McDonald's Corporation is an international fast-food company that started as a restaurant in America but later established chain stores globally. The market dynamics are changing each day, with new environmental regulations and customer preferences, and this has influenced the operation of the company by applying pressure to the company, causing organizational change. McDonald's Corporation keeps evolving to accommodate the emerging market.
McDonald's Corporation has a divisional organizational structure. This structure works favorably for the company. The company is divided into specific sections, and each section handles a particular role, working towards defined goals and objectives. McDonald's organizational structure is divided into three characteristics. The first one is the global hierarchy that handles the global franchises, ensuring they are well managed and directed. Secondly, performance-based divisions evaluate performance and revenue from various regions; this characteristic is the most outstanding feature of McDonald's organizational structure. The third characteristic is function-based groups, enabling the company to address essential functions, and each group is under managerial leadership. An advantage of this structure is that it allows for the monitoring of activities in their global operations. The drawback is that McDonald's organizational structure evaluates performance-based on divisions.
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The fast-food and restaurant industry is multiplying. It is a significant contributor to most countries' economies, and each year its value grows significantly. Companies in the fast-food business are striving to be consistent in experiences, speed, and affordability. A clear organizational structure in a company shows employees' hierarchy, divides roles, and enhances accountability. The best structure for such a company is the divisional structure, whereby the employees are oriented and handed specific tasks. The staff understands the chain of command, and they work towards achieving specific goals and objectives. Fast food companies like McDonald's Corporation often divide their team into the following categories: executive managers, shift supervisors, the drive-through associates, chefs, and food preparation associates, and cleanup crew.
There are many factors influencing change in the fast-food industry. Internal pressure, such as a change in the managerial personnel as a result of transfer or retirement, affects a company's organizational structure. Change is required when linked to the organization's purpose and in line with the organization's values (Todnem, R. 2020, p. 4). For instance, when the executive manager at McDonald's retires, the working relationship formed between the former manager and employees will be compromised, as new managerial personnel comes up with new ways, rules, and ideas to run the company. This causes tension between the management and employees. We exist in a reality of managers vs. employees (Todnem, 2020, p. 4).
Deficiency in the existing organizational structure has lead to organizational change in a company. A company with a large number of managerial level staff experiences a coordination issue that causes an organizational change. One or two leaders at the administrative level are ideal for easier decision making and accountability. At McDonald's, the large number of shift supervisors per franchise is affecting efficient decision making. Lack of coordination and uniformity between departments causes friction; this affects the company's organizational structure; whereby, the production team and the sales team lack coordination, resulting in a lack of progress in the company.
Marketing conditions also contribute to organizational change. In the fast-food industry, customer's demands and expectations change regularly, and a company like McDonald's Corporation needs to adjust accordingly to satisfy the consumer's wants. Technology is snowballing, and technological inventions are continually affecting the nature of jobs in many companies. In McDonald's Corporation, technology and innovation impact the drive-through branches. Installation of answering machines for the clients has reduced the need for some employees; this shift has sparked organizational change.
The government has passed new environmental regulations for food companies in the industry to adopt a greener approach. This move has caused the companies to revise their policies. McDonald's Corporation has been compelled to introduce a recycling and waste management program to support this regulation. McDonald's Corporation has been criticized for being insensitive about their consumers' health, by lack of healthier options in their menu. The customers in the food industry are more educated, and they have increased the demand for plant-based food options in a bid to adopt a healthier lifestyle. This new demand has compelled companies like McDonald's Corporation to make changes in their production and come up with a new menu. This shift has caused an organizational change in the company.
I predict that McDonald's may experience first-order organizational change. McDonald's Corporation has been affected by these changes, and the company should prepare to experience organizational change. These changes are not entirely transformational, and they do not affect the overall organizational structure. The changes are implemented in the already established division organizational structure, making the existing process better. As predicted, these first-order organizational changes should prove to be sufficient and adequate so that McDonald's Corporation will not result in second-order changes later on.
Technological changes are prominent in this era. This is because of the breakthrough invention of machines such as; answering machines, packaging machines, and ticketing machines in drive-through stores. Innovative drive-through technology appears to be a solution to ensure the speed of fast food services ( Castillo et al., 2020 para 1.4). These implementations lead to the replacement of labor and the reduction of the company's workforce. If customers choose to pay cash, they can conveniently insert their cash in the kiosk ( Castillo et al., 2020, para 7). The number of shift managers in various McDonald's stores may be reduced by issuing layoffs. This move should reduce labor costs in the company and enhance decision-making processes.
The food menu at McDonald's Corporation is projected to improve. This move should satisfy the rising consumer demands for healthier options. The company may also introduce a more experienced and educated workforce, especially the chefs and food organizers, ensuring variety and improvement of the food presented by the company. Due to the market competition, McDonald's Corporation should invest in their branding and marketing departments. This move is essential to update their marketing merchandise and develop new advertisement strategies. This change should enable them to compete with other companies effectively.
McDonald's Corporation is planning to substitute its current packaging materials for more eco-friendly and reusable products. This move is sufficient in a bid to support the go-green movement introduced by the government and promote environmental conservation. The company is also predicted to improve their communication and interactions among the stores globally. This decision should enhance coordination and improve the policymaking process. These first-order organizational changes are easy to apply, and they should be useful in growing business at McDonald's Corporation. Still, they can only work if they are adhered to.
References
By, R. T. (2020). Organizational change and leadership: Out of the quagmire.
Castillo, A. M. M., Salonga, L. J. L., Sia, J. A. L., & Young, M. N. Improving Fast-Food Restaurants’ Method of Operation: Automated Drive-Through Ordering System.
