Discuss about the Retaining Talent with Salary Packaging at McDonald.
In an environment, that is becoming progressively more aggressive, depiction and perceiving talent is an important trepidation on the organization’s perspective. Due to the ongoing financial crisis in some of the countries, the competition has somewhat eased off, however, stiff competition remains in some of the other labor markets. In this scenario of tough competition, organizations are competing with each other to retain talent with handsome salary packages. In each industry, the employee retention level varies where there is existence of certain organizations that that suffer internally, amplifying the turnover of key employees. According to Nadolny & Ryan, (2015), competitive improvement can be attained through people depending on the greater part of the workforce taking into functions of the people that are being hired, the ways they get developed and the factors leading to their retention in their jobs.
The human resource department of any association is considered one of the most significant resources associated with the workforces’ quality and eventual goals. McDonald’s human resource department is accountable for recruiting right people and that too in right number, right jobs along with right cost and knowledge and skills. The company HR department is also liable for providing their employees with adequate training and keeping a record of accomplishment of everything. As per McDonald & Hite, (2015), the HRM department of any organization directs its aim towards focusing on people’s compensation, administration, training, and motivation and employee recognition. Retention in any company always commences at the point of recruitment. McDonald’s has been following a good recruitment policy over the years where focus is given on the candidate’s capability along with principles and objectives. McDonald’s Australia is a big player in the market of fast food restaurant chain, employing around 70000 people.
The Human Resource Management (HRM) deals with the ‘Human’ characteristic of an organization. There are different activities that an organization needs to process through for attaining the definitive goals. From the viewpoint of an organization, fostering talent and permitting high potentials are significant in safeguarding the future of any organization. Employee enthusiasm is something that has been injected into the DNA of McDonald’s where even though the McDonald’s restaurants work as separate profit units, the employees have demonstrated enough interest in participating in the concept of teamwork and creating a team to ensure that the restaurants remain successful. Employees in the top 10% of McDonald’s restaurants collect bonus based on the mystery shopper’s score. As per McCloskey, McDonald & Cook, (2013), the restaurant managers are also entitled to receive a quarterly bonus that is being recognized based on three equally evaluated measures: productivity, sales growth and mystery shoppers. The whole of the management team needs to be united as a team that needs to be aggravated and rewarded thereafter for attainment of those metrics. Customer service is key and McDonald’s can never slip over it which might in turn make their customers shift to their rival companies.
For titles like Restaurant of the year and Restaurant of the Quarter, both the franchisees and the company owned restaurants remain qualified. As per Ostrov, (2015), the motivation and recognition schemes of McDonald’s comprises of the champion of the month, service awards and Ray Kroc Award for Business Managers which plays an important part in employees striving hard and maintain a healthy competition to better each other’s performance. According to Martins, Rindova & Greenbaum, (2015), for McDonald’s it is important to keep its recognition schemes new and stimulating for maximization of motivation of employees. The company has always come up with new employee recognition programs and modified the previous ones to ensure they keep on appealing the employees. The highest profile instance in the last few years have been the realization of McDonald’s employee of the month scheme into its Olympic Champion Crew (OCC) application, for which the company received ‘Most Motivational Benefits’ at the 2013 Employee Benefits Awards.
In a company like McDonald’s there is continuation of the recruitment process throughout the year. McDonald’s too like many other organization is in the habit of recruiting both internally and externally, and on most occasions they draft in their managers and Assistant managers internally, rather than going external. As per ArunKumar, (2014), the main motive behind this idea of placing candidates at higher position who have already been a part of that organization is that they take less time to adapt and lessens the training process and cost related to it. Around 50% of the McDonald’s salaried managers are endorsed from within the company. This is how McDonald’s shapes its future leaders from within the organization. Bringing such valuable candidates from within the ranks of the company implies that those candidates have a strong immoderation of the business spotlight and rationale. McDonald’s belief has always been on its people and this is the reason they invest so much on what they care for. The company has recognized that high value customer service, eminence of products and better run processes can only be achieved through venturing on people (Shvetsova, 2016, October). The organizational structure of McDonald’s has been deemed to be a unique one with the management highlighting five key strategy points like people, price, place, products and promotion. Its thinking and providing high value to people is evident from the fact that it invests around $40 million in its training procedure, especially for people that are a part of the frontline crew.
The company arranges for different training programs for various reasons like developing of satisfaction from jobs, motivating them to be regular at their work, thus limiting absenteeism and turnover of labor. Training programs are also introduced to improve the skills of old employees and assisting them in coping up with labor shortages. Certain other technological factors and new equipments might also require McDonald’s to provide training to its employees.
The organizational goals and the Human Resource Planning have always been unified and has been deemed as an important facet of the McDonald’s Corporation. To attain the goals of McDonald’s, the human resource planning is apprehensive with getting the right people on board and making use of them in a perfect manner along with providing them with adequate training and improving them. Like other businesses, McDonald’s carry out is regular activities with the assistance of its staff and all its employees hold a significant position in their operation. Without the existence of refined technology, McDonald’s would never have been successful. Retaining good employees with salary packaging is only possible if recruitment is done in a proper manner. According to Neckermann & Frey, (2013), if one of McDonald’s managers does not choose the probable employees in a cautious manner and the job position does not match with the selected candidate, a number of issues can crop up like dissatisfaction in jobs, poor level of productivity, high level of absenteeism and dismissal of the candidates.
For the purpose of demand of labor, McDonald’s needs to analyze the road ahead and guesstimate the activity level within the organization. With this, McDonald’s can forecast that the organization consists of right number of impending candidates with rich quality. According to Allisey, (2014), McDonald’s have always accepted and rewarded hard work that comes with right level of dedication and motivation. Appreciation can take many forms like a simple thank you for a job well done from one of the managers to restaurant-wide appreciation through agendas like management leadership honor and ‘Employee of the Month’ scheme. The crewmembers, restaurant managers and full time employees have always been entitled for broader range of rewards and benefits. McDonald’s provide competitive salary packages and other performance feedbacks to enhance skill augmentation and producing power. The employees who are employed full-time are qualified for total compensation and benefits like Comprehensive Group Insurance Plan that provides disability, dental and life insurance for workforce and their family.
The human resource strategy has always been based on performance or behavior where employees are an important source for any service organization. Few models can be associated within an organization like the Harvard Model and the Guest Model. As per the Harvard Model, the policies of HRM need to be consequential from the critical analysis of the stakeholders’ demands and other situational factors. Employees are variable factors and are valuable for any organization. The Harvard Model puts it emphasis on the significance of incorporation of HR policies with objectives of business. According to Leekha Chhabra & Sharma, (2014), this model has taken into consideration the four factors like employee influences, flow of human resource, reward system and the work system along with other situational factors like labor market, laws and trade unions. The HRM’s effectiveness is related to four ‘C’s’ within the theory which are ‘Competence’, ‘Commitment’, ‘Cost-effectiveness’ and ‘Congruence’. The Harvard model states that employees are always an asset to an organization and never an expense or cost. However, in McDonald’s, line managers are answerable to the people and the store managers are accountable for the regular activities implying both soft and hard approach. The company believes that employees are an asset that is evident from the provision of training and should offer long-term asset for the organization.
David Guest developed his representation that is being based on the Harvard model that included four upshots that have been developed into four policy goals like integration of strategy, flexibility, commitment and quality. As per Talwar & Thakur, (2016), McDonald’s takes into account the Guests theory, where it is being believed that an organization should always aim for high level pledge from their staffs, achieving output of high quality with continuous development of standards, no possible fixed definition of jobs and conditions. McDonald’s have always focused on humanizing standards and providing flexible working times for its staff. McDonald’s line managers acknowledge the HRM policies and merge them into the strategic plans, roles regarding changing of staffs that is being permitted within an organization.
Employee’s job satisfaction does not depend on only the reward and recognition factor. However, as per Shvetsova, (2016), expectancy theory describes that performance of employees an rewards are openly related where increase in rewards number would witness and upward inclination of employee’s efforts. Monetary benefits take care of extrinsic motivation, whereas intrinsic motivation is more about the interesting facts and other factors related to job proceedings.
As per Jehanzeb, Hamid & Rasheed, (2015), an organization’s culture has different values and beliefs that influences the way they function and according to Handy there are four sorts of culture like Role, power, Person and Task. Out of this four, McDonald’s culture takes into account the effect of Power and Task. McDonald’s top management replicate the culture of ‘power’ that takes decisions and permits speedy response to decisions. For the ‘task’ culture, McDonald’s whole aim has been that of task-oriented nature, highlighting the team culture and authoritative communication between all echelons of staff. McDonald’s has incorporated the contingency approach through its consideration of the environment culture. The contingency approach suggests that various problems and situations demand various solutions which is only possible if both the internal and external persuades fit together. The contingency approach affects promotions of employees that emerge from McDonald’s restaurant. Employees are provided with appraisals that implies to increasing opportunities of job for staff. McDonald’s has been great for people who enjoy an environment that is fast-paced and highly embryonic (Martins, Rindova & Greenbaum, 2015). McDonald’s working culture mostly comprises of students with experienced candidates teaching them skills that would later help them build their own career in whatever path they choose. A highly motivated employee is possible to receive to a salary point beyond AUD$ 30,000 though it would take a bit of time to get processed. McDonald’s have always been a job that leads to passion, a passion those employees should commit them in making their store the greatest they can be (Treem & Leonardi, 2015). To the outer world working in McDonald’s might seem easy, but this company do pave ways for its grassroots employees to position themselves in high management.
McDonald’s pay and reward program takes into account the philosophy of “pay for performance”. McDonald’s belief remains on bettering results that would in turn take care of opportunities regarding pay. This program takes in five groups like base pay, car program of company. short-term incentives, long-term incentives and recognition programs. These sort of pay and reward types influences employees to execute better and take pleasure in benefits. Employee motivation has never been easy and neither it will ever be, with certain employees get bored from performing the same task repeatedly. Needs vary for each employee, which keeps on changing under the influence of different situations, making it way difficult for organizations to fulfill all at one single time.
In case of non-profit organizations, its effort to select volunteers and staffs plays an important part in revealing its existence. As per Pathak, (2015), an important aspect of non-profit seeking organizations is the need of training that they fail to understand at times and the importance associated with it. They lack the idea that training should be provided to all the employees and volunteers and not only to the compensated ones. However, it is not always possible for non-profit organizations to have an exclusive training program for all as it involves a lot of monetary factor. Whereas, in case of McDonald’s, they have that financial ability to invest around $40 million in its annual training programs, something not viable for non-profit organizations. The other company in the case study, Spastic Center can devote only $16,500 in expenses on any matters related to the organization. Organizations like McDonald’s have the ability to attract skilful employees through attractive salary packages and hold onto them for years. However, in the recent scenario, organizations like Spastic Center have started competing in candidates who are high in quality, something that is evident in private organizations. Even the graduates are keen on working for non-profit organizations having certain social purpose and responsibility that comes with compensation based on merit. According to Carpenter & Charon, (2014), both the profitable and non-profitable organizations needs to be managed in same fashion. The organizations needs to be manage volunteers in the same way as that of paid staffs where every responsibility should be specified clearly, recruitment should be done properly with adequate training and orientation. Organizations like Spastic Center manage their advancement towards benefits of employees, compensation and policies of employees. Spastic Center should hold these actions themselves as with a limited budget, affording a full or part time help might seem like a luxury.
To be a successful non-profit organization, motivational needs should be better addressed in non-profit organizations. Even the employees that are paid require accomplishment, satisfaction in their service, as without all these they would at certain point become hostile. The leaders of Spastic Center should look out for ways where they can get involved in the company proceedings and make a difference. The main criteria are if one is working in a non-profit organization, that person needs to contribute.
It can be concluded that companies like McDonald’s boasts of a recognition program that motivates and encourages employees to better their performance. Employees need to visualize their career progression path in that organization and if the company can provide with all the requirements and needs of the employees, that person is sure to give his best shot. Its HRM policies too are aligned in a way, which helps McDonald’s to attain the best results. Recognition is required in organization that influences people to enhance their performance and motivating others to follow suit. Non-profit seeking organizations have limited financial power in their kitty, but organizations like Spastic Center have realized that retaining employees depends on factors like good salary and job satisfaction where there is scope to improve oneself. Certain fringe benefits are being added by the non-profit organizations to attract more workforces towards them.
References:
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