Mcdonald’s

Topics: Employment, Human resource management, Strategic management Pages: 5 (1643 words) Published: May 12, 2011
McDonald’s, based in California, USA, has become the most famous and successful fast-food restaurants all over the world. Since the first McDonald’s opened in 1955, till now, McDonald’s has established more than 32,000 chain stores over 100 countries, serving more than 60 million people each day, and gaining around 15 billions incomes per year. In addition, McDonald’s keeps enhancing its brand imagine through different social activities and the sponsorship of special events and sports. (www.McDonalds.com.au)

Why McDonald’s is so successful? How can it achieve this? The reason why McDonald’s is so successful is it well implements several business strategies. This essay is going to analyze the recipe of success of McDonal’s and argues that how business strategy influence the staffing strategy. The business strategy of McDonald’s is to deliver outstanding service to its customers, that is to provide its customers quality, cleanliness, quick service and value. Poter’s specialization strategy can help better understand McDonal’s business strategy. Poter (as cited in Phillips and Gully,2011, pp. 31) stated that firms using specialization strategy can be either cost leaders or differentiators. Such a strategy “focus on a narrow market segment or niche-a single product, a particular end use, or buyers with special needs”. Companies pursue specialization strategy can focus on a particular buyer group, either through a low price or differentiated products or services that other competitors cannot imitate. The nature of McDonald's product is food which everybody needs this makes the idea of a narrow focus strategy a little less likely for McDonald's. The specialization strategy is a combine of cost-leadership strategy or differentiation strategy. Businesses adopt such a strategy often try to develop a competitive advantage through customer intimacy and try to gain and increase customers’ loyalty through meeting their customers’ needs by delivering unique products or services. When hiring empolyees, it is very important that employers should focus on employees’ good people skills. McDonal’s competitive advantage is to provide its customers quality, cleanliness, quick service and value. In such a situation, hiring people with experience and good interpersonal skills can help Mcdonal’s to implement its business strategy However, many of its restaurant employees are teenagers without any work experience. Why is that? As Bechet( 2002, p.167)stated, business strategy can influence staffing strategy. McDonal’s specialization strategy can be either cost leadership strategy or differentiation strategy. The main focus of cost leadership strategy is to keep costs and prices low. Organizations that adopt such a business strategy are try to build up a competitive advantage based on operational excellence that is to maximize the efficiency of the product development to minimize costs(Phillips and Gully 2011, pp. 30). Such an operational excellence requires companies to employ employees trainable and flexible, and have the ability to fulfill short-term production objectives by avoiding waste and lowering the company’s production coasts. Consequentially, it is not desirable to hire people who have experience and have high salary expectation because by adopting this strategy, employees require to work as team with a tight margin. It is not effectively for teamwork considering that employees pay disparity(Phillips and Gully 2011, pp. 31). In addition, McDonal’s is chain restaurants and views its employees as most important asset, which means that when hiring employess, it is necessary and significant to manage costs and control the asset, like managing other asset such as equipment or steel. As a result, the acquisition and deployment of the cheaper and the quicker the labor the better. By knowing this, McDonal’s turns to working hard at hiring employees without experience, but want to excel in delivering its outstanding service rather...
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