1. INDEX
 INTRODUCTIONTO ORGANIZATIONALBEHAVIOR
 KEY ELEMENTS OF ORGANIZATIONALBEHAVIOR
 BASIC APPROACHESOF ORGANIZATIONBEHAVIOR
 COMPANY BACKGROUND - MCDONALD'S
 ORGANIZATIONALBEHAVIOR – MCDONALD’S
 MCDONALD’SVALUES
 MCDONALDS SWOT ANALYSIS
 CONCLUSION

2. Introduction to Organizational Behavior
The study of Organizational Behavior (OB) is very interesting and challenging too. It is related to
individuals, group of people working together in teams. The study becomes more challenging
when situational factors interact. The study of organizational behavior relates to the expected
behavior of an individual in the organization. No two individuals are likely to behave in the
same manner in a particular work situation. It is the predictability of a manager about the
expected behavior of an individual. There are no absolutes in human behavior. It is the human
factor that is contributory to the productivity hence the study of human behavior is important.
Great importance therefore must be attached to the study. Researchers, management
practitioners, psychologists, and social scientists must understand the very credentials of an
individual, his background, social framework, educational update, impact of social groups and
other situational factors on behavior. Managers under whom an individual is working should be
able to explain, predict, evaluate and modify human behavior that will largely depend upon
knowledge, skill and experience of the manager in handling large group of people in diverse
situations. Preemptive actions need to be taken for human behavior forecasting. The value
system, emotional intelligence, organizational culture, job design and the work environment
are important causal agents in determining human behavior. Cause and effect relationship
plays an important role in how an individual is likely to behave in a particular situation and its
impact on productivity. An appropriate organizational culture can modify individual behavior.
Recent trends exist in laying greater stress on organizational development and imbibing a
favorable organizational culture in each individual. It also involves fostering a team spirit and
motivation so that the organizational objectives are achieved. There is a need for commitment
on the part of the management that should be continuous and incremental in nature. The
scope of the organizational behavior is as under:
(a) Impact of personality on performance
(b) Employee motivation
(c) Leadership
(d) How to create effective teams and groups
(e) Study of different organizational structures
(f) Individual behavior, attitude and learning
(g) Perception
(h) Design and development of effective organization

3. (i) Job design
(j) Impact of culture on organizational behavior
(k) Management of change
(l) Management of conflict and stress
(m) Organizational development
(n) Organizational culture
(o) Transactional analysis
(p) Group behavior, power and politics
(q) Job design
(r) Study of emotions
The field of the organizational behavior does not depend upon deductions based on gut
feelings but attempts to gather information regarding an issue in a scientific manner under
controlled conditions. It uses information and interprets the findings so that the behavior of an
individual and group can be canalized as desired. Large number of psychologists, social
scientists and academicians has carried out research on various issues related to organization
behavior.
Employee performance and job satisfaction are determinants of accomplishment of individual
and organizational goals. Organizations have been set up to fulfill needs of the people. In
today’s competitive world, the organizations have to be growth-oriented. This is possible when
productivity is ensured with respect to quantity of product to be produced with zero error
quality. Employee absenteeism and turnover has a negative impact on productivity. Employee
who absents frequently cannot contribute towards productivity and growth of the organization.
In the same manner, employee turnover causes increased cost of production. Job satisfaction is
a major factor to analyses performance of an individual towards his work. Satisfied workers are
productive workers who contribute towards building an appropriate work culture in an
organization. Organizations are composed of number of individuals working independently or
collectively in teams, and number of such teams makes a department and number of such
departments makes an organization.
It is a formal structure and all departments have to function in a coordinated manner to achieve
the organizational objective. It is therefore important for all employees to possess a positive
attitude towards work. They need to function in congenial atmosphere and accomplish
assigned goals. It is also important for managers to develop an appropriate work culture. Use of

4. authority, delegation of certain powers to subordinates, division of labor, efficient
communication, benchmarking, re-engineering, job re-design and empowerment are some of
the important factors so that an organization can function as well-oiled machine. This is not
only applicable to manufacturing organizations but also to service and social organizations.
Study of organizational behavior is very interesting. It is the art on the part of manager to
understand, describe, forecast and modify individual behavior. Lot of studies have been
undertaken in the field of organizational behavior and vast literature is available, which need to
be studied by practitioners in the field of managing human resources. Various models and
research instruments are available to investigate human behavior. Various fields like
psychology, social psychology, anthropology, sociology, politics, economics, and medical
sciences have contributed to the field of organization behavior. Various models in the above
fields have enriched the study of organization behavior.
It is the field of study that investigates the impact on individuals, groups and organizational
structure have on individual behavior so that the knowledge so achieved can be suitably
modified and applied for organizational effectiveness. The study of organizational behavior
relates to the study of attitude, perception, learning, values at individual level. The study is
undertaken pertaining to managing stress, conflicts, intergroup behavior, decision making at
group level. Management of change, development of organizational culture, designing and
redesigning of jobs, and various organizational development strategies are required to be
undertaken by leaders for organizational effectiveness. It is the responsibility of the managers
to evolve appropriate strategies to study organizational components. The first component is
people. The study of organizational behavior involves identifying need spectrum of the people,
managing interpersonal relationship, understanding of individual objectives and co-relating
organizational strategies accordingly.
The second component is understanding of organizational structure and its modification based
on the need of the hour. Manager should decide upon the nature of structure and ensure unity
of command, number of levels that may be required for effective command and control.
Communication, delegation of authority, well defined policies, rules, regulation, systems,
procedures and processes. Introduction of latest technology is an essential part of
organizational development that should be taken care of by the manager responsible for
running the organization. Jobs should be allotted to the individual based on the aptitude and
the processes must be compatible with the technology being used. One of the most important
components is environment. While internal environment relates to various personnel policies
and corresponding managerial actions, the external environment relates to cultural, social,
legal, and governmental rules and regulations that should be taken care of. Technological

5. changes has made it imperative on the part of managers that they should take care of
employees and meet their social expectations so that organizational goals can be achieved.
DEFINITIONS
“Organizational behavior is a field of study that investigates the impact that individuals, groups
and organizational structure have on behavior within the organization, for the purpose of
applying such knowledge towards improving an organizational effectiveness”. The above
definition has three main elements; first organizational behavior is an investigative study of
individuals and groups, second, the impact of organizational structure on human behavior and
the third, the application of knowledge to achieve organizational effectiveness. These factors
are interactive in nature and the impact of such behavior is applied to various systems so that
the goals are achieved. The nature of study of organizational behavior is investigative to
establish cause and affect relationship. OB involves integration of studies undertaken relating
to behavioral sciences like psychology, sociology, anthropology, economics, social psychology
and political science. Therefore, organizational behavior is a comprehensive field of study in
which individual, group and organizational structure is studied in relation to organizational
growth and organizational culture, in an environment where impact of modern technology is
great. The aim of the study is to ensure that the human behavior contributes towards growth of
the organization and greater efficiency is achieved.
Organizational behavior can be defined as – “the study and application of knowledge about
human behavior related to other elements of an organization such as structure, technology and
social systems (LM Prasad). Stephen P Robins defines “Organizational behavior as a systematic
study of the actions and attitudes that people exhibit within organizations.” It has been
observed that we generally form our opinion based on the symptoms of an issue and do not
really go to the root cause of the happening. Science of organizational behavior is applied in
nature. Disciplines like psychology, anthropology and political science have contributed in terms
of various studies and theories to the field of organizational behavior.
A leader should be able to communicate with his subordinate and keep them in picture as to
the happenings in the organization. People promote organizational culture for mutual benefit.
Politics is often used to create conflict with the aim of enlarging self-power base to the
detrimental of organizational growth. Politics, in Indian context has made inroads based on
religion, caste system in the decision making process which has led to formation of informal
groups in the organization that often exploit the organization for fulfillment of personal goals at
the cost of organizational goals. Conflict and manipulating power bases need to be handled in
an appropriate manner to modify human behavior and stimulate various individuals towards
achieving higher productivity. Power dynamics plays a significant role in organization situations
in different environment.

6. Key elements of organizational behavior
The key elements in organizational behavior are people, structure, technology and the external
elements in which the organization operates. When people join together in an organization to
accomplish an objective, some kind of infrastructure is required. People also use technology to
help get the job done, so there is an interaction of people, structure and technology. In
addition, these elements are influenced by the external environment, and they influence it.
Each of the four elements of organizational behavior will be considered briefly.
#People
People make up the internal social system of the organization. They consist of individuals and
groups, and large groups as well as small ones. People are the living, thinking, feelings beings
who created the organizations. It exists to achieve their objectives. Organizations exist to serve
people. People do not exist to serve organizations. The work force is one of the critical
resources that need to be managed. In managing human resources, managers have to deal
with: i) Individual employee who are expected to perform the tasks allotted to them ii) Dyadic
relationships such as superior-subordinate interactions iii) Groups who work as teams and have
the responsibility for getting the job done, iv) People outside the organization system such as
customers and government officials
#Structure
Structure defines the official relationships of people in organizations. Different jobs are
required to accomplish all of an organization’s activities. There are managers and employees,
accountants and assemblers. These people have to be related in some structural way so that
their work can be effective. The main structure relates to power and to duties. For example,
one person has authority to make decisions that affect the work of other people. Some of the
key concepts of organization structure are listed as below:
a) Hierarchy of Authority: This refers to the distribution of authority among organizational
positions and authority grants the position holder certain rights including right to give direction
to others and the right to punish and reward.
b) Division of Labor: This refers to the distribution of responsibilities and the way in which
activities are divided up and assigned to different members of the organization is considered to
be an element of the social structure.
c) Span of Control: This refers to the total number of subordinates over whom a manager has
authority

7. d) Specialization: This refers to the number of specialties performed within the organization.
e) Standardization: It refers to the existence of procedures for regularly recurring events or
activities
f) Formalization: This refers to the extent to which rules, procedures, and communications are
written down
g) Centralization: This refers to the concentration of authority to make decision.
h) Complexity: This refers to both vertical differentiation and horizontal differentiation. Vertical
differentiation: outlines number of hierarchical levels; horizontal differentiation highlights the
number of units within the organization (e.g. departments, divisions)
Organizations can be structured as relatively rigid, formalized systems or as relatively loose,
flexible systems. Thus the structure of the organizations can range on a continuum of high
rigidity to high flexibility. There are two broad categories of organization: i) Mechanistic form of
organization ii) Organic form of Organization.
#Mechanistic form of Organization
It is characterized by high levels of complexity, formalization and centralization. A highly
mechanistic system is characterized by centralized decision making at the top, a rigid hierarchy
of authority, well but narrowly defined job responsibilities especially at lower levels, and
extensive rules and regulations which are explicitly make known to employees through written
documents. In mechanistic organization, labor is divided and subdivided into many highly
specialized tasks (high complexity), workers are granted limited discretion in performing theirs
ta sks and rules and procedures are carefully defined (high formalization); and there is limited
participation in decision making which tends to be conducted at the highest levels of
management high centralization.
#Organic form of Organization
A highly organic system is characterized by decentralized decision-making which allows people
directly involved with the job to make their own decisions, very few levels in the hierarchy with
flexible authority and reporting patters, loosely defined job responsibilities for members, and
very few written rules and regulations. It is relatively simple, informal and decentralized.
Compared with mechanistic organizations, employees in organic organizations, such as design
firms or research labs, tend to be more generalist in their orientation.

8. #Jobs and Tasks
Job refers to the sum total of an individual’s assignment at the workplace. Tasks refer to the
various activities that need to be performed to get the job done. The nature of tasks, it’s
executives by various individuals, nature of interdependence and inter-relatedness, group
activities etc. have implication for organizational effectiveness. Thus the jobs and tasks have to
be designed and managed properly. Core Job Characteristics: There are five job characteristics
which are central to providing potential motivation to workers. They are: Skill variety, Task
identity, Task significance, Autonomy, and Feedback from the job itself.
i) Task Variety: This denotes the extent to which any particularly job utilizes a
range of skills, abilities and talents of the employees. If number of different skills
is used by the employee on the job, the job is going to provide challenge and
growth experience to the workers.
ii) Task Identity: This indicates the extent to which the job involves a ‘whole’ and
identifiable piece of work. If the job involves the whole components (eg –
painting a portrait), then the individual can identify with the ultimate creation
turned out by him and derive pride and satisfaction from having done a good
job.
iii) Task significance: This refers to the meaningfulness or significance of the impact
that a job has on the lives of others – both inside and outsider of the
organization. If what one does has an impact on the wellbeing of others, the job
becomes psychologically rewarding to the person who performs it.
iv) Autonomy: This refers to the extent to which the job provides an employee the
freedom, independent and discretion to schedule work and make decision and
formulate the procedures to get the job done without interference from others.
The greater the degree of autonomy, the more the person doing the job feels in
control.
iv) Feedback from the Job itself: This indicates the extent to which the person who
is working on the job can assess whether they are doing things right or wrong
even as they are performing the job. That is, the job itself is stimulating one and
enjoyable.
#Job Design:
Jobs can be designed to range from highly simple to highly complex tasks in terms of the use of
the workers skill. Some of the job design options are as follows:

9. i) Job Simplification: The jobs are broken down into very small parts as in the
assembly line operations where a fragmented task is repeatedly done over and
over again by the same individual.
ii) Job Rotation: This involves moving employees among different tasks over a
period of time. Management does not have to bother with combining tasks, but
at the same time, the workers do not get bored with doing one simple task over
several years. The employee is periodically rotated from one job to another
within the work setting
iii) Job Enlargement: This involves simply adding more tasks to the job so that the
workers have a variety of simple tasks to perform rather than doing just one task
repetitively. Two or more tasks are combined and the individual does the
combined tasks altogether.
iv) Job Enrichment: This offers a greater challenge to the workers because it
requires the use of variety of skills possessed by them. This involves building in
motivating factors into the job, giving the workers more responsibility and
control over work, and offering learning opportunities for the individual on the
job.
#Technology Organizations have technologies for transforming inputs and outputs.
These technologies consist of physical objects, activities and process, knowledge, all of
which are brought to bear on raw materials labor and capital inputs during a transformation
process. The core technology is that set of productive components most directly associated
with the transformation process, for example, production or assembly line in manufacturing
firm. Technology provides the physical and economic resources with which people work.
They cannot accomplish much with their bare hands, so they build buildings, design
machines, create work processes and assemble resources. The technology that results has a
significant influence on working relationships. An assembly line is not the same as a
research laboratory, and a steel mill does not have the same working conditions as a
hospital. The great benefit of technology is that it allows people to do more and better
work, but it also restricts people in various ways. It has costs as well as benefits.
Classification of Technology: Thomson classified technology into three categories: Long-
linked technology, Mediating Technology and Intensive Technology.
i) Long linked Technology: In this, tasks are broken into a number of sequential and
interdependent steps, where the outputs of one unit become the input of the next.
(eg. Assembly line) this facilitates to have high volume of output and efficiency. This
technology calls for mechanistic structures with high levels of specialization,
standardization and formalization.

10. ii) Mediating Technology: This links different parties who need to be brought together
in a direct or indirect way (eg. Banks – use mediating technology to lend money to
borrowers by taking money from depositors)
iii) Intensive Technology: It is used when a group of specialists are brought together to
solve complex problems using a variety of technologies (eg. Hospital – parties are
treated with the help of experts drawn from different fields of specialization).
Coordination of the different activities is achieved in the system primarily through
mutual adjustment among those engaged in solving the problem in the different
units. Organic structures would fit in this system using intensive technology.
#Environment
All organizations operate within an external environment. A single organization does not exist
alone. It is part of a larger system that contains thousands of other elements. All these mutually
influence each other in a complex system that becomes the life style of the people. Individual
organization, such as a factory or school cannot escape from being influenced by this external
environment. It influences the attitudes of people, affects working conditions, and provides
competition for resources and power. Every organization interacts with other members of its
environment. The interactions allow the organization to acquire raw material, hire employees,
secure capital, obtain knowledge, and build, lease or buy facilities and equipment. Since the
organization process a product or service for consumption by the environment, it will also
interact with its customers. Other environmental actions, who regulate or over see these
exchanges, interact with the organization as well (distributors, advertising agencies, trade
associations, government of the countries in which business is conducted)
Two Distinct Sets of Environment:
i) Specific Environment: This includes the suppliers, customers, competitors,
governments’ agencies, employees, unions, political parties etc.
ii) General Environment: It includes the economic, political, cultural, technological and
social factors in which the organization embedded.
Organizations are embedded in an environment within which they operate. Some of the
external factors may be completely beyond the control of the organization to change, such
as the cultural, social or economic, or governmental aspects. However, many of the other
factors such as sizing up the market, being in tune with the technological changes takes
place, being a step ahead of competition, or stocking up and buffering supplies when
certain materials are likely to be in short supply, are all within the control of the
organization. Effectively managing these situations, however, requires constant and close

11. vigilance, adaptability to changes, and being able to manage problematical situations
through good decisions making. Those organizations which are proactive (that is, watchful
and take action before crisis situations occur) and can manage their external environment
are more effective than those that are reactive (that is, caught off guard and wake up after
facing the crises situation) and are unable to cope effectively. Fit between Environment and
Structure: Firms facing a fast changing or turbulent external environment were very
effective when they had more organic structures which provided flexibility for quick
changes to be make within the internal environment of the system. Similarly, firms which
operated in a relatively stable external environment were very effective when they had
more mechanistic structures. This mechanistic structure allowed the system to operate in a
predictable manner since authority, responsibility, procedures, and rules were clearly
specified.
Basic Approaches of Organization behavior
1) An InterdisciplinaryApproach:Itisintegratingmanydisciplines.Itintegrates social sciences and
other disciplines that can contribute to the Organizational Behavior. It draws from these
disciplinesany ideas that will improve the relationships between people and organization. Its
interdisciplinary nature is similar to that of medicine, which applies physical, biological and
social science into a workable medical practice. Organizations must have people, and people
working toward goals must have organizations, so it is desirable to treat the two as a working
unit.
2) Scientific Management Approach: The fundamental concern of the scientific management
school was to increase the efficiency of the worker basically through good job design and
appropriate training of the workers.Tayloristhe fatherof the scientificmanagementmovement
and he developedmanyidesto increase organizational efficiency. Taylor showed that through
proper job design, worker selection, employee training and incentives, productivity can be
increased. The scientific management school advocated that efficiency can be attained by
findingthe rightmethodstogetthe jobdone,throughspecializationonthe job,byplanningand
scheduling,byusingstandardoperatingmechanisms,establishing standard times to do the job,
by proper selection and training of personnel and through wage incentives.
3) A Human Resources (Supportive) Approach: It is developmental approach concerned with the
growth and development of people toward higher levels of competency creativity and
fulfillment, because people are the central resource in any organizations and any society. It
helpspeople growinself-control andresponsibilityandthenittriesto create a climate in which
all employees may contribute to the limits of their improved abilities. It is assumed that

12. expanded capabilities and opportunities for people will lead directly to improvements in
operatingeffectiveness. Work satisfaction will be a direct result when employees make fuller
use of their capabilities. Essentially, the human resources approach means that better people
achieve better results.
4) A Contingency Approach: Traditional management relies on one basic principle – there is one
best way of managing things and these things can be applied across the board in all the
instances.The situationaleffectwillbe totallyignoredinthistraditional management.Situations
are muchmore complex than first perceived and the different variables may require different
behavior which means that different environments required different behavior for
effectiveness.Eachsituationmuchbe analyzed carefully to determine the significant variables
that exist in order to establish the kinds of practices that will be more effective. Contingency
theoristarguesthatthe external environment and several aspects of the internal environment
govern the structure of the organization and the process of management. Effective
management will vary in different situations depending on the individual and groups in the
organization, the nature of jobs, technology, the type of environment facing the organization
and its structure. For example, if the employees are highly matured and willing to take more
responsibility, the managers can follow delegating style and give full freedom to their
employees. If the employees are not so matured and avoid taking any responsibility, the
managersmustfollow directing style. Depends upon the situation, that is, employees level of
maturity, managers will adopt different style of leadership to ensure more successful results.
5) A Systems Approach: This implies that organization consists of many inter related and inter
dependentelementsaffectingone anotherinordertoachieve the overall results. Conceptually
a system implies that there are a multitude of variables in organization and that each of them
affectsall the othersincomplex relationships.Aneventthat appears to affect one individual or
one departmentactuallymayhave significantinfluenceselsewhereinthe organization.Systems
theorists describe the organization as “open to its external environment”, receiving certain
inputs from the environment such as human resources, raw materials etc, and engaging in
variousoperationstotransformthose raw materialsintoafinished products and finally turning
out the “outputs” in its final form to be sent to the environment. The organization, since it is
open to the environment, also receives feedback from the environment and takes corrective
action as necessary. This input-transformation process-output model with the feedback
mechanism can be illustrated through a simple example.

13. Company Background - McDonald's
Name McDonald's Corporation
Logo
Industries served Restaurants, Fast Food
Geographic areas
served
Worldwide
Headquarters U.S.
Current CEO Don Thompson
Revenue $ 27.56 billion (2012)
Profit $ 5.46 billion (2012)
Employees 1,800,000 (2013)
Main Competitors
Burger King Worldwide,Inc., Yum! Brand Inc., Subway, Wendy’s
Company and many others.
McDonald’s is the world’s leading fast food restaurant chain with more than 34,000 local
restaurants serving approximately 69 million people in 119 countries each day.
More than 80% of McDonald’s restaurants worldwide are owned and operated by
independent local franchisees.

14. History
The McDonalds migrated from Manchester, New Hampshire to Hollywood in the late 1920s,
where brothers Richard and Maurice McDonald began working as set movers and
handymen at motion-picture studios. In 1937, their father Patrick McDonald opened "The
Airdrome", a food stand, on Huntington Drive (Route 66) near the Monrovia Airport in
Monrovia, California. Hamburgers were ten cents, and all-you-can-drink [citation needed]
orange juice was five cents. In 1940, Maurice and Richard ("Mac" and "Dick") moved the
entire building 40 miles (64 km) east, to West 14th and 1398 North E Streets in San
Bernardino, California. The restaurant was renamed "McDonald's Bar-B-Q" and had twenty-
five menu items, mostly barbecue.
In October 1948, after the McDonald brothers realized that most of their profits came from
selling hamburgers, they closed down their successful carhop drive-in to establish a
streamlined system with a simple menu of just hamburgers, cheeseburgers, French fries,
shakes, soft drinks, and apple pie. The carhops were eliminated to make McDonald's a self-
service operation. The brothers took great care in setting up their kitchen like an assembly
line to ensure maximum efficiency. The restaurant's name was changed again, this time to
simply "McDonald's," and reopened on December 12, 1948.
In 1952, the brothers decided they needed an entirely new building in order to achieve two
goals: further efficiency improvements, and a more eye-catching appearance. They
collected recommendations for an architect and interviewed at least four altogether, finally
choosing Stanley Clark Meston, an architect practicing in nearby Fontana, in the fall. The
brothers and Meston worked together closely. They achieved the extra efficiencies they
needed by, among other things, drawing the actual measurements of every piece of
equipment in chalk on a tennis court behind the McDonald house (with Meston's assistant
Charles Fish). The design achieved a high level of noticeability thanks to gleaming surfaces
of red and white ceramic tile, stainless steel, brightly colored sheet metal, and glass; pulsing
red, white, yellow, and green neon; and last but not least, two 25-foot yellow sheet-metal
arches trimmed in neon, called "golden arches" even at the design stage. A third, smaller
arch sign at the roadside hosted a pudgy character in a chef's hat, known as Speedee,
striding across the top, trimmed in animated neon.
In late 1952, with only a rendering of Meston's design in hand, the brothers began seeking
franchisees. Their first franchisee was Neil Fox, a distributor for General Petroleum
Corporation. Fox's stand, the first with Meston's golden arches design, opened in May 1953
at 4050 North Central Avenue at Indian School Road in Phoenix, Arizona. Their second
franchisee was the team of Fox's brother-in-law Roger Williams and Burdette "Bud" Landon,
both of whom also worked for General Petroleum. Williams and Landon opened their stand

15. on 18 August 1953 at 10207 Lakewood Boulevard in Downey, California. Today the Downey
stand has the distinction of being the oldest surviving McDonald's restaurant. The Downey
stand was never required to comply with the McDonald's Corporation's remodeling and
updating requests over the years because it was franchised not by the McDonald's
Corporation, but by the McDonald brothers themselves to Williams and Landon.
(Recognizing its historic and nostalgic value, in 1990 the McDonald's Corporation acquired
the stand and rehabilitated it to a modern but nearly original condition, and then built an
adjacent museum and gift shop to commemorate the site.)
In 1954, Ray Kroc, a seller of Multimixer milkshake machines, learned that the McDonald
brothers were using eight of his machines in their San Bernardino restaurant. His curiosity
was piqued, and he went to San Bernardino to take a look at the McDonalds' restaurant. He
was joined by good friend Charles Lewis who had suggested to Kroc several improvements
to the McDonald's burger recipe.
Believing the McDonalds' formula was a ticket to success, Kroc suggested they franchise
their restaurants throughout the country. The brothers were skeptical, however, that the
self-service approach could succeed in colder, rainier climates; furthermore, their thriving
business in San Bernardino, and franchises already operating or planned, made them
reluctant to risk a national venture. Kroc offered to take the major responsibility for setting
up the new franchises elsewhere. He returned to his home outside of Chicago with rights to
set up McDonald's restaurants throughout the country, except in a handful of territories in
California and Arizona already licensed by the McDonald brothers. The brothers were to
receive one-half of one percent of gross sales.[5] Kroc's first McDonald's restaurant opened
on April 15, 1955, at 400 North Lee Avenue in Des Plaines, Illinois, near Chicago. (It was
demolished in 1984 after many remodels.) Kroc incorporated his company as McDonald's
Systems, Inc., which he would later rename McDonald's Corporation.
Once the Des Plaines restaurant had become operational, Kroc sought franchisees for his
McDonald's chain. The first snag came quickly. In 1956 he discovered that the McDonald
brothers had licensed the franchise rights for Cook County, Illinois to the Frejlach Ice Cream
Company. Kroc was incensed that the McDonalds had not informed him of this
arrangement. He purchased the rights back for $25,000, five times what the Frejlacks had
originally paid, and pressed forward. McDonald's grew slowly for its first three years. By
1958, there were 34 restaurants. In 1959, however, Kroc opened 68 new restaurants,
bringing the total to 102 locations.

16. Organizational Behavior – McDonald’s
More than 50 years have passed since the first McDonald’s was opened in the United States
and needless to say the Marketing plan has changed several times. However, the main goal
of McDonald’s has always and will always be to provide excellent service and good food at a
reasonable price. McDonalds is currently the #1 rated fast food restaurant in the world;
maybe this is because there are over 30,000 restaurants in the world and they serve over 52
million people a day, but regardless it was/is necessary for McDonalds to have constant
change and innovations added to their marketing scheme in order to remain the best rated.
McDonald’s introduced their newest strategic plan in 2008, which they called “Plan to Win.”
The objective of this plan was not to be the biggest fast-food chain but to be the best fast-
food chain in the world. To do this, McDonald’s implemented what would be known as the
5 P’s. They are Price, Promotion, Place, Products, and People. The main objective of the
“Price” strategy was to make it very affordable for a family to go out for breakfast, lunch or
dinner and not break the bank in doing so. McDonald’s achieved this by making happy
meals for children that were of right portion, right price, along with the everyday value
meals and dollar menu items. There are over 10 items on the dollar menu all day which
makes it very easy for customers to swing by for a quick bite to eat. McDonald’s also runs
many different specials for breakfast where they will make different breakfast sandwiches 2
for $3. By doing this it allows for parents to feed two children for the price of one. It also
allows for more hungry people to make sure that they will be full after they have eaten two
sandwiches.
The second aspect of the marketing mix is Promotion. Advertising through television, radio,
and billboards are great ways that McDonald’s promotes their products and service. Over
the years McDonald’s has used several slogans to leave an impression in people’s heads.
Some of these include “It’s a good time for the Great Taste of McDonald’s,” “Food, Folks,
and Fun,” “We love to see you smile,” and the most recent slogan, “I’m Lovin’ it.” All of
these slogans have been used over the years to promote McDonald’s and by doing so
people remember the name and have become accustomed to visiting nearby locations.
Another strategy that McDonald’s used over the years was to promote their figure head,
Ronald McDonald. Ronald is the made up character behind McDonald’s corporation for the
past 50 years. He was originally introduced in 1963 and resembles a clown character that is
considered #2 only to Santa Claus for the most recognized name in children’s eyes. There
has also been a television show called, The Wacky Adventures of Ronald McDonald,” which
have variously been released between 1998 and 2003. This show was great promotion for
children and McDonald’s because it only happened a very limited amount of times so kids

17. were so excited when they actually got to experience it and it allowed for McDonald’s to
expand revenues.
McDonald’s continues to promote by using several athletes and celebrities to endorse their
products. During the 2008 Olympics in Beijing, McDonald’s featured nine
Olympic and Paralympic Athletes on their cups and packages. McDonald’s also held a
Marketing Campaign in Australia where there people could decide the name of a new
burger about to be introduced. By doing such things McDonald’s is creating a better brand
image and thus making greater profits.
The third aspect of McDonald’s Marketing Mix is Place. Place has been considered the most
important “P” of the 5 P’s over the years because without numerous locations throughout
the world it would be impossible to reach the 52 million customers a day and would make it
hard for McDonald’s to be the world leader in the fast-food industry. Nearly 50% of the U.S.
is less than three minutes away from their nearest McDonald’s. This is a perfect example of
why McDonald’s is the leader in customer satisfaction. What kinds of people want to drive
long distances just to get some quality food at a great price? Not only is McDonald’s a great
place to take yourself or your kids for a deal, but it also allows for kids to enjoy a playground
area at several locations around the world. By offering the attractions of swings, slides and
ball-pits McDonald’s is helping to promote exercise and nutrition in children’s diets.
The forth aspect of the Marketing Mix for McDonald’s is Products. McDonald’s offers such a
large variety of products that it allows for almost all people to be satisfied. Products range
in the food department from burgers to chicken sandwiches to chicken nuggets to apple
pies to soft serve ice cream to apple slices. Along with the beverages, which range from
soda to milk to apple juice to water to coffee. It is also important to point out that
McDonald’s now is introducing a Vegan Menu as well as a vegetarian
Menu in parts of the world. Another point of interest is that in places such as Europe you
can also sit down with your food and enjoy a beer. This is something that hasn’t been
implemented in the U.S. but it could be a potential possibility in the future. By having such a
wide variety of product choices McDonald’s has made it hard for people to not dine-in or
eat-out at one of their locations.
The final aspect of McDonald’s Marketing Mix is People. This is unlike most ordinary
Marketing Mix’s. The main objective when talking about the People aspect is to discuss both
customers and employees, because if the employees aren’t happy, they will be more likely
to take out their anger on the customer. This would result in bad service and publicity.

18. McDonald’s does a lot of internal as well as External Marketing. They have found that it is
extremely important to show employees the proper respect and courtesy that they deserve
and by allowing for them to give input about things they think should be improved or
worked on is a great way of keeping everyone happy. If customers didn’t feel a great sense
of appreciation when they walk into a location they are much less likely to come back and
be repeat customers. By doing research and taking surveys, McDonald’s executives are
finding out what people want and making sure that customers and employees are
completely satisfied.
McDonalds has a target group of Families with children because it is considered a treat for
the children and easy for the parents. It is considered more of an open, public atmosphere
when compared to a fancier sit down restaurant. They offers playgrounds and toys for the
children at many locations. McDonald’s also targets people without a lot of time who need
a quick meal. They offer a drive through for convenience, which brings you delicious food to
you fast and at a convenient price.
We also created a SWOT analysis for McDonalds. Such strengths include: Strong Brand
name, Customer Intimacy, Product Innovation and Supplier Integration. We believe these
are the main strengths of McDonalds. However, weaknesses include Low depth of food
because though there is a variety it still isn’t extremely large at every location and it is
mostly fast food which doesn’t bring the best quality. We also decided that healthiness of
the food was a weakness. This is because though it is quick and convenient we all know it
isn’t the best choice to eat. For opportunities we focused on the prospect of the McCafe
branching out to its own section with fancier snacks and drinks. This would also bring
McDonald’s a new product line. McDonalds also has a few threats, such as its competitors,
like Burger King. Also, the threat of customer wants changing and trying to adapt to the new
customers would be seen as a threat.
The Standards of Business Conduct
These Standards of Business Conduct are a guide to the ethical and legal responsibilities we share as
membersof the McDonald’s family. This is not a complete rulebook that addresses every ethical issue
that mightarise.Itis nota summaryof all lawsand policiesthatapplytoMcDonald’sbusiness.Itis not a
contract, and it does not replace good judgment. Rather, the Standards of Business Conduct give us
guidance and direct us to resources to help us make the right decisions.

19. Applicability of Standards
These Standards of Business Conduct apply to employees of McDonald’s Corporation and its majority-
ownedsubsidiariesworldwide. Non-employee members of McDonald’s Board of Directors must abide
by the Code of Conduct for the Board of Directors of McDonald’s Corporation, which is posted and
maintained at the McDonald’s website at www.mcdonalds.com. The Standards do not apply to our
owner/operators, suppliers or their employees. However, as members of the McDonald’s System, we
expect them to be aware of the Standards, to develop their own policies and procedures that are
consistent with the spirit of the Standards and to fully support our employees in complying with the
Standards. This shared commitment will help ensure that we earn our reputation as a company that
conducts business with integrity.
Publication, Amendments and Waivers
The current version of the Standards of Business Conduct will be posted and maintained on the
McDonald’s website at www.mcdonalds.com. Amendments will also be posted on the website, as
requiredbyapplicable law. In the extremely unlikely event that a waiver of the Standards of Business
Conduct for executive officers would be in the best interests of the Company, it must be approved by
the AuditCommittee of the Boardof Directors,anddisclosedpromptly as required by law. Because the
Standards of Business Conduct are revised periodically, please check the website for the most recent
version.
Management Commitment
McDonald’s management is committed to living up to high standards of ethical behavior. The
McDonald’s Board of Directors oversees the Company’s commitment to ethics and compliance with
legal standards. To help our employees live up to our Standards of Business Conduct, McDonald’s has
established the Global Compliance Office. This office is responsible for overseeing the Company’s
compliance with these Standards and other McDonald’s policies.
Additional Responsibilities of Supervisory Employees
Those employees who have supervisory authority over others are in positions of trust and influence.
Therefore, they have special responsibilities under the Standards of Business Conduct to sustain an
ethical workenvironmentandtoleadbyexample.Theymustensure that the employees who report to
themunderstandandfollowthe Standardsandcomplete all requiredcompliance and ethics training. In
addition, they must communicate relevant McDonald’s policies to employees and assist them in
understandingsuchpolicies.Supervisorsmustmaintainopenandhonesttwo-way communication with
employees. This means encouraging employees to ask questions, make suggestions and report

20. wrongdoing.Finally,supervisorsmustfollow up on allegations of wrongdoing that are brought to their
attention and take appropriate corrective or disciplinary action.
Personal Accountability
To the rest of the world, each of our actions represents McDonald’s, and we must do our best at all
timestoupholdthe reputationof ourCompany. Our success depends on each of us accepting personal
responsibility for doing the right thing. We accept the obligation to stop or prevent actions that could
harm customers, the System or McDonald’s reputation, and to report any such actions as soon as they
occur. Employeeswho violate the law or the Standards of Business Conduct are subject to disciplinary
action, up to and including termination of employment.
Open communication/ Business Integrity Line
At McDonald’s, we speak honestly and openly and listen for understanding. We raise questions or
issues,evenif theyare difficult.If youknow of any violation of the Standards of Business Conduct or of
any applicable law,youare responsible forreportingthe violation immediately. There are a number of
ways to raise issues. If you believe that a law has been violated, consult with the Global Compliance
Office orthe Legal Departmentimmediately.Forothermatters,youcantalk to yourdirect supervisor or
another member of management, or contact Human Resources or the Global Compliance Office. You
can alsocall the McDonald’sBusinessIntegrityLine, a toll-free telephone line reserved specifically for
employee calls on ethics and compliance issues. The McDonald’s Business Integrity Line is staffed 24
hours a day, 7 days a week, 365 days a year by an outside firm experienced in handling sensitive calls.
Phone 1-800-261-9827 within the United States. Reverse charges if outside the U.S. Interpreters are
available.Callersmayreportanonymously,andno attempt will be made to identify them. Anonymous
callers should know, however, that it is sometimes more difficult to follow up on issues raised
anonymously.
The main focus of our conducted research was to find the relationship between employees and
managementinrespecttomotivation at McDonalds. From our online study of employee behavior and
management interview we found that there was a potential gap in motivation. This gap was a
detachmentbetweenmanagementandemployees.Employees’pointof view wasdifferent from that of
the manager, in which they often required an instrumentality – a reward or a bonus to improve an
individual’sperformance.Mostemployeesdidn’ttake working at McDonalds as their future occupation
for variousreasons.Our study found that the motivation of employees of McDonalds were low due to
minimum wages, poor relationship with manager, lack of input motivation, terrible job tasks, and
deficient quality of overall performance. They eventually led employees to believe working at
McDonalds wasn’t worth it. So, three main issues struck as a result; insufficient training supply, high

21. responsibilitywithlowwage increase andtoohighexpectationfromsenior management. They needed
to improve this gap or continue to see lack of effort from their employees. Money was the key
motivation that pushed employees to work productively. In order for employees to do their job
efficientlytheywere tobe paidadequatelyorotherwisebe heldbackfromdoing their job. So Maslow’s
theorywasusedto analyze thisaspectinwhicheveryindividualhadtosatisfytheirphysiological needs.
Many other theories were used as well, such as the expectancy theory. This was used to study the
behaviorof whatmotivatedemployees.Tosumup our studyresearch,a broadclarification was applied
to respond to the ways we can improve management and employee motivation and the relationship
between them.
Introduction:
The organization we chose is McDonalds. McDonalds is considered to be one of the largest fast food
restaurantsinCanada withmore thantwo milliondailycustomrevisits.Itoperatesand owns about1400
restaurants inwhich three forth of the Canadian branch of McDonalds are locally owned and operated
by independent entrepreneurs. It also has a size of 80,000 employees and is well known to build a
strong workforce, business partnerships and local economies. Amidst combining direct and indirect
employment impact together, Canada’s branch of McDonald has created more than 200,000 jobs,
engrossinga$4.5 billionin local annual economic activity. The company is also known for contributing
$75 millioninpayrolltaxes,benefitsand$34 millioninbusinesstaxesnationwide. Aside from their $1.5
billionannual expenses,they contribute $130 million in corporate income taxes yearly and$4.2 million
to local Canadian economies.
McDonald’s Values
We place the customer experience at the core of all we do Our customers are the reason for our
existence. We demonstrate our appreciation by providing them with high quality food and superior
service, in a clean, welcoming environment, at a great value. Our goal is QSC&V for each and every
customer, each and every time. We are committed to our people We provide opportunity, nurture
talent,developleadersandrewardachievement.We believethatateam of well-trainedindividualswith
diverse backgrounds and experiences, working together in an environment that fosters respect and
driveshighlevelsof engagement, is essential to our continued success. We believe in the McDonald’s
SystemMcDonald’sbusinessmodel,depictedbythe “three-leggedstool”of owner/operators,suppliers,
and companyemployees,isourfoundation,andthe balance of interestsamongthe three groups is key.
We operate ourbusinessethicallySoundethicsisgoodbusiness. At McDonald’s we hold ourselves and
conduct our business to high standards of fairness, honesty, and integrity. We are individually
accountable and collectively responsible. We give back to our communities We take seriously the
responsibilities that come with being a leader. We help our customers build better communities,
support RMHC, and leverage our size, scope and resources to help make the world a better place. We
grow our business profitably McDonald’s is a publicly-traded company. As such, we work to provide

22. sustainedprofitable growthforourshareholders.Thisrequiresacontinuingfocusonour customers and
the healthof our system. We strive continually to improve We are a learning organization that aims to
anticipate andrespondtochangingcustomer,employee and system needs through constant evolution
and innovation.
Nowadays we think that everything is about certainty – having a good job requires to know your goal
and dealing with the daily requests while maintaining it is about good knowledge and continuous
adaptation. It is almost about being perfect: companies struggle to sell a “perfect” product, hire
“perfect”persons,makinga“perfect”forecast.Buttimesare changingand the speedof the change is so
high that sometimes we do not even perceive it. Changing times requires frequent adaptation,
reinventing the products and yourself. In big companies, with hundreds/thousands of employees,
changes may be a reason of failure if they are not correctly handled and implemented. Why so? Let’s
think for a second: if a change is going to be implemented, how many of us will say “I don’t like this
change. I’m feeling vulnerable, I’m feeling unable to adapt it, and it’s too hard for me?” How many of
our superiors will say: “I know it’s hard for you, but implementing this change, is ten times harder for
me?” Will most of us be so honest? We do not think so. Every each of us will try to highlight the
negativespartsof a change and will tryto resisttothe changes,eitherbecause we are afraid to lose our
jobor maybe because we donot wantto deal withthe uncertaintythateverylittle change brings along.
Not everything is black or white, but when comes to change it can be grey. We can see changes like
mountains. You need to start climbing it step by step, sometimes with a lot of effort (depends on its
high, road accessibility, your energy resources, like in figure 1) but you can reach the top. Even if the
landscape is breathtaking, you realize that in order to reach your destination, you need to go through
some valleysandclimbothermountainstoo.Nahavandi startsthe 9th chapter of her book with a quote
fromBenjaminFranklin“Whenyou’re finishedchanging,you’re finished.” This article tries to point out
the personal reactionof McDonaldsVallamanagerwhenshe faceschanges,the reactionoractionof her
employees and some tools used within restaurant to deal with changes. Writing this article was a
challenge foreveryone inthisgroup,because we facedanew side of whatmanagement means, what is
the leader’s role and why it is so important to know how to manage change.
1 METHODS The paper is centered on an interview with Ms. Evelina Idmyr, Restaurant Chief at
McDonaldsValla, Linköping. No previous knowledge existed between Ms. Idmyr and any of the group
members,buta telephoniccontactwastakenin advance to illustrate the purpose of the interview and
to schedule asuitable time.The general guidelinesfor the interview as well as more specific questions
were agreedinadvance bythe projectgroup.More specifically,eachof the projectmembersfocusedon
specificareasinthe fieldof Leadership and Organizational Changes and proposed questions that were
suitable for the situation we expected to find at McDonalds Valla. All the group members had been
customers of McDonalds Valla in the past and had a general knowledge of the company activities,
structure and values, which helped directing the questions towards topics that were relevant for the
specificcase.The interviewitselftookplace in the common areas of the restaurant and was carried out
by two of the four members of the team. Originally, the group members planned to register the
interview, but Ms. Idmyr expressed discomfort upon this, so manual notes were taken instead. The
interview wasconductedinarelativelyquietenvironmentandwithoutanyinterruption, since only few

23. customerswere presentinthe restaurant.Ms.Idmyrextensivelyanswered to all our questions and she
sometimes touched some of the relevant topics spontaneously. She provided several insights of her
management job and also referred details that she is not willing to divulgate, asking to keep them
strictlyreservedtothe people directlyinvolvedwiththe presentpaper.Atthe endof the interview, Ms.
Idmyrwas askedto complete the testabout“Buildingcredibility” presented in Nahavandi (2009, p.324)
and based on the concepts of Kouzes and Posner (1993, 2003) that has been used to determine her
leadership approach. The interview lasted approximately 45 minutes, more than what was initially
expected, but we didn’t perceive her as being in a hurry or impatient to terminate the interview, and
there was time to discuss all the topics that were initially planned. We can therefore assume that the
collecteddataisof good quality,eventhoughwe must also mention some factors that may undermine
their validity: none of the interviewer nor Ms. Idmyr are native English speakers, while both the
interviewers have only basic knowledge of Swedish. This was sometimes a problem, and Ms. Idmyr
repeatedly expressed her difficulties in expressing herself in English. To overcome this issue, we
encouragedhertoalso expressthe conceptinSwedish,notingdownthe keywords she used in order to
obtain the best possible translation. After the interview, the notes were reorganized by the two
interviewers and divulgated to the rest of the team. Even though we were confident that all the
discussed topics were present in the notes and that the interviewers placed a great effort in avoiding
any personal interpretation, it exists the possibility that the notes were biased by the interviewers’
perception and thus are not completely representative of what Ms. Idmyr tried to express. The data
collected during the interview was then analyzed using a theoretical framework largely based on the
book by Nahavandi (2009), introducing also concepts presented by other authors in the literature.
2 RESULTS EvelynaIdmyrhas beenworkingatMcDonaldsfor 9 yearsnow,since she startedright before
finishing the secondary school. During her career, she first took courses held directly by McDonalds to
become chief leader, a managerial figure that in McDonalds is right below the Restaurant Manager.
Three years ago she also took a course in Stockholm to become Restaurant Chief and after that she
started working with that position at McDonalds Valla. Her main responsibilities are linked to the
economyof the restaurant,butshe is alsoincharge of schedulingthe workingshiftsandcontrollingthat
everythingworksasitissupposedinthe restaurant.Sometimes,she alsohelps out in the kitchen when
the restaurantis crowded.The typologyof herworkloadvarieswiththe period of the year: sometimes,
she has a lot of office work,while inothermomentsthe office work is almost nothing and she spends a
lotof time dealingdirectlywithheremployees.Herdirectsuperior owns3otherMcDonalds restaurants
and she has a meetingonce amonthwithhimand the otherrestaurantchiefs,where she reports about
herwork.On the other hand,she isinsteaddirectlyleading85employees working at McDonald’s Valla,
and she usesthe helpof 8 chief leaderswhichare her direct sub-managers to do that. She gathers with
the chief leadersthe firstMondayof everymonth,andshe alsotriesto have a face-to-face meetingwith
each of them for about 1 hour every week. She also tries to provide direct feedback to all the other
employees in the restaurant, even if communication with them is not as intense as with the chief
leaders. Every year, the employees are also asked to answer an anonymous computerized form
evaluatingtheirworkconditions:thisyear,the resultswere reallypositive,withover90% of employees’
satisfactionanda large improvementoverthe past year, when the results weren’t as good. The results
from this poll are also discussed together with the top manager and the other restaurant managers to

24. findareasthat may be improved,since they aim at achieving 100% satisfaction. Also, to promote team
spirit, once a year all the staff from the 4 restaurants is reunited for one day and some team-building
activities are carried out. She also has the responsibility of directly training the 8 chief leaders, in a
standard program formalized directly by McDonalds. The main focus of the training is related to the
economicsof the restaurant.The chief leaderhave insteadthe responsibilityof the basic training of the
restof the employees,butshe alsomentioned that she often provide direct suggestions on basic tasks
whenshe hasthe chance.It isher beliefthatitisimportantto have a directcontact withthe employees,
but it is also important that they have a certain degree of autonomy; also, when asked, she said that
somehow the employees perceive her both as a team member and a boss at the same time. She
mentionedthoughthatsometimesshe needstobe authoritariantohave peopledotheirwork.Also,the
perception changes for different people: those who have been working in McDonalds for longer time
knowherbetterand so theyhave a closer relation with her, while she has a more formal relation with
new employees. She made clear, though, that she doesn’t have a friendship relation with any of her
employees, asserting that it is important to have a good balance between personal relation and
managerial duties.
When asked more specifically about changes in the organization, she said that people do not like
changes: they want to have “always the same” and that “every little change takes months to be fully
implemented”. To have the changes more easily accepted, her strategy consists in proposing a trial of
one month, adopting a spirit of “let’s try it first and then we see”. This creates acceptance about the
change: after one month, even those who were skeptical in the beginning can usually recognize an
improvement,sothe changesintroducedthiswayare usuallyimplementedinadefinitive way. She also
alwaysreceivesalotof suggestionsfromthe employees,butthese suggestions usually take into scarce
consideration the economic perspective, so they have to be mediated by her. When the change is
proposed by the employees, it’s easier to get acceptance for it, while this is more difficult when the
changes come from her directly. On the other hand, when the change is required by the headquarter;
the staff has fewerdifficultiesinaccepting it. Her explanation for this is that the staff is afraid of losing
theirjobif theydo notcomplywiththe request.Giventhe characteristicsof the job and the employees
inthe restaurant,the turnoverof the employeescansometimesbe a challenge: indeed, the workers in
the restaurant have an age that varies from 16 to 50 years old, but most of them are in their twenties.
Some people just stay 6 months, while some others stay 5 years. This generates a turnover of about 2
personspermonthswhichcan sometimesbe a problem: it often happens that new employees show a
lotof enthusiasmandare verymotivated,endingupdoingtheirjobbetter than senior employees, that
may have hard time accepting the new situation. According to Ms. Idmyr, “attitude is everything” and
she supports people who show enthusiasm: at the same time, though, she recognizes that older
employeeshave alotof knowledge thatisalsoimportant.However,initspersonal scale,the knowledge
comesafterthe attitude,since it’smucheasiertotrainand helpsomeone whoshowsenthusiasm. With
those employees,she isverysupportive and tries to encourage them to develop towards a managerial
position. Indeed, some of her sub-managers only have limited experience (6 months). When she was
asked to mention the most difficult change that she had to implement as restaurant manager, she
broughtup a change in the shiftcomposition:earlieron, there was only one chief leader for each shift,
and thissometimesresultedindifficultiesforhimto handle the employees when problems arise. Now

25. there are two chief leaders for every shift and this composition works much better, because the two
managers can back up each other. Another consequences of working in shifts is that a lot of smaller
groups with their own informal leader are created: indeed, it is usually easier to collaborate with a
colleague thatsometimesknowsthe process better or shows that he is open to help the others: this is
normal to Ms. Idmyr,but sometimesthe differentgroupshave conflictsbetweeneachother.Itmay also
happen that some of the informal leaders do not show commitment to their work and have a bad
influence on their followers, encouraging them to operate in a different way from what McDonalds
want. In these cases, the strategy adopted is to transfer the person with a bad influence to another
restaurant. This case is however an exception, and usually Ms. Idmyr tries to support the informal
leaders,sendingcardstothe topmanagementtopraise the employeesthatare doinga goodjob. In this
regard, she specifically mentioned one of the chief leaders who she considers being her “personal
assistant” and that she continuously praise.
To conclude the interview, Ms. Idmir was asked to complete the test about “Building credibility”
presentedin Nahavand i) and based on the concepts of Kouzes and Posner (1993, 2003). She scored 46
points out of 48, which means that her behaviors are highly directed towards building credibility. In
particular, ironically asked if she could give a rating of 5 (even if the maximum for the test is 4) in a
questionaboutprovidingfrequent positive feedbacks and encouragement, indicating that that was an
aspect that she considered to be particularly relevant.
3 DISCUSSION 3.1 GENERAL PERSPECTIVEMcDonaldsis a worldwidecompanywithmanytraditions. The
basicprinciple isthateveryrestaurantworks as a franchise company. So basically, McDonalds provides
the restaurantowner/managerstrict,detailedand clear rules and behavioral models to follow and the
organization is highly standardized and bureaucratic with strong back ground culture. As a result, the
managers of the restaurant are not able to express individuality or show their own individual
characteristics as a leader. It is not appropriate to make own changes to the concept (Barrick and
Mount, 1993; Mischel, 1973; Weiss and Adler, 1984; in Nahavandi, 2009, p.113). Individual
characteristics, like demographic characteristics, values, abilities, skills and personality traits, do not
determine howeffectivealeaderis,buttheyhave animpact onthe waythe leader thinks, behaves and
approachesproblems.Everypersonis a unique combination of these factors. (Navahandi, 2009, p.111)
This can of course be also seen in McDonalds Valla. The restaurant looks the same as any other
restaurant and you can order the same food as any restaurant all around the world. Ms. Idmyr’s
responsibilities are defined beforehand by McDonalds Corporation. Ms. Idmyr has in her team 8
submanagers and her direct boss owns 4 restaurants excluding the one in Valla campus. She could be
associated with the concept of Micro Leadership. Indeed, several elements from Nahavandi (2009,
p.226-227) are linkedtothe type of managementusedbyMcDonaldVallarestaurantmanager.First,the
managerwe considerisclearlythe leaderandisthe person in charge of the restaurant team. Secondly,
as micro leader, she has impact on a specific group, almost 85 people. But she is depending on a
manager who is leading 4 restaurants which implies 4 managers in total. Thirdly, she is focusing on
internal issues that affect her team. In opposition to that, a strategic leader requires attention on the
one hand to internal issuesandonthe otherhand onexternal issues,whichisnotthe case here. Finally,

26. the “effectiveness criteria” is different from strategic leaders. As micro leader, she is focusing on the
productivityof herteam,the qualityof the productssoldandthe services,andthe motivationormorale
of herteam. (Nahavandi, 2009, p.226-227) She took courses in Stockholm where she has been thought
herrole as a managerand hermainresponsibilitiesashandlingthe economy,budgeting and scheduling
of the restaurant. She is also bounded to share her knowledge about the economics of the restaurant
forward to the eight sub-managers and teaching changes to them as they occur. She can make some
changesconsideringthe staffingandbudgetingbutshe can’tchange the conceptor her role as a leader.
McDonalds SWOT analysis

27. Strengths
 Largestfast foodmarketshare in the world.McDonald’s isthe largestfastfoodrestaurantchain
interms of total worldsales(8%).Itis the secondlargestoutletoperatorwithmore than34,000
outlets,serving69millionconsumerseverydayin119 countries.
 Brand recognitionvaluedat$40 million.Company’sbrandisthe mostrecognizedbrandinfast
foodindustryandisvaluedat $40 billion.McDonald’sisalsofamousbythe RonaldMcDonald
clown.
 $2 billionadvertisingbudget.McDonald’sspendsonadvertisingmore thanthe next4 fast food
restaurantchainscombined.
 Locallyadaptedfoodmenus.The fastfoodchainisoperatinginmanydiverse cultureswhere
tastesinfoodare extremelydifferentthanthose of US or Europeanconsumers.Thusabilityto
adapt to local tastesisone of McDonald’sstrengths.
 Partnershipwithbestbrands.McDonald’soffersonlymostpopularbrandsinitsrestaurants,
such as: Coca Cola,DannonYogurt,Heinzketchupandothers.
 More than 80% of restaurantsare ownedbyindependentfranchisees.Therefore,McDonald’s
can focusmore onperfectingitsservingsystemandmarketingcampaigns.
 Childrentargeting.The businesssuccessfullytargetsveryyoungchildrenthroughoffering
playgrounds,toyswithitsmealsandadvertisements.
Weaknesses
 Negative publicity.McDonald’sisheavily criticizedforofferingunhealthyfoodtoitscustomers,
stimulatingobesityandstrongmarketingfocusonveryyoungchildren.
 Unhealthyfoodmenu.AlthoughMcDonald’striestointroduce healthierchoicesinitsmenu,the
menuislargelyformedof unhealthymealsanddrinks.Suchmenuofferingpromptsprotestsby
organizationsthatfightobesityandhence,decreasesMcDonald’spopularity.
 Mac Job andhighemployee turnover.MacJob isa low paidand a low skilledjob,whichisoften
seennegativelybyits employees.Thisresultsinlowerperformance andhighemployee
turnover,whichincreasestrainingcostsandaddto overall costsof McDonald’s.
 Low differentiation.McDonald’sisnolongerable tosubstantiallydifferentiateitself fromother
fastfoodchains (atleastnot enoughtogainsome marketshare) and optsto compete byprice
rather thanby additional features.
Opportunities
 Increasingdemandforhealthierfood.Whiledemandforhealthierfoodincreases,McDonald’s
couldintroduce more healthyfoodchoicesinitsmenuandreverse itsweaknessintostrength.

28. McDonald’sistryingto seize suchan opportunityandsoonplanstoopenonlyvegetarian
restaurantinIndia.
 Home meal delivery.McDonald’scouldexploitanopportunityof deliveringfoodtohome and
increase itsreachto customers.
 Full adaptationof itsnewpractices.McDonald’shasredesigneditslogoandrestaurantdesignin
2006. Inaddition,ithasintroducedsome new practices.Ina result,remodeledrestaurantshave
seen8-9% higherthan average marketgrowth.McDonald’sshouldfinishremodelingall of the
restaurantsandadapt the bestpracticesin themas soonas possible.
 Changingcustomerhabitsandnew customergroups.Changingcustomerhabitsrepresentnew
needsthatmustbe metby businesses.Sofar,the companyhasbeensuccessful inintroducing
itsMcCafé, McExpressand McStop restaurantstomeetthe changingcustomerhabitsandthe
needsof previouslyuntappedcustomergroups.
Threats
 Saturatedfastfoodmarketsinthe developed economies.The fastfoodmarketinthe developed
countriesisalreadyovercrowdedbysomanyfast foodrestaurantchainsand thisalreadyproves
to be a threatto McDonald’sas it barelygrew through2012.
 Trendtowardshealthyeating.Due togovernmentandvariousorganizationsattemptstofight
obesity,people are becomingmore consciousof eatinghealthyfoodratherthanwhat
McDonald’shas to offerinitsmenu.
 Local fastfoodrestaurantchains.Local fastfoodrestaurantscan oftenofferamore local
approach to servingfoodandmenuthatexactlyrepresentslocal tastes.AlthoughMcDonald’s
doesa great jobinadaptingitsown menutolocal tastes,the risingnumberof local fastfood
chainsand theirlowermeal pricesisathreatto McDonald’s.
 Currencyfluctuations.The businessreceivesapartof itsincome fromforeignoperations.The
profitsthatare sentback to US have to be convertedintodollarsandmaybe affectedbythe
exchange rates,especiallywhenthe dollarisappreciatingagainstother currencies.In2012,
McDonald’sprofitwaslargelyaffectedbyappreciatingdollar.
 LawsuitsagainstMcDonald’s.McDonald’shasalreadybeensuedformanytimesandlostquite a
fewlawsuits.Lawsuitsare expensive astheyrequire timeandmoney.AndasMcDonald’s
continuestooperate more orlessthe same way,there is highprobabilityformore expensive
lawsuitstocome.

29. CONCLUSION
A leaderwhodealswithchangesliketurnoverof twoemployeespermonth,withnew processes almost
every year, who has to take care of awareness of the change among 85 employees, is a leader who
needs to be trust and who needs to have a clear vision. Asking Ms. Idmyr to make the “Building
credibility test” helped us to understand more about her approach to leadership. Rating yourself is a
good way for a better understanding of your own way of working. Ms. Idmyr took the self assessment
testof Nahavandi veryseriouslyandwhenshe reachedthe 10th (“I provide frequent positive feedback
and encouragement”) question she asked: “Can I rate myself with a five here, even if the maximum is
justa 4?”. At that particularlymomentitseemedmore like ajoke andwe laughed,butindeedthismade
us to understand what is truly important for her. She realized that when comes to deal with changes
whichinvolvesnewco-workers,new processes, it is really important to stay in touch with your people
and to understand their needs.
A clever way to do this is to practice empowerment, thing that Ms. Idmyr is doing with responsibility,
because she knowsthe importance of makingthe othersfeelingimportantwhenachange is going to be
implemented.Beingamanagerina McDonald restaurantisn’teasy.Ms. Idmyr begun to work there in a
periodwhenthe fastfooderawas reallysuccessfulandnobody complainaboutthe lackof vegetablesin
the meals. The idea of organic food exploded and McDonald trust needed to reinvent most of their
meals.Ms.Idmyr understoodwhatpeoplenew needsare andshe adaptedto this change. The first step
inbeinga leaderwhosuccessfullyleadsthroughchange istoaccept the change and have a vision about
it. Even if now she is caught in bureaucratic work, she has the advantage of being educated to see
everythingfroman economical perspective, thing that can represent an advantage when dealing with
change, and this is: adopt the changes just when they are truly needed and when they are made
according to the McDonald’s policy.
We understoodthatinvolvingtheorywhencomesof practical workisn’tsoeasy.You needexperience,a
clear approach, and a really good understanding of the theories. An interview like this one made, can
show you ways of a better understanding, or the need of a better knowledge. Even so, the way of
dealing11 with change, is related with the kind of leadership that one practice, but because there are
several types of leadership, there are for sure different ways of dealing with change. It is all about
“adapt to the situation”andtake the bestdecision,based on your own experience, others experience,
your opinion, and of course, your followers opinion, when there is time to do so.
McDonald's turnaround plan: 'Get closer to the customer'
The McDonald's menuhas expandedoverthe years.Puristsargue thatwideningitsofferingsishurting
the brand. Some have suggestedthatgoingbackto basics -- scalingdownto itsoriginal burgersand
nixingheart-healthyinitiativesbygoingbackto the oldway itusedto prepare itssignature fries -- isthe
answer.
But McDonald's isn'tgoingto go backward.If anything,itsmenuisgoingto getmore complex.The chain

30. talkedupthe Create Your Taste testduringlastweek'sconferencecall.It'sbentonexpandingthe tech-
drivencustomizedburgerplatformwhereguestsuse touch-screentabletstobuildgourmetburgerswith
nearlytwodozentoppings -- includingtortillastrips,garlicaioliandguacamole.AtfourSouthern
Californiastores,dinersdon'thave tostepupto the counterto pickup theirordersor busthe trays off
the table whenthey're done.Employeesperformthose tasks.A burgerruns$5.49 plustax."Bacon, the
only extrathat costsextra.
Thisseemsmore like agourmetburgerjoint,butthat's alsothe point.AndMcDonald'ssaid lastweek
that ithas "aggressive supportof the franchisees"toroll outCreate Your Taste inmore marketsnext
year.
Offeringfanciersandwichesandpamperingcustomersaren'tthe onlywaysthatMcDonald's istryingto
grow salesagain.The chainalsowantsto make it easierforthe hungryto place ordersbefore theireven
withinsightof the GoldenArches.
McDonald's hasalreadybeentestingamultiple orderpointstrategyoverseas.Patronsatselect storesin
France and Australiacan use self-orderkiosksatthe restaurantsor place ordersand payfor themwith
theirmobile phones.
McDonald's wouldn'tbe the firstfast-foodchaintoroll outa mobile orderingapp.Cultfave Five Guys
has had a mobile platformforacouple of years.BurgerKingWorldwide (BKW) introducedhome
deliveryservice twoyearsago,andearlierthisyearintroducedasmartphone appthatoffersmobile
coupons and insome citiesmobile ordering.
There'sa lot of catchingup to do at McDonald's. Embracingtechnologytomake the patronexperience
more convenientandefficientwillbringguestsback.Stepstakentoautomate prepprocessesthatmay
helplowerstaffingrequirementstothe pointwhere the companycandrive profits -- bothtoplease
investorsandpayhigherwagestosatisfyactivists -- will follow.McDonald'sisembracingthe future.It
doesn'thave muchof a choice at thispoint.