ENTREPRENEURSHIP, CONFLICT MANAGEMENT AND ETHICS
1. Ray Kroc is a salesman who is
trying to sell multi-mixers in order to make some money. He is unsuccessful at
the beginning of the film, but then receives an order for six of his milkshake
mixers, from McDonald’s owners Mack and Dick McDonald. Ray then decides to
drive up to their restaurant, and discovers great potential there. He is eager
to work with the two owners, and learns their secret to success – the ‘speedy
system’. It is through this that Ray is inspired by the idea and seizes the
opportunity to make the business even more successful. Mack and Dick, however,
aren’t so keen to work with Ray after learning of his risky ways of doing
business, as the two would much rather stick with their current methods of
running McDonald’s. Ray is strongly opposed to this idea, and begins to
franchise the business and find people who would be able to run the stores in
different states. Ray divorces his wife due to his obsession with business
success, and manages to pull the company completely from the original owners,
leaving him with one of the most successful businesses in the world.
2.1. The entrepreneurial
successes of Ray Kroc began with his persistence in the beginning. It’s because
of this that he was finally able to break through with his mixers, hence
discovering McDonald’s as a new opportunity in the process. The McDonald
brothers, however, gave up very easily on franchising their business after
their first attempt at franchising failed.
Ray Kroc was able to identify the
right people for the new stores that
he opened up, and he made the most out of people once he saw that they could
add value to his advancement in McDonald’s. He firstly chose wealthy people to
be franchise owners, but then realised that they tended to do things their own
way, and so went on to choosing middle-class people who had the motivation to
work and were inspired by the business’ concept. The McDonald brothers, on the
other hand, seemed adamant to run their business on their own, and since the
failure of their attempt at franchising McDonald’s, shrunk their dreams for the
business drastically and so were only able to have small successes.
Ray Kroc was also very open,
flexible and adaptable to other products or services that would save McDonald’s
money, maintain or enhance the quality of their products, and furthermore make
the workload easier for his employees. He demonstrated this when he took on the
idea of powdered milkshakes, which were much simpler to make, tasted the same,
and cost McDonald’s less money. However, the McDonald brothers chose to stay
true to their traditional milkshakes, as they believed that that was what would
make the business more unique and assist to maintain customer loyalty.
Ray Kroc’s main objective was to
increase the profits of McDonald’s, just as with any other business. However,
the way he achieved this was very clever, in the sense that he consistently
sought out ways on how he could advance the business with minimal effort. The
McDonald brothers were more concerned with keeping their brand name and
preserving the quality of their food. It’s because the two parties never had
the same mindset in terms of furthering McDonald’s, which resulted in Ray Kroc
taking over the business and causing the brothers to lose out. This would be
seen as Kroc’s success and the brothers’ shortfall.
The drastic furthering of
McDonald’s through the use of Ray Kroc’s methods, was definitely a risk for
him. It did, however, pay off very well, because of the way that he invested in
as many restaurants as possible despite his lack of money, in the hopes that
something would turn out in the favour of McDonald’s. The McDonald’s brothers,
however, were too focused on running one business, and because of Kroc taking
risks that turned out favourably, e.g. creating Franchise Realty Corporation,
their partnership came to an end.
The McDonald’s brothers weren’t
professional in the sense that they spoke a lot about and relating to contracts
that involved Ray Kroc, when Kroc disappointed them. They should’ve taken legal
action, but became too emotional for the difficult situation that they were in,
and this worked out in Kroc’s favour as now they had minimal power over him.
The scene where the brothers shook hands with Kroc over the 1% of royalties
that they were going to get, shows a great lack of unprofessionalism, as we are
now unable to justify whether or not there was a legitimate agreement made.
Ray Kroc was greatly unethical in
the way he handled and acted upon contracts made throughout the film. He was
obliged to stick to certain rules concerning McDonald’s, but took advantage of
the McDonald brothers’ emotions and overruled the contracts made between both
parties. It was unethical for him to steal the McDonald’s name when stated
otherwise in the contract.
There was a great lack of
communication, especially communication at the right time between both parties.
Either one would call the other to discuss an issue, when the damage had
already been done. For example, when Ray Kroc had already sent out the powdered
milkshakes to all the McDonald’s stores, the McDonald brothers weren’t informed
about this until it was too late.
Also, in the beginning of the
movie, the McDonald’s brothers used a great technique to train their employees
in the speedy system of making their food. The tennis court method was a very
good effective business practice that motivated employees to work efficiently,
effectively and quickly.
2.3. Communication skills
Both Ray Kroc and the McDonald
brothers struggled to stay in communication with each other, especially when
communication was needed at a certain time. In order to avoid future conflict,
it is important that both parties learn to communicate as the first step
towards resolving conflicts. If this is done, both parties will know what is
expected of them as well as what needs to be done in future, allowing them to
make steady progress in McDonald’s.
Neither Kroc nor the brothers
dealt with issues between the parties very well. If both parties could
introduce new and innovative ways to solve certain issues that may arise, they
can learn from these issues, move past them and make progress, as well as learn
to use the methods that worked, in the future. It’s important to think outside
the box when solving disputes between workers, and the creative solution often
begins with the willingness to hear each other out first.
Most of the conflict within the
film was caused by delayed responses from both parties, as well as a delay in
solving these problems, for example, when Kroc distributed the powdered
milkshakes without informing the McDonald brothers. The way this could have
been sorted out is if Ray Kroc could have informed the brothers of his idea to
sell powdered milkshakes, and then both parties could reason together on the
correct and best solution so that neither party would experience an undesired
result the hard way.
In most conflicts, if not all,
both parties want their idea or proposal to be agreed with. With this in mind,
it is important that Ray Kroc and the McDonald brothers learn to resolve
conflict in such a way that it creates a win-win situation, be it that it
requires a lot of compromising and sacrifice from each side. For example, the
outcome would’ve been different if Kroc had proposed the idea of the powdered
milkshakes to the brothers, and if the brothers agreed to experiment with it in
one store, and discontinue with the product if it didn’t work or if customers
conflict as opportunity
Both parties in the movie became
rivalries more than anything, and it’s because of this that none of them wanted
to hear the other out. Both Kroc and the McDonald brothers should begin seeing
conflict as an opportunity for advancement within themselves, and hence
McDonald’s advancement in terms of profits. If they started seeing conflict
this way, there would be less arguing and more reasoning and listening, as well
as being open to new ideas. Both parties in the end would need to celebrate the
final decision, and see it as a stepping stone towards more success in McDonald’s.
B: LEADERSHIP AND TEAMWORK
type of leadership assisted Ray Kroc in making McDonald’s a success, because he
constantly asked people who he thought would be good for the job, what their
thoughts were etc. This ensured buy-in from those who supported the concept of
McDonald’s, and further increased the productivity of the business which led to
McDonald brothers at the beginning of the film, showed each employee what
needed to be done very clearly, and they practiced how the running of the
business should take place until they got it right. This form of leadership
motivated their employees to want to work well in the business, because they
were able to see what part they were all playing in the success of McDonald’s.
This led to an increase in production, and happy employees.
the McDonald brothers and Ray Kroc made a very clear emphasis on teamwork and
the need for family to be the centre of McDonald’s. This is mainly what led to
a great build-up of confidence in employees, encouraging them to work better
for the common goal. Emotion plays a big part in this type of leadership, and
it led to a success for McDonald’s when Ray Kroc took the business under his
workers at McDonald’s had a high morale and were very much involved in how the
business was run. Kroc and the brothers would constantly uplift their employees
when checking the running of the business, as well as correct mistakes the
second they saw them. They also listened well to those that worked with and
under them, and considered most of their ideas. This led to success for
McDonald’s because of the combination of having everything clearly defined, and
having motivated workers.
Management Styles Used in the Fast Food Industry
a restaurant setting, the owner can make all decisions on his/her own, without
input from anyone. This can be helpful in stressful situations where a decision
needs to be made quickly, as a discussion could potentially result in a loss of
a customer or worse.
democratic management style can assist in building confidence in employees
working at a restaurant. The owner can allow employees to decide how to handle
certain situations that may arise, such as an unhappy customer. This builds up
confidence and integrity in employees, however, this management style can only
be effective in a good way if employees are able to discern what the correct
solution would be to a problem.
is a combination of both the autocratic and democratic management styles, and
tends to give both the owner and employees a certain level of satisfaction when
it comes to dealing with certain issues or managing things. A way in which this
style can be used is, for example, when the owner needs to make a decision on
changing something in the restaurant, and asks his/her employees what they
think but makes the final decision on his/her own.
Leadership Styles in the Fast Food Industry to “The Founder”
autocratic leadership style used in the food industry was barely used in ‘The
Founder’, as there weren’t many issues that people had with the food that
required an immediate decision for Ray Kroc or the McDonald brothers to make.
democratic leadership style in a fast food setting, however, is similar to the
style used in the movie in the sense that just as an owner asks for input from
his/her employees in a fast food setting, so did Ray Kroc allow for input from
people who worked for him in different stores, with the powdered milkshake
consultative leadership style in a fast food setting wasn’t used in the film,
as a lot of the decisions made were rushed and didn’t allow ample space for
discussion. The main similarity from the movie was when Kroc sought out advice
from Harry J. Sonneborn, who managed to assist him in furthering McDonald’s.
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