Change Management as a Vital Process in McDonald's Organization Lifecycle - Case Study Example

Name Class Unit Introduction McDonalds was started in 1954 and by the end of 1960s, it had more than 1000 franchises across USA. The organisation first multinational venture was a franchise in British Columbia in 1967. The fast food chain has expanded globally and has more than 30,000 locations in more than 118 countries (Gilbert, 2011). The fast food chain has estimated 58 million customers daily globally. The organisation has worked hard to make sure that their fast food menu is healthy due to the current trend on healthy eating. McDonald’s organisation structure is headed by the chairman. I once worked for McDonald in the marketing division and evidenced change management process in the organisation. I worked under the marketing manager in the organisation. During this period, I noticed a decline in customer satisfaction and also loss in the branch. The organisation structure is as follows (Gilbert, 2011). Fig.1 McDonalds’ organisation structure (Gilbert, 2011) Diagnosis of the problem Being a fast food giant, McDonalds has a complex organisation structure. This makes it hard to respond to the customer preferences. The complex organisation structure was a major contributor to the service problems. The customers could find irrelevant menus. The leaders lacked autonomy in making local menus as well as contributing in making market decisions. McDonald’s structure is not optimized to fit the customer needs. Fast food is in a rapid changing market, hence an organisation in the market is required to be organized in consumer tastes and preferences which keeps on changing. Symptoms reflecting the need for change Change in McDonald’s organisation structure is needed due to recent complaints by the customers as well as the profit decline in some areas of operations such as US whose loss was at was at 4.1% this year. The current structure has led to the creation of too many layers and led to redundancy being experienced in planning as well as communication. There exists competing priorities, hindrance to effective decision making and lack of communication between organisation and customers. Approach to be used As a change agent, I would ensure that local operations have the final say in rolling out products that are suitable for the local population. There is a need to realize that the fast food chain areas of operations have become more diverse. This requires the organisation structure to ensure that decision making is placed near the customers. There is a need for restructuring to ensure that the management is closer to the customers. Though McDonalds have been having a good reputation, it is important to note that the current population have changing nutritional attitude. This requires the organisation to be closer to the consumer in determining the menu. I will ensure that there is a new integrated communication plan that will involve all stakeholders in the organisation. The employees have to be informed of the new changes and the reasons for taking it (Gazendam, Jorna & Cijsouw, 2003). Planned change process/ creating readiness and interventions Before implementing change, there is a need to ensure that the staffs are motivated to carry out the process (Kotter, 1996). If the change process does not impress anyone, the likelihood of failure is high. All the key players should be involved when implementing change. If all the key players who have influence on change decision are involved, it becomes easier to implement it. This can be done by calling a meeting and discussing the need for change. The staff should be involved in seminars later after meeting where change will be discussed. The key players should be given a role in restructuring the organisation. This is a change that will lead to job losses as the structure changes hence there is need to make sure that all involved understands. The change process will involve three steps; initiation, implementation and continuation. The initiation is the process that will lead to the change needed. In the implementation process, the first experience of change is felt. The change becomes embedded in the continuation phase. The change process requires stakeholders’ analysis. This is through looking at what the rest of colleagues would stand for and the approach to take which will ensure that there is support (Gazendam, Jorna & Cijsouw, 2003). I would be needed to carry out force analysis through determining the driving forces and the restraining forces. Handling communication and readiness for change According to Sengupta (2006), listening to what others have to say is part of constructing change. There is need to listen to different viewpoints when carrying out change. In this case, McDonalds change in structure can only be achieved through communication with all stakeholders. There will be a need to communicate with the staff on what is going on. This can be done through newsletters, workshops, briefing or issuing guidelines. Through communication, it becomes possible to convince the stakeholders that the change has positive impacts. Poor communication is a major cause of failure in organisation change. The language used in this change process needs to be easy so that all involved will fully understand. Through the use of simple language it is easier to make others know what we think (Kotter, 1996). Organisation readiness for change is the shared resolve by all members of an organisation to implement change. This can only be determined by looking at how the members value change, their capability, resources, demands for task and other situational factors. There is need for the readiness for change to be high for McDonalds to carry out change. This is due to fact that high level of organisational readiness leads to cooperative behaviour which makes implementation of change more effective. The level of readiness for change at McDonalds can be guided through efforts by the stakeholders as well as their persistence in carrying out change. Communication is a vital tool in creating readiness for change (Lehman, Greener & Simpson, 2002). Readiness for change cannot occur unless there is communication. I will communicate with all stakeholders why there is a need to restructure the organisation. Organisations such as IBM have successfully carried out change through communication. The communication should be centred on the need of a structure change that will make the organisation more close to the customer needs. Through communication, the stakeholders will see the need to involve the customers in making decision. This is the only way that readiness for change can be handled. According to Lehman, Greener & Simpson (2002), highly effective change management is carried out by organisations who implement communication. An example is Bayer AG which in 2004 carried out a well communicated change to focus on core business. Today, the company is one of the most successful global chemical businesses (Schmitz & Becker, 2012). The staff and management are the one who will be doing a lot of work to make the change work. This implies that communication will be vital with them. Evaluating the change effort and learning from unanticipated outcomes In evaluating the change efforts, I will use the realistic evaluation context mechanism. This involves determining what to do in order to come up with the best outcome. I will intervene through creating an environment where there is support for organisation structure change. This involves ensuring that all the stakeholders realises the need for change (Sengupta, 2006). I will have to observe how they behave when the process of restructuring start. During this process, I expect groups to differ. There will be resistance based on those who want to maintain the status quo. Resistance can also be due to poor communication which leads to inadequate information. The outcome of the process can only be determined through increased sales and customer satisfaction. It’s easier to know whether the customers are satisfied through their feedback on the services offered. This is due to the fact that restructuring of McDonalds is aimed at making the customers near the management and involving them in decision making. There is a need for the method of evaluation being used to be accepted by the organisation (Beerel, 2009). There is also need to know the evaluation is an expensive and also political. There is a need for clarity on the need to carry it out. If unanticipated outcomes are experienced, they should be used as a learning lesson. For example, if restructuring leads to reduction in organisation effectiveness, it will be possible to avoid it in future. Unanticipated outcomes serve as a lesson and can be positive or negative (Thomas, 2001). This was seen in the banking sector after the financial crisis, where collapse of financial institutions led to change in financial management (Beerel, 2009). Conclusion Change management is a vital process in the organisation lifecycle. For one to carry out change, a problem has to be identified and means of diagnosing it achieved. The problem at McDonalds can be solved through change in the organisation structure. This is evident after the current loss and the fact that customer needs have not been adequately met. To implement change, there is a need to make sure that all stakeholders are involved. This is achieved through the use of communication which can be through workshops, briefings or meetings among other means. It’s importance to realize the importance of communication in creating readiness for change. Through communication, it becomes easier to make the stakeholders see the need for change. There is a need to evaluate change after implementing it. Realistic context evaluation mechanism is the best method to use in this case. For McDonalds, an increase in sales and customer satisfaction is an indicator of successful change. Unexpected outcomes should be treated as learning opportunities. References Beerel, A. C. (2009). Leadership and change management. Los Angeles: SAGE. Gazendam, H. W. M., Jorna, R. J. & Cijsouw, R. S. (2003). Dynamics and change in organizations. Dordrecht: Kluwer Academic. Gilbert, S. (2011). Mcdonalds. Creative Paperbacks Inc. Kotter, J. P. (1996). Leading change. Boston, Mass: Harvard Business School Press. Lehman, W.E.K., Greener, J.M., & Simpson, D.D. (2002). Assessing organizational readiness for change. Journal of Substance Abuse Treatment , Vol. 22, no. 1, p. 197-209. Schmitz, G. & Becker, O., (2012). Why communication is key to successful change management, Performance, Vol. 4, no.3, p.64-69. Sengupta, N. (2006). Managing change in organizations. S.l.: Prentice-Hall Of India Thomas, S. J. (2001). Successfully managing change in organizations: A users guide. New York: Industrial Press. Read More