Functions of Management
McDonald’s company is the biggest chain of fast-food restaurants in the world, having approximately 68 million clients every day in 119 states. The McDonald brothers, who started the corporation, reorganized it to a hamburger stand via production line standards in 1948 (Watson, 2006). Ray Kroc joined the corporation as a franchise representative in 1956 and afterward he procured the chain from the McDonald’s siblings and oversaw its international expansion.The company is run by franchisee in over 35,000 outlets internationally, providing employment to over 1.5 million people (Kaufmann & Lafontaine, 1994). The corporation also manages additional restaurant products, for example Piles Cafe. In regard to its core product, the company started separating itself from supplementary chains it had obtained in 1990. The business possessed a commanding share in Chipotle Grill but it separated from the company by means of stock trade later in 2006.
The company has augmented investor dividends for 25 successive years, emerging as one of the S&P 500 Dividend nobles (Watson, 2006). It was only in 2012 that its monthly sales dropped for the first time in nine consecutive years, and this success is accredited to the management of the corporation. McDonald’s utilizes a variety of techniques, procedures and tactics for its efficient operation. It has developed and implemented management functions that assist them in the implementation of their vision for the future of the corporation. The company is well managed and geared up to realize future objectives.
The company began in 1940. It is the launch of the Speed Service System in the same year that advanced the principles of the current fast-food restaurant that were already put into effect more than two decades before (Watson, 2006). First amulet of the company was a gentleman in a chef’s cap and was named Speedee. This amulet was later substituted by Ronald McDonald in 1967 when the corporation first filed a U.S. brand on a clown shaped gentleman with costume legs.
The corporation initially filed for their trademark using McDonald’s as their brand name in 1961. In the same period, the corporation filed a brand logo on an overlapping, double curved “M” sign but it was shortly replaced with a single arch one. The current corporation was established when a Ray Kroc obtained shares from McDonald siblings (Watson, 2006). Kroc afterwards bought the commanding shares in the corporation and contributed to its global growth, whereby it was listed in security markets. The new owner also noted violation of business practices, coercing the McDonald brothers to exit from the fast food business. They both disagreed over management of the business, as highlighted in their autobiographies. San Bernardino outlet was destroyed afterwards and it currently acts as head office for the Juan Pollo restaurants who acquired it. With the opening out of McDonald’s in various global markets, the corporation has turned out to be an icon of globalization and it has spread American lifestyle. Its reputation has as well made it an everyday subject of public discussions regarding business ethics and customer responsibility.
Managers subsist in all industries and they carry out similar functions in all businesses. Various management concepts have a significant task in realizing management’s goal. Each concept is significant and one cannot function well with an exclusion of the other. The four functions of management bring about creation of an interconnected organization (Bateman & Snell, 2004). There is no solid and fast regulation to be followed in the application of these concepts, as administration is a real-time decision-making arrangement; any of these concepts can be operational in concurrence with any other and also as autonomous entities.
Planning is the basis upon which all other parts of administration are established. Planning necessitates management to evaluate where the company currently is, and where it would be in the coming years. At this point, a suitable course of action is agreed on and implemented to accomplish the company’s goals. McDonald is pursuing new and improved sustainability tactics. The corporation has lately pronounced new goals for sustainability and social accountability, which incorporates beef production by 2020. McDonald’s management says they are focusing on the areas that are core to their business and that make a real difference (Kincheloe, 2002).
The company will be upholding sustainable beef production and start procurement of beef from established sources in 2016. It is also going to Source 100 percent of coffee and palm oil that is confirmed to maintain sustainable production. It is planning to procure 100 percent of fiber-based wrappers from licensed sources. The company aims at serving 100% extra fruit, vegetable, and whole grains in a portion of its top markets (Watson, 2006). In addition, it aims at growing in-restaurant reprocessing by 50%, and improve energy efficiency by 20% in some of its top markets. After conducting a SWOT analysis, the Company is able to come up with several threats and strengths. The company’s major competitors are Aramak and Ark restaurants. Their customer base and emerging popularity is a great threat to McDonald’s. The company gains from the extensive operations it has globally and while maximizing on this advantage, the restaurant is working to satisfy the yearning for international tastes at its home in the United States. To avoid losing customers to the competitors, the company is spicing up its menu by coming up with new offerings and distinguishing its current menu.
Leading is the other concept of management and working under this function assists the administration in controlling and supervising the staff performance. It also allows them to provide support to the workers by directing them in the right path to realize the corporation’s goals and achieve their individual or profession goals (Bateman & Snell, 2004). Inspiration, communication, unit dynamics, and unit leadership can drive this. The leadership of McDonald’s has delegated duties to junior staffs in different countries of their operations. Lately, McDonalds has decided to go Green. For it to do so the executive Team will delegate to the Midlevel administration team the responsibilities of sorting out what has to be done to reduce misuse in the entire 3,000 restaurants around the globe. Consequently, this will result to enhanced output of the whole organization.
Directing is assumed by every level of the management in McDonald’s restaurant. A superior directs his assistant who consecutively delegates duties to the people he/she oversees and so on (Thompson, Strickland & Thompson, 1999). The employee on the kitchen floor also directs the machines to carry out certain tasks. Managers who are given the responsibility to direct in this corporation are insightful to behavior patterns, and have the capacity to read body language are able to make more knowledgeable decisions concerning their workers. Directing tries to inspire and lead the workers toward the projected objectives and thus it is motivating in nature.
It is the responsibility of management to organize all its resources in advance and to follow the strategy settled on during planning (Thompson, Strickland & Thompson, 1999). Whilst determining the hierarchy of its branches, management in McDonald’s observes the necessities of various departments. The management also ensures the harmonization of workers and tries to find out the best way to deal with important tasks and lessen unnecessary expenses. Management in McDonald’s determines the division of labor in relation to its need. It also decides suitable departments to entrust with power and responsibilities. Job profiles require to be identified in consistent with the needs of different departments in a company.
The company’s management organizes different jobs within the company into controllable units. The executive in McDonald’s has noticeably specified the extent and range of authorities given to different managers working in various departments. Managers in McDonald’s ensure that various departments synchronize between themselves and recognize the authorities and duties allocated to them. This is essential as the smooth running of the entire organizational configuration relies upon people learning to work collectively (Thompson, Strickland & Thompson, 1999).
Controlling function incorporates establishing work standards that are allied to the company’s objectives. This function also involves evaluation and reporting real work performance. It involves scrutinizing the company’s performance to make certain that goals are realized. Managers should concentrate on the costs against the productivity of the company. McDonalds has integrated its good citizen method of doing things into the entire concepts of management (Kincheloe, 2002). The Top Management group has delegated what is thought to be the best thing to do for the society. This is usually done after conducting some kind of a survey to find out societal needs. They also contemplate on the parts of the various levels of administration that will cause the right thing to ensue. Top Management group of McDonalds decides what goals are to be newly employed throughout the company’s hierarchy. Globalization is affecting McDonald’s expansion strategy as it is attempting to enlarge its business in international market like China. This is why the management of McDonalds is considering about the region, customs and religion of consumers. In addition, McDonalds needs to reflect on food habit and choice of their new regions clients.
McDonald’s should reflect on the environmental factors that are affecting the corporation. In addition, the management should also review strategies that are being implemented because they may have positive or negative consequence on business. The administration of McDonald’s have to constantly concentrate on the umbrella activities of the business, by assessing what works and what does not work in order to form the business strategies (Kincheloe, 2002). To apply the strategies successfully and lucratively, the upper level administration should form a safe environment to support changes, and enhance commitment of the company. McDonald’s should make certain that all strategies are well designed and implemented cautiously in advance, since these changes and strategies will be the deciding factor for the achievement or failure of any business.
Bateman, T. S., & Snell, S. (2004). Management: The new competitive landscape. New York: McGraw-Hill/Irwin.
Kaufmann, P. J., & Lafontaine, F. (1994). Costs of control: The source of economic rents for McDonald’s franchisees. JL & Econ., 37, 417.
Kincheloe, J. L. (2002). The Sign of the Burger: McDonald’s and the Culture of Power. Philadelphia: Temple University Press.
Thompson, A. A., Strickland, A. J., & Thompson, J. (1999). Strategic management: Concepts and cases. New York: Irwin/McGraw-Hill.
Watson, J. L. (Ed.). (2006). Golden arches east: McDonald’s in East Asia. Calif: Stanford University Press.