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McDonald's and Harvard: A Structural Odd Couple

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McDonald's, the company that made the Big Mac a household word, has been enormously successful. For 40 years after its founding in the 1950s, the company was an unstoppable growth engine that came to dominate the worldwide fast‐food business. In recent decades, growth has ebbed and flowed, but McDonald's is still the world's largest food service business. The company has a divisional structure with divisions organized around markets (Thompson, 2019), and a relatively small staff at its world headquarters near Chicago. The vast majority of its employees are salted across the world in more than 38,000 local outlets. But despite its size and geographic reach, McDonald's is a highly centralized, tightly controlled organization. Most big decisions are made at headquarters.

Managers and employees of McDonald's restaurants have limited discretion about how to do their jobs. Their work is controlled by technology; machines time the preparation of French fries and measure soft drinks. The parent company uses powerful systems to ensure that customers get what they expect and a Big Mac tastes about the same whether purchased in New York, Beijing, or Moscow. Cooks are not expected to develop creative new versions of the Big Mac or Quarter Pounder. In 2019, the company began to experiment with the logical next step: robots that can take orders and flip burgers faster and with fewer errors than humans. Creative departures from standard product lines are neither encouraged nor tolerated on a day‐to‐day basis, though the company has adapted to growth and globalization with a mantra of “freedom within a framework,” increasing its receptivity to new ideas from the field. The Big Mac and Egg McMuffin were both created by local franchisees, and burgers‐on‐wheels home delivery was pioneered in traffic‐choked cities like Cairo and Taipei (Arndt, 2007).

All that structure might sound oppressive, but a major McDonald's miscue in the 1990s resulted from trying to loosen up. Responding to pressure from some frustrated franchisees, McDonald's in 1993 stopped sending out inspectors to grade restaurants on service, food, and ambience. When left to police themselves, some restaurants slipped badly. Customers noticed, and the company's image sagged. Ten years later, a new CEO brought the inspectors back to correct lagging standards (David, 2003).

Year after year, Harvard University appears at or near the top of lists of the world's best universities. Like McDonald's, it has a small administrative group at the top, but in most other respects the two organizations diverge. Even though Harvard is more geographically concentrated than McDonald's, it is significantly more decentralized. Most of Harvard's activities occur within a few square miles of Boston and Cambridge, Massachusetts. Most employees are housed in the university's several schools: Harvard College (the undergraduate school), the graduate faculty of arts and sciences, and various professional schools. Each school has its own dean, its own endowment and, in accordance with Harvard's philosophy of “every tub on its own bottom,” largely controls its own destiny. Schools have fiscal autonomy, and individual professors have enormous discretion. They have substantial control over what courses they teach, what research they do, and which university activities they pursue, if any. Faculty meetings are typically sparsely attended. If a dean or a department head wants a faculty member to chair a committee or offer a new course, the request is more often a humble entreaty than an authoritative command.

The contrast between McDonald's and Harvard is particularly strong at the level of service delivery. Individual personality is not supposed to influence the quality of McDonald's hamburgers, but Harvard courses are the unique creations of individual professors. Two schools might offer courses with the same title but different content and widely divergent teaching styles. Efforts to develop standardized core curricula founder on the autonomy of individual professors.

Reframing Organizations

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