Business The McDonalds Way

Paul Facella worked at McDonalds for 33 years rising from crew member to senior executive (not unusual  – 7 out of 10 McDonalds executives rose through the ranks). He published a book this year, “Everything I know about business I learned at McDonalds” which wins first prize as a statement of the obvious. It is the only place you worked Paul – the more impressive title would have been “Everything I learned about business I learned FROM McDonalds”. And of course Paul groups his learning under 7 headings which, unoriginally, he calls ‘the 7 Leadership Principles that Drive Break-Out Success’.

They cover:-
Honesty and integrity
Standards – Never be satisfied
Lead by example
Courage: Telling it like it is
Recognition (motivation through recognition of staff service)

It makes you wonder why lying, smug, dysfunctional bastards with no principles, who constantly sit back and let others do what they can’t be bothered to do while taking all the credit and none of the blame just never seem to make it in business.
This is very unfair to a book we quite liked. McDonalds is a great business and Facella’s war stories are worth reading, especially the ones about the marvelous Ray Kroc, the man who had the sense not to be the eponymous founder, preferring the brand name McDonalds which he thought sounded more homely because he liked the Scots.

McDonalds did two things brilliantly.

Firstly, they introduced assembly production to fast food (just like Henry Ford introduced it to car manufacture many years before) but instead of hiding it away at the back of the restaurant they made it totally transparent. They have that much admired obsession with quality which Kroc enforced ruthlessly (he once publicly shut down a restaurant that failed to meet his high standards on an inspection visit) but if your kitchen is completely open to view – a goldfish bowl – it gives no opportunity to drop your standards.

Secondly they put into practice ‘recognition’, the most powerful form of motivation, so powerful it can transform the most callow of youth into responsible, confident, polite citizens with a strong work ethic and ambition.

One of the most popular reprints ever from the Harvard Business Review is ‘One more time: How do you motivate Employees?’ by Frederick Herzberg. He makes this exact same point, that recognition both formal and informal (preferably both) is what really encourages people to do their best. McDonalds made it the cornerstone of their business model. To pay hamburger wages and get cordon bleu service is a very clever thing to pull off.

What McDonalds have not done so well is adapt to changing consumer attitudes and needs. They were not entirely honest and full of integrity when it came to their food’s nutritional value. Ray Kroc apparently once said that he did not know what food McDonalds would serve in the future but was certain they would be selling more of it than anyone else. He started out as a milk shake salesman (he was 52 years old when he spotted the McDonald Bothers hamburger store and had this idea about a national fast food chain) so he was not wedded to burgers. A man with his vision may have spotted the need to evolve the food at McDonald’s a little sooner than they did.

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