McDONALD’S OPENS HAMBURGER UNIVERSITY IN SHANGHAI

According to Associated Press, McDonald’s inaugurated its first Hamburger University in China this week, not to train a new Chinese generation to flip burgers, but  as business managers to attract and retain ambitious young talent.

This move is easy to understand even though the idea of Chinese people eating McDonald’s is not.

The human resources dimension of innovation is often a forgotten question in the panoply of innovation issues. As China has grown the issue of a trained middle management has become a pressing problem for foreign as well as indigenous companies. China is McDonald’s Inc.’s fastest-growing global market. Its ‘eating out’ market, roughly estimated to be worth $300billion -a-year, is growing at 10 per cent a year which is huge compared to the USA where it is only expanding at 2 to 3 percent per annum.

But the problem they face is holding on to staff who are young, ambitious and are lured by numerous opportunities created by China’s rapid growth.

McDonald’s has more than 60,000 employees in more than 1,100 restaurants in mainland China (after 20 years in the country) and according to The Wall Street Journal, it plans to expand to 2,000 outlets in three to five years, creating 10,000 new jobs. They have invested $250 million in Shanghai’s Hamburger University – the company’s seventh worldwide – which aims to become the ‘Harvard’ of the food industry.

Ronald McDonald will not be teaching flipping burgers and making fries, but management and how to run businesses effectively. There’s nothing particularly new about this, but the fact that McDonald’s is effectively setting up a management institute to solve its immediate and longer-term human resources problem, highlights that they are thinking big and planning for the longer-term. Whatever you might think about their products, and given the short-term character of innovation today, then this is at least worthy of note and recognition.

If innovation is a subject close to your heart, please visit Big Potatoes and get involved.

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