After a Tough Few Months for McDonald’s, the New CEO Makes His Public Debut: Culture & Organisations Case Study, KU, Singapore

Assignment Brief:

After a tough few months for McDonald’s, the new CEO makes his public debut.

New York (CNN Business) After fewer than three months at the helm of the company, McDonald’s CEO Chris Kempczinski will address investors and analysts during the first earnings call of his tenure on Wednesday. The pressure is on.

Kempczinski replaced Steve Easterbrook in November after the company announced that it had cut ties with its former CEO. Easterbrook violated company policy when he engaged in a relationship with an employee, which the company described as consensual. The abrupt transition left some investors initially uneasy about the company’s future, and McDonald’s stock sank the day after Easterbrook left. Easterbrook, who became CEO in 2015, helped significantly increase McDonald’s value during his tenure thanks to an aggressive turnaround plan.

“Anytime there’s change, especially when you’re transitioning away from an executive that’s had a lot of success, there’s nervousness,” said Peter Saleh, a restaurant analyst with BTIG. Kempczinski has started off his tenure by addressing employees directly during town halls around the world and meeting with corporate officers, among other things. “This is a people business and it’s really about all of you,” he told workers.

Introducing a new leader

In early January, Kempczinski began to make some changes. In a message to employees obtained by CNN, he outlined a plan to increase and sharpen McDonald’s focus on technology. He created a new digital customer engagement team, led by the company’s first-ever chief digital customer engagement officer. Kempczinski also formed a Digital Advisory Council, made up of leaders from across the company, to work with the team and make sure it’s making progress toward company goals.

Read the following news article (reproduced in Appendix A):

“After a tough few months for McDonald’s, new CEO makes his public debut” Source: CNN Business, 28 April 2020

Answer the following questions:

1. Organisational purpose

Describe briefly the organisation, its purpose, and its business. Research is required, with at least TWO (2) references. The word limit for this question is 250 words.

2. Organisational structure

Based on McDonald’s organisational structure in the figure in Appendix B:

• What form of organisational structure has it adopted? (4 marks) b. Explain TWO (2) advantages and TWO (2) disadvantages of this structure for McDonald’s.

3. Organisational culture

• According to the article, discuss TWO (2) issues related to organisational culture and processes that have been identified. Include a specific example from the article.
• Give TWO (2) reasons why these issues are a grave concern for McDonald’s.
• Referring to the 7 Dimensions of Organisational Culture, suggest ONE (1) dimension that McDonald’s can apply to improve its overall organisational culture.
• In what way will this help McDonald’s?

4. Was McDonald’s facing a structured or unstructured problem? Give TWO (2) reasons for your answer.

5. Give an example of a structured problem in McDonald’s workplace.

6. What kind of decision-making style would be the least appropriate for the situation that McDonald’s was in, as reported in the article? Give reasons for your answer, with at least TWO (2) references.

7. Apply the first FIVE (5) steps in the Rational Decision-Making Process with elaboration for each step in the context of McDonald’s situation.

8. Identify TWO (2) important leadership qualities that McDonald’s new CEO should possess for him to transform the organisation. Explain why they are important