Question 1 ± To implement this delivery model, what kinds of organizational changes Mc Donald¶s must undertake?


cDonald's has had to innovate its way through India Vegetarian fare, home delivery, breakfast menu, extended

hours and so on. As a result, the McDonald's model in India looks very different from anywhere else in the world. Most of these steps have added incremental revenue. The company is now all set to launch its web-based delivery service. As a concept, McDelivery, or free home delivery of meals, is not new in India. In fact, the company first launched it in Mumbai way back in 2004. McDonald's now wants to take it to the next level. A major reason for this is the huge potential. The food market in the country runs into thousands of crores of rupees. There are various estimates of its size, from Rs 100,000 crore (Rs 1,000 billion) per annum to Rs 350,000 crore (Rs 3,500 billion). A little less than a fifth of this market is with quick-service restaurants. Lifestyle trends show that more and more people prefer to order food home from such restaurants. The biggest advantage is convenience. Hot boxes ensure that the food does not go cold. Most restaurants, aware that this increases their sale, charge nothing extra for home delivery. With the number of working women on the rise, the business has got a huge lift. Though it means investments in two-wheelers and insulated boxes to keep the food warm, and parking lots adjacent to the restaurant, most fast-food chains have gone for it. But home delivery is not inexpensive. McDonald's runs a sizeable call centre for this purpose. It takes the order from the customer and then forwards it to the nearest outlet.

Rush hour can see the lines to the call centre clogged. So, it decided to run a pilot on the web.

The reason is not difficult to find: This eliminates the call centre from the transaction and therefore makes it more efficient.

Of course, the cost comes down as well. The city selected was Hyderabad, for long the chosen market for test launches.

What also helped McDonald's case was the large net-savvy population of the city -- it is the second largest information technology centre in the country after Bangalore. The stint in the four stores across Hyderabad brought home two learnings. One, it is better to offer web-based delivery to customers who visit the restaurants.

To tackle that, McDonald's set up a process whereby orders above a certain limit (Rs 1,000) require cross-checking:

Once the location is entered. Satisfied with the outcome. the company will roll out the service in March across the 75 McDelivery cities in the country. the website will determine whether the area comes under a delivery grid or not. However. According to Upadhye. The order gets registered if you are in the grid. Kind of Organizational changes to support new Web-Delivery model Customer Service Management Demand Management Order fulfillment Manufacturing Flow Management Supplier relationship Management Product Development and Commericialization Returns Management Procurement F jjvhhjvhdPhysical uygyre7yfryrycuydy Distributionkjkjhugh jjhjijghjgujhyytytgtt6tfgjhhfjuyuytgstgteytte Outsourcinghuhgtyytyyffr tryhttnkgmrm Performance measurement Technological Support Online payment functionality Distributor Quality management Process Quality Control Product handling standards .The restaurant calls up the concerned person to validate the order. Upadhye maintains that such pranks made up a minuscule part of the web orders. all that the customers have to do is register on the web delivery portal.

For a model like online food ordering to be successful we need deeper penetration of alternate payment mechanisms like ewallets and mwallets.Determining the need for change. The real challenge with online is pranks or false orders which can cost a company like mcdonalds as it would waste real money in transporting the orders. I won¶t be surprised if you have a tweet to eat channel as well that¶s launched soon by one of these food chains. Only then would we be able to say ± Im Lovin¶ It! Figure 2.2 The Change-Management Process Initial Organization Analysis Understanding the forces for and against change and the organizational situation Why Change? . We have covered several online food ordering portals before and though none of them have made it big yet it seems like a growing trend in India.Emergency and Contingency Plan Delivery model Service TAT Staff Development for online delivery Helpdesk Complaint Management Communication management Advertisement and Various marketing activities to increase Web portal Pentration. determining the degree of choice about whether to change. defining the vision Defining the Desired Describing the Present Gap Analysis Describing the Present State Action Planning Assessing the present in terms of the future to determine the work to be done . As we have discussed earlier once online payment mechanism¶s improve this issue would be taken care of as there wont be a requirement of cash of delivery model but instead customers would use ewallets (like paypal which was blocked) to order food.

Sometimes those fears are well founded . Organizational culture is a set of shared mental assumptions that guide interpretation and action in organizations by defining appropriate behavior for various situations.Managing the Transition Significant organizational change occurs. for example. It further continues to explain organizational values. For organizations to develop. they often must undergo significant change at various points in their development. and/or wants to change the very nature by which it operates. there are two kinds of organizational culture found. however. adds or removes a major section or practice. . b) Weak culture where there is little alignment with organizational values and control must be exercised through extensive procedures and bureaucracy. Appropriate kinds of behavior by employees in particular situations. It also occurs when an organization evolves through various life cycles. help to implement any change strategy with huge success. A "strong" culture is especially beneficial to firms operating in the service sector since members of these organizations are responsible for delivering the service. In such environments. Almost all people are nervous about change.the change really will have a negative impact for them. From organizational values develop organizational norms. Many will resist it consciously or subconsciously. when an organization changes its overall strategy for success. the target population for the change will come to realize that the change was for the better. strong cultures help firms operate like well-oiled machines. guidelines. Research shows that organizations that foster strong cultures have clear values that give employees a reason to embrace the culture. Generally. cruising along with outstanding execution and perhaps minor tweaking of existing procedures here and there. described as "beliefs and ideas about what kinds of goals members of an organization should pursue and ideas about the appropriate kinds or standards of behavior organizational members should use to achieve these goals. Its very important to understand the organizational culture before we speak about organizational change that is required to bring about any change in the strategy. a) Strong culture is said to exist where staff respond to stimulus because of their alignment to organizational values. or expectations that prescribe appropriate kinds of behavior by employees in particular situations and control the behavior of organizational members towards one another. In many cases.

The most common response to impending change is a negative response where. Many people will hide their negative feelings. Part of the art of organizational change and make the new web based delivery model acceptable is to: y y y understand what journey they wanted which populations had to take (it may not be the same for everyone). people are affected by change. It is not wise to be openly critical of your bosses and their new ideas. Understanding their position requires more than listening to what they say. Management specialists should have used an array of diagnostic tools to uncover the true characteristics and attitudes of the target populations. By definition. As a part of the new initiative of the web based delivery model to be made acceptable. the target population sees the change as a bad or threatening thing. Some people will not even be aware of their own resistance which.Therefore. properly answering and considering the resistence to change. and use that knowledge to guide them in the right direction. resistance to change could never be ignored and had to be addressed with due care by Mc Donald. lying training plans before and after the execution of the project. framing the strategies for execution and roll out plans. acceptance of the new plan internally by properly briefing on the roadmap and vision. Assuming the final outcome can represent a good thing from their perspective. the goal is to leave them in favour of the change and highly motivated to make it work. Generally project failures are the result of resistance to change. A few will comfortably accommodate any degree of change. Psychologists have researched these "bad news" responses and found that there is a common emotional response. affects their behaviour sub-consciously. but most people have a change journey to undertake. assess what their attitude would likely to be. This chart shows how the individuals oscillate between inactivity and high emotion. Mc Donald in order to implement the web based delivery model as a new initiative should have first concentrated on the existing culture. nevertheless. initially at least. .

you should recognise the likelihood of disappointment during the change process.Here are some thoughts that might be expressed by someone passing through the "bad news" curve: y y y y y y y Oh no! It can't be true! You cannot be serious!!! Can we sort this out some other way? That's it .after 20 years of service they want me to. Am I going to be part of this? Yes.. Be ready to lift them out of the trough in time to benefit from their enthusiasm. The Project Manager should expect to encounter it and deal with's not bad really. Resistance to change is normal. I can live with this . The worst time to encounter resistance is .. The "Good News" Curve A different emotional curve may occur where individuals are initially in favour of the change. the risk is that they will be disappointed by the reality of the change or the effort it will take to achieve it. In the "good news" curve. In these cases.

try to deal with it should be taken seriously. Here are some change styles that may be appropriate: y y y y Collaborative .The target population is informed about the changes and their views are sought.during the cutover to the new solution. Their views will be actively sought and acted upon.The workforce is informed about the changes and why those changes are important. critical. In fact. Directive . high-risk period when the last thing you need is a lack of co-operation from the target population. Some Organisational Change Management experts suggest that you should deliberately upset the target population early in the project so that you can guide them through the emotional curve and change their attitude. In general. if there is going to be resistance. Using the right change style The design of the project's approach should take into account the optimum style of addressing organisational change issues. Coercive . That may be taking the principle too far . Try to surface issues and resistance earlier in the project so that there is time to get the target population engaged before any damage is caused.The target population are engaged in the change process.The workforce is told that they must obey the new instructions. Consultative . The degree to which you involve them will depend on the magnitude of the change. if they feel their views were sought then ignored they are likely to become more resistant. . typically through cascading workshops or meetings. The cynical view is that you should make them feel part of the process even if you prefer to ignore what they have to say. their active participation is likely to add to the quality of the solution . the target population will be more supportive of the changes if they have been part of the change process.but. Working with a broad selection of the target population adds time and cost to the project. Feedback will demonstrate how their input has been acted upon. Transition is usually a busy. Conversely. They will be kept up to date on the issues.

It may also be appropriate to couple these organisational issues and needs with the mainstream design work of the project. feedback and the changing circumstances of the project. The input activities are essentially forms of fact-finding and analysis. The best media should be identified to convey the right messages to the right people at the right time. so that certain issues could be solved by the way the solution is designed. Early in the project an initial approach to communication will be formulated.inducing organisational change.analysing the problem. Organisational Change Management techniques fall into two main types: y y input . these messages and methods will be refined based upon achievements. Management experts have many specialised tools to: . It has two main purposes: y y to convey important information that the audience needs to know. During the project.Communication One of the main tools for promoting change is communication. and to promote organizational change. It may be easier to make the solution fit the people rather than the people fit the solution. and output . Messages supporting the project's change objectives should be carefully constructed.

. In many cases. much of the change output can be applied by other project team members. They should also be guided by the specialists (if any) and by the project's change management approach and planning. The end of a phase is always a good time to review progress. design and planning may be specialist tasks. assess that population's capabilities. Output activities tend to be various forms of communication. and determine what is required to bring about that change.increasing or decreasing resistance. It can be hard to measure whether the target population has now become sufficiently supportive for the project to succeed. Although the change management analysis. Many organisational change activities are imprecise in their effect. Take a fresh look at the organisational issues: y y y did we really understand the barriers? how effective were the actions taken? what more do we need to achieve? The conclusions will be fed into the planning for the next phase of work. In the absence of an expert you would fall back on basic fact finding and analysis. behaviour.y y y y identify a population. attitude. Non-specialist team members should be given the basic skills and understanding to promote organisational change. coupled with common sense and experience. define the change goals. All team members will have opportunities to spread the right message. the way they approach a given activity might have a significant affect on the target population . culture. for example: y y y y communicating messages coaching setting up sponsorship cascades collaborative workshops.

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