Case Study: McDonald's Corporation - Designing an Incentive System

1. INTRODUCTION Designing a compensation plan is iodine of the most manifold tasks for most organizations as it affects job satisfaction, employee turnover, productivity and the overall social club impellingness. If not properly managed, this may lead to high employee turnover, subaltern productivity, among other problems which is especially accredited for a large service-oriented staunch like McDonalds. McDonalds first-line managers deal straightway with customers along with the front-line crew and it is polar to draw up an effective compensation plan that leave alone keep them tripd to work hard. McDonalds has to consider various factors in order to purpose an optimal compensation plan for the first-line managers. Unless other specified, managers provide be taken to mean first-line managers in this report. 2. FACTORS TO librate IN invention A COMPENSATION PLAN 2.1 Financial and Non-Financial Incentives Compensations foot be based on financial and non-financial in centives. Financial incentives let in salary and bonus while non-financial incentives include benefits and perquisites such as the use of company cars and club memberships. Financial incentives can motivate managers by cheering their holds but only to a sure extent. According to Maslows hierarchy of destinys , erstwhile a bewilder level of needs has been satisfied, it testament no longer kick the bucket as a motivating factor for the managers. As such, red-blooded their higher level of needs is required.

Therefore, in the context of McDonalds, erstwhile the managers are satisfied with their basic needs ( pay), the monetary incentives will no longer! motivate them. There is a need to provide managers with non-financial incentives such as promotion, increased autonomy and actualization so as to fulfill their esteem needs. Thus, it is necessary for McDonalds to watch out the needs of the first-line managers and incorporate suitable financial and non-financial incentives into the compensation package. 2.2 hire System Generally, there are two types of... If you want to draw in a full essay, order it on our website: OrderCustomPaper.com

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