Is your company a punch bag?
11th January 2018
A recent article in the Sunday Times featuring Steve Easterbrook, the CEO of McDonald’s caught my eye, not only because we look after the accounting and tax affairs of a number of McDonalds restaurants but also because Easterbrook is one of only three Britons who lead a company in the Dow Jones index of America’s top 30 companies. The turnaround which he has overseen is remarkable and in the article he shares some of the reasons for his success.
The company remains, he says, a punch bag for critics of industrialised food production, globalisation and anti-tax avoidance campaigners. In addition, he had to confront an existential crisis: the demand from millennials for tastier and fresher food. So what action did he take and is there anything that we can learn to improve our own rather more modest sized businesses?
His first action was to cull several layers of middle management in a sweeping overhaul of the global empire and he ordered a revamp of the 37,000 worldwide restaurants. As a result, profits are growing again and the value of the company has doubled to a staggering $140 billion under his management. Easterbrook says that McDonald’s had been brought low by its failure to recognise the revolution in consumer tastes and that the global management team had allowed the business to stagnate. Within 15 months of his arrival as CEO, 11 of the 14 global leadership team had moved on. The corporate restructuring slashed overheads and removed layers of bureaucracy, allowing the company to launch new products and services more rapidly.
Easterbook’s spells at Pizza Express and Wagamama between 2011 and 2014, before returning to McDonald’s in Chicago, allowed him to experience the faster pace of working for smaller private companies and it seems clear that the “edge and zip” required in those roles has been a key element in his management of the globe spanning brand.
Author: Paul Feist, Director
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