MANAGEMENT PROCESS (POLC) OF MCDONALDS PDF

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FUNDAMENTAL OF MANAGEMENT (MGT 162)INDIVIDUAL ASSIGNMENT(MCDONALD’S)PREPARED BY :TASNEEM BINTI MUSTAFFA(2020883586)DIPLOMA IN ACCOUNTANCY (GROUP: AC1101E)PREPARED FOR :PUAN NORAIDA BINTI OMAR21 DECEMBER 2020ACKNOWLEDGEMENTFirstly, I praise to the God, the Almighty, for His showers of blessings throu...

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FUNDAMENTAL OF MANAGEMENT (MGT 162) INDIVIDUAL ASSIGNMENT (MCDONALD’S)

PREPARED BY : TASNEEM BINTI MUSTAFFA (2020883586) DIPLOMA IN ACCOUNTANCY (GROUP: AC1101E)

PREPARED FOR : PUAN NORAIDA BINTI OMAR

21 DECEMBER 2020

ACKNOWLEDGEMENT Firstly, I praise to the God, the Almighty, for His showers of blessings throughout my research work to complete this research successfully. I would like to express my deep and sincere gratitude to my beloved lecturer, Madam Noraida Omar for helping and guiding her students in completing the individual assignment given. Her vision, sincerity and motivation have deeply inspired me to keep going when I’m tired. It was a great privilege and honor to work and study under her guidance. I am truly grateful for what she has offered me. I would also like to thank her for her kindness, strong dedication to her students and also great sense of humor. I am thankful for her acceptance and patience during the discussion me and my fellow classmates had with her on our online research. Besides, I am also grateful to my parents for their love, prayers, caring and sacrifices for educating and preparing me for my future. I also want to thank my fellow classmates for helping me by answering my queries. Next, thank you to my sister for the endless support she has given me to complete this assignment. Finally, my thanks go to all the people who have supported me before in order to complete this assignment directly or indirectly.

TABLE OF CONTENTS

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TITLE Cover page Acknowledgement Table of content Introduction: Company’s background Planning : Mission and vision statement Planning : Goals and objectives Planning : Strategic plan Planning : Operational strategies Planning : Operational strategies Organizing Motivation Leading Control Conclusion References References

INTRODUCTION : COMPANY’S BACKGROUND In 1937, McDonald’s initiated with a hot dog stand that was opened by the McDonald brothers, Maurice and Richard McDonald near the Santa Anita track. They started to get into the food service business as a team. In 1940, both of them opened their barbecue restaurant in San Bernardino which is the world's first McDonald's restaurant. Then, in the year 1948, the McDonald brother turned their restaurant into a hamburger and milkshake restaurant located in San Bernardino, California. The original McDonald’s sells their products which are burgers, fries and shakes for half the price and in half the time of competing restaurants. Then, the business came up with something beneficial. Instead of depending on waiters and waitresses, the McDonald brothers have installed a self-service counter which helps in reducing the staff workers and to save cost. Instead of cooking each meal after receiving order, the workers prepared their burgers in advance and also kept the food warm under high-powered heat lamps to make sure the quality and taste of products are good as always. In 1948, the McDonald brother turned their restaurant into a hamburger and milkshake restaurant in Detroit. On the year 1953, McDonald’s has opened its first franchise restaurant in Phoenix. In addition, they also did open multiple restaurants in Arizona and California during the company's early years. In 1961, Ray Kroc who is a traveling appliance salesman, buys out the McDonald

brothers for $2.6 million (approximately $22.3 million in 2019 equivalent). Unfortunately, Kroc died on the year 1984. After that,in the year 1993, McDonald’s opened its first McCafe, which was an undertake to run a coffee restaurant, in Australia. From the year 1988 to 1996, the company doubled its number of restaurants and finally had entered an era of rapid growth. By the end of the 1990s, McDonald's has successfully opened more than 11,000 restaurants outside of the U.S.

PLANNING VISSION STATEMENT : 

To move with velocity to drive profitable growth and become an even better McDonald s serving more customers delicious food each day around the world

The main components of this vision statement are moving with velocity to drive profitable growth, become an even better McDonald’s, and also serve more customers delicious food each day around the world. This vision statement clearly shows that the business aims to grow and expand its operations. This can be done by opening more business locations and improving operational efficiency to improve profit margins. Then the vision statement also focuses on improving the business such as product development, marketing, franchising, and human resource development. In coclusion of this vision statement, the company expects growth and an overall enhancement of the various areas of the fast food restaurant chain business. MISSION STATEMENT : 

To be our customers' favorite place and way to eat and drink.

In this mission statement, McDonald’s Company emphasizes becoming the favorite of target customers. Based on this aspect, the major determinants of the business is customer’s preferences For instance, McDonald’s has develop its menu and recipes in order to satisfy the consumers’ preferences. This is to achieve the company’s mission which is to become the customer’s favorite place to eat. The components of this mission statement focus on two points which are becoming the favorite place and becoming the favorite way. As a fast food service business, the company optimize productivity and customer experience by developing restaurant designs and layouts. The menu development, helps in making the company’s restaurants and franchised locations the favorite place to eat and drink. Meanwhile, the “favorite way” component of the mission statement shows that the company aims to influence people on how to eat and drink.

GOALS/OBJECTIVES : 1. To be the world’s premier consumer product organization mainly focusing on convenient fast foods. 2. To increase profits or percentage of sales for a certain period of time 3. Survive current hard times the business is in. 4. Business objectives may state growth by 15% year on year for the next 5 years ahead. 5. Increasing brand awareness over a certain period of time.

The core objective of McDonald’s is to be the world’s premier consumer product organization generally focusing on convenient fast foods. They practice providing financial rewards to their investors hence giving opportunities for growth and enrichment for their employees, business partners and for the communities in which they operate. They strive for Honesty, Fairness and integrity in everything they do. Meanwhile, McDonald’s aim and objectives are to have great concerns about the organizations customers, being socially responsible for the company’s welfare and to sustain a good and friendly environment. Besides, they seek to serve high standard and good quality food with quick and outstanding service all along with great value of money.

STRATEGIC PLAN : Strategic planning is the process by which an organization makes decision and takes action that affect its long run performance. A strategic plan is important to move the organization from where it’s now to where it wants to be. The strategic plan that is used by McDonald’s is called ‘plan to win’, which its concept is for McDonald’s to not be the biggest fast food chain, except for it to be the best fast food restaurant chain. McDonald’s tries achieving this by practising the 5P’s. The 5P’s are people, products, price, place, and also promotion. Besides, McDonald’s combines organizational strategic plan which include better restaurant operations, prioritizing the first customer, menu variety and also beverage choices. From McDonald’s overall strategic direction and its geographical strategic plan, it leads the business’s global brand to acquire a very high turnover rate and also more positive financial results as yet. McDonald’s has introduce “McD Man” which attracted a lot of children which leads to increase of sales figure from the previous year. Besides, they attract consumers by following the psychological pricing strategy that makes the price looks economical to the customers. McDonald’s utilizes mental estimating system in a way that it looks a lot simpler to be logical. McDonald’s often observe the integrated pricing policy by the C3 formula which are cost, customers and competitors. McDonald’s uses this formula to set prices to target consumers and also keep teamwork and fairness among diverse consumers within different franchises all around the world. McDonald’s always chooses the most strategic location to open the business as it will get more customers in any area with lots of people. They also make promotions of their brand such as advertisement and promoting sales. McDonald’s sell the Prosperity Burger only once a year and the strategy definetely works because most people are willing to queue for hours just to buy it. Most customers also buy the burger in lot of quantiy because it only come out once a year. McDonald’s also set several specific skills that are needed for the workers to work. These skills are separated into personal skills and professional skills. The personal skills are self confident, good communication skills, decision making, management skills, problem solving as well as creative skills. Meanwhile for the professional skills, they are leadership skills, lading

and mentoring skills, counselling skills and also coaching and mentoring skills. All of these skills will definitely help the business to achive the objectives and goals of the business. OPERATIONAL STRATEGIES : Every business must have operational strategies in order to achieve the goals and objectives of business. These operational strategies focuses on certain key elements of the production process which brings a competitive advantage to the company. The measures that McDonald’s practice to achieve its goals are as below: 

Lower the cost.

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Enhance their product quality.

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Punctual delivery of products.

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Accelerating their speed.

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Product design.

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Oustanding customer service.

The measures here focuses on certain key elements of the production process, thus giving the company spirited adavantages. The most important strategies in the operations of McDonald’s is to maintain their supply chain process. McDonald’s have 3 dimensional operation process strategy which are : 1. VALUE The worker’s job is repitive and well-organized. They need to make sure that the taste and quality of the product are same as always. So, they were each given a particular job to keep up the standards. 2. VARIETIES McDonalds provide a lot of variety for the customers to choose from, ranging from burgers, fried chickens, tortilla wrap, chicken nuggets, fries, cakes, coffees and fizzy drinks. They regularly attempt to come up with a new menu to prevent the customers getting bored of the same menu and also to pull all kinds of customers all around the world.

3. VARIATIONS McDonalds provide a lot of variations as they can meet the changing capacity of the customer’s demand over time due to their systematic processes. The normal process design of McDonald’s are : 

Order received

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Toasted bread products

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Cook frozen product

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Add up ingredients

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Place eatables in packets

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Keep in cabinet ( max 10minutes)

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Deliver to the customers

This process helps them to implement customization in the orders and reduce the customer’s waiting line.

ORGANIZING

This is a functional structure. As a whole, this would be the organization structure of McDonald’s. I must say that it is a simple structure but a really effective one. Functional structure is one of the most used organisational structure in business, especially in a large company. McDonald’s has made a good decision in using a functional structure as the departmentalization structure. Groups of employees are organised according to the function that they perform. In this functional structure, business are organised according to their roles and skills into smaller departments such as marketing, sales, finance, restaurant and supply department. Besides, functional structure will achieve greater operational efficiencies. This is because

employees with shared skills and knowledge work together and perform similar

functions. In addition, this method will also eliminate overlapping in the execution of organizational structure. It is also easy to coordinate activities. MOTIVATION

Motivation is the management process of influencing people’s behavior to behave in a way that ensures the accomplishment of some goal. There are several types of motivation practiced by McDonald’s. In 2014, Road to Rio iniative is the program which cause measured developments for the business. The project incentivised the top 5% of restaurants based on customer satisfaction ratings in February, March and April 2014. There was a prize draw that the employees from these restaurants can entered in order to earn a trip to the World Cup in Brazil. The contest ran in conjunction with the Fifa World Cup, with McDonald’s using its sponsorship of the competition to its advantage, which send 11 winning members of staff to Brazil. More essentially, it helped to boost the speed of service while also delivering great customer experience. For incentive pay, McDonald’s has given the three bonus schemes which are a monthly scheme for hourly paid employees, a quarterly scheme for the restaurant management teams and also an annual scheme for office support departments. Besides, McDonald’s has introduce the recognition schemes such as employee of the month for each restaurant, employee of the year and also award and honour for the best restaurant managers. These kind of recognition schemes will definitely motivate the workers to work harder in order to get the awards.

LEADING

McDonald’s use different styles of leadership. For instance, directive behavior. It happens when a leader behavior aimed at telling followers what to do and how to do it. A leader will indicate the exist of performance goals and what must be done precisely to achieve them. Secondly, supportive behavior. It happens when a leader behavior aimed at being friendly with followers as well as showing interest in them as human being. Leader will show sensitivity to the personal needs of followers through supportive behavior. Both of this behavior are important and frequently used. Both have their time, place and situation for efficiency. The next leadership style adepted in McDonald’s is autocratic which the team leaders and managers are willing to make unilateral decisions. Autocratic leadership can only dictate but can’t motivate. This style of leadership brings a lot of pressure on team members who are always stressful. However, the crew members seemed to prefer an autocratic style because they do not have to be creative to do their work except to follow instructions and orders. In addition, the crew members are not involved at all in any decision making and their suggestions are not welcomed regarding most of them are only new workers. Autocratic leadership also doesn’t fulfil the self esteem requirements which are reflected in Maslow’s hierarchy. It doesn’t completely utilize the skills and capabilities of available human resources and yet thrives and flourishes, bringing in more profits to the business conglomerate as well as customers satisfaction. The managers at McDonald’s also need to recognize leaderships behaviours that could be used in order to perform as well as help their team to lead it. They could take references from the six behaviours identified by Manz and Sims for inspiration. All six behaviours tells to encourage self-observation so that the team can gather the informations needed to monitor and evaluate its own performance. The second behavior is to inspire self-goal setting in order for the team to set their performance goals. Besides, team leader at McDonald’s need to encourage selfreinforcement in order for the team to recognise and reinforce good team performance and also to encourage self-criticism in hope that the team is elf-critical and discourages poor team performance. Next, team leaders need to encourage self-expectation. This is to give high expectations to the team for group performance. The last behavior is to encourage rehearsal so that the work group thinks through and implements an activity before actually performing the activity. CONTROL

Control is a process of monitoring performance and taking action to ensure desired results. Control is an important part in management because it will help the business to achieve the organization’s objectives. McDonald’s has practice the feedback control. Managers will set a goal that they want, then take precautions according to the data to avoid bias from continue to develop or exist. Basically, controlling process takes place after an action is completed. This is also known as corrective control. Meanwhile, feed-forward control is done at the input of production which is before the start of production. This type of control is also called preventive control. It designed to prevent or reduce the performance deficiencies before they occur. In addition, feed-forward control can definitely improve the company’s chances of success. This situation will happen if managers can predict in advance the problem and fix it. Besides, McDonald’s major method which is the bureaucratic control has becomes the most practicable and effectual controlling system at McDonald’s. Managers will attempt to affect the workers’ behavior through punishments and bonus regarding their working performance. Bureaucratic control is also know as a top-to-bottom method of control which seems to work best since McDonald’s is a global fast food chain retailer. Hierarchical system makes sure all employees are allocated to be in a specific position of the fast food production chain, with strict company rules and procedures. For formative control, any the employee will carries McDonald’s mission and value, and they are always prepared to serve the customers in the most effective way with automatic response under bureaucratic, which means they only follow the orders from managers and follow steps of using the machinery to produce freshly made fast food to the customers with a happy face and smile. Formative control lets McDonald’s employees to form a good business image as an entity.

CONCLUSION From doing this individual assignment, now I know about McDonald’s mission and vision statement as well as their goals and objectives. Besides, I also know the business’s strategic plan and operational strategies which are important for the business to achieve their goals and objectives. I also know that McDonald’s is using functional structure as their organizational structure. In my opinion, it is a good choice to use functional structure as it comes with benefits as well. In addition, I learnt that the business is practicing directive and autocratic style of leadership. Leading is very important in a business so that the members or workers contribute to the goals achievement of the organization. Next, the company will use motivation practices in order to influence people’s behavior to behave in a way that ensures the accomplishment of some goals. After the company has done their part in motivating the workers, they will control the performance shown by the workers and start to take action to ensure desired results. Some of the control process used by McDonald’s are feedback control, feed-forward control, bureaucratic control as well as formative control. Im so grateful that I learnt so many things while completing the individual assignment given.

REFERENCES Norlida Kamaluddin (2018 July). Principles of Management Third Edition text book. Eric

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