Analysis of Human Resource Practices in McDonalds

The report analyses the human resource practices and employee engagement policies of McDonalds. It discusses the HR strategies, evaluation of HR practices, and employee engagement initiatives of the organization. It also suggests further initiatives that can be taken by the company to increase employee engagement and revenues.

Running head: ANALYSIS OF HUMAN RESOURCE PRACTICES
ANALYSIS OF HUMAN RESOURCE PRACTICES
Name of the Student
Name of the University
Author Note

1
ANALYSIS OF HUMAN RESOURCE PRACTICES
Executive Summary
The report is based on the analysis of the human resource related practices of an organization
and the employee engagement policies that are formulated by the management. The
organization that is taken into consideration is McDonalds, which fast food chain of
American origin. The various employee engagement policies of the organization and the HR
practices are also analysed in the report. The ways by which the employee engagement
policies help in increasing the revenues of the organization are also discussed in the report.
The initiatives that can be further taken by the company are also suggested.

2
ANALYSIS OF HUMAN RESOURCE PRACTICES
Table of Contents
Introduction....................................................................................................................3
Background of the organization.....................................................................................3
HR strategy of McDonalds.............................................................................................4
Evaluation of HR practices............................................................................................5
Employee engagement of McDonalds...........................................................................5
Plan of initiatives to be taken by McDonalds................................................................8
Conclusion......................................................................................................................8
References......................................................................................................................9

3
ANALYSIS OF HUMAN RESOURCE PRACTICES
Introduction
Human resource practices are mainly related to the means by which the human
resource personnel of the organizations can develop leadership of the employees. This
process takes place with the help of developing motivational programs and extensive training
related programs. The functions related to human resources of an organization are different
from the various HR practices. The HR practices in an organization are partly conceptual and
the partly the implementation of HR strategies. The concept of best practices refers to the HR
systems which have the greatest impact on the employees and the organizations (Yamao and
Sekiguchi 2015).
The report will be based on the analysis of the different HR practices of an
organization and the effects of these practices on the employee engagement related factors.
Background of the organization
McDonald’s is fast food company of the American origin which was founded in the
1940 in the form of a restaurant and was operated by Maurice and Richard McDonald in
California, United States. The headquarters of the organization is located in Oak Brook,
Illinois, United States. McDonalds has its operations in more than 100 countries in the world
with an employee strength of 3,75,000 in all the branches of the organization
(Mcdonalds.com. 2018).
The vision statement of McDonalds is related to becoming a progressive and modern
burger company which is known for delivering a contemporary type of customer experience.
The company is focussed towards delivering food that great taste and high quality to the
customers and provide them with world-class experience that makes them feel valued and
welcome (Armstrong and Taylor 2014).

4
ANALYSIS OF HUMAN RESOURCE PRACTICES
The mission statement of McDonalds is to become the favourite place of the
customers and provide them with a specific way to eat and drink. The company is also
dedicated to become a great place for the employees to work. The organization further aims
at building a positive and strong presence in the community to deliver, service, quality,
cleanliness and value the customers as well.
McDonalds has become a symbol of globalisation within a short span of time and the
term that has been given to this huge growth of the company is “McDonaldization” of the
entire society. McDonalds has been able to create its own position in the various countries
with the help of its innovative offerings according to the taste of the various customers. The
major products that are sold by McDonalds include, hamburgers, various types of chicken
burgers, soft drinks, French fries, breakfast related items, desserts. McDonalds also offers
vegetarian items, salads and dishes that are able to represent the local culture (Albrecht et al.
2015).
McDonalds depicts a divisional type of organizational structure where each of the
divisions are responsible for handling a specific area of operations. The different
characteristics of the organizational structure of McDonalds are, global hierarchy,
performance-based divisions and function-based groups.
HR strategy of McDonalds
McDonalds has become the largest family owned restaurant in the world and main
vision of the organization is to provide the best experience that can be provided to the
customers. The company has aimed at making the workplace suitable and enjoyable for the
employees by providing them with suitable benefits and rewards that suit their needs and
lifestyle (Brewster 2017). The employees who work in McDonalds become a part of the
greatest global brand and they also try to develop the organization constantly which can offer

5
ANALYSIS OF HUMAN RESOURCE PRACTICES
the environment of equality, flexibility, opportunity and diversity. McDonalds has been
offering the most diverse work culture among the various organizations that are operating in
UK and USA. The policy named Hire the Smile is followed by McDonalds to hire the
employees, which helps the organization to create positive approach and nurture the
workforce (Ma et al. 2017).
Evaluation of HR practices
The fast food related industry provides many people with their first job opportunity
and McDonalds has become one of the biggest industries in this sector. The company has
employees around 56,000 people in around 730 outlets. The suburban outlets of McDonalds
in the various regions of Australia, Europe, Asia and North America employ around 50 to 60
workers. The operate for 24 hours in a day and seven days in a week. The age of around 70%
of the managers of various outlets was between 18 and 25. The company consists of a small
majority of female workers in its various outlets. The key trends related to Taylorism and
Fordism are implemented by McDonalds (Shields et al. 2015).
The major factor that has contributed to the huge success of McDonalds in the fast
food industry is motivation that is provided to the employees. The company serves more than
60 million customers in 119 countries in the world. the Taylor’s Scientific Management
theory has been used by McDonalds to motivate the employees. The employees are also
provided with competitive wages which is a major part of the payment policy of McDonalds.
The Maslow’s Hierarchy of Needs Theory is also used by McDonalds to deliver the needs of
the employees of the organization in an effective manner. The various needs of the customers
are related to physiological needs, safety related needs, belonging and love needs, self-esteem
needs and the needs of self-actualisation (Reiche et al. 2016).

6
ANALYSIS OF HUMAN RESOURCE PRACTICES
Employee engagement of McDonalds
Employee engagement can be defined as the energy and the commitment that the
employees bring to the jobs that are being performed by them. This is an indicator of the
dedication and the involvement of the employees in the organization. The engaged employees
are much more productive and loyal to the company (Chahal, Jyoti and Rani 2016).
McDonalds has been known in the industry for its employee engagement related
activities and has further received many awards and recognition. The employees are
considered to be the best ambassadors of the organizations in the industry. They become the
face of the brand and organization needs to empower them to build their pride and foster
feelings related to empowerment and appreciation. Employee engagement related activities
have always been on the top of the mind of the top management of McDonalds. The
management also has to face the question related to the ways of appealing to a wide range of
employees who work in the organization. The process of employee motivation has been built
in the DNA of fast food giants like McDonalds (Nasurdin, Ahmad and Ling 2015). The
company has vested a lot of interest in the engagement related activities of the employees.
McDonalds is known in the industry for encouraging team and collaboration so that the
success of the restaurant can be ensured. The rewards and recognition related schemes that
have been implemented by McDonalds like providing bonus to the employees every year
based on scores that are given by the mystery shoppers and providing quarterly bonuses to
the restaurant managers (Jackson, Schuler and Jiang 2014).
The motivation scheme portfolio of McDonalds consists of the following factors,
Service awards that help in recognising the services of the employees at
intervals of five years.
Award given to the restaurant of the quarter.

7
ANALYSIS OF HUMAN RESOURCE PRACTICES
Award given to the restaurant of the year.
Global awards scheme formed for the support staff of the restaurants.
Ray Kroc Award for the business managers.
Champion of the month award given to the employees for his yearly services.
Bonus schemes related to restaurants which are developed for the employees
and the managers (Delery and Gupta 2016).
The various employee engagement related initiatives that have been taken by
McDonalds are as follows,
 Appealing schemes related to employee recognition – The recognition
schemes of the employees that are offered by McDonalds are appealing in
nature and this provides them with high levels of motivation to give their best
performance in the jobs. The engagement of the employees in various
functions of the organizations will also increase leading to the increase in
revenues. The company has also won awards for providing the most
motivational benefits t employees in the year 2013 (Chahal, Jyoti and Rani
2016).
 Global awards – The support department related staff of the company are
eligible for the global President’s Awards related scheme that is provided to
them. Five winners of these awards are chosen by the company management
every year from the various nominations which were made by the executive
team of the organization. The winning staff of these awards are provided with
rewards like travel packages at the expense of the company (Nasurdin, Ahmad
and Ling 2015).
 Better communication of the motivation related plans – The motivational plans
of the employees are communicated to them in an effective manner. This

8
ANALYSIS OF HUMAN RESOURCE PRACTICES
provides them with the knowledge about their eligibility regarding the various
schemes that are formulated by the company. McDonalds however need to
measure the effectiveness of the various schemes and motivational plans that
are provided by the company (Shields et al. 2015).
Plan of initiatives to be taken by McDonalds
Initiative to be taken Proposed step to be taken Expected impact of the
initiative
Providing incentives based
on the performance of
employees.
Feedback system of the
stores needs to be improved.
The motivation levels of the
employees increases and try
to perform better.
Taking the inputs of
employees in various
decisions of organizations.
The managers need to hold
meetings with the various
employees at regular time
intervals to take their
opinions.
The employees feel that they
are a major part of the
operations of an
organization.
Conclusion
The report can be concluded by stating that the human resource managers play an
important role in the various organizations belonging to different sectors. McDonalds has
also taken special care of the human resource activities that are related to the employee
engagement in the organization. The HR strategy is also formed in such a manner so that
employees can be motivated to provide their best performances. The recommendations are
based on the other initiatives that can be taken by the management to increase employee
engagement in the organization further increasing the revenues.

9
ANALYSIS OF HUMAN RESOURCE PRACTICES
References
Albrecht, S.L., Bakker, A.B., Gruman, J.A., Macey, W.H. and Saks, A.M., 2015. Employee
engagement, human resource management practices and competitive advantage: An
integrated approach. Journal of Organizational Effectiveness: People and Performance, 2(1),
pp.7-35.
Armstrong, M. and Taylor, S., 2014. Armstrong's handbook of human resource management
practice. Kogan Page Publishers.
Brewster, C., 2017. The integration of human resource management and corporate strategy.
In Policy and practice in European human resource management (pp. 22-35). Routledge.
Chahal, H., Jyoti, J. and Rani, A., 2016. The effect of perceived high-performance human
resource practices on business performance: Role of organizational learning. Global Business
Review, 17(3_suppl), pp.107S-132S.
Delery, J. and Gupta, N., 2016. Human resource management practices and organizational
effectiveness: internal fit matters. Journal of Organizational Effectiveness: People and
Performance, 3(2), pp.139-163.
Jackson, S.E., Schuler, R.S. and Jiang, K., 2014. An aspirational framework for strategic
human resource management. The Academy of Management Annals, 8(1), pp.1-56.
Ma, Z., Long, L., Zhang, Y., Zhang, J. and Lam, C.K., 2017. Why do high-performance
human resource practices matter for team creativity? The mediating role of collective efficacy
and knowledge sharing. Asia Pacific Journal of Management, 34(3), pp.565-586.
Mcdonalds.com. (2018). McDonald's: Burgers, Fries & More. Quality Ingredients.. [online]
Available at: https://www.mcdonalds.com/us/en-us.html [Accessed 13 Apr. 2018].

10
ANALYSIS OF HUMAN RESOURCE PRACTICES
Nasurdin, A.M., Ahmad, N.H. and Ling, T.C., 2015, January. High performance human
resource practices, identification with organizational values and goals, and service-oriented
organizational citizenship behavior: A review of literature and proposed model. In SHS Web
of Conferences (Vol. 18). EDP Sciences.
Reiche, B.S., Stahl, G.K., Mendenhall, M.E. and Oddou, G.R. eds., 2016. Readings and
cases in international human resource management. Taylor & Francis.
Shields, J., Brown, M., Kaine, S., Dolle-Samuel, C., North-Samardzic, A., McLean, P.,
Johns, R., O'Leary, P., Robinson, J. and Plimmer, G., 2015. Managing Employee
Performance & Reward: Concepts, Practices, Strategies. Cambridge University Press.
Yamao, S. and Sekiguchi, T., 2015. Employee commitment to corporate globalization: The
role of English language proficiency and human resource practices. Journal of World
Business, 50(1), pp.168-179.