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PROJECT ON MCDONALDS (HR POLICIES AND PRACTICES)

Submitted to: Prof. H.V Kothari

Submitted by: (SEC-B) Aditya kumar agarwal Ankita verma Aprajita pathak Happy rana Jatin sharma Karishma Shubham kant

CONTENTS
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INTRODUCTION HUMAN RESOURCE ANALYSIS JOB ANALYSIS RECRUITMENT SELECTION TRAINING DEVELOPMENT PERFORMANCE APPRAISAL COMPENSATION INCENTIVES BENEFITS EMPLOYEE RELATIONS CONCLUSION AND SUGGESTIONS

INTRODUCTION
McDonalds brand is the leading global foodservice retailer with more than 30,000 local restaurants serving almost 50 million people in 120 countries each day. FOUNDERS: Its rich history began with its founder`s vision and their commitment to be peoples' favorite place and way to eat with inspired employees who delight each customer with unmatched quality, service, cleanliness and value every time. The business was started in 1940 by two brothers DICK and MAC MCDONALD in San Bernardino. VISION STATEMENT The McDonalds System leverages the unique talents, strengths and assets of diversity around the globe in order to be our customers favorite place and way to eat. M ISSION STATEMENT McDonald's mission is to be the world's best quick service restaurant experience. Being the best means providing outstanding quality, service, cleanliness, and value, so that we make every customer in every restaurant smile. PRODUCTS AND SERVICES Macdonald sells the following products in order to provide their customer with good and hygienic food:

PRODUCTS
y Burgers y Chicken sandwiches y French fries y Soft drinks y Desserts y Salads y Breakfast items y Milkshakes y Coffee

SERVICES
McDonalds provides basic two services such as: y Self-Service System y Drive-In through Service

HUMAN RESOURCE MANAGEMENT IN MCDONALDS


The human resource department at McDonalds is working as a separate department and holds an important place in almost all major operations of the organization but all managers across McDonald's are given responsibilities for selecting, motivating, developing and evaluating employees so that they can have a share in the organizations affairs. All managers therefore take on human resource responsibilities. Employees are the most important resources in McDonald's, particularly in creating a competitive edge.

FUNCTIONS OF HR IN MCDONALDS
The functions of HRM in McDonalds are: y POLICY-MAKING - Establishing major policies that cover the place and importance of people in McDonald's. y WELFARE - Concerned with looking after people at McDonald's and their needs. y SUPPORTIVE Co-operative and helping other managers in their work. y BARGAINING AND NEGOTIATING - Acting as an intermediary between different groups and interests. y ADMINISTRATIVE Responsible for pay rate system and supervision implementation of health and safety laws, etc.

JOB ANALYSIS
McDonalds has many employees who are working on different posts and are working hard according to their own capacity. McDonalds conducted job analysis in order to hire new employees at every year that sometimes on quarterly basis. This also enables management to have a better understanding of the jobs and duties being performed at every level and also helps them in training the people who are freshly recruited.

JOB ANALYSIS METHOD IN MCDONALDS


In job analysis McDonalds focuses on Work Activities and Human Behaviors of an employee for a job.

JOBS IN MCDONALDS
McDonalds Pakistan has two types of job openings with their sub openings as listed under: y Restaurant Jobs y Office Jobs

RESTAURANT JOBS
In the restaurant jobs, there is a clearly defined career path, from Crew Member to Crew Leader to Floor Manager to Assistant Manager to Restaurant Manager. And from there onwards the opportunities for growth and development are limitless Area Supervisors, Operations Consultant and beyond are just a few to mention from.
TRAINEE MANAGER

This is an entry level managerial position at McDonald's restaurant, providing opportunity to start and excel the career with the core business functions. Trainee managers handle various areas of professional excellence where sales, people, product safety and security are the minimum areas to be mentioned.
CUSTOMER CARE REPRESENTATIVE

This is an exciting career opportunity for the females, responsible to independently organize birthday events & various activities at local store level so that the challenging fun activities of the job will gear up the commitment of employees for providing the first class customer services.
CREW MEMBER

Crew Members are the core team members always ready to serve the customers on the floor with a shining smile unique with the services. This job is offered either as a Delivery Rider or a Crew Member. So the fun & enthusiasm prospect apart from extensive learning will make employees a key member of the team serving our customers. There are three main areas of responsibility of a crew member: y Customer service y Food preparation y Cleanliness and hygiene

OFFICE JOBS
Managerial jobs are categorized as Office Jobs in McDonalds. At McDonalds office jobs are an excellent match, provided an employee can exhibit the right skill set up to

excel in the areas of his/her expertise. Depending upon the knowledge, experience and right aptitude, there are 3 key entry points in the office jobs. y INITIAL ENTRY LEVEL This entry level is specifically for beginners to start the career in a professional work culture, these positions will provide the opportunity to develop the skills as a successful business entrepreneur. y MIDDLE ENTRY LEVEL As a middle entry level incumbent the incoming employee will perform as a liaison with team members to deliver the team objectives while ensuring the execution of assigned tasks as per defined standards and procedures. y HIGHER ENTRY LEVEL The higher entry level job incumbents are accountable for the execution of assigned tactics and strategic plan. The provision of leadership approach to work will enhance their sense of ownership and part of the winning team member.

JOB ANALYSIS METHOD IN MCDONALDS


MCDONALDS applies the basic methods of Job analysis by which HRM can determine job elements and the essential knowledge, skills and abilities for successful performance methods. MCDONALDS uses the following job analysis methods according to their jobs: y Observation Method y Interview Method y Questionnaire Method The CREW MEMBERS are like main workers of the McDonalds because they are the one who handle the stage work. McDonalds use direct Observation and Interviewing together Firstly, they observe the work of the crew member note the information as much as they can and then for further assistance ask the crewmembers about the detail of their work. For CUSTOMER CARE REPRESENTATIVES McDonalds follow the similar Interview Technique where they ask the employees that what they feel when they work in this fun environment, how they manage all the work and satisfy the kids and their parents.

For the MANAGERIAL JOBS McDonalds use the Questionnaire and Interview Method. They prepare a structured Questionnaire in which they ask employees about their jobs, purpose, education required for the job, experience or other key factors. Whereas, in Interviewing they further collect the information related to job directly from employees.

JOB DESCRIPITION
The job analysis is used to generate a job description, which defines the duties of each task, and other responsibilities of the position. The description covers the various task requirements, such as mental or physical activities; working conditions and job hazards.

JOB DESCRIPTION AS PER JOBS


McDonalds represent its Job Description as Category Profile and Individual Competencies OFFICE JOBS For office jobs Job Description is named as Category Profile I .INTIAL ENTRY LEVEL: y Strong focus towards learning and adapting to the corporate environment y A real interest in how people drive business y Positive work attitude with the ability to lead challenging roles & responsibilities Exposing good confidence level for delivering responsibilities at outstanding level y Innovative approach for initiating change at different levels y Strong communication skills to act as a liaison between stakeholders and team leaders II. MIDDEL ENTRY LEVEL: y Strong interpersonal and leadership skills. y Effective negotiation & problem solving skills y The ability to see the big picture while delivering organizational goals

RESTAURANT JOBS For restaurant jobs the Job description is written as Individual Competencies 1. TRANIEE MANAGER: y y y y y Effective communication skills able to work in a team environment Proactive to exhibit true managerial capability Career oriented with focus on continuous learning Flexibility to adapt to a diversified work culture Customer orientation with a positive attitude towards provision of quality services

2. CUSTOMER CARE REPRESENTITIVES: y y y y y To maintain work standards of Customer care, customer relationship To strengthen marketing at local store level. Perform with a strong focus toward customer orientation. To independently organize and execute various events at store level. To achieve agreed targets for enhancing Local Store Marketing.

3. CREW MEMEBERS : y Good communication skills. y Have ability to work at all levels required for crew members y Work efficiently and in organized way.

JOB SPECIFICATION
The job specification describes the person expected to fill a job. It details the knowledge (both educational and experiential), qualities, skills and abilities needed to perform the job satisfactorily. The job specification provides a standard against what to measure; how well an applicant matches a job opening and it should be used as the basis for recruiting.

JOB SPECIFICATIONS AS PER JOB


In McDonalds the Job specification is written under heading known as Profile and Competency Level

OFFICE JOBS:
In office jobs it is known as COMPENTANCY LEVEL y INITIAL ENTRY LEVEL: 1. 2. 3. 4. Education: Graduate or Post Graduate degree holders Experience: No prior experience is required for this entry position Age: 22 - 28 years maximum Gender: Male or Female

y MIDDLE ENTRY LEVEL: 1. Education: Post Graduate degree holders with relevant area of specialization 2. Experience: 3-5 years of experience in the relevant field 3. Age: 25 - 32 years maximum 4. Gender: Male or Female y HIGHER ENTRY LEVE L: 1. Education: Specialized degree in the relevant field with professional certification 2. Experience: 5 years or beyond 3. Age: 30 - 35 years maximum 4. Gender: Male or Female

RESTURANT JOBS:
Job Specification is represented by Profile in McDonalds. y TRAINEE MANGER 1. 2. 3. 4. Qualification: Post Graduate Degree in any discipline Experience: Fresh candidates with no prior experience Age: 28 years maximum Gender: Male or Female

y CUSTOMER CARE REPERSENTATIVE 1. 2. 3. 4. Qualification: Graduate Degree in any discipline Experience: Fresh candidates with no prior experience McDonalds Age: 24 years maximum Gender: Females only

y CREW M EMBER 1. 2. 3. 4. Qualification: Intermediate Experience: Fresh candidates Age: 18-25 years Gender: Male or Female

PLANNING AND FORECASTING PERSONNEL NEEDS


McDonalds uses the method of TREND ANALYSIS for forecasting its personnel needs. This is a method in which the firm studies its past employment needs over a period of years to predict future needs. McDonalds has been operating since a very long time and by now it has full information of where it stands in the minds of people. No doubt McDonalds has raised its value above mark. McDonalds forecasts its personnel needs according to what has been the trend of its sales, revenue and labor needs in the past. For this they use two ways: MANAGEMENT ESTIMATES Managers are asked to forecast their staff requirements. They will do this on the basis of past, present and likely future requirements. WORK STUDY TECHNIQUES Work-study specialists works out how long various jobs take, using available machinery and equipment. Provided they know what sales are likely to be, they calculate the numbers of employees required and the hours they will need to work. McDonalds forecasts the need of staffing employees by inside and outside supply of candidates. INSIDE SUPPLY OF CANDIDATES In this forecasting method Information is collected on employees already working within McDonalds. For this purpose McDonalds uses Qualification Inventory system.

A Qualifications Inventory of current employees gives the thorough information about current employees skills, education, career, performance and other interests. HR requirements of McDonald's may be met by training and developing current staff rather than recruiting externally. OUTSIDE SUPPLY OF CANDIDATES After determining the number of employees that can be obtained internally McDonalds searches for the rest from the outside. For this McDonalds information system plays a vital role. It keeps track of the economic conditions and employment rate and after that forecasts its external needs accordingly. In this way McDonalds develops a pool of talent as much as possible so that it can choose best out of it.

RECRUITMENT
Recruitment is the first part of the process of filling a vacancy. It includes examination of the vacancy, the consideration of sources of suitable candidates, making contact with those candidates, attracting application from them, short listening, interviews and finally induction of the selected candidates within the budget of the department company. In McDonalds recruitment process is decentralized. Every branch of McDonalds is independent to hire the employees. Usually at McDonalds employees are hired in a form of badge. Also the transformations of employees within the franchises of McDonalds took place for recruiting the employees. A typical McDonalds restaurant can employ about 60 people who include the both managerial and floor- based staff. RECRITMENT METHODS IN MCDONANLDS McDonalds follow the two basic types of recruitment such as: y Internal Recruitment y External Recruitment INTERNAL RECRUITMENT McDonalds uses the following two basic methods for internal recruiting y Job Positioning y Succession Planning

JOB POSITIONING In Job positioning McDonalds select candidates from inside by considering their past performance. MCDONALDS publicize their open jobs on their site ,where their employees could apply for the job they also publicize it in their restaurants on Notice Boards. So that the working employees could be informed from the vacant position and apply. SUCCESSION PLANNING For the executive posts McDonalds follow a succession planning technique where they recruit their managers or senior employees to executive level on the basis of their performance. EXTERNAL RECRUITMENT McDonalds often goes for external recruitment though they mostly prefer internal recruitment or internal promotion of the employees to the higher posts. External recruitment of McDonalds involves: y Recruiting via internet y Advertising y College Recruiting 1. RECRUITING VIA INTERNET Now a Days Recruiting via Internet is becoming very common. McDonalds has its own site where they publicize for the jobs and offer people to send their CVs through online process and often recruit employees from there. 2. ADVERTISING Advertising is the most used method for recruitment. McDonalds approaches the Newspaper or a magazine adds mostly to invite employees for jobs. 3. COLLEGE RECRUITING McDonalds follow the most common method of college recruiting known as Internships because many floor base employees usually join McDonalds for internship. Here they have one advantage that they dont have to pay them much and their workforce need is also fulfilled for a temporary period of time.

SELECTION
The selection process of McDonalds involves the following factors: y y y y Initial screening Testing Interviewing Background investigation

INITIAL SCREENING In initial screening McDonalds collects the application forms of candidates from their Website online and also by Mail or Fax and than they choose those applications which are according to their job requirements and call those candidates for further process. TESTING TESTING EMPLOYEES IN MCDONALDS McDonalds take the following tests to check the abilities, knowledge and nature of work of employees. TESTING FACTORS McDonalds conduct tests to know the following factors: y Motor& physical skills y Personality( attitude test) y Cognitive abilities (Aptitude and Intelligence test) TESTING PROCEDURE McDonalds always want a multi-skilled worker or employee who could work efficiently at any level. For that when they hire employees they test according to their above mentioned criteria that the employee should be little or more skilled to work in any area. In McDonalds employees are tested in two basic ways first through some ORAL OR WRITTEN TESTS they are judged and then they are allowed to perform a PRACTICAL WORK, where the McDonalds managers could evaluate them more accurately.

MCDONALDS TESTING METHODS McDonalds took following tests of employees: y Physical fitness test y Attitude test y Aptitude test y Case study test method y On-the-Job evaluation test INTERVIEWNG All candidates after formal testing are called for the final interview. This is where the final and overall assessment of the candidate takes place and selection decisions are made. MCDONLADS INTERVIEW The selection interview of McDonalds is classified it into as given classifications: y Interview format y Interview content y Interview administration INTERVIEW FORMAT: McDonalds employ Structured or Directive Interview content; the managers first make a set of proper Questionnaires related to job and also predetermine their answers and ask those questions from applicants in a structured order. Here questionnaires are prepared according to the job requirements. INTERVIEW CONTENT: McDonalds has a set interview content known as Situational Interview, they ask situational questions from their employees like give them a situation and ask their opinion that what would they do in that situation but the situations are job-related. ADMINISTERING INTERVIEW: For administering the test McDonalds conducts a most common used system Panel Interview. PANEL INTERVIEW: McDonalds take panel interview. In this interview a panel or group of executives or senior employees usually HR manager and head of the particular department ask situational or other basic questions from the candidate. If an interview for a most senior or executive post ahs to be done than the General Manager (GM) of the McDonalds conduct that interview.

INTERVIEW PROCEDURE In McDonalds interviewing system apply subsequent method: First they examine the job description, specification, duties, and requirements for a job such as skills, knowledge or abilities. After that they create situational (job-related) questions for the candidate to know their capabilities. Finally, they appoint the interviewers to conduct and evaluate the interview

TRAINING AND DEVELOPMENT


At McDonalds, a job is never just a job; employees know that working at McDonalds provides them with a wealth of knowledge, experience, skills and above all a true fun work Environment. McDonalds follow a highly structured training process. Employees in McDonalds are trained at all levels. They are trained to work on floor base area to back area. McDonald's employee training programs are based on the company's core principles such as: y y y y Quality Service Cleanliness Value

ORIENTATION As like other organization McDonalds training and development program starts from orientation. In McDonalds employee orientation program range from 5 to 6 months and it includes such contents: y A Welcome Orientation Day is arranged for the new employees where they got familiar with the history or background of the company, cultural values, present conditions, future goals and objectives or plans of the company. They also watch videos related to companys information and handouts are also given to them. y Employees are formally told about what to wear their dress code or uniform y Then employees have to spend 15 to 25 days in different sub departments under one department. y The head of the department decides that what objectives a new incoming employee should carry out. y In McDonald each employee works with or under a Training Buddy (supervisor). y Employees get at least 6 months of time to show their skills and knowledge.

y After these 5 to 6 months orientation employees get their appointment letters as a permanent employee of McDonalds.

TRAINING METHODS IN MCDONALDS


The most used training methods that McDonalds follow are given as: y y y y On-The-Job Training Job Rotation Lectures Audio-visual based training

These training methods are often practiced by entry-level workers or crew members basically for the new employees. LECTURES The first stage of training is at the Welcome Meetings. These are usually arranged in a Training Centre or Room. These lectures set out the company's standards and expectations for the new employees. Where, employees are introduced with a complete description about the job, and a guideline that how to work and what are the job requirements and procedures. A verbal outline is given to the employees. ON-THE-JOB TRAINING The majority of training is floor based, or "On-The-Job" training because people learn more and are more likely to retain information if they are able to practice as they learn. All new employees have an initial training period. Here they are shown the basics and allowed to develop their skills to a level where they are competent in each area within the restaurant. They will also attend classroom-based training sessions where they will complete workbooks for quality, service and cleanliness JOB ROTATION McDonalds also uses the most known type of on the job training Job Rotation. It is done within the specific department so that the employee becomes familiar with all level of jobs. AUDIO-VISUAL BASED TRAINING For the new trainees McDonalds also provide them with DVDs, films, video or audio tapes related to the operational or functional work of the organization. EVALUATION OF TRAINING McDonalds evaluate its training program through On-The-Job Behavior that after the training session the behavior of employees are changed or not. They match up the performance behavior of employees before training and after training like, the

behavior of a crew member is more courteous to customers? The Inventory control manager is now more practical in his work and manages the inventory more systematically?

DEVELOPMENT CAREER MANAGEMNT


At McDonalds there are different management development plans. McDonalds has established adevelopment program for managers, employees and also for the workers at lower level. It includes: y Management development plan for employees at all levels. y McDonalds provide facilities to employees in their career planning. y Transformation of employees is also carried out within the branch or in other branches. y Different training courses are also arranged for the employees i.e. McDonald arranges a Summer Crash Course for their employees. McDonalds arrange following methods for specifically managers and employees development:

JOB ROTATION In job rotation process the managers are allowed to work in different department or sub-department at every level to learn more about their job and identify their strong and weak points. y Restaurant Managers progress their way through Shift Management and Systems Management courses while attending one of our 22 regional training centers. Once these courses have been completed, managers attend Hamburger University where they learn the additional knowledge and skills they need to run a multi-million dollar restaurant. y The Mid-Management learning path at Hamburger University is for business consultants anddepartment heads. It builds on their leadership and consulting skills, teaching individuals how to effectively operate a business and how to coach and consult with others to run great restaurants. y The Executive Development learning path helps reinforce ongoing business and leadership skills for top management. The courses available at Hamburger University build upon the leadership competencies needed to support employees, Owner/operators and sales growth.

PERFORMANCE APPRAISEL
Performance appraisal compares each employees actual performance with his or her performance standard. Managers use job analysis to determine the job specific activities and performance standards. Performance appraisal helps in estimating employees current performance, setting work standards and then providing feedback to employees with the aim of eliminating performance deficiencies. PARAMETERS OF PERFORMANCE APPRAISAL The performance appraisal is based on the following some of the parameters: y Ethics y General Knowledge/ IQ, y Confidence y Motivation y Team Work y Communication Skill At McDonalds every employee is on a race to give the best performance through their knowledge, abilities and skills. An appraisal session is also arranged for the employees. An appraisal interview in McDonalds is taken by Head of the Department only and the progress report of the employee is also in the hands of the Head of the Department. In McDonalds the yearly appraisals of employees are done in June to July.

PERFORMANCE APPRAISEL METHOD


McDonalds uses the Graphic Rating Scale Method for evaluating the performance appraisal of employees. GRAPHIC RATING SCALE METHOD Through the Graphic Rating Scale the head of the department rate the person according to the performance of its work, skill, knowledge, experience and after the assessment according to the rating scale, rate the employee as appraised. Graphic rating scale method involves the following traits:

y y y y y y

Communication Personal effectiveness/efficiency Teamwork Productivity Quality of work Reliability

In McDonalds employees are rated according to these or more traits. Rated on his/her performance that the employee is good in communication skills or not, the employee could work independently on its own. The employee is cooperative with other his/her co-workers. The productivity of work that weather he/she could work more and proper in less time and finally is the employee is reliable means he/she will work on time appropriately. Well the graphic rating scale method which McDonalds use is a best and simplest method for them because employees from floor base to managerial level are rated easily. The scale lists the suitable traits or standards for the employees according to their work or job and they are rated fairly as according to their performance.

COMPENSATION AND BENEFITS PROGRAMS


COMPENSATION METHOD McDonald uses Broad banding trend of compensation, in this trend wide range of jobs and salary levels are represented by Bands. So the employee, whose job falls on one of these grades, gives the pay range listed on that grade and determines his or her salary. McDonalds has this system of compensation because, broad banding allows for flexibility in terms of pay, growth and movement. WHY THEY USING BROADBANDING METHOD McDonalds is using broad banding method for compensation because it is the most used method by companies and it is relatively easy to handle. As there are so many jobs and each job has its own description and value so by making bands of similar jobs and assigning them the appropriate salaries will make easy for McDonalds to set the pays of employees. COMPETENCY-BASED PAY McDonalds dont apply the Competency-Based Pay Method because in this method pays are established as according to the performance of employee such as: If a crew member is working according to the level of manager his performance is equivalent to manger so their pays will be same. But McDonalds pay their employees according to the job or level. Mangers own different higher pays as compared to worker or Crew members.

ESTABLISHMENT OF PAY RATES Why pay rates are established???? It is very difficult to set pay for any organization without conducting pay rates. Pay rates are necessary to define because it is better for both employer and employee. FOR EMPLOYER: He sets salaries according to the market or could be more from market and employer get knowledge about market. FOR EMPLOYEE: Similar nature of jobs categorized in groups and employee feel secure that he is getting salary according to market rate or could be more. PAY RATES IN MCDONALDS McDonalds follow following steps in establishing of pay rates A.MCDONALDS SALARY SURVEY McDonalds conduct salary survey, that what other employers are paying for the same nature of job to there employees. McDonalds pays more to their employees as compare to market. So, the salary survey is necessary for establishing pay rates. McDonalds has also given its salary ranges on different jobs in their site. LOWER LEVEL JOBS: For the lower level jobs like Crew Members or clerical workers McDonalds conduct a salary survey through Telephone or Internet. HIGHER LEVEL JOBS: Whereas, for the higher level jobs such as at managerial level a formal survey is conducted by McDonalds. In McDonalds the employer collects the information from other employers in a form of questioners, in which he asks about the overtime policies or bonuses, the starting salaries or other increments. B. JOB EVALUATION: The second step in establishing pay rates is evaluating jobs or JOB EVALUATION In Job Evaluation jobs are evaluated or compared with each other on the basis of qualifications, skills, responsibilities and working conditions. McDonalds follows the Job Classification method of job Evaluation because they have categorized their Jobs into two main classes known as: y Part Time Employees y Full Time Employees

McDonalds evaluate its job on the basis of working hours of their employees more clearly for the crew members they use the part time job evaluation and for managerial level staff they use full time evaluation PART TIME EMPLOYEES: Well for part time employees MacDonalds pay them on the basis of their working hours means hourly wages. FULL TIME EMPLOYEES: The Full Time Working Employees are given salary on monthly basis they are known as permanent employees. C. GRO UP SIMILAR JOBS INTO PAY GRADES After job evaluation, McDonalds grouped similar nature of jobs into pay grades for establishing pay rates. As McDonalds uses the job classification technique so their jobs are already in a grouped form and they establish pay grades according to part time and full time jobs. D.PRICING OF PAY GRADES This step assigns pay rates to pay grades. For assigning pay rates to any level of job, McDonalds uses Wage Curve which shows the relationship between value of the job and wage price for the job. McDonalds through wage curve assign pay rates to part time and full time jobs according to the requirement of job. More specifically according to the job nature of employee such as for part time crew member the pay rate will be different from full time depending on their work. MCDONALDS MANAGERIAL JOBS McDonalds price their managerial jobs on the basis of their performance of work, skill, knowledge and experience. It is different for all level of managerial job. McDonalds price its managerial jobs as: y Base pay y Incentive pay BASE PAY: Employees' base pay is the most significant portion of their compensation, McDonald's maintains the competitiveness of base pay through an annual review of both external market data and internal peer data. INCENTIVE PAY: Incentive pay provides their employees with the opportunity to earn competitive total compensation when performance meets and exceeds goals. The Target Incentive Plan

links employee performance with the performance of the business they support. TIP pays a Bonus to top of employees in their base salaries.

INCENTIVES PROGRAMS
ORGANIZATION WIDE McDonalds has developed under given People Philosophy for compensating and motivating their employees. RESPECT AND RECOGNITION Respect is one of the major factors in any organization all over the world. Managers and all employees of McDonalds treat with respect to their seniors or subordinators and value them. VALUES AND LEADERSHIP BEHAVIORS All of employees act in the best interest of the Company and tries to achieve their goal in a better way. They communicate openly, listening for understanding and valuing diverse opinions. They accept personal accountability. They coach and learn. COMPETITIVE PAY AND BENEFITS Pay is the main factor of job, mostly pay is dependant on persons skills, experience etc .In McDonalds Pay is at or above local market rates and according to the vacancy offered by the organization. LEARNING, DEVELOPMENT AND PERSONAL GROWTH: Learning is the basic task of employee other than his pay, that what he or she learnt from his job, its known as his or her experience. Employees receive work experience that teaches skills and values that last a lifetime. Employees are provided the tools they need to develop personally and professionally. RESOURCES TO GET THE JOB DONE: It is ensured that a comfortable place to work with access to the materials, equipment and information has been provided to do the job. To the employees at all levels such basic benefits and compensation are given: y Health and Protection y Work or Life Balance y Pay and Rewards

INCENTIVES FOR SENIOR MANAGEMNT McDonalds is providing different incentives to their senior managers such as: LONG TERM INCENTIVES: Long term incentives are granted to eligible employees to both reward and retain key employees who have shown sustained performance and can impact long-term value creation at McDonald's. MEDICAL AND HOSPITAL FACILITIES: It includes the some percent of compensation in the fee of hospital. FREE FURNISHING ON HAVING NEW HOME (MANAGERIAL LEVEL): The employees at most executive posts are given new and fully furnished home. PROVIDENT FUND (ESOP): Provident fund is given to employees as according to the companies policy mostly organizations cut 5%from the salary of the employee and he/she could take that provident fund at any time they demand. CHOICE TO GET NEW CAR AFTER FIVE YEARS (COMPANY CAR PROGRAM): It is an incentive that McDonalds give to its senior employees that they could own car for their office and personal use and change the car after five years given by the company. UMRAH PACKAGES: Special Umrah packages are given to employees at senior level. RECOGNITION PROGRAMS: McDonalds recognition programs are designed to reward and recognize strong performers, these include: y Presidents' Award (given to the top 1% of individual performers worldwide) y Circle of Excellence Award (given to top teams worldwide to recognize their contributions for advancing our vision).

BENEFIT PROGRAMS
HEALTH AND PROTECTION: Health and protection includes the following benefits:

y y y y y

Medical Aid Pension or Provident Fund Disability Cover Funeral Cover Accidental death & dismemberment (AD&D)

WORK OR LIFE BALANCE: McDonald's believe in work and life balance and they offer the following programs to assist their employees: y y y y y Annual Leave Leave of Absence Educational Assistance Employee Discount Card Staff Appreciation Days

PAY AND REWARDS: McDonalds pay and reward method is fair which is as given: y y y y y Highly competitive salary packages Performance based bonus Employee of the Month program Annual employee recognition awards Opportunity for local and/or international training at all levels

STEPS TAKEN BY MCDONALDS TO MOTIVATE ITS EMPLOYEES McDonalds should follow these steps to keep their morale and motivation level high: y y y y Offer the insurance for employees Increase the wage rate Give incentives to their employees on different events Arrange parties just for McDonalds staff once in a month

EMPLOYEE RELATIONS
In any organization employee relation plays a key role. If the employees of an organization are satisfied it means that the organization could touch to the heights of success because a satisfied employee will work more passionately.

COLLECTIVE BARGAININIG Collective bargaining is a process in which employees union and the management negotiates with each other and signs an agreement on the labor issues such as pays, benefits, working or other facilities. COLLECTIVE BARGAINING IN MCDONALDS UNION There is no such collective bargaining system is McDonalds because McDonalds dont have a predefined labor or crew unions. McDonalds culture supports anti-union concept. When a crew member or any lower level employee joins the McDonalds he/she have no basic knowledge of Unions, but after working for a period of time, when they get familiar with the culture of McDonalds they become more firm at antiunion concept. The former CEO and Chairman of McDonalds Peter Ritchie says Unions stifle Creativity; there is no place for unions at McDonalds; I have spent my entire life opposing unions; I have had some horrible and stressful fights with union leaders, its often very difficult keeping them out. McDonalds has a well systematic pay rates, benefits and employee needs program so when a new employee comes to join McDonalds they define every single policy, values, culture and employee benefits or compensation programs. So he employee working in McDonalds is well-aware of their procedure of employee relations. More precisely, when McDonalds hire an employee they make everything clear and if the employee agrees to work in such environment than they allow him to work. PAY- RELATED BARAGAINING IN MCDONALDS Unions play an important role in pay-related issues. Most of the time employees are not satisfied with their pays. So they create problems, although many different agreements are signed between employees and management. But as in McDonalds there are no such unions so the problem related to pay to employees would be that if a crew member do wage bargaining with employer individually In McDonalds most of the employees dont favor for this method because they typically believe that such strategies would be: y y y y Bad for morale Difficult to administer More time consuming Encourage discrimination or favoritism

Although on other hand some employees believe that it should be done on the basis of: On-the-job performance or workplace effort. Like if an employee performs well his/her pay should be increased through individual bargaining, that the employee himself should demand for more pay.

But the management or managers of McDonalds believe that pay is not a subject on which employees negotiate individually, because according to them they have no discretion to enter into such arrangements that involve altering individual crew or small group wages on the grounds of performance. In McDonalds when employee is recruited they specially discuss the terms and conditions about the pays and negotiation issues on pays. MCDONALDS EMPLOYEE RELATIONS McDonalds has a comprehensible strategy of occupational health, safety and security of employees. HEALTH SAFETY IN MCDONALDS McDonalds has a safe environment regarding to health, there are no such serious health safety threats in McDonalds but they have developed a systematic health and safety program for those employees specially who work in production lobby. Such factors could be a health and safety problem for McDonalds employees: y High temperature y Hygiene y Smoking y Infectious disease MCDONALDS HEALTH SAFETY SYSTEM McDonalds keeping in view the above factors take the following steps ahead to prevent their employees from any health hazard: VENTILATION SYSTEM: Proper ventilation systems such as exhausts are placed so that the high temperatures dont cause any health problem to employees who work in production lobby (cooking area). INSPECTION: For the hygiene of office and cooking place per month a inspector from food department visits to observe the cleanliness system, this is better for employees themselves and the customers as well. NO SMOKING RULE: In the office a smoking rule is obeyed for the health protection of employees and restaurant environment. INFECTIOUS DISEASES: A medical checkup of employees is conducted to know that any employee doesnt have any viral disease and if any employee becomes serious ill he/she is granted a leave so that no other employee could suffer from same problem. When employees are hired in their training session they are informed with a complete description and safety measures related to their health.

SAFETY AND SECURITY IN MCDONALDS


For safety and security of employees two areas are considered such as, Inner area of the office and outside threats. y Inside office means that the safety and security of office, like McDonalds has a production lobby inside their restaurant where they cook or prepare food so the danger of Fire Explosion is always there for them and as well like all other offices the threat of Electric Short-Circuit. Also any sort of Criminal Act from employees. y Outside area signifies that if in McDonalds any one enters and makes them HOSTAGE or Commits Bomb Blast, is a sign of big threat to their employees and restaurant as well. MCDONALDS SAFETY AND SECURITY SYSTEM McDonalds according to the above mentioned security risks use two basic facilities of security given as: y Natural Security y Mechanical Security NATURAL SECURITY: Natural security means securing your office architectural area. McDonalds has Security Guards and Check Post in parking lot. SECURITY GUARDS: They have security guards in their Parking Area and at the Entrance Door as well. CHECK POST: Also a check post is placed at the Entrance of parking lot. MECHANICAL SECURITY: In mechanical security system technological systems or machines are used to enhance the security system. McDonalds has placed a scanner at their entrance door, CCTV cameras are also fixed in and outer area of the restaurant, fire extinguishers and stabilizers for short circuit. SCANNER: Scanners are placed at Entrance door for every customer or person to detect any metallic thing like weapons etc. CCTV CAMERAS: CCTV cameras help McDonalds to monitor every movement of customers or any person who is in the restaurant.

FIRE EXTINGUISHERS: For the danger of fire explosion Fire Extinguishers and other Aid Equipments are placed in the office area and production lobby of McDonalds. Fire alarms are also placed. STABILIZERS: In the case of electric short-circuit are used to retain the voltage of electricity and any mishap doesnt take place.

CONCLUSION
HR POLICIES AND PRACTICES OF MCDONLADS The HR policies and practices involve certain core tasks to fill such as: Recruitment, Selection, Evaluation, Performance, Compensation and certain other factors. The HR department of McDonalds fulfills all the requirements of these tasks or functions in a true sense of the meaning. McDonalds strongly believes in the well being of people and its workforce and that is one reason why it is the leader in the fast food industry and it proves that the strategies the company has chosen are right and efficient for their business. EVALUATION OF HR POLICIES AND PRACTICES OF MCDONALDS The policies and practices of McDonalds which we discussed above in the report are according to our literature all their strategies of HR meet up with are literature of course because during interview we asked all their HR practices according or comparing to our literature.

SUGGESTIONS
After critically evaluating the HR Functions of McDonalds we recommend the following suggestions according to the each section of HR: JOB ANALYSIS: For job analysis we recommend that McDonalds should also include Performance Standards and Human Requirements which would help them more in making job description and specification. JOB DESCRIPTION AND SPECIFICATION: Well their job description and specification is not clear they have intermingled it. In Job Description they have written about the skills required in an employee not about the duties he/she would have to perform. Similarly in Job Specification they have just written general information not about the skills and personality traits. PLANNING AND FORECASTING: In planning and forecasting McDonalds is using trend analysis method for personnel needs but according to our opinion Computerized Forecast should be used because McDonalds is a large organization and they should estimate their need of employees through computerized system it would be easier for them. TESTING : All over McDonalds has a good formal testing system but in our view for crew members specially who deal with customer care area a Communication Skill Test should be taken which includes testing of accent, language, talking way and facial expression of employees. INTERVIEW: McDonalds should also ask Behavioral Questions from the candidates so by knowing their past experience they could judge their attitude and mental abilities more accurately. COMPENSATION & BENEFITS: For the employees at lower level like crew members, a proper Medical Check-up after every month should be provided to them and their pays should be increased comparing to the economic conditions of country. For higher level employees a Life-insurance policy should be made.