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January 19, 2013

Inter-Culturally Intelligent Reward Systems for McDonald's in Pakistan

Inter-Culturally Intelligent Reward Systems for McDonald's in Pakistan

Successful incentive design for Community and Honor oriented societies.

Some time ago, we had the opportunity to meet with the HR Director of McDonald's in Pakistan, who had some beautiful examples of how they changed the way that performance management was handled to fit with Pakistani context.

Historically, McDonald’s franchises based almost all of their performance management and reward systems on what calls ‘individual accountability’ thinking and assumed that people would pursue their work from a directive destiny orientation. These assumptions are typical of an Innocence/Guilt oriented environment (read our article on the Three Colors of Worldview).

The cultural makeup that McDonald's found in Pakistan is not quite so Innocence/Guilt or directive destiny oriented and as a result employees found it difficult to relate to their performance management and reward systems. Plaques like "Employee of the Month," individual bonuses, rewards, and perks just didn’t get the results that McDonald's was used to.

So McDonald's decided to make some changes to fit their reward systems to the local culture. One thing they did was start connecting employee rewards to the employee’s community. The asked, “For this employee’s family, what would be considered a high value asset?” Then, if an employee performed above expectations, they would purchase one of those highly-valued assets, go to the head of the household (almost always the father, in Pakistani culture), and say, "Sir, we are very happy that your son (or daughter) works at McDonald's, and we are very thankful that you released one of your excellent family members to come work for us. To show our appreciation for his or her contribution to our team, we want to present you with this motorcycle."

This was a powerful way to bridge the gap between community accountability mechanisms and individual accountability mechanisms. The processes McDonald's developed were also mindful of the honor shame mechanisms in Pakistani society: they formed their incentives in a way that would produce the greatest amount of honor for the stakeholders involved. They thanked the family head publically, and ensured that the whole family would experience the benefit of having one of their members work at McDonald's in a way that brought them honor within their community.

In another example, they gathered their staff and the family of an outstanding employee at a busy intersection, where they put the family’s name up on the LED billboard at the intersection for all of the city to see, thanking the family for making a major contribution to McDonald's as an enterprise. Their initiatives hit the sweet spot for reward systems in the culture they were working in, and they got the results they were looking for.

The lessons are pretty straightforward: in a community and honor oriented culture, honor the whole family instead of just honoring the individual. Look at performance in context of the goods that are valued in that community at that time. And finally, keep your eyes peeled for intercultural factors that can affect your bottom line.

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Last modified on Wednesday, 25 March 2015 00:09

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