HRM project Prof.

Miree
22/11/2015

HRM in the Fast

Food Industry
Hrm in the Fast food Industry

Aleksandar Garlanov
Todor Kolev
Seydi Abdishev

13/02/2015
0|Page
 HRM project Prof. Miree
22/11/2015

Table of Contents
Abstract ........................................................................ 2
Introduction .................................................................. 3
Staffing practices and their implications for the
characteristics of the workforce ................................ 4
Training and development: What do fast food chains
do to increase the productivity of employees ........... 5
Hrm in the Fast food Industry

Compensation and Benefits in the Fast Food

Industry ........................................................................ 6
Recruitment and selection in the Fast Food industry
...................................................................................... 8
McDonalds Corporation: ............................................ 8
Starbucks Corporation:............................................... 9
Yum! Brands: ............................................................. 10
Dunkin Brands Group, Inc: ...................................... 10
Training and Development in the Food Industry .... 11
McDonalds Corporation: .......................................... 11
Starbucks Corporation:............................................. 12
Yum! Brands, Inc.: ..................................................... 13
Dunkin Brands Group, Inc. ...................................... 14
Conclusion: ................................................................ 15
Tables and Graphs: ................................................... 16
References: ................................................................ 19

1|Page
 HRM project Prof. Miree
22/11/2015

Abstract

The purpose of this paper is to examine the most common human resource practices
in the fast food industry and to determine their implications for the characteristics of
the workforce of the industry. The paper comes to the conclusion that majority of the
companies in the industry adhere to predominantly traditional practices in the areas of
recruitment and selection, training and development, and compensation and benefits,
with less than one tenth of them using innovative human resource practices. In terms
Hrm in the Fast food Industry

of recruitment and selection, companies stick to traditional channels and employ

standard interviews and testing for finding qualified workers. Training and
development of employees is primarily limited to initial training of employees which
comes in three methods: On-the-job training, Class-room-style training, and the more
recent Interactive media training. The industry has traditionally notorious for its bad
practices related to compensation and benefits. Most employees there receive the
minimum wage and do not have access to virtually any non-wage benefits, which
renders them dependent on public assistance programs.

The paper goes on to identify the best practices in the industry in terms of recruitment
and selection, and training and development by comparing the way they are used by
major players in the industry such as McDonalds, Starbucks, Yum! Brands, and
Dunkin Brands. It concludes that the practices employed by these competitors are
very similar and, because of the low-skilled nature of these jobs and the very basic
requirements for the applicants, they do not deviate a lot from the well-established in
the industry traditional staffing and training ones.

2|Page
 Human Resource Management Project
23/11/2015
Introduction
T he restaurant industry has
historically been of one of the
major drivers of the US economy.
With more than 1 million restaurant
locations across the US, owned by
approximately fifteen thousand
companies, and with annual revenues
exceeding 700 billion dollars, the
industry certainly qualifies for an
economic powerhouse1. With its 14
million full- and part-time employees, it
is also one of the industries with the
largest employment (ranks second only
HRM in the Fast Food Industry
after the elementary and secondary
education system)2 as well as
employment growth rate it is projected
to contribute to the economy more than
100,000 new jobs annually until 2025.
This is the reason the industry has
traditionally been considered the largest
first-job provider for young Americans,
with as many as one third of them
reporting to have acquired their first
work experience in a restaurant.
The industry can be divided into
subindustries based on the distinction
between full-service restaurants and
limited-service restaurants. The former,
as their name suggests, provide
customers with a full set of table
services and a relatively broad menu,
whereas the latter pride themselves in
quickly providing affordable food. Full-
service restaurants can be further
broken down in fine dining, casual
dining, and family ones. The limited-
service restaurants, on the other hand,
can be divided into fast food and fast-
casual dining places. Since the scope of
this paper does not allow for a thorough
examination of the entire restaurant
3|Page
Prof. Miree
industry with all of its sub-divisions, we
are going to focus only on the fast-food
segment.
Unlike the other divisions of the
restaurant industry, the fast food
segment was able to grow even during
the economic downturn of 2008,
outpacing inflation and thus achieving
growth not only in nominal, but in real
terms as well. The reason for this
remarkable performance in the
otherwise lackluster US economy can
be traced to the eating habits of
Americans in general. According to the
National Restaurant Association,
approximately half of Americans visit
QSRs at least twice a week, and around
one third of them report that they eat in
fast food places three or more times a
week 3
Offer differentiation and the fact that the
industry has historically appealed to
price-sensitive customers whose
numbers increased significantly after the
economic crisis of 2008, also contribute
to the growing popularity and strong
financial prospects of the fast food
segment (Riehle, Hudson, 2014, p.7).
However, despite its robust financial
performance, it has been notorious for
the poor management of its human
resources and its use of cost-focused
human resource practices. Due to its
high utilization of part-time labor, the low
compensation provided, its restricted
access to benefits, the poor and
physically-demanding working
conditions, and the virtually non-existent
career advancement opportunities, the
industry has developed a poor
reputation for providing attractive
employment opportunities. This in turn
 Human Resource Management Project
23/11/2015
has made the recruitment and retention
of good employees difficult for the
companies in the sector. As a result,
according to the US Bureau of Labor
Statistics, the annual industry turnover
for both part- and full-time employees is
among the highest in the economy,
getting as high as 40 % (Bureau of
Labor Statistics, 2015).
The prime aim of this paper is to
examine the existing human resource
management practices in the fast food
segment of the restaurant industry and
ascertain their implications for the
HRM in the Fast Food Industry
employees satisfaction, turnover, and
the reputation of the industry in general.
More specifically, the paper will attempt
to examine the industry in terms of
staffing practices, training and
development methods, and common
compensation and benefit practices. As
it is beyond the scope of this paper, we
are not going to to examine every
practice that can be found in the
industry as a whole, instead, more
specific attention will be paid to the most
common practices in every of the
categories outlined above.
Staffing practices and their
implications for the
characteristics of the
workforce
Many organizations claim that
employees are their most valuable
assets and should therefore be picked
very carefully. Since the characteristics
of employees are a function of labor
market factors as well as of the
organizations staffing practices, many
4|Page
Prof. Miree
organizations invest heavily in improving
their staffing processes to make sure
the employees they recruit and select
will eventually, if hired, perfectly match
the requirements and needs of the
organization. This is important because
good human resource practices reduce
turnover, which is always expensive for
organizations, and create a more stable
workforce. However, this is usually the
case in industries that need highly
qualified employees that are difficult to
find and even more difficult to attract.
Fast food workers, on the other hand,
are considered easily disposable
employees and companies in the
industry make little investments in the
use of formal recruitment and selection
practices.
A notable finding here is that the overall
use of formal recruitment and selection
practices in the industry is generally low,
with as many as half of the companies
examined reporting that they only use
such formal practices to some extent
(Figure 2.3).4 The other half of the
restaurants examined belong to some of
the big fast food chains and employ at
least some formal recruitment and
selection methods. However, those
adhere to standard and simple rules that
are specified and closely monitored by
the corporate center. Usually,
companies in the industry make use of
both internal and external recruitment,
the former being used for management
positions only, and employ more than
one recruitment avenue, with examples
including posting advertisements on the
corporate web site, displaying job
postings in the restaurants themselves,
using external employment agencies,
 Human Resource Management Project
23/11/2015
local facilities, social networks, and
even job fairs.5
Selection, or the process of determining
which candidates are qualified for the
job, in the fast food industry is also
simple because the low skill
requirements of most of the jobs. Most
of the employers in the industry
(including McDonalds, Burger King and
KFC) have adopted a two-step
application process for considering the
applications of potential candidates.
(Batt, Rosemary, 2015, p.13) It all
begins with the candidate filling in an
HRM in the Fast Food Industry
online application, which in isolated
cases can be a paper one too. If the
applicants characteristics match the
organizations needs and requirements,
the latter gets invited to a restaurant for
an interview and, if successful on the
interview, the candidate takes part in an
On-Job Evaluation. The purpose of the
On-Job Evaluation is twofold: it provides
the organization with information
concerning the applicants customer
service skills and at the same time
enables the applicant to get a first-hand
experience of the companys working
environment.
The characteristics of the workforce in
the fast food industry are more or less
consistent with the characteristics of the
staffing process. The use of simple
recruitment and selection processes,
oriented towards hiring disposable
workers, has resulted in a workforce
characterized by low levels of
education, high minority representation,
and a low average age of workers
(Figure 2.1) (Bureau of Labor Statistics,
2015). A considerable majority of
employees in the industry are women,
5|Page
Prof. Miree
immigrant or people of color. The
average age of workers in the industry
was estimated to 24 with outliers
varying in the range from 16 to 60.
Another notable finding pertains to the
average level of education achieved. by
employees in the industry. The typical
worker The average worker there has
completed 12 years of education,
whereas the typical employee in the
restaurant industry as a whole has 13 or
more years of education, including a
professional high-school degree or
some university courses.
Training and development:
What do fast food chains do
to increase the productivity
of employees
Having hired qualified workers for its
open positions, the company needs to
provide some sort of training to the new
employees to make sure that they
possess all of the requisite restaurant-
specific knowledge and abilities. 6Initial
induction training and orientation are
conducted on-site and may include
introduction to the basics of the job,
teaching employees how to use the
kitchen equipment, getting them
acquainted with the hygiene standards,
informing them about the health and
safety regulations, and making them
familiar with the customers service rules
and requirements. Generally, training is
comprehensive in terms of scope, but it
is not demanding or highly specialized
in any way, which is what usually makes
employees in the industry disposable
workers.
 Human Resource Management Project
23/11/2015
Training and development of employees
in the industry has traditionally been
conducted using three different
methods: Classroom style method,
Interactive media training method, and
On-the-job training method.7 Various
innovative practices have started to
appear in the industry, but those are
beyond the scope of the current section.
The classroom style method, together
with the on-job training, is presumably
one of the oldest methods of training
and has been around since the
beginning of training as an
organizational practice. It is preferred by
HRM in the Fast Food Industry
trainees because it is interaction-based,
allows for instant feedback from the
instructor due to its face-to-face nature,
and because sessions can be
customized to match individual needs.
The on-the-job method is preferred by
trainees because there is always a more
experienced mentor to demonstrate the
right performance of a task and because
it allows for guided practice.
The interactive media method uses a
computer instead of a personal
instructor for the control of the various
sections of training (DiPietro, Robin
Barbara, 2003, p.14). It is a relatively
new method of training compared to the
classroom style one, but is getting
increasingly preferred by trainees
because it is more practical and allows
for the provision of knowledge and skills
without a need for constant overlooking
by a mentor. Another major advantage
of the computer-based training is that it
is not as costly as the classroom one
and allows for the training of applicants
who are geographically dispersed
around the country. KFC was one of
the first among the large fast food
6|Page
Prof. Miree
chains to adopt an interactive media
method of training of new applicants. Its
Learning Management, Virtual
Classroom, Video and Web
Conferencing training platform provided
by SABA, the company claims, allows
for the simultaneous conducting of
training sessions across 825 of its
stores and saves up to $ 1 million of
administrative expenses a year.8
Although there is a variety of training
methods employed in the fast food
industry, the time of initial training and
job-related skill seminars of newly-hired
employees, remains low compared to
other industries and even to the
restaurant industry as a whole. The
average worker there get as few as 40
hours of training altogether compared to
95 hours in the hospitality one (Figure
2.4) (Batt, Rosemary, 2012, p.16).
Another indicator that measures the
effectiveness of the training and
development programs is the time it
takes for a new worker to become fully
productive in his or her job. As figure 2.5
shows, the workers in the fast food
industry require almost nine weeks to
become proficient in their work(Batt,
Rosemary, 2012, p.17). This finding can
be taken to mean either that Mcjobs, or
the fast food jobs, are not as low-skilled
as generally accepted or that the
training and development programs in
the industry are highly ineffective. The
issue is still open to empirical research.
Compensation and Benefits
in the Fast Food Industry
 Human Resource Management Project
23/11/2015
Although the fast food industry is the
major contributor of new jobs to the
economy, it is also the industry with
both the lowest average hourly wages
and with the highest income inequality
between management and non-
management positions. According to the
the Bureau of Labour Statistics, the
average fast food worker makes $8.59
per hour, or approximately $20,000 per
year if working full-time. (Ruetschlin,
Catherine, 2013, p.6) This is below the
poverty threshold in the country and is
not sufficient to support a three-member
family. However, it is worth noting that
most of the employees in the industry
only work part-time hours, which means
HRM in the Fast Food Industry
that the current statistics do not
accurately reflect the real level of
income for those employees. If we
adjust the income calculation to reflect
the average hours per week that
employees in the industry work, which is
around 24, their level of income drops to
$ 12,000 per annum, which is barely
enough to sustain a single individual
having one job only.9What is even more
disturbing is that, even though the
industry has been growing in real terms,
the average hourly wage there has risen
with the mere 0,3 per cent in real terms
since the beginning of the century. By
comparison, CEOs in the industry are
some of the highest paid managers in
the economy, with an average salary of
$23.8 million in 2013, which has
increased by 400% in real terms since
the year 200. As an example of the
growing income inequality, the CEO-to-
worker compensation ratio reached
1200-to-1 in 2012 and has since then
remained above 1000-to-1.
Non-wage benefits such as paid leave,
health insurance, pension plans etc. are
a common part of the total
compensation package that a typical
employee would usually receive from
his or her employer. However, the fast
food industry scores poor on this
criterion too. It has historically been
7|Page
Prof. Miree
notorious for providing few, if any, non-
wage benefits to employees (Figure
2.10). Reasons here could include the
part-time and often seasonal nature of
those jobs, the high turnover and the
low employee bargaining power of
workers. These
points are confirmed
by a study recently CEO-to-worker
conducted by) compensation
students of
economics at the
ratio reached
University of 1200-to-1 in 2012
10
Illinois. Their and has since then
findings show that
clearly the most remained above
common benefit, 1000-to-1.
which is close to
ubiquitous among
companies in the
industry, is a
discounted or free meal. According to
Center for Disease Controls National
Health Interview Survey (2011) a very
basic benefit such as health insurance
is available to only 17 % of full-time
employees in the industry usually
those holding managerial positions.
Given that the majority of employees
there work part-time, this percentage
drops to 13 % when the analysis is
expanded to all workers. According to
the former study, paid sick leave and
paid vacation time are two of the most
rarely found benefits in the industry
they are provided by only 5% of the
restaurants, which are usually not part
of any of the large fast food chains.
The combination of low hourly wages
and very restricted non-wage benefits
has rendered many employees in the
industry unable to make the ends meet.
This is the main reason for the higher
utilization of public programs by those
workers as compared to workers in
other industries. (Allegretto, Sylvia,
2013, p.15) Research indicates that the
families of employees working in the
fast food industry are twice as likely to
 Human Resource Management Project
23/11/2015
enroll in a public program that the
average American family (Figure 1).
Table 5 also shows the participations
rates in assistance programs by
average weekly hours of work. Findings
indicate that the participation rate of
employees is a function of the average
number of hours they work per week.
The more hours they work, the less
likely are they to enroll in such a
program.
Recruitment and selection
in the Fast Food industry
HRM in the Fast Food Industry
In the past, most fast food restaurants
did not put efforts on recruiting and
selecting the right people or making
their customer service outstanding, as
the whole idea behind those
organisations was to get the customer in
and out as quickly as possible.
However, recently the recruitment and
selection processes in that industry
have become a crucial part as the
manpower has become what drives the
business to success and profit. In this
part of our paper, we are going to take a
glance at the most common recruitment
and selection practices at four major
incumbents in the fast food industry, as
well as give some recommendations on
how these processes can be improved.
McDonalds Corporation:
In order to recruit the right people which
would make McDonalds customer
service exceptional, the company has
acknowledged certain skills and
8|Page
Prof. Miree
behaviours that the ones who have
applied should be able to show. For
every different position, the biggest fast
food chain has made specific job
descriptions which outline the duties,
responsibilities, personal skills, and
competences required for the applicant.
At McDonalds each restaurant is
responsible individually for the
recruitment process. However, the
methods applying are very similar and
include advertising in the restaurant
itself, using local job fairs/career centers
and, of course, online applications.
Each individual is asked for personal
details, references, education, skills that
match the requirements for the specific
position, and previous work experience.
If the candidate is selected, he/she is
contacted for an initial screen of
qualifications. This follow-up screening
can be done in the form of an
interview/questionnaire or both. After
that, the hiring manager decides if the
applicant should be invited to an on-site
interview where the interviewee might
meet key stakeholders, colleagues or
other people from the top management
besides the HR manager. Next comes
educational, previous employment,
reference, and criminal record check,
after which the applicant is informed
about the final decision of the hiring
manager. Sometimes the recruitment
process might include the so-called on
job evaluation where the candidate
must interact with customers in a
regular business environment under the
supervision of his manager after
completing an online psychometric test.
In case the candidate is not selected he
is notified and all new employees are
invited to a Welcome meeting where
 Human Resource Management Project
23/11/2015
they are given an overview of their job
role, as well as introduced to some
hygiene, safety measures and other
policies. 11 12 13 Even though,
McDonalds is a very good example of a
company, which values its employees a
lot, puts efforts in hiring people from
different cultures and ensuring equal
opportunity, we recommend that the
recruitment process should be a little bit
less formal. What is more, our research
showed that there were issues with
people on management positions who
did not have first degree education
which, we believe is an unacceptable
HRM in the Fast Food Industry
HR practice for the biggest fast food
chain in the world.
Starbucks Corporation:
Starbucks recruitment and selection
process is very similar to the one that
McDonalds uses. The company also
uses job analysis and job description,
but does not put so much emphasis on
the applicants CV, work experience,
achievements etc. Instead, Starbucks
has a simple application form which can
be filled either online or in every
Starbucks store where the stress is on
peoples qualities and personality. Every
employee is called a partner and
usually people who get hired are the
ones who share the same values as the
ones Starbucks proposes in its mission
and values statement.
Very often Starbucks refers to the
internal recruitment process, as it is less
expensive, less time-consuming and all
the background checks on applicants
are skipped. Methods of recruiting
internally include: announcing vacant
9|Page
Prof. Miree
positions in their website where only
current employees have access, staff
meetings consisting of high level
managers or supervisors where they
discuss and select the right employee
for the unoccupied position or promoting
current employees when through
recommendation. When it comes down
to hiring people externally, the company
uses ads in the newspapers, makes
posters in each store, provides
information about available positions on
its website or through social media. Of
course, after an applicant is selected he
goes through an interview, conducted
by a store manager, which consists of
questions ranging from knowledge of
the company to past experience in the
industry. Many people who have
undergone the interviewing process say
their interviewers have made them feel
very enthusiastic about the position they
are applying for. On top of that, the
formality of the interview is minimal, as
every interviewee is offered a cup of
coffee when he/she arrives. A recent
milestone in Startbucks recruitment and
selection process is its plan to hire 10
000 veterans and military spouses, so
far it has hired more than 5000. Based
on our research, we can say that
Starbucks is a very good example of
how the recruitment and selection
process should be made, as the
company focuses on the personality of
the applicant and not on his professional
qualifications. Starbucks core value is
making the customer completely
satisfied with the services they offer,
which is almost an impossible task. Our
research showed that customer
complaints are often a reason to change
the person at managing level staff,
which leads to other complications with
 Human Resource Management Project Prof. Miree
23/11/2015

the current employees so our social platform as their main staffing

recommendation is to try to reduce
those exchanges of management
positions as much as possible, which
would improve the working environment
for the whole team. 14 15 16 17
Yum! Brands:
With over 850 000 employees across
the globe, one can assume that the
management of human resources at the
parent company of KFC, Pizza Hut, and
HRM in the Fast Food Industry
strategy. By doing so, they have
managed to improve the candidate
experience throughout the application
process, thus increasing the number of
applicants, dramatically. Another
solution which Yum! Brands has
introduced in its recruitment strategy is
IBMs Kenexa 2x Brassring, which is a
very complex software for managing
applicants. Through it an organization is
able to track down talented people in
the hiring process, select them and,
eventually, hire them. This system also
has an integrated employee

Taco Bell restaurant chains- Yum!

assessment tool, which makes the
Brands, is performing very well. In order
recruitment process very easy and less
to manage such a huge working force,
time consuming, and much more
and as well to be able to recruit people
efficient. It is very suitable for
for the companys 41 000 restaurant,18
organizations with multilingual
Yum! Brands does not differ too much in
requirements and large volumes of
its methods from its competitors
applicants such as Yum! Brands. Our
mentioned above. For example, KFC,
research on Yum! Brands specifically,
which is a part of Yum! Brands mostly
did not lead us to a lot of information on
relies on internal recruitment. Of course,
recruitment and selection processes,
this includes employee referrals,
however we can conclude that it has
notifications of vacant positions through
very modern and advanced recruitment
e-mail, through the website, after which
practices. Moreover, the companys
the selected candidates are given
website career section is very user-
specific tests created by experts in the
friendly and one can easily view and
field, including an IQ test. When in need
apply for vacant positions. The only
to hire externally, KFC uses adverts in
room for improvement might be to
newspapers, in their website, or the HR
include more information on how exactly
department encourages employees to
their recruitment/selection process is
spread the word. After finding a suitable
done. 19 20 21 22 23
candidate he goes through an entry
level test as well as two interviews
before getting a job offer. Another Dunkin Brands Group, Inc:
example of how successful, Yum!
Brands company can be is Pizza Hut,
which have undergone drastic changes Bring your application to life by
in their recruitment strategy. After a showcasing more than just your
large investment, they have integrated resume this is how the recruiting
social recruiting through an integrated process at Dunkin Brands website is

10 | P a g e
 Human Resource Management Project
23/11/2015
described. Differently from the previous
three companies we have researched,
Dunkin Donuts has a very clear and
thorough description of its recruiting
process in its website. The company
puts efforts on recruiting people who
want to be engaged in the working
process and want to have a long-term
career in the organization. The first step
of the recruitment process is the
creation of a profile at Dunkin Donuts
website. All the information in the profile
is included in the application and can be
used for applying for different positions.
After this, comes an online assessment
HRM in the Fast Food Industry
tool, which determines behavioural and
cognitive abilities of the applicant, and
helps the recruiting team decide
whether the candidate is the right fit for
the position or not. Next comes a phone
interview, and the final step is a hire
video interview where the applicant
records his answers to predetermined
questions which are later sent to a hiring
manager. By doing the interview one-
way, Dunkin Donuts have eliminated the
problem with flexibility of both the
candidates and the HR experts. If the
answers to the video interview are
satisfactory, the right-fit candidates are
invited to an in-person interview with the
team. Similarly to Yum! Brands, Dunkin
Donuts also uses a tool which helps
with the e-recruitment. Throughout our
research, we found that many leaders in
the organization do not appreciate the
value that HR can bring to the company,
this is why we think that resolving those
issues is essential for the future
development of Dunkin Donuts. 24 25
11 | P a g e
Prof. Miree
Training and Development
in the Food Industry
Training and development is the best
tool companies can use when
expanding knowledge and skills through
the whole organization. This process is
considered expensive in terms of money
and time but the benefits of it make the
cost and time a worthwhile investment
for both employers and employees. A
good training program could allow a
company strengthen the weaknesses of
their employees, improve their
performance, make them aware and
consistent about the companys policies
and finally brings satisfaction in them.
Such programs builds loyalty in
employees and loyalty brings
productivity. We will review the training
strategies of four worldwide food
industry conglomerates and will discuss
their advantages and disadvantages as
well as make some recommendations.
McDonalds Corporation:
In 1993, McDonalds invested $40
million in a 130,000 square foot facility
and turned it into a school for training
and leadership development.
Hamburger University is located in Oak
Brook and has 13 teaching rooms, 12
interactive education team rooms, 3
kitchen labs and 300 seat auditorium26.
McDonalds is the first company to
develop a global training center and
over the years, Hamburger University
has become the main instrument for
training employees. The company
stated that their mission is to be the best
 Human Resource Management Project
23/11/2015
developer of people with the most
committed individuals to quality, value,
cleanliness and service in the world.
The founder of the company Ray Kroc
once said: Youre only as good as the
people you hire and If we are going to
go anywhere, weve got to have talent.
And Im going to put my money in
talent27. As a result, the company
spends over $1 billion on training and
development every year. More than
7500 students attend the university
each year and since 1961, more than
80,000 graduates worked as restaurant
managers, mid-managers and
HRM in the Fast Food Industry
28
operators . The curriculum consists
classroom instruction, goal-based
scenarios, hands-on lab activities and
computer e-learning modules. Each
employee has his/her own specific
career path: development paths for
crew, restaurant managers, mid-
managers or executives. The Crew
development curriculum is created and
supported at the Hamburger University
but is facilitated in the restaurant. This
stage of the development of an
employee serves as a foundation for
management career path. Restaurant
Managers goes through Shift
Management and Systems
Management courses which happen in
1 of the 22 regional training centers.
Once these courses are finished,
managers are sent to Hamburger
University where they train and learn the
additional knowledge and skills needed
in order to run a multi-million dollar
restaurant. The Mid-Management
program is for business consultants and
department heads. The idea of this path
is to develop leadership and consulting
skills by teaching employees how to
operate a business and coach others to
12 | P a g e
Prof. Miree
run restaurants. The Executive
Development program is only for the top
managers of the company. Through this
path, they reinforce their leadership
skills.
McDonalds method of training and
development is very expensive since,
the needed capital and time for such a
program is too much but the results of it
are outstanding. The company
managed to build a training process
which creates fully developed leaders,
ready to manage multi-million dollar
restaurant chain. As a recommendation
for improvement, we would suggest that
McDonalds should focus more on
spreading the corporate culture among
their employees during the training
process. Our concerns about this issue
come from the fact that 20% of the
complaints towards the company are
related to bad service or more
specifically- rude or unprofessional
employees.
Starbucks Corporation:
Starbucks Coffee Company has
developed four different programs for
training their employees. Barista Basic
Training Program is for newly hired
employees and stresses on essential
skills and knowledge required for the
barista role at Starbucks. In this
practice, each new employee is guided
by the store manager and learning
coach which serve as role models to the
newly hired. The store manager helps
the baristas to get acquainted with the
store environment and the learning
coach is responsible for the one-on-one
personal training process. This training
 Human Resource Management Project Prof. Miree
23/11/2015

process is recognized by some to the company and will spread their

universities in the US (e.g. the City
University of Seattle29) and can earn
students college credits. The second
training program used in the company is
Shift Supervisor Training Program. This
module focuses on the basics of people
management, supervisory skills, cash
control responsibilities and ensuring the
delivery of the Starbucks experience30.
This training program is a combination
of classroom and in-store training and
its main goal is to teach supervisors of
their responsibilities towards the
company, the lower level employees
HRM in the Fast Food Industry
corporate culture in every single store
across the world. But as it appears this
is not only their core value but their
biggest problem as well. The most
frequent complaint from Starbucks
employees is that the training process is
boring and repetitive especially the
Barista Training. Our recommendation
would be to make the process more
involving and interesting. For example,
by adding cross cultural experience of
making and drinking coffee or simply
make best performance contests among
trainees.

and the customers. The third program

frequently used is the Retail
Management Training Program which is Yum! Brands, Inc.:
focused on training assistant store
managers or above positions in the
Yum! Brands is considered to be one of
company. This module consists of
the strongest players in the food
practices that enhances the effective
industry. Yum is owner of one of the
management knowledge and skills
biggest fast food chains like KFC, Taco
needed. It includes problem solving
Bell and Pizza Hut. Since the company
practices, motivational topics, improving
operates worldwide and has various
performance and managing Starbucks
brands, they have developed different
experience. The goal of this practice is
training programs for each region. For
to improve managers performance in
example, for Taco Bell U.S., the
order to maximize profits. The fourth
company have adopted theMark
method of training and developing is
program for training. This program takes
district Manager Training Program and
place in each restaurant and is
its goal is to prepare district managers
designed for Restaurant General
to be successful in their jobs. This
Managers and it helps managers to
program takes 15 weeks to be finished
enhance leadership skills and develop a
and consists of paper and online
culture in their restaurants. KFC U.S.
training modules as well as in-store
has developed another strategy for
practices and one-to-one delivery31. The
managers. They have created KFCs
result expected from the training
Restaurant Support Center in Louisville
strategies of Starbucks is not only to
and there managers learn and develop
engage the employees in the details of
skills as time management, skills
their work, but also to capture their
management, conflict recognition etc.
hearts and heads. Starbucks Coffee
KFC U.K. has created Restaurant
Company believes that employees
General Manager Leadership program
satisfaction will bring the most benefits

13 | P a g e
 Human Resource Management Project
23/11/2015
which stress on building know how,
retaining and developing talents,
practicing leadership skills. In Asia,
Pizza Hut took another course of
training employees. They have
launched the Yum! Asia Internship
Experience program which is in
partnership with four universities in
Singapore. The program gives the
opportunity to develop career and
become Pizza Hut brand ambassador in
the region. In Korea, Pizza Hut focused
on store level and created the Rapid
Development Program which is for high
potential Assistance General Managers
HRM in the Fast Food Industry
and are on the way to become
Restaurant General Managers. In
addition, Yum! Inc. has built their own
university in the U.S. and moreover they
are in the process of creating a world
class, integrated, global mobility
program to create and develop talents
worldwide32. Yum has developed
different strategies for each region since
they understand the importance of cross
cultural differences but that could be
their problem in the long term. Regional
culture is important but that should not
prevent them from focusing on
corporate culture in their training
programs. Corporate values are those
which give identity to the brands and
should not be underestimated,
especially in the training and
development process.
Dunkin Brands Group, Inc.
Dunkin has developed different training
strategy for their Dunkin Donuts and
Baskin Robins brands. The Dunkin
Brands Online University operates with
14 | P a g e
Prof. Miree
Skillport which is the most popular LMS
software technology. Dunkin Brands
skillport website is very advanced and
consists of comprehensive corporate
training programs. The conglomerate
relies on online education and training
for their employees which could be
considered as the cheapest and fastest
way of training. The system can be
accessed 24/7 as long as there is a
training process and could be used by
thousands simultaneously. Some of the
courses needed are preparation of food
and beverages, and customer service
and register operations. After each
module, every employee can access
his/her results so they can track their
training progress. Managers and top
Executives can see the results of the
training program as well, which helps in
comparing employees33. The whole
training lasts six weeks and instruct
individuals on every donut and
beverage as well as customer service,
store operations etc. There is a specific
course about corporate policy which
introduce the Dunkin world to the
employees. The system is very efficient
and relatively cheap but there are some
disadvantages. The personnel
relationship between employees is
totally ignored by the company. Such
online education can train you how to be
perfect employee but cannot teach you
how to be a good co-worker. As a
recommendation, we would suggest to
make the training process both
theoretical and practical. There should
have live classes so employees can
meet their co-workers and managers in
advance, to get acquainted with the in-
store environment and to have some
real experience with customers.
 Human Resource Management Project Prof. Miree
23/11/2015

Conclusion:

The primary purpose of this paper was to review the HR strategies used in the fast
food industry and their impact over organizational performance. It came to the
conclusion that, because the industry has changed dramatically since its beginning
back in the 1960s due to the soaring demand for its products, the practices used in
this industry had to change as well. Recruitment processes had to take different
course since, the fast food industry became main factor in the workforce creation in
the world and more specifically U.S. The conglomerates in this industry keep the trend
of hiring low educated, underage and minority people in order to reduce expenses by
HRM in the Fast Food Industry

giving low salaries. Alongside with recruitment, other HR practices had to change as
well. Such practices are training and development, which turned from basic knowledge
needed for a certain job to specialization through universities. Even though fast food
industry offers employment opportunities, in this fast developing world this is not
enough. People are looking for places where they can feel belonging and more
concrete, companies with established corporate culture and values. This is another
factor which made this industry change its HR practices since corporate culture gives
identity to the brand names. The result of these changes seeks to increase employee
productivity and therefore, increase profits. We can conclude that the whole changing
process has been difficult, expensive and time costing but the success of it is
undeniable in terms of market share growth and profit growth of the industry.

15 | P a g e
 Human Resource Management Project Prof. Miree
23/11/2015

Tables and Graphs:

HRM in the Fast Food Industry

16 | P a g e
 Human Resource Management Project Prof. Miree
23/11/2015
HRM in the Fast Food Industry

17 | P a g e
 Human Resource Management Project Prof. Miree
23/11/2015
HRM in the Fast Food Industry

18 | P a g e
 Human Resource Management Project Prof. Miree
23/11/2015

References:
1 Bureau of Labor Statistics. OCCUPATIONAL E MPLOYMENT AND W AGES. N.p.: n.p., 2015. United
States Department of Labor Bureau of Labor Statistics. Web. 18 Nov. 2015.
<http://www.bls.gov/news.release/pdf/ocwage.pdf>.
2
http://www.careerinfonet.org/indview3.asp?nodeid=47
3
Riehle, Hudson. 2014 Restaurant Industry Forecast. New York: National Restaurant
Association, 2014. National Restaurant Association.
<https://www.restaurant.org/Downloads/PDFs/News-
Research/research/RestaurantIndustryForecast2014.pdf
4
Batt, Rosemary, Jae Eun Lee, and Tashlin Lakhani. A NATIONAL STUDY of Human
Resource Practices, Turnover, and Customer Service in the Restaurant Industry. New York:
ILR School, Cornell University, 2012. Restaurant Opportunities United. Web. 19 Nov. 2015.
<http://rocunited.org/wp-content/uploads/2014/01/HRPTCS_Cornell_Report_4.pdf>.
HRM in the Fast Food Industry

5
Recruitment & Training at McDonalds. New York: McDonalds Corporation, 2011.
McDonalds Corporation. Web. 17 Nov. 2015.
<http://www.mcdonalds.co.uk/content/dam/McDonaldsUK/People/Schools-and-
students/mcd_recruitment_training.pdf>.
6
AGCAS editors. "Fast food restaurant manager: Training." Prospects.uk. N.p., Dec. 2014.
<http://www.prospects.ac.uk/fast_food_restaurant_manager_training.htm>.
7
DiPietro, Robin Barbara. THE EFFECTIVENESS OF MANAGERIAL TRAINING IN A FAST
FOOD RESTAURANT CHAIN. Lincoln: University of Nebraska, 2003. University of Nebraska.
Web.. <http://digitalcommons.unl.edu/dissertations/AAI3092537/>.
8
Green, Bernie. Saba Helps KFC Transform Their Learning Organization for Countrywide
Extended Enterprise. Redwood Shores: Saba Software Inc., 2014. Web.
<http://www.saba.com/media/1038721/cs_kfc_web.pdf>
9
Ruetschlin, Catherine. Fast Food Failure: How CEO-to-Worker Pay Disparity Undermines
the Industry and the Overall Economy. New York: Demos, 2013. The Huffington Post. Web.
22 Nov. 2015. <http://big.assets.huffingtonpost.com/FastFoodFailure.pdf>.
10
Allegretto, Sylvia, et al. Fast Food, Poverty Wages: The Public cost of low-wage Jobs in the
fast-food industry. Urbana-Champaign: UC Berkeley Labor Center, 2013. UC Berkeley Center
for Labor Research and Education. Web. 22 Nov. 2015.
<http://laborcenter.berkeley.edu/pdf/2015/the-high-public-cost-of-low-wages.pdf>.

11
"WeThrive." <https://wethriveindia.wordpress.com/tag/mcdonalds-recruitment-and-selection-
process/>
12
"McDonald's Corporate Job Application Process: AboutMcDonalds.com."
http://www.aboutmcdonalds.com/mcd/corporate_careers/career_resource_center/application_
process.html. N.p.,
13
"The Four Steps of the McDonald's Application Process." TARGETjobs. N.p.
<https://targetjobs.co.uk/employer-hubs/mcdonalds-restaurants-limited/321719-the-four-steps-
of-the-mcdonalds-application-process>.
14
"Investigating Recruitment And Selection At Starbucks Commerce." N.p., n.d. Web.
<http://www.ukessays.com/essays/commerce/investigating-recruitment-and-selection-at-
starbucks-commerce-essay.php>.
15
"Starbucks Retail Recruitment." Everything You Need to Know about Starbucks Coffee
Company HRM. N.p., 02 Sept. 2013.. <https://makegoodcoffee.wordpress.com/starbucks-
recruitment/>.

19 | P a g e
 Human Resource Management Project Prof. Miree
23/11/2015

16
"Starbucks Coffee Human Resource Management Management." N.p., n.d. Web.
<http://www.ukessays.com/essays/management/starbucks-coffee-human-resource-
management-management-essay.php>.
17
"Starbucks on Fast Track with Military Hiring Commitment." N.p., n.d. Web.
<http://www.nasdaq.com/press-release/starbucks-on-fast-track-with-military-hiring-
commitment-20151109-00081>.
18
"About Yum! Brands." N.p., n.d. Web. <http://www.yum.com/company/>.
19
N.p., n.d. Web. <http://www.yum.com/careers/your-career-yum.asp>.
20
"Recruitment And Selection Process Of Kfc Business Essay." Recruitment And Selection
Process Of Kfc Business Essay. N.p., n.d. Web. <http://www.uniassignment.com/essay-
samples/business/recruitment-and-selection-process-of-kfc-business-essay.php>.
21
"The Recruiting Unblog." The Recruiting Unblog. N.p., n.d. Web.
<http://www.recruitingunblog.com/tag/how-do-pizza-hut-recruit/>.
22
"Yum!Brands Case Study." - The Human Resources Social Network. N.p., n.d. Web.
<http://www.hr.com/SITEFORUM?&t=%2FDefault%2Fgateway&i=1116423256281&applicatio
n=story&active=no&ParentID=1119278070334&StoryID=1119655022843&xref=https%3A%2
F%2Fwww.google.bg>.
HRM in the Fast Food Industry

23
"Yum! Brands Selects Kenexa to Support Recruiting Initiatives in China - Personnel Today."
Personnel Today. N.p., .<http://www.personneltoday.com/hr/yum-brands-selects-kenexa-to-
support-recruiting-initiatives-in-china/>.
24
"Dunkin' Runs on Great Talent." Dunkin-runs-on-great-talent. N.p., n.d..
<http://www.talentmgt.com/articles/dunkin-runs-on-great-talent>.
25
"Our Recruiting Process." Our Recruiting Process. N.p., n.d. Web.
<http://dunkinbrands.com/careers/our-recruiting-process>.
26
"Hamburger University - McDonald's :: AboutMcDonalds.com." Hamburger University -
McDonald's :: AboutMcDonalds.com. N.p., n.d. Web. 22 Nov. 2015.
27
"Ray Kroc Quotes." BrainyQuote. Xplore, n.d. Web. 22 Nov. 2015.
28
"Hamburger University - McDonald's :: AboutMcDonalds.com." Hamburger University -
McDonald's :: AboutMcDonalds.com. N.p., n.d. Web. 22 Nov. 2015.
29
https://bdaily.co.uk/opinion/12-06-2013/starbucks-3-inspirational-ways-it-develops-its-staff/
30
Learning and Development." Starbucks Coffee Company. N.p., n.d. Web. 22 Nov. 2015."
31
"Learning and Development." Starbucks Coffee Company. N.p., n.d. Web. 22 Nov. 2015.
32
"Leadership Excellence." Leadership Excellence. N.p., n.d. Web. 22 Nov. 2015.
33
http://www.glassdoor.com/Benefits/Dunkin-Donuts-Job-Training-US-
BNFT43_E19153_N1.htm

20 | P a g e