he or she is assigned. The operations supervisor maximizes long-term sales and profit potential for each restaurant and is tasked to build a positive business relationship with Restaurant Managers and Restaurant Leadership Team. (“Mc Donald’s Carreer Paths, n.d.”)
Training Consultants, on the other hand, conduct training classes to motivate and improve performance. He or she also doubles as operations expert and consultant on McDonald's operation standards, management tools and training systems. Business Consultants, for their part, help a designated group of individual owners boost restaurant profits, QSC, profit and lay-out parameters for people development; while the Human Resources Consultant is asked to dispense best-practices information, recruiting recommendations analyze individual restaurant needs and develop recommended customized solutions. (“Mc Donald’s Carreer Paths, n.d.”)
The Mc Donald’s system not only monitors the progress of its staff and crew who possess leadership and managerial potentials. It has set up and developed a streamlined training as well as additional enhancement courses specifically for this purpose. Since 1961, Mc Donald’s very own Hamburger University, a 130,000-square-foot facility in Oak Brook, Illinois, has been offering courses for restaurant managers, owner/operators and corporate employees. Course materials are available in 28 languages, and classes have been translated into as many as six languages at one time. The university’s curriculum can be credited towards a two- or four-year college degree. It is the only restaurant organization to be awarded college credit recommendations from the American Council on Education. (“Mc Donald’s Training, n.d.”)
Finally, strict business and ethical standards are hammered onto all McDonald’s employees worldwide. Mc Donald’s has set clear-cut rules for proper ethics and conduct for its staff . Each employee is informed of their basic rights, what the company offers to protect them from harassment; that they are given equal opportunity while under the employ of Mc Donald’s and are briefed on what constitutes conflict of interest; non-disclosure of classified company materials and financial records. Subsequently, everyone is also informed of the corresponding penalties and violations. Management then asks them if they have fully understood and if they are willing to abide by the said guidelines, prior to letting them start work in a Mc Donald’s restaurant. The company expects their staff to act responsibly and hold themselves accountable for keeping an eye out for violations and subsequently reporting the perpetrators to their superiors. All reports are treated by the management as confidential, and the employee is granted full anonymity for his or her protection. If proven guilty, the employee will be meted out a warning; may be suspended or terminated, and depending on the gravity of the case, legal prosecution. (“Mc Donald’s Corporate Responsibility Report 2004”)
When it comes to benefits and incentives for its employees, much is to be expected from Mc Donald’s. The rewards program they have designed is aimed at attracting, energizing and retaining the talented and dedicated members of its staff. It is divided into four tiers, namely: base pay, incentive pay, long term benefits and recognition programs. (“Mc Donald’s Benefits, n.d.”)
The base pay is considered the most significant portion of employees’ compensation. Mc Donald’s maintains the competitiveness of its base pay through an annual review of both external market data and internal peer data. In their corporate, division and regional offices, a broad banding compensation system which allows for flexibility in terms of pay, movement and growth is used. On the other hand, incentive pay gives the employee a chance to earn additional compensation whenever the restaurant performs well and sales are exceptionally good. The company makes use of a Target Incentive Plan (TIP) which links employee performance with the performance of the business they support. TIP pays a bonus on top of employees' base salaries based on business performance and their individual performance.
Long term incentives are awarded to both reward and retain key employees who have exhibited sustained performance and have the potential to affect long-term business at McDonald's. Recognition programs have likewise been set up to reward and recognize strong performers. The Presidents' Award, for starters, is given to the top 1% of individual performers worldwide while the Circle of Excellence Award is handed to top teams worldwide in recognition of their efforts to perpetuate the Mc Donald’s vision. (“Mc Donald’s Careers—management, n.d.”)
At the same time, McDonald's rewards programs are designed to help its employees maintain or regain the right balance between work and outside life. Corporate, division and regional office employees may be able to arrange with HRD for an alternative work approach. They can opt to take flex time or compressed work week for full-time positions and part-time scheduling and job sharing for part-time employees. Restaurant Managers, and all of Mc Donald’s corporate employees enjoy the benefit of paid vacation leaves. The length of vacation time is based on the number of years the employee has worked. For other qualified regular employees, Mc Donald’s gives nine paid vacation days. Part-time employees are also given paid leaves, but the number of days are subject to company discretion. They can also opt to take an eight-week sabbatical for every 10 years of full-time continuous service with the company. (“Mc Donald’s Benefits, nd.”)
Likewise, McDonald's provides a leave of absence program with specific policies. This includes family, medical, adoption and funeral leaves. Mc Donald’s also supports the continuing education of its employees; and extends even child care or home and auto insurance aids. Some employees were assisted by the company in adoption cases. (“Mc Donald’s Benefits, nd.”)
A comprehensive health and insurance benefits system is also mapped out for employees and their immediate family members. McDonald’s gives them medical plan options that use the First Health network of providers. The medical plans include a prescription drug program feature and lifetime health benefits that include preventive care and once a year executive check-ups for employees and their nominated family members. Well-baby care, child immunizations and inoculation are also covered. Mc Donald’s also placed provisions for vision (includes eyeglasses and contact lenses replacement and discounts on laser vision correction surgery) and dental expenses coverage. An employee may also ask the management to put aside a maximum of $5,600 from his pre-tax income for a health care spending account . (“Mc Donald’s Benefits, n.d.”)
Mc Donald’s also extends free short and long term disability coverage for all its employees. Short term disability readily compensates an employee who is rendered unable to work by injury for 10 or more days, consecutively. Long term disability, on the other hand, gives the injured employee up to 60% of his or her monthly basic pay. He is compensated for the entire duration of his disability. McDonald's also provides free basic life insurance equivalent to twice the employee's base salary. In case of death or serious injury caused by an accident the company gives out accidental death and dismemberment insurance which is worth twice the employee's basic pay. And, in the event of an accident when traveling for personal reasons, travel insurance, amounting to twice the basic monthly pay is also given. If the employee is sent on an official trip, an additional $100,000 or $200,000 is provided as business travel insurance on top of the regular travel accident coverage. (“Mc Donald’s Benefits, nd.”)
With regards to the finances of its employees, Mc Donald’s encourages them to invest and save by offering several money management programs. McSave, which is a special money market fund set up for McDonald's employees while MCDirect Shares allows them to invest and reinvest dividends in the company. There is also a Profit Sharing and Savings Plan which lets employees set aside up to half of their basic pay. The plan’s 401(k) feature matches employee contributions with $3 for each $1 of the first 1% they set aside, and $1:$1 for the subsequent amounts they save up. (“Mc Donald’s Benefits, n.d.”)
In conclusion, Mc Donald’s human resource development policies provide its employees a challenging career and a nurturing work environment. Inspite the controversies and intrigues that befell the company in the last two years, Mc Donald’s has managed to reinvent itself not only by reestablishing its reputation as a provider of nutritious and high-quality food by giving its consumers healthier meal options, but also placed the training and continuous development of its staff as the heart of its operations. Its people policies make each employee proud of holding a “Mc Job”. The workplace is secure; their inputs and suggestions are welcome; they are aware of what the company expects from them, and what they get in return for their loyalty and service Moreover, the values and code of ethics Mc Donald’s instills in its employees are invaluable and applicable to any job they may hold in the future.
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