Entrepreneurship is technically defined as “balancing risks and rewards to create entirely new sources of value and wealth.”
But, is entrepreneurship just for Silicon Valley start-ups?
Despite its size, McDonald’s has successfully sustained the same kind of enthusiasm, passion and teamwork that defined its humble, entrepreneurial beginnings. It has accomplished this through an enduring commitment to implement the Mindset, Mandate and Model, or “3Ms”, of Entrepreneurship.
First, McDonald’s promotes the right MINDSET that promotes the idea of employees becoming independent franchise owners. With underlying cultural principles, such as “In business for yourself, but not by yourself”, McDonald’s creates an “entrepreneurial spirit” where prospective franchisees are empowered and encouraged to make the risk/reward tradeoffs that can result in their becoming a business owner.
Second, by creating formal financial incentives and rewards for creating new sources of value and wealth, the company has granted an explicit “MANDATE” for employees and franchisees to engage in corporate entrepreneurial activities. This principle has resulted in many of the company’s most iconic menu items—like the Big Mac, Filet-O-Fish and the Egg McMuffin— being created by franchisees outside of the corporate entity.
Finally, by organizing around individual, team, group and enterprise level entrepreneurial activities, McDonald’s has deployed the right entrepreneurial MODEL. For example, at the enterprise level, the company’s worldwide franchise model itself is inherently entrepreneurial. Through this structure, the corporate entity enables independent franchisees to purchase and operate new or existing restaurants under mutually beneficial terms. With more than 80% of its worldwide restaurants owned and operated by franchisees, this entrepreneurial model is not a “side-show…it is fundamental to the success of the company.
By successfully implementing the 3Ms of Entrepreneurship, McDonald’s has effectively combined the resources of the corporate entity with the entrepreneurial spirit of employees and franchisees. By taking these deliberate steps, McDonald’s has created a unique “I’m lovin’ it” corporate environment that positions the company, its employees and its franchisees for sustained growth for decades to come.
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Author: Wayne A. Simmons
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