McDonald's Org Chart – Assignment Example
Ron Steele John Smith Business 500 20 August The Organizational Chart of McDonalds Corporation as listed is a hierarchical type (Dredge, 2).
Improvements could be made in the chart as listed in the text. Three improvements would be as follows: (1) Ralph Alvarez is a President at the company, yet is listed at the same level as three Vice Presidents. It would be proper to keep consistency in the structure, so either moving Mr. Alvarez to a higher level; or simply changing his title to match that of his three current peers would be one improvement. (2) There could be better structure identification at the third tier of the chart as listed in the text. Janice Fields’ title is not consistent with her peers as listed. It could be improved by having her title as ‘President of McDonalds USA Division Operations’. (3) There is some confusion also at the lowest level listed. Donald Thompson should be at a higher level that his peers since he is accountable for the entire USA group. The chart lists him at the same level as the West USA division; the East USA division; and the Central USA division.
Reasons for making the above changes are to keep uniformity and consistency. It keeps equality in how resources are allocated by not giving one area more or less importance than another at the same tier level. It also should help form who is held accountable in an organization. For example, as the chart currently appears in the text, Mr. Thompson has equal accountability as that of the various regions of the USA. Logically, Mr. Thompson should be above each region of the USA and have Ms. King, Mr. Johnson, and Mr. Plotkin reporting to him, but it isn’t clear by looking at the chart.
There are some especially beneficial parts to how the text structure is developed currently. McDonalds is an extremely large international company and having the focus on geographical areas is good. The breaking down by the USA, Europe, APMEA, and Canada/Latin America is a good start. In this way, each geographical region would be less affected by other areas that might be beyond their control. If a geographic area is struggling, then the top level management would know where to target resources and improvements. If it was not organized by geography, then it could more difficult to interpret and analyze financial, marketing, operational, or other data as well. Top management could also decide what areas to devote more resources to.
A good organizational chart could be to make it even more clear and streamlined by spinning off each region into a stand alone subsidiary. This is often termed a strategic business unit or SBU (Dredge, 3). The new structure could have a President/CEO at the top, with a second level right below consisting of (1) Vice President USA; (2) Vice President Europe; (3) Vice President APMEA; (4) Vice President Canada / Latin America. Following that, each of the 4 primary divisions above would have its own standalone accounting division; marketing division; operating division, etc….It could result in less bureaucracy, confusion, and unnecessary inter-region / intercompany competition for scare company resources. (Gilkin, 3).
Dredge, S. Organizational Structure. Encyclopedia of Business, 2nd ed. 2010.
Web. Accessed 20 August 2010.
Gilkin, J. Advantages and Disadvantages of Divisional Organizational Structure.
http://smallbusiness.chron.com/advantages-disadvantages-divisional-organizational-structure- 611.html Web. Accessed 20 August 2010.