McDonald’s Corporation Analysis: Functions of Management

Words: 1276
Topic: Business & Economics

The impact of globalization has continually influenced the manner in which organizations operate. Hence, several organizations continue to stumble upon new challenges in their struggle of attaining market stability. However, such organizations must consider implementing various organizing functions in all their business endeavors in order to succeed (Thomas & Gerhard, 2006). As such, the services, duties and requirements of the society need to be addressed before any substantial success come into realization. As a response, several corporations develop implementation strategies aimed at meeting such requirements at the expense of their competitors.

Effective management practices, realized from the struggle, create substantial impact on several resources such as knowledge, technology, physical assets, and human resource just by applying these strategies (Bateman & Scott, 2009). In this paper, the author evaluates the organizing function of management in McDonalds Corporation basing on the human resources, and monetary assets.

Human Resources

The human resource function plays crucial roles in ensuring that organizations get the most skillful, knowledgeable, and effective staff that can execute difficult tasks. Listed among the largest and famous global food retailers, McDonalds must implement unique human resources function that will allow competent staff to be hired (Engelberth, Signe, & Stefan, 2001). Hence, individuals follow long, transparent and time consuming selection practice in order to become employees at McDonalds. The food industry is delicate; thus, the tough selection procedure must be implemented in order to hire the most qualifying candidates. First of all, the hierarchy of the corporation implemented in several regions of the world is as shown below.

Hierarchy of the corporation.
Hierarchy of the corporation.

Since McDonalds is a multinational corporation, the classification falls into five main regions globally, but the initiation of crucial decisions takes place at the head office. These decisions may be slightly modified to suit the local requirement in the respective markets (Engelberth et al., 2001). Since employees create the first impression of an organization, McDonalds considers several factors before making the final decision of recruiting an individual. As such, their managers apply several tactics and rules as described in the following paragraphs.

As much as McDonalds wants to employ the best individuals, the company has always implemented the EEO laws in order to give applicants equal chances of securing jobs. Hence, the corporation employs several individuals, who work skillfully and diligently, out of merit. Furthermore, McDonalds is not gender biased and allows all employees to prove their worth during their entire service.

Since the complexity of human resources duties become increasingly demanding, the organization delegates them to the human resource department. Some of these delegated duties include recruitment, selection, appraisals, and training of identified individuals. However, the operating managers understand the job details and requirements better than the human resource staff. As such, the process referred to as job analysis gives the necessary details of any specified job. In McDonalds, filling of questionnaires or observation defines the entire process of job analysis. The process allows candidates to get acquainted with the job requirements and responsibilities before going to through the hiring process.

  • Position: Operations Manager.
  • Region of Vacancy: Texas.
  • Candidate’s Profile: The candidate must have an MBA with specialization in Hotel Management. Additionally, more than 5 years experience in a related position will be an added advantage.
  • Job Description: The individual will be responsible for the management of all hotel duties relating to capital operations. Furthermore, the successful candidates will constantly participate in making crucial decisions and radical changes in several operations.

After the establishment of staffing needs, McDonalds goes ahead to hire the most qualified and experienced individuals to take the vacant positions. This involves a two step process namely recruitment and selection. Hiring passes through two levels identified as trainee managers or crew members. In the recruitment process, the company gets individuals either by hiring through internal (intranets and bulletin boards) or external sources (newspapers and website). During selection, the company identifies preferred candidates’ using unbiased (merit) procedures. The selection process follows several steps that include screening of applicants, writing tests, initial interview, aptitude tests, reference checks, final interview and lastly, the relocation of candidates.

After hiring, McDonalds offers training to successful candidates so that they become familiar with the company’s expectation. The training takes different durations from as low as 10 days to as high as three months depending on the job category. This training can be conducted immediately after the selection or overseas. In that situation, the training techniques put under implementation can be categorized as orientation, on-the-job, classroom, and computer-based training.

Successful candidates start working for McDonalds’ after completing all the procedures; however, there are constant evaluations conducted to evaluate their performances. This process takes 6 months where feedback comes, and individuals below the target level receive warnings advising them to work on their performances. “The levels of performances include; outstanding, excellent, average and need improvement” (Engelberth et al., 2001). In the long run, the implementation of incentives follows to encourage the performance of all employees.

The Monetary Asset

Since most organizations have to upgrade, expand and constantly improve their services, the monetary asset remains fundamental in business management (Milgrom & Roberts, 1992). The financial budget forms the backbone of an organization because it imparts the ability to purchase required resources such as new machines, communication gadgets and advertising facilities. According to relevant sources, McDonalds enjoys a strong financial muscle that enables it to expand and thrive well in new markets around the globe. For instance, the corporation thrives well in more than 121 nations and owns restaurants exceeding 30,000 globally. As such, financial professionals experience an uphill task in determining the most appropriate policies for adoption in order to run the corporation (Thomas & Gerhard, 2006).

Therefore, effective financial and investment strategies currently in use allow for effective management. In line with that, the company uses various techniques such as the firm’s contribution and general contribution to measure success at unit level. Several years back, the application of strategies such as heavy discounting on fast food products resulted in sales increase (Milgrom & Roberts, 1992).

Since the profits margin remained at low levels, the company had to move large volumes of products to realize substantial profits. However, with increasing commodity costs, McDonalds gradually increased the selling prices of its products. As such, the profit margins improved, and more profit started flowing into the business. Hence, improvement in the financial planning of the company resulted in better incentives that triggered better performances, as well as, financial stability (Thomas & Gerhard, 2006). Currently, corporation uses the financial muscle gained to upgrade existing restaurants, purchase machinery, improve methods of communication and advertise immensely.


Over a long period, McDonalds has continually revolutionized the way of carrying out business. This became possible because of improved services delivered through effective managerial functions. Hence, when several factors get to be actualized, an organization becomes successful and profitable in all markets. As established in the paper, McDonalds adequately responded to most of these factors. For instance, the human resource function proves the fact that McDonalds follows the standard procedure of recruitment and selection. This leaves no room for discrimination and compromise; hence, only qualified individuals deserving the rightful jobs become selected (Bateman & Scott, 2009).

Furthermore, the implementation of incentives increases the productivity of the firm by significant margins (Milgrom & Roberts, 1992). Additionally, the organization’s financial growth and stability is a direct correlation to excellent decisions made by the firm’s financial advisors. As such, constant improvement of the company will result over the years. In conclusion, it is undeniable to mention that McDonalds Corporation optimized the human resources and monetary assets for effectiveness and efficiency.

Reference List

Bateman, T., & Scott, S. (2009). Management: Leading & Collaborating in a Competitive World. McGraw-Hill Companies, Inc. Web.

Engelberth, C., Signe, S., & Stefan, Z. (2001). McDonalds: Economics of Organizations. Web.

Milgrom, P., & Roberts, J. (1992). Economics, Organizations and Management. Prentice Hall. Web.

Thomas, J., & Gerhard, P. (2006). Planning. Web.