When Ray Kroc structured McDonalds as a franchise business, the founding idea was to have a franchisee who lives in the community and who is going to be way better at managing the restaurant than some corporate stiff, thousands of miles away. A whole group or team needs to be invited to the socializing opportunities with an executive, not just those employees who share the executives interests and hobbies. In July, in response to the killing of George Floyd, McDonalds posted a video titled, They were one of us. How do you view the responsibility of brands such as McDonalds to take a stand on social issues?It all connects to what you stand for as a company. In just four years, he had clearly made a mark. I stepped up my communication to make sure that our employees understood what our plan was to get through thisbut also to get a lot of feedback. Regardless of the delivery channel deployed, though, we always focus on our customers experiences because customer satisfaction is critical to us. A Division of NBCUniversal. I am excited to share that, starting today, you can follow me on Instagram @chrisk_mcd. So you just have to accept the unpredictability and risk as part of the bargain to be a relevant brand today. The new chief executive officer of McDonald's is a Harvard University MBA who played a critical role in the revamp of the fast . In the meetings, employees could express concerns and discuss topics openly and freely. Definitely one of the things thats gained focus is the need for communication. When you had a leader that acted in a way that was incongruous with those values, it raised a question: Are we as good as we say we are? That, for me, was incredibly gratifying. He describes Mr. Kempczinski as a "business savant," someone who is able to "translate insight into action into results." He also was struck by Mr. Kempczinski's genuine commitment to personal growth and development, as well as his focus on building meaningful connections. We had the worst quarter in the history of McDonalds in the second quarter of last year. [5] Membership in The Conference Board arms your team with an arsenal of knowledge, networks, and expertise that's unmatched in scope and depth. The chain's total CEO compensation in 2019 ended up topping $18 million. We had too many instances where a country or market was almost making up the playbook as they went along, and its because we werent as good as we could have been in sharing best practices. McDonald's new CEO held a town hall on Wednesday, as the fast-food giant adjusts to an unexpected leadership shakeup. I cover the intersection of business, psychology and gender. That doesnt mean throwing wild parties, but instead having thoughtful interactions where employees can be heard, and where executives can share their vision for the future of the organization. In a press release, McDonalds said Easterbrook, who had been CEO since 2015, violated company policy and demonstrated poor judgment involving a recent consensual relationship with an employee.. Given your franchise model, how do you ensure during COVID-19 that restaurants can survive the short term and be in a position of strength for the long term? Hed come to McDonalds in 2015 after holding top management positions at Kraft Foods and PepsiCo. That's different from a captain's role, in which the route is often fixed and the destination defined." Zhang Ruimin, CEO of Haier Mr. Kempczinski wasnt new to the company but unlike previous chief executives, he hadnt joined the restaurant giant decades earlier, either. Chris Kempczinski Named President and CEO and a Member of the Board. Essentially, its a new cooking procedure in the restaurants that allows us to cook a hotter, juicier burger every time. I wanted to make that set of expectations very clear at the beginning of my tenure so that this was not a moment to reconsider what we stood for. He said he hoped to speak with the victims' parents. We did have a leader who didnt act in accordance with our values, and youve got to hold everybody to the same account. When something in the public discourse is relevant to who we are as McDonalds, and frankly where we would be expected to say something, we should lend our voice. And what are things that are best left to othersgovernments, other companies, or nonprofits? We call them the three Ds: Drive Thru, delivery, digital. My very first impression of Chris, and a belief I continue to hold today, is that he is a true values-based leader. As the Harvard Alumni Association notes, before joining McDonald's global strategy team in 2015, Kempczinski was an executive vice president. Together, we served over 65 million customers, on average, every day, providing great tasting food faster with more convenience and better service than ever before. They like to show me the latest thing that theyve got on the menu and Ill go with that. One-stop, member-exclusive portal for the entire suite of indicators. What Im most impressed with are the people who are servant leaders the people who prioritize others.What decisions did you make during the pandemic that proved critical? In early November, Brunswick Partner Jayne Rosefield, head of the firms Chicago office and Global Consumer Industries Practice, interviewed Mr. Kempczinski. In the meantime, you'll continue to see and hear from me across the System. The context of how I came into the job is important to understand: it was very much a values-based situation. Additionally, weve been able to expand the number of restaurants offering delivery to more than 30,000. In most major markets, they were at or near record cash flow, which essentially is how much money theyre able to take out of the business. The whole world was in crisis mode, but Chriss calm demeanor and thoughtful approach ensured that as a team we could implement the swiftest operational transformation in our history to protect restaurant. The following are edited excerpts of their conversation. McKinsey: In delivery, youre currently partnering with third-party providers, which means you dont have full access to the customer data or full control of the customer experience in delivery. When youve built your business model on diversity and providing opportunities for everyone, and suddenly a human rights issue comes into the public discussion, it would have been a huge miss for us to not put our voice out there. I have a rotation of lunch items. Food is such a local experience that you have to give people some latitude to adapt to local tastes. US consumers thoughts on the economy, jobs, finances and more. We would have a digital relationship with those customers. It was a great reminder about the embedded cost of complexity in our P&L. How much consumer demand do you expect to shift back to dine-in when COVID-19 subsides? Chris Kempczinski: Prior to 2017, delivery was a $1 billion business for us, largely in Asia. My answer is: ensuring the relevance of the brand. Early on, there was a lot of trepidation: Well, we dont want to be seen as somehow capitalizing on the pandemic. But our communities wanted to understand how companies like McDonalds were supporting them, and our purpose of feeding and fostering communities was so aligned with the need of the moment. Theres nothing more important to my job than making sure McDonalds is as relevant 10 years from now as it is today. McDonald's newly minted executive leadership have worked this week to adjust to their new positions while assuaging concerns of employees still stunned by the abrupt downfall of now-former CEO Steve Easterbrook. The Conference Board is the global, nonprofit think tank and business membership organization that delivers Trusted Insights for What's Ahead. I get asked sometimes, What exactly do you do as CEO of McDonalds? It can seem as though the system runs itself. One thing weve learned during the pandemic is that if we simplify our business and focus on what were great atlike drive-thru and our core menu itemstheres a fantastic benefit for our customers. Not a day goes by that I dont have a small order of fries. In addition to serving on the McDonalds Board of Directors, he is also a trustee of Ronald McDonald House Charities. When I travel abroad, I embrace the hospitality of the franchisee that Im visiting. For over 100 years, our cutting-edge research, data, events and executive networks have helped the world's leading companies understand the present and shape the future. A big learning for me was realizing that there is no such thing as overcommunicating. When you travel abroad, do you have any favorite international menu items? By using this website, you accept the use of cookies. You are leaving McDonalds to visit a site not hosted by McDonalds. By the end of 2019, delivery sales were over $4 billion and we continued to see very strong growth in 2020. I firmly believe that McDonald's can change the world in a way that no other company can. Photograph: Jerritt Clark/Getty Images for McDonalds. What dont we know? We did recognize three or four years ago that delivery was going to be a huge opportunity for us. We want to hear from you. If you think you have reached this message in error, please contact membership@tcb.org, Your Indispensable guide through the global recession. Listen as Kempczinski talks to Dr. Murray about human-centric leadership, how to keep stakeholders resilient in times of crisis, the importance of defining your company purpose, engaging in the public square, and more. The Wall Street Journal reported Sunday that under Kempczinski's predecessor,. 2023 The Conference Board Inc. All rights reserved. Track the latest short-, medium-, and long-term growth outlooks for 77 economies. So, for example, if you are a customer using the app, maybe you have a dedicated drive-thru lane. In a recent interview with McKinseys Greg Kelly, Kempczinski discussed his tenure so far and what the next normal might look like for McDonalds. j=d.createElement(s),dl=l!='dataLayer'? Lori Lightfoot rode into the Chicago mayor's office in 2019 as a reform candidate, offering a break from the city's clubby political scene while making history as the first Black woman and first . McKinsey: Looking back on your tenure so far, is there anything you wish youd done differently? As for drive-thru, we offer it in 95 percent of our US restaurants and nearly 65 percent globally. There are more than 39,000 McDonald's restaurants in 120 countries, employing. Chris Kempczinski: I admire how Amazon constantly talks about Day 1; I think thats a great orientation and mindset for us to have at McDonalds. To me, there is nothing further from the truth than that. By continuing to use this Site or by clicking "OK", you consent to the use of cookies.OK, On leading during COVID-19: as you would imagine, in a system like ours, where you have not just the company people, but you have a network of suppliers, you have a network of franchisees, you get bombarded with a lot of questions that come in from everybody around the world. Maria Figueroa Kp, who leads Brunswicks office in the city, recounts what its been like leading from the epicenter of the pandemic. Blog > chris kempczinski leadership style. McKinsey: McDonalds has fared better than many other restaurant chains during the pandemic, thanks to your investments in what you call the 3 Ds: delivery, drive-thru, and digital. Where do we have credibility to speak and stand behind our values and commitments? When you took on the role, quickly establishing values as a central theme of your leadership, was there a sense that McDonalds needed its values updated?I think its precisely because McDonalds had a very strong core set of values that the issue with my predecessor was as traumatic for the company as it was.