SECTION A $[100$ MARKS$]$

Read the extract below and answer ALL the questions that follow.

McDonald$$s Restaurants puts motivation and reward at heart of business strategy

McDonald$$s Restaurants has successfully implemented schemes to make its employees feel motivated and engaged, not

only with the organisation but also with its reward and benefits provision. The organisation has boosted performance and

productivity by ensuring all of its reward programmes are aligned to its business strategy. The employer was recognised

for its approach in $2012,$ when it won an Employee Benefits Award for best alignment of benefits to the business strategy,

and in the years since it has ensured it has never lost this focus.

McDonald$$s business transformation was facilitated by focusing staff towards five principles of employee engagement,

called the $$five vital ingredients to great customer experience$,$ to which its recognition strategy is aligned. The

organisation introduced these five key values in $2014$ to ensure that it embedded a hospitality culture in its restaurants

after identifying that its previous $10$ commandments$$ were out of date. One project that saw measured improvements for

the business was its Road to Rio initiative in $2014,$ which incentivised the top $5\%$ of restaurants based on customer

satisfaction ratings in February, March and April $2014.$ Employees from these restaurants were entered into a prize draw

to win a trip to the World Cup in Brazil. The competition ran in conjunction with the Fifa World Cup, with McDonald$$s using

its sponsorship of the competition to its advantage, sending $11$ winning members of staff to Brazil. More importantly, it

helped to boost the speed of service while also delivering great customer experience.

Motivation is a key focus within the organisation. McDonald$$s also incentivises and supports desired behaviours through

two bonus schemes for its $400$ company$-$owned restaurants. Each month, all employees in the top $10\%$ of restaurants,

based on mystery shopper scores, receive a bonus of $50$p for each hour they have worked in a two$-$week period. In

addition, restaurant managers are eligible for a quarterly bonus based on three equally weighted measures: mystery

shopper scores, sales growth and profitability. This bonus strategy is aligned to business objectives and has been key in

helping the organisation secure $36$ consecutive quarters of comparable sales growth with a $4\%$ sales increase for $2014.$

The sales growth has been achieved by really staying close to the customer, being relevant to needs and looking after

our people through the benefits we offer. The job is to ensure that McDonald$$s is best placed for staff to be motivated and

engaged.

The organisation offers a flexible benefits scheme but does not operate a fixed annual enrolment window. For example, at

any time, an employee can choose to add or remove a dependent to their healthcare benefits plan. The organisation also

allows its employees to choose the benefits that suit them and has a wide$-$ranging package to suit the needs of the

different age ranges it supports. Its voluntary benefits package, provided by Reward Gateway, has been one of its most

successful schemes, with employees having spent more than $37$m through the site, resulting in savings of $2\mathrm{.}15$m$,$

since it launched in $2010.$

McDonald$$s is a dynamic working environment for employees. It offers benefits on a range basis that adds value to

employees. This reward structure makes its communications even more important. Total reward statements and its $$Our

lounge$$ employee portal have helped to improve take$-$up and employees$$ understanding of the benefits McDonald$$s

offers. As a result, employees$$ satisfaction with benefits has improved in $2015,$ with $74\%$ of staff being satisfied with

these. The portal is essentially the gateway to McDonald$$s life. It is$]$ a one$-$stop shop for employees to check schedules,

payslips and book holiday. The organisation calls it a lifestyle learning website, but it is more of an engagement portal. It

has upcoming promotions, news stories, learning and development training and online content for qualifications, and

discounts can only be accessed through here. In summary, the following are the benefits offered by McDonald$$s

Restaurants

$$ Pension: $-$ A defined contribution scheme for all salaried employees.

$$ Healthcare and wellbeing: Private medical insurance for all hourly paid employees after three years$$ service and

salaried staff after six months$$ service is provided along with dental care and eyecare vouchers, personal accident

insurance and life assurance.

$$ Family$-$friendly benefits: such as enhanced maternity and paternity policies for salaried employees, childcare

vouchers, flexible working patterns and job$-$sharing arrangements.

$$ Recognition schemes: such as Employee of the month, quarter, and year for each restaurant.

$$ Holidays:$28$ days including public holidays for hourly paid employees and

$30$ days