A Systemic Approach to Career Development at McDonald's

Organization Development Journal, Fall 2007 by Rasins, Linda, Franze, Irene, Russell, Steve

Abstract

McDonald's USA used a high-engagement approach to improving both their operations leadership pipeline and employee satisfaction with their career growth. This effort was initiated and sponsored by top leadership, with the specific changes developed by a group representative of the impacted middle-management employees. The approach used embodies McDonald's cultural values of partnership, collaboration, and openness, and effectively ensured that a critical mass of over 100 field officers and 3,000 middle managers embraced the change.

Introduction

It is not uncommon for large, geographically dispersed organizations to experience tension between corporate headquarters and their field organizations, as they both vie for power and control. This tension is often apparent when change initiatives are designed and developed by employees at the corporate headquarters to be cascaded throughout the organization. While this is a common approach, it runs the risk of not being grounded in"field reality/'alienating important stakeholders, for example, field leadership, and leaving field employees skeptical about the core issues the initiatives are attempting to address. As a result, the response is typically resistance and/or mechanical compliance. Over time, employees can become increasingly cynical about all such efforts and perceive them as"programs of the month." In this way, many top-down change initiatives do not succeed in energizing the organization or sustaining new business practices.

When it came to talent management, McDonald's USA division knew that it needed an approach that would minimize resistance and mechanical compliance. In fact, the organization recognized early on that employee ownership, engagement, and commitment were essential factors to creating sustainable improvements in talent management practices. At the same time, it realized that managing the pervasive issue of "headquarters versus field" was critical to the success of introducing and fostering an important talent management effort, referred to as the Career Development Initiative.

The purpose of this article is to provide an account of how McDonald's USA leaders and talent management staff utilized a highly involved partnership between field and corporate, combined with a systemic, holistic approach in leading this initiative. What follows is a description of the business context of the issue, the engagement process that emerged, the core components of the systemic approach, the high-engagement launch design, and the methods recently employed to assess progress and sustain positive changes. This effort took place entirely within the USA business unit, to meet its specific needs and business situation. However, it is viewed in some ways as a prototype or pilot, since similar efforts in other areas of the world, as well as corporate, began within the two years following the launch in the USA.

Talent Management Imperative

Like many Fortune 500 organizations, McDonald's is investing in its employees more than ever before. McDonald's three-pronged talent management strategy is to ensure that the company has high-performing leaders, a deep, diverse pool of replacement candidates, and a development culture that demands and supports learning and development.

In its USA business unit, McDonald's recognized that middle management was integral to driving the business, both short and long term. The employees in these roles provide direction, guidance, quality control, training, site selection and construction management, restaurant management expertise, and support for over 13,700 franchisee and company-owned restaurants across the United States. The USA business unit began an initiative focused on career development for middle managers in late 2004. Employees had expressed dissatisfaction with career growth opportunities, and top leadership identified a need for greater breadth of experience in candidates for officer-level positions. An annual performance planning and review process, including individual development plans (IDPs), had been in place for years, but was not utilized consistently, meaningfully, or strategically. Too often, IDPs ignored long-term career growth needs, and concentrated on training programs to be completed within the year.

The systems and processes were not the problem. Shifts in culture, patterns of behavior, and assumptions about career progression were needed. Recognizing that sustainable culture change in the development of middle managers could not happen without both individual commitment and a consistent, well-grounded, company-wide framework, leadership called for an approach that systematically engaged employees.

Task Force Chartered

Ralph Alvarez, at the time president of McDonald's USA and since promoted to president and chief operations officer for McDonald's Corporation, decided to address the issue of career development in late 2004, as he became aware of two related business issues: (a) the talent pipeline for operations and general management officer positions was insufficient, and (b) middle-management employees across the US were less than satisfied with their perceived career opportunities. These two issues had surfaced from field leaders during talent review sessions, in employee commitment survey results, and in employee focus groups. As a result, Alvarez and Steve Russell, the senior vice president of human resources, commissioned a task force to further examine these issues and provide senior leadership with recommendations. Task force members consisted of middle-management employees, representing several functions, locations, and levels, who were selected based on their interest and track record in development, and their credibility among peers. The group of 25 included 20 field managers and directors collaborating with five corporate human resources and training staff.