McDonald is a fast food chain all over the world and providing excellent quality of food in all of their restaurants. It was founded in California State of America in 1940. With the great values and same taste they received a large number of responses from the customers to bring it in national market. Then after 20 years of progress they focused the need of the time and took the benefit from the analysis and customers support open their branches nation wide and these days they are operating world wide.
McDonald work of area is customer's food industry and they well entered in to provide world wide same level of standard.
McDonald have another issue in Japan where they were marketing their products with giving free toys to the customers and some where they did hit that ethical values of those people by making toys of some respected creatures for them. We can see the different same level of mistake happened again and again, but what is the reason?
To understand these reason and further changes in McDonalds first we will understand the model of change. Now we will discuss one of the famous Kotter's model for change that have been already applied in different organizations.
Background of Change:
Change is a process which cannot be measure and stopped after certain level, but it can be analyze and evaluate more efficiently inside the organization to gain extra ordinary results in term of excellent services excellent management or for excellent level of sales target. Changes leave two types of effects which are positive and negative, it depends on the management that how they analyse the need of change and what model of change they implement in their organization.
Now we will discuss the type of model of change and their effectiveness in our chosen organization which is McDonald.
Kotter's Model of Change:
Many organizations changed their management with need of time of time and most of them fail to do so because of unplanned and use of improper change of model. Kotter is one of the founders of successful change of model that implements in 100 of organizations and they succeed it with proper control management. He introduced eight steps of leading the change these points are described below:
Create Urgency:
This step shows that company need to have a spark and active tool of urgency. It does not mean that company shows the decline in sale in general meeting and asked the motivation from employees and insist them to be motivate and efficient to meet the sales target, but if the employees start thinking first that they need change because there sales is gradually falling down so they can be more efficient and have urgency condition towards the changing strategy. Now the question is that how they can do this or create this awareness, this could be done if any company choose these points in their strategic planning initially:
Produce a report with the help of employees and let them find that what are the threats from our competitors
After analysing done by employee they will produce and provide their own ideas against that threat in shape of opportunities
Be ready and list down your supportive material and support from outside in case of urgency.
Team work with Powerful coalition:
Strong leadership make a vital role to develop the need of change in to the organization, because some times due to lack of leadership qualities companies fail to produce awareness of change among their employees. So the first requirement is strong leadership in organization to develop the awareness of change. To play a vital role management need to follow the following basic rules:
Take the help from HR department and choose and hire the strong leader inside the organization
These leaders should be contracted with their common objectives
Indentify that leader having the powers that lead the whole team work with free consent towards change.
Vision of Change:
Employees in the organization must have a clear picture that why they and their organization need change. This awareness would help org. to meet the focus results. Here org. need to do these points to make a vision clear:
Smart strategy with fewer words to make clear picture of vision of change among organizations.
Practice these words on different occasion to remember these among employees
Communication of the vision:
Company must do revision of their mission statement and objective of their organization among their employees at different occasion such as common meeting and in general discussion.
Remove Obstacles:
While you implement the model of change and have done the revision of change among your employees, the works not end only on this performance but then we need to sit down and again revise the whole process again and again and need to find out any barriers during the process of process of implementing the change. Here company need to be more quick in the process of change to remove the barriers.
Create Check Points Wins
Appreciating with the little success gives employees more confidence and especially at the start of implementation of change boost their confidence more quickly.
Build on the Change:
Kotter mentioned that many companies fail to implement change because they fail to implement that change until the completion date, that mean through short term wins they declare their success over all and loose their progress towards the goals that leads to the unsuccessful change in the organization.
Relate the change in corporate culture:
Kotters helped organization to understand the whole process of successful change in organizations and in final he in traduced eighth step that described that company needs to do:
Relate the success stories of change with company's change model and discuss about old success of change inside the organization that give more motivation to employees towards change.
After successful of completion of change company need to mention the key leaders who actually plays a vital role with old and new team members. (Mind tools, 2011)
Need of Strategic Change in McDonalds
McDonald was founded in California in 1940 and since than they have been developing their brand image with great competition. Recently they faced a great criticism by in Asian country India because they didn't change their management style and their product line before entering in new market, that initially destroyed their brand values in that country and this news spread all around the world where McDonald were operating their restaurants. That was a big loss of Good will for them at that time but soon they found their weakness and threat in those areas and did SWOT analysis and change their model of management and change their product line. At that time they did change the product line and management form western culture but at some point things are still unfavourable today.
Need of change:
Recently it have been discussed on different new channels such as BBC UK that McDonald need some more changes in their organization in Asian countries to lead more successfully then their competitors.
Now with the above statement we can find three main components of discussion that is that they have strong competition in Asian markets, second is that they still eed change in management to become their local restaurants and third is that they must read the style and choices of those areas of customers and population.
These changes act not only on their sales but also have great effect on brand value in the competitive market. The need of change is in their menus of restaurants that they offer to their customers and their way of presenting food. For this they must do analysis by which they could implement the necessary change steps they need exactly.
Now we will compare the need that would be found through SWOT analysis and will relate it with Kotter's model of change and will implement in with strategic change policy.
Factors that drives the need of change:
Through SWOT analysis I found the strength and weaknesses of McDonald that reveals me the changes they need to be placed in to their organization in Asian countries specifically in Indian community.
These threats are as follows:
Non suitable menu for the south Indian community
Traditional style of American culture
Highly competitive policies of competitors
Presentation of food in traditional way of Western culture
Become environmental friendly
Changes in to Menu due to Ethical Issues:
In Indian culture majority of the community are vegetarian and they feel unethical to present them non vegetarian food. In initial when McDonald opened its first franchise in India they received a great protest and anger because of ethical issues, it was the result of improper planning but soon they change their menu to survive and made their brand value better over their but still yet they haven't developed the same level of brand value in Indian community as compare to the value they have in American culture.
This is due to they have same old and traditional style of presenting food to their customers and mostly their menus are not new and tasteful in experience of customers (according to BBC survey, 2009)
Need of application and Implementation of Kotter's Model of Change to remove ethical issue:
This is the place where McDonald in Indian market must aware their employees the need of urgency and quick change need. They also have their own example of ethical criticism in past so they must aware and must be active to react on changes quickly, this action only could be practiced by a strong leader. For that purpose McDonald needs to survey the Indian market to find out the strong leader among their community who knows the ethical issue and liking and disliking of there people and customers.
The main reason to choose the leader from that community is that they have experienced and having same level of expectation and taste as like customer of that community and they can easily teach their employees in their own mother language that how to react positively in time of urgency.
Need of Change in Cultural Presentation:
The inner process of presenting the food needs to be change in McDonald, for example in California they introduced the way of take away food and there are very few restaurants few years ago they applied same in Indian community which was not that successful because there they believe to eat in restaurants with their families and spend more time outside with their children.
Recently McDonald act towards change and in Pakistani restaurants they made play land for kids in restaurants to attract them and introduce a kids burger meal for their healthier digestive system that change helped them to grow their business in Pakistan up to 13% in 2008, but in India there are still some restaurants that are not so attractive and not presenting their environment of food healthier for their customers. So they need to create the need of urgency to make the specific change in to their restaurants to maintain and to increase the brand image in that community. (McDonalds, 2010)
Change with the application of Removing Obstacle:
According to Kotter's model they need to measure their level of sales and performance with other restaurants and should plan their strategic planning and action and on urgent basis they need to remove obstacles and implement the plan after that they can change the perception of their old customers and would able to attract new community of customers.
Environmental Friendly:
Recently it was found that in Indian restaurants they waste 25% of their stock order that goes to landfill this report were recently published by one of the news channel of Indian community named 'Star news' according to them the leaders or managers in MacDonald are not qualified to order and predict the right stuff for coming days because of that almost 20% of waste with the reason of unused material and expiry date. They must be trained to provide the excellence level of service and protect the environment.
This is one of the barrier that mangers of the restaurants are not trained McDonald must act on urgency to save their brand value and help govt. to protect the environment for their people.
Now we will relate the above factors that drive to change and the solution supported by Kotter's model of change with interest of key stake holders.
Key Stake holder at McDonald and their participation:
Stake holders are those groups of persons or companies who have direct or indirect interest with in company's strategies or policies or effected with it directly or indirectly. In following ways change in McDonald can effect the participation of key stake holders, these are as follows:
Suppliers:
With the above change supplier would have the great effect becouse when McDonald management remove the barrier of inexperienced managers than the new managers would able to predict the required stock correctly and that decision would help supplier to meet their target on daily basis without any ups and sown. It will create a healthier circle and Suppliers as key stake holders would have positive impact on them.
The second benefit would be the greener environment and help the Govt. activities to stop land filling and made the environment green.
Board of Directors:
Board of Directors are the key stake holder of the organization who have high level of interest as well as high level of power to implement any new changes so it is crucial to have a proper way to show the effect of changes before implementing it and have a clearer view fro these stake holders.
Customers:
This is the common key stake holder of every organization and especially key stake holder in McDonalds, so the management of McDonald must be ready on urgency basis to provide the new and excellence service with new products to their customers to achieve the best level of satisfaction as well as sales target to build the brand value and accomplish the long term goals of McDonald.
Planning for Change in McDonalds:
Planning is the back bone of any organizational success, its not only planning but also perfect planning that covers essential parts in it such as:
Planning with accurate time measurement
Planning by knowing availability of resources
Planning with the reviewing process
Planning with monitoring process
Planning with the interest of key stake holders
These all above points are essential points while doing planning for change in organization. Planning by accurate time measurement means that during planning process measure the need of resources and checks their availability and then plan accordingly so the timing in planning would be effective until its successful completion.
Reviewing process means successful planning. For successful planning it is essential that they must have reviewing process, lets take the same example of above company, they are currently needs a change in their management (Leadership) and in their style of work that needs timely careful reviewing process to achieve the best level of practice.
Monitoring Process - This process is related with the reviewing process but have separate identity, monitoring means McDonald must have internal audit scheme in Asian restaurants to make them healthier and safest food point for their customers.
Planning with interest of key stake holders - In any planning process if the management who are working on planning process did not include the interest of stake holders than all the process rejected after the whole expenses and after spending the lot of process, so the need is to remember the key stake holder interest in all planning process to receive approval from them.
Monitoring and Reviewing the Whole Process:
Through proper checking it is very important to check the change management system again to complete it on time and remove any obstacles at urgency level.
Conclusion
The conclusion of whole discussion is that change is the very crucial step in all organization if it is properly planned and reviewed on different occasion during implementation that it can give you desire results otherwise it would lead to unsuccessful management for the organization.
Yours Truly,
Babar Ali
