In order for McDonald’s to successfully execute its business strategy, the company has determined it needs to excel at developing and successfully implementing a balanced global/local approach in managing and developing its global workforce. While global frameworks and parameters can be used to set the stage for success and align the entire business with regard to strategy, essential tactics, and a shared company culture—at the end of the day, the actual execution of the company’s “plan to win” depends on the capability of local talent to develop and customize the elective tactics to fit their local culture and circumstances. As a business, McDonald’s success relies not only on the leverage that comes from its coherent business strategy and focus on standardizing core operations/processes but also on its ability to adapt its tactics to fit the needs and preferences of specific customers in particular regions or countries and to develop a deep connection between McDonald’s and the local communities in which it operates. This connection is reflected in McDonald’s commitment to local charities; to Ronald McDonald Houses; and, most importantly, to the very people who own, operate, and manage McDonald’s stores in any locale, country, or region. Given this, it is deemed highly important that the individuals operating the business come from, understand, and represent the communities and cultures in which the business is located.
All areas of world have freedom to execute in their locales as long as they stick within the basic parameters of the “plan to win” framework by (1) developing an aligned strategy, (2) meeting customer needs within the marketplace, (3) supporting the global brand campaign—“I’m Loving It,” and (4) ensuring that their people develop and demonstrate key competencies that reflect the core elements of the company’s common culture and support its “plan to win.” In addition to having the technical skills and expertise to do their specific jobs, staff throughout McDonald’s are expected to be attentive not just to getting results but to doing so in a way that is aligned with the company’s shared global company culture and values.
Customer and Employee Focus
Whatever is done within McDonald’s is routinely assessed and measured against its impact on customers. Customer service and experience levels are key metrics that are embedded within the performance expectations for employees throughout the system. The company’s focus on and commitment to quality, service, cleanliness, and value (QSC&V) is strong. These variables have been shown to be strongly linked to customer expectations and loyalty. Any and all efforts to enhance the company’s global workforce management system incorporate a focus on key behaviors (customer focus and service orientation) and results-metrics (speed and quality of service, food, and environment) that deliver to customers what they value.
McDonald’s has also paid significant attention to its employees and their development throughout its history. The company is well known for the opportunities it has given many of its people to grow with the company and to rise (over time) from working as a member of a store crew to its highest executive ranks. In addition, the company has placed strong emphasis on its managers’ ability to create a work climate within which their employees are motivated to excel, give their best, and help to make McDonald’s “everyone’s favorite place and way to eat.” Since 1997, McDonald’s has used its commitment survey to assess the extent to which the desired work climate is being created throughout the company. This survey gathers employee feedback on a wide variety of specific management behaviors and practices that have been shown to be linked to employees’ personal satisfaction and commitment and to the company’s business success. More specifically, the survey assesses employee satisfaction with such factors as the support and recognition they receive, the extent to which their skills are utilized and developed, their workload, the degree of their empowerment, resource availability to get the job done, the quality of supervision/leadership, and their compensation /benefits. A manager’s scores on the commitment survey are one of many important factors considered in rating his or her effectiveness and potential for advancement. In addition, turnover and tenure measures are used to evaluate the effectiveness of managers—especially in retaining top talent. The global workforce initiatives described later in this chapter were developed so that they reflect both the customer and employee focus described above.
EVOLUTION OF THE TALENT MANAGEMENT SYSTEM: KEY INITIATIVES AND ENHANCEMENTS
As mentioned earlier, five separate initiatives were developed and have been implemented since 2001 to enhance McDonald’s talent management and development processes and support the organization’s goal of meeting the global leadership needs of the business. These include: (1) the redesign of the performance development system (PDS) for all staff positions throughout McDonald’s; (2) introduction of the talent review process for all officer-level positions; (3) the development and roll-out of a series of accelerated development programs beginning with the Leaders at McDonald’s Program (LAMP) launched in 2003 to enhance the development of high-potential individuals for officer level positions; followed by (4) the introduction of the McDonald’s Leadership Institute; and (5) the design and launch of the Global Leadership Development Program.
Initiative 1: Performance Development System Redesign
Prior to 2001, McDonald’s performance development system was comprised of (1) an “MBO-based” annual performance plan that measured performance against established annual objectives but included no assessment of how these results were achieved (that is, leadership behaviors); (2) a 5-point rating scale of overall performance ranging from “outstanding” to “unsatisfactory”; (3) a personal developmental planning element based on a McDonald’s-wide competency framework that included nine core competencies and four leadership competencies as well as a menu of “elective” competencies that could be chosen/applied as relevant in specific functional areas (see Table 9.2); (4) a three-level assessment of career potential that combined performance and demonstrated leadership competencies; and (5) an