Recognition Scheme at McDonald’s
Discuss about the Employee Retention and Encouraging Leaders.
Employee retention and encouraging the future leaders are crucial for the commercial organizations in regards to ensuring commendable productivity, customer satisfaction, low operational cost, positive brand image and sustainable business opportunities. Hence, the modern companies largely focus on is HRM policy that promotes the strategy of employee reward and training and development. As discussed by Miner (2013), the strategy of providing tangible and intangible rewards for recognizing the contribution of the employees helps the management in encouraging the motivation level of the employees. On the other hand, training helps in increasing the competency of the employees which serves in professional growth of the employee and productivity of the company. As discussed by Rowley and McMurtrey (2016), depending on the operational and service pattern, this employee reward program may vary.
For the successful completion of this essay, the author has chosen the internationally popular fast food restaurant chain McDonald’s. Based on the case study of McDonald’s the author has explored the answers of three questions related to the employee reward and retention policy of McDonald’s and the applicability of those policy to a different organizational set up (Spastic Centre). Finally, the author has concluded the essay with the summery of the discussion.
As discussed by McFarlane (2015), recognising the employees’ contribution with the tangible and intangible awards helps the companies to obtain employee motivation and retain the talents within the organization.
The organizational mission of McDonald’s includes the objective of being best employer for its employees in each community around the world. Hence, the organizational culture of the company puts emphasise on human resource development and efficiency (Qureshi & Hassan, 2013). McDonald’s has the prioritization for “People-Centricity” and “Individual Learning”. The organizational culture of McDonald’s prioritizes the needs of the employees. The tangible and intangible needs of the employees and supported with various HRM strategies. On the other hand, the organizational culture supports “individual learning” for increasing efficiency, productivity and the professional growth of the employee himself (Xu, 2014).
In the context of McDonald’s the management of the company largely depends upon the strategy of providing tangible rewards to the employees for maintaining their motivation and commitment. As mentioned in the company website, McDonald’s depends on retaining the talents with lucrative salary packaging (McDonald’s Australia, 2017). The company follows a “pay for performance” philosophy (McFarlane, 2015). The company has opted for a competitive salary in the industry, which is complemented with extra reward for overtime. On the other hand, the company has a strategy of short term incentives which is “variable, at-risk portion of cash compensation one can earn each year” (McDonald’s Australia, 2017). The company also follows a recognition program that is designed to reward and recognize the strong performers and encourage them to be the next leaders. It includes the “Presidents’ Award” that is given to the highest 1% of the individual performers globally and the “Circle of Excellence Award”, that is given to the best performing teams globally to recognize their contribution for advancing the organizational performance (Rowley & McMurtrey, 2016). Moreover, the company follows the “company car program”. In this policy the eligible employees are provided with cars for personal and professional use. The program provides the scope of chose, car and related insurance, maintenance and repair benefits.
Motivation Theories Supporting McDonald’s Recognition Scheme
All these tangible reward strategies support the culture of “People-Centricity” of McDonald’s. On the other hand, as mentioned by Mukerjee (2014), good salary structure and additional benefits help the companies to attract eligible and talented employees. Moreover, with a lucrative and competitive salary, the companies become able to retain its old employee base.
The company largely believes on improving the skill set of the employees with the professional trainings. Moreover, the company believes in constant skill development of the employees which is helpful for the company as well as the employees. As discussed by Mahajan (2014), the company provides training and development at all levels to assist the employees to enhance their skill set, grow in their current position or promote to a new role in the company. According to the case study provided, a national crew opinion survey has identified that the managers has a favourable attitude regarding McDonald’s as an employer (Lockyer, 2013). They find it an attractive workplace as it provides a growth opportunity with its professional and leadership training (Talwar & Thakur, 2016). Through the Hamburger University, the company provides training on “restaurant operations procedures, service, quality and cleanliness” (McDonald’s Australia, 2017). With the help of lab activities and e-learning, the company makes its employees capable of operating a high end restaurant with success.
On the other hand, in the leadership training, the company provides training to all level of employees for career development. With the components like “career planning, Individual Development plans, career maps, succession planning, and learning activities” the company strives to create future leaders for the organization (McDonald’s Australia, 2017). All these personal and career development opportunities attract the ambitious employees to work with McDonalds. It provides them the assurance that these personal training sessions will be helpful in encouraging their leadership qualities which will be rewarded by the company.
In the context of McDonald’s Australia, the company invests more than $40 million for employee training (Nadolny & Ryan, 2015). It organizes programs like Crew Recognition program for recognizing the contribution of the high performing staffs. The eligible staffs are awarded with gift vouchers or discount cards in front of the colleagues or in the staff meetings (McDonald’s Australia, 2017). The achievers are named in the monthly staff magazine of McDonald’s as well.
As mentioned by Miner (2015), the basics of human resource management and employee reward system in an organizational set up can largely be supported by a number of employee motivation theories. The content and process theories ideate what and how motivation can be achieved from the employees (Parker, 2014).
As per the motivation theory of Fredrick Herzberg, a good salary structure can be identified as a hygiene factor in the employee motivation and retention (L?z?roiu, 2015). According to this particular theory, a good salary structure is needed to maintain a general satisfaction level among the employees. As mentioned by Pinder (2014), the salary structure does not necessarily creates motivation among the employees, however, it is needed to prevent dissatisfaction among the employees. However, as discussed by Shields et al. (2015), Herzberg has identified the provisions of “recognition” and “advancement” both is the motivating factors for employee motivation. Hence, the strategy of “pay for performance” or the rewards like “Presidents’ Award”, “Circle of Excellence Award”, “gift voucher” etc. can be identified as motivators for the employees.
On the other hand, as mentioned in the most celebrated motivation theory Maslow’s hierarchy ladder, the assurance of a good salary structure is a physiological need of the employees. As identified by Miner (2013), it is the most basic need of an employee. For ensuring satisfaction and retain the employee the management must provide a good salary structure. Here. McDonald’s is addressing the basic need of the employees by providing a lucrative salary structure and additional tangible benefits. On the other hand, the provision of providing awards like gift voucher, “president’s awards” or the mentioning of the name in the monthly magazine serve as the esteem motivators in the model of Maslow’s hierarchy of needs.
Moreover, the policy of training for the employees plays a significant role in ensuring the employee motivation and retaining them in the organization. This strategy of training has a theoretical base in maintaining employees’ motivation to work for their professional growth which is helpful in ensuring organizational success. As mentioned by Yamuna and Devi (2016), the expectancy theory of motivation is effective in this regard. This theory states that the “expectancy, instrumentality and valance” acts as the force or motivation for performance within the employees. As mentioned by Quested et al. (2016), the idea of expectancy is the belief that putting effort for increasing the personal productivity will obtain a desired level of success, whereas instrumentality states that a successful performance will be rewarded by the company and the valance is the value a person assigns to the reward. Now, the companies can opt for a policy of promotion or other rewards for the good performers. On the other hand, the management needs to provide a scope to the employees to enhance their skill level which would be helpful in increase their performance and grab the performance reward. Thus, the expectancy theory states that the companies need to provide training opportunities which an allure of rewards for better performance. As opined by Miner (2013), in the “expectancy” the employees make an expectation and a level of confidence about what they are capable of. Here, the management has to discover and provide resources, trainings and supervision for the skill enhancement among the employees. It creates a sense of satisfaction among the employees and the idea of “instrumentality” pushes them forward to achieve the reward. Here, McDonald’s is using this strategy of providing professional trainings to the employees for career development.
In this context of McDonald’s recognition scheme, the ERG theory of employee motivation can also be discussed. As mentioned by Findsrud, Tronvoll and Edvardsson (2016), Alderfer’s ERG theory has explained that the people have the need of Existence, Relatedness and Growth. Existence refers to the concern with the basic materials for existence requirements. Here, competitive salary structure of McDonald’s satisfies this need of the employees. On the other hand, as mentioned by Lee and Raschke (2016), Growth can be identified as the highest level of need among the human beings. This Growth refers to an intrinsic desire for personal development. The training and development scheme obtained by McDonald’s can be identified as an appropriate tool for satisfying this need of personal development. With the help of training facilities the employees become able to improve their skill set and get higher level of responsibility which serves as a sense of personal satisfaction (Yamuna & Devi, 2016).
Last but not the least, David McClelland’s learned need theory can also be mentioned in this regard. As discussed by Lee and Raschke (2016), this theory of learned need has identified the major needs those provide motivation in the workplace. These are: Need for achievement, Need for power, Need for Competence and Need for affiliation.
McDonald’s have addressed almost all these needs with its human resource management program. The performance goals help in satisfying the need for achievement, the provision of leadership endorsement and internal promotion satisfies the need for power. The integrated approach towards employee trainings helps in satisfying the need for competence and the organizational culture of “people centricity” and cooperation helps McDonald’s in satisfying the need for affiliation among the employees.
Hence, it can be noted that the company is utilizing various theoretical approaches in actualizing its need of employee satisfaction and motivation.
The Spastic Centre of Australia has already used this strategy of salary packaging of McDonalds. As mentioned by Miner (2013), offering competitive salary package is essential for reducing the employee turnover. McDonalds and the Spastic Centre have already used it. This non-profit organization is allowed to offer up to $16,500 per year in salary sacrificed expenses on anything, it includes a meal entertainment allowance as well. This particular organization is using this strategy of salary packaging for more than twelve year, which is an evidence of its success in a not-for-profit organisation as well.
In the context of the non-profit organizations, employee turnover rate is substantially higher than the profit making organizations. As mentioned by Lee and Raschke (2016), the poor salary and lack of employee benefits are the major reasons for the huge employee turnover rate in the NGO sector. Moreover, a very few organizations provide the chance of professional trainings for uplifting the faculty of the employees which would be helpful in professional growth of the employees (Miner, 2013). This lack of opportunity for professional growth often drives the employees for opting for switching their career options. Spastic Centre has not wholly imitated the McDonald’s approach of managing human resources, as they do not have the provision of uplifting the employee capabilities with trainings, which is largely important for a non profit organization.
Hence, it can be said that the McDonald’s approach of managing human resources ca directly be applicable to the non profit organizations. As mentioned by Yamuna and Devi (2016), a competitive salary will restrict a sense of frustration among them, and packaged services (like accommodation, food, tax relaxations, health benefits, organization provided transportation services and many others) will be helpful in providing a sense of satisfaction among the employees. With the help of employee training provision, like McDonald’s the non profit organizations will also be able to uphold a culture of leadership promotion.
Conclusion:
In conclusion, it can be said that the employee recognition scheme is largely influential in ensuring operational smoothness and employee satisfaction and commitment. By providing attractive salary package coupled with tangible facilities and training provisions, the organizations can become able to attract and retain talents within the organizations. A number of scholastic theories on employee motivation have supported the provision of high salary packaging and the strategy of employee benefits for ensuring employee satisfaction and retention. McDonald’s Australia is strategically using the employee recognition scheme and the training provisions for supporting the culture of the company, i.e. leadership promotion. The contribution recognition scheme of the company is helping it to encourage the employees to make increased contribution to the organizational productivity. On the other hand, the employee training schemes help the company to increase the faculty and capability of the employees so that they can be utilized for better organizational productivity and advanced job roles. This serves as a motivating and satisfactory factor for the employees who are ambitious enough to opt for a leadership goal. Thus, the human resource management policy of McDonald’s serves reciprocally for employee motivation and organizational benefit.
References:
Findsrud, R., Tronvoll, B., & Edvardsson, B. (2016). Conceptualizing resource integration in value co-creation using theories of motivation. Tiziana Russo-Spenaand Cristina Mele, 165.
L?z?roiu, G. (2015). Employee Motivation and Job Performance. Linguistic and Philosophical Investigations, (14), 97-102.
Lee, M. T., & Raschke, R. L. (2016). Understanding employee motivation and organizational performance: arguments for a set-theoretic approach. Journal of Innovation & Knowledge, 1(3), 162-169.
Lockyer, C. (2013). Working for McDonald’s in Europe. The Unequal Struggle. Employee Relations.
Mahajan, S. (2014). Competitive advantage through training and development in Mcdonald’s: a case study. International Journal of Management, IT and Engineering, 4(10), 403-417.
McDonald’s Australia. (2017). Mcdonalds.com.au. Retrieved 6 February 2017, from https://mcdonalds.com.au
McFarlane, D. A. (2015). Gaps in Executive and Worker Compensation as an Organizational and Management Challenge. Journal of Entrepreneurship and Business Innovation, 2(1), 1-15.
Miner, J. B. (2013). The role motivation theories of organizational leadership. In Transformational and Charismatic Leadership: The Road Ahead 10th Anniversary Edition (pp. 365-394). Emerald Group Publishing Limited.
Miner, J. B. (2015). Organizational behavior 1: Essential theories of motivation and leadership. Routledge.
Mukerjee, K. (2014). Fostering employee engagement in organisations: a conceptual framework. International Journal of Management Practice, 7(2), 160-176.
Nadolny, A., & Ryan, S. (2015). McUniversities revisited: a comparison of university and McDonald’s casual employee experiences in Australia. Studies in Higher Education, 40(1), 142-157.
Parker, S. K. (2014). Beyond motivation: Job and work design for development, health, ambidexterity, and more. Annual review of psychology, 65, 661-691.
Pinder, C. C. (2014). Work motivation in organizational behavior. Psychology Press.
Quested, E., Ntoumanis, N., Thøgersen-Ntøumani, C., Hagger, M., & Hancox, J. (2016). Evaluating quality of implementation in physical activity interventions based on theories of motivation.
Qureshi, A., & Hassan, M. (2013). Impact of performance management on the organisational performance: An analytical investigation of the business model of McDonalds. International Journal of Academic Research in Economics and Management Sciences, 2(5), 54.
Rowley, B., & McMurtrey, M. E. (2016). McDonald’s and the Triple Bottom Line: A Case Study of Corporate Sustainability. Journal of Strategic Innovation and Sustainability, 11(1), 33.
Shields, J., Brown, M., Kaine, S., Dolle-Samuel, C., North-Samardzic, A., McLean, P., … & Plimmer, G. (2015). Managing Employee Performance & Reward: Concepts, Practices, Strategies. Cambridge University Press.
Talwar, E., & Thakur, M. (2016). Training and Development and its Impact on Employee Performance. We’Ken-International Journal of Basic and Applied Sciences, 1(1), 18-27.
Xu, Y. (2014). Understanding CSR from the perspective of Chinese diners: the case of McDonald’s. International Journal of Contemporary Hospitality Management, 26(6), 1002-1020.
Yamuna, G., & Devi, R. J. (2016). Motivation Theories Applied for Increasing Employee Performance at Work Place-Case study Review. Imperial Journal of Interdisciplinary Research, 2(11).
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
