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Chris Kempczinski · The David Rubenstein Show

0:02
Speaker 1: McDonald's has been at the top of the food chain
0:05
Speaker 1: for over sixty years. It's CEO, Chris Kemchinsky, says it
0:09
Speaker 1: stayed there because of McDonald's guaranteed quality, experience, and connection
0:13
Speaker 1: to its communities. In this episode, appear to appear I
0:16
Speaker 1: visited McDonald's headquarters in Chicago to find out what makes
0:20
Speaker 1: their fries so addicting, what makes their Coca Cola perfect,
0:24
Speaker 1: and how the restaurant plans to stay on top for
0:26
Speaker 1: another sixty years. Companies more than sixty years old now,
0:30
Speaker 1: and many companies over the last sixty years have gotten
0:33
Speaker 1: in the fast food business. Some have done okay, so
0:35
Speaker 1: I'm going out of business. But McDonald's is by far
0:37
Speaker 1: the biggest. You have a market capitalization about a hundred
0:40
Speaker 1: and seventy five billion dollars. What is it that made
0:42
Speaker 1: McDonald's by far the biggest of the fast food companies.
0:45
Speaker 1: I think it starts with the brand. I mean, we
0:47
Speaker 1: have a brand that is one of the most valuable
0:50
Speaker 1: brands in the world. And how did you get to
0:53
Speaker 1: that brand? It was a combination of things. I mean,
0:55
Speaker 1: it's started with Gray Croc recognized the importance of ubiquity
1:00
Speaker 1: and so That was part of the genius or genesis
1:02
Speaker 1: of of doing a franchise model, because with a franchise model,
1:06
Speaker 1: he could get capital deployed, get restaurants built more quickly
1:10
Speaker 1: than he could if he was trying to do this
1:12
Speaker 1: all on his own. So that was one idea. I
1:14
Speaker 1: think the second was the production system, the speedy production system.
1:18
Speaker 1: It guaranteed equality of the experience that people knew no
1:22
Speaker 1: matter where you went, you could get a consistent experience
1:25
Speaker 1: at McDonald's. And then it certainly came from, you know,
1:29
Speaker 1: our attachment in the local community. One of the things
1:31
Speaker 1: that also Ray Kroc was very focused on was building
1:36
Speaker 1: the brand at the local level. That's why he wanted
1:38
Speaker 1: the franchise ease engaged in the restaurants, and so you
1:41
Speaker 1: saw getting involved in schools, getting involved with you know,
1:45
Speaker 1: birthday parties, all those things. Those were all part of
1:47
Speaker 1: building the brand that ultimately now I get the benefit of,
1:52
Speaker 1: you know, protecting and hopefully further shining the arches. So
1:56
Speaker 1: you are the CEO of this company for the last
1:58
Speaker 1: couple of years, and has you been doing this? Uh?
2:01
Speaker 1: Have you had to deal with the COVID problems in
2:03
Speaker 1: particular COVID has been an issue that's impacted us in
2:07
Speaker 1: every country that we operated in a hundred and twenty countries,
2:10
Speaker 1: and it's been kind of a unique experience because what
2:13
Speaker 1: we've dealt with regional issues before. We've dealt with stars
2:17
Speaker 1: and mirrors and swine flew and things like that, but
2:20
Speaker 1: we've never had an issue where it impacted literally every
2:23
Speaker 1: country all at about the same time, So huge issue
2:27
Speaker 1: for us. It varied around the world. Some places went
2:30
Speaker 1: into complete shutdown. In the US we were able to
2:33
Speaker 1: keep the restaurants open, but drive through only UH, and
2:36
Speaker 1: that was I think part of where are the genius
2:38
Speaker 1: of our system came to light, which is you were
2:41
Speaker 1: trying to manage this situation everything from Chicago. It never
2:44
Speaker 1: would have worked. The fact that we're a locally owned
2:48
Speaker 1: company with franchise ease, they're able to act much more
2:51
Speaker 1: nimbly than than we could from the center. And somehow
2:54
Speaker 1: another knock on wood a year later, Um, you know,
2:57
Speaker 1: we are in a very strong spot, and it's it's
3:00
Speaker 1: hard to believe really, So when COVID hit, UH, many
3:03
Speaker 1: people didn't go out anymore. They weren't buying McDonald's products,
3:07
Speaker 1: other people's products as well. Did you have to lay
3:09
Speaker 1: off people for low people? How did you deal with
3:11
Speaker 1: your employees or the franchisees had to do that. Yeah,
3:15
Speaker 1: we didn't lay anybody off, certainly from the company's standpoint,
3:18
Speaker 1: And our franchisees went through quite a bit of effort
3:22
Speaker 1: to make sure that either through government programs or through
3:25
Speaker 1: things that they could do on their own, that they
3:27
Speaker 1: kept attached to their staff, that they kept the staff
3:31
Speaker 1: uh working and available to the restaurants. And so I think,
3:35
Speaker 1: you know, well, we have forty thou restaurants. I don't
3:38
Speaker 1: know every particular situation. By and large, we were able
3:42
Speaker 1: to retain our workforce through all of that. What did
3:45
Speaker 1: you learn through COVID about how to manage a company differently, better,
3:48
Speaker 1: or some other ways that you would have not probably
3:51
Speaker 1: learned if you had not going through COVID. I certainly
3:53
Speaker 1: think one of the things that we saw was our
3:56
Speaker 1: ability to stay connected through technology bes Zoom, Yeah, Amazon Chime.
4:03
Speaker 1: I've learned all the different teleconferencing tools and they've all
4:06
Speaker 1: worked reasonably well for us. So I think, you know,
4:10
Speaker 1: we learned things there that we have the ability to
4:13
Speaker 1: to stay connected. I think the other thing though, that
4:15
Speaker 1: it highlighted for US is um we ultimately are an
4:19
Speaker 1: in person business. We're in person in the restaurants, were
4:22
Speaker 1: in person in the office, and so well, you lose
4:26
Speaker 1: something from culture, you lose something from a connectedness by
4:29
Speaker 1: by being so remote and so, you know, while it
4:32
Speaker 1: worked well for the time, we're committed to getting back
4:35
Speaker 1: into our offices, getting back into the restaurants. And one
4:38
Speaker 1: of the problems I think some of the franchises are having,
4:40
Speaker 1: not just McDonald's, getting people to come back to work.
4:43
Speaker 1: Either they don't want to come back to work, or
4:45
Speaker 1: they for health or other reasons, or they want to
4:47
Speaker 1: hire a compensation, and they often get at the kind
4:49
Speaker 1: of starting jobs you might have. How hard has it
4:51
Speaker 1: been to get people to come back to work. It
4:53
Speaker 1: has been very challenging in the US. We have not
4:56
Speaker 1: seen that issue as pronounced in Europe barrel swear on
5:00
Speaker 1: the world, but in the US it certainly has been
5:02
Speaker 1: a challenge. I think it's a lot of different factors
5:05
Speaker 1: in it. Certainly the stimulus UH support had some element.
5:09
Speaker 1: But you know, if I asked the franchise ease, okay,
5:11
Speaker 1: so September, is everything gonna be good? Once the stimulus
5:14
Speaker 1: rolls off the like will know there are other things
5:16
Speaker 1: going on, so I think, you know, there's a variety
5:18
Speaker 1: of things that play. But it has certainly been a
5:21
Speaker 1: challenge for us on staffing at the restaurants, and it's
5:24
Speaker 1: putting pressure on wages, which is what you see in
5:27
Speaker 1: you know, any kind of capitalist system. UM, So employers
5:30
Speaker 1: like McDonald's are now having to pay more on wages.
5:33
Speaker 1: We announced in our company owned restaurants, UH sort of
5:36
Speaker 1: a across the board minimum ten percent wage increase. UH
5:40
Speaker 1: that has been carried forward by many of our franchise
5:43
Speaker 1: ease and I think we're just having to get creative
5:46
Speaker 1: about how do we get people uh to come and
5:49
Speaker 1: interview for a job at McDonald's. And you're seeing our
5:52
Speaker 1: franchise ease do things like, hey, you know, fifty dollars
5:55
Speaker 1: for an interview or free iPhone after ninety day is
6:00
Speaker 1: I mean, that's sort of all the things that we're
6:02
Speaker 1: having to come up with right now to make sure
6:04
Speaker 1: we can staff the restaurants. But most of the people
6:06
Speaker 1: who are young who do work at McDonald's, are they
6:08
Speaker 1: minimum wage people and they go up from minimum wage
6:10
Speaker 1: or are you above the minimum wage? The legal minimum wage. Now, yeah,
6:14
Speaker 1: we're above the legal minimum wage, so it's seven and
6:16
Speaker 1: a quarter. Uh. And there are very few places these
6:21
Speaker 1: days that you can be competitive in the marketplace paying
6:24
Speaker 1: the federal minimum wage. I think from our vantage point,
6:27
Speaker 1: what we announced in our company owned restaurants is eleven
6:30
Speaker 1: dollars is the starting wage, and then you know, as
6:33
Speaker 1: you move up, you would you quickly progress through that.
6:36
Speaker 1: If you are a restaurant manager, someone who's maybe been
6:39
Speaker 1: there for a couple of years, you're earning anywhere from
6:41
Speaker 1: fifteen to twenty dollars an hour, and I think that's
6:44
Speaker 1: been largely Um. You're seeing a similar type of thing
6:47
Speaker 1: with our franchise. So while we don't collect information around
6:51
Speaker 1: what is you know, the average wage paid by our franchisees,
6:55
Speaker 1: I would expect it's probably about ten dollars that we're
6:59
Speaker 1: paying right now, just because again, the marketplace is driving it. Uh.
7:03
Speaker 1: And I think that's always been one of the questions,
7:05
Speaker 1: is you know, is this something that you want to
7:07
Speaker 1: be legislated or wanted to be in the marketplace. Our
7:10
Speaker 1: view is, um, we're gonna do whatever we need to
7:14
Speaker 1: be successful as a business, but we also don't oppose
7:17
Speaker 1: if the federal minimum wage is addressed either. So during
7:21
Speaker 1: COVID there were some problems. You had some franchise I
7:23
Speaker 1: guess where there were some strikes or something. Employees weren't happy.
7:26
Speaker 1: What was that all about? We always have something going
7:29
Speaker 1: on at McDonald's around the world there, certainly, I think
7:33
Speaker 1: what you're referencing. There were um some protests about either
7:36
Speaker 1: were were doing enough to protect essential workers? Um, which
7:40
Speaker 1: is you know how we were deemed as a business.
7:44
Speaker 1: We went to a lot of effort there to make
7:46
Speaker 1: sure that we provided ppe into other things like social
7:49
Speaker 1: distancing the restaurant, but we had protests on that. Well,
7:52
Speaker 1: we'll get protests around wage rates. Um, that will crop up.
7:56
Speaker 1: So the thing about McDonald's is, no matter what has
7:59
Speaker 1: happened in society, you can be certain it has some
8:03
Speaker 1: permutation that affects McDonald's. And it's both the challenge of
8:07
Speaker 1: the job but also what's interesting about it. Let's talk
8:09
Speaker 1: about the major things on your menu, which I've sampled
8:12
Speaker 1: over the years. Of course, Um, so the most popular
8:15
Speaker 1: thing that you have on your menu, is it a
8:18
Speaker 1: big mac or a quarter pounder or the French fries? Well,
8:21
Speaker 1: I mean from a volume standpoint, the fries are by
8:24
Speaker 1: far the biggest within sandwiches, probably the Big Mac. It
8:28
Speaker 1: does vary a little bit around the world, but but
8:31
Speaker 1: the Big Mac is probably up there well. The fries
8:34
Speaker 1: are intoxicating, lee difficult to avoid eating one. Can you
8:39
Speaker 1: tell us what's the secret? What do you put in
8:41
Speaker 1: the in the batter or the cooking oil or whatever
8:45
Speaker 1: you do that is the secret? Is it the potatoes?
8:47
Speaker 1: What is it? We have a room here that I
8:49
Speaker 1: haven't taken you too that has all the secrets on that.
8:51
Speaker 1: But I would just say there's there's a lot of
8:53
Speaker 1: things that go into it. It's starting with, um, you
8:57
Speaker 1: know where we get the potatoes from, and we have
9:00
Speaker 1: proprietary relationships with that, how those potatoes are then processed, Uh,
9:05
Speaker 1: what we will put on those potatoes, and then ultimately
9:08
Speaker 1: how they're cooked in the restaurant, the cooking oil that
9:11
Speaker 1: we use, the amount of salt that we use. So
9:14
Speaker 1: there's a lot of things that go into the secret recipe.
9:17
Speaker 1: Some people might say the French fries might not be
9:19
Speaker 1: that healthy. Some people might say that, I don't know.
9:21
Speaker 1: If you would say that, um, what would you say
9:24
Speaker 1: about that? I'd say, you know what we try to
9:26
Speaker 1: do on our menu is to have choice. So we
9:28
Speaker 1: have a variety of things on our menu, from more
9:31
Speaker 1: indulge in items to healthier items. And you know, it's
9:35
Speaker 1: no different than if you go to the grocery store.
9:37
Speaker 1: You can go to the salad bar, or you can
9:39
Speaker 1: go to the ice cream section. And that's how we
9:41
Speaker 1: approach our restaurant, which is about choice. The other thing, though,
9:45
Speaker 1: you know, I get asked a lot of times, why
9:47
Speaker 1: don't you have more of this? Why don't you have
9:49
Speaker 1: more of that? Or why did you get rid of this? Um,
9:51
Speaker 1: it all comes down to did itsell. So our restaurant
9:55
Speaker 1: and what goes on the menu is all based on
9:58
Speaker 1: what moves gets on the menu, what doesn't move comes
10:01
Speaker 1: off the menu, and so ultimately we're letting the customer
10:04
Speaker 1: decide what we do or don't carry on the menu.
10:06
Speaker 1: Since McDonald's was started some sixty plus years ago or so,
10:10
Speaker 1: there's been a greater interest in the United States and
10:12
Speaker 1: maybe around the world healthier eating. Have you tried to
10:14
Speaker 1: reflect that in your menu? We've tried, um, And I
10:18
Speaker 1: would say, you know, it gets back to again, what
10:21
Speaker 1: what sells gets on the menu and stays on the menu.
10:25
Speaker 1: What we have seen consistently is, as we've tried to
10:29
Speaker 1: broaden UH more of what you know, people might say
10:32
Speaker 1: are better for you items, uh, there's just not as
10:35
Speaker 1: strong a demand for them as there are for some
10:37
Speaker 1: of our iconic classics. And so you know, we're not
10:40
Speaker 1: in the business of telling people what they should or
10:42
Speaker 1: shouldn't eat. Our view as our obligation is to provide
10:46
Speaker 1: them with total transparency and nutritional information to make sure
10:49
Speaker 1: that we afford them choice. But ultimately what the consumer
10:52
Speaker 1: buys is up to them. Suppose I'm a vegetarian or
10:55
Speaker 1: a vegan and i want to go to McDonald's, is
10:57
Speaker 1: there anything there for me there? So you could certainly
10:59
Speaker 1: have UM right now a salad UH in a restaurant.
11:03
Speaker 1: Depending on if you're vegetarian or vegan vegetarian, they're going
11:06
Speaker 1: to be other offerings that you have. If you're in India,
11:09
Speaker 1: for example, we have quite a broad sample of vegetarian
11:14
Speaker 1: menu items, less so if you're in Lubbock, Texas, for example.
11:18
Speaker 1: Uh So, again it depends on the customer and what
11:21
Speaker 1: the customer wants. But we've also talked about launching mcplant
11:25
Speaker 1: UH and mcplant for us as a plant based burger.
11:29
Speaker 1: Uh that is available in some countries already. Uh, it's
11:33
Speaker 1: something that we're gonna be testing later in the U s. So, uh,
11:36
Speaker 1: maybe we'll get you a mcplant Another product I don't
11:38
Speaker 1: want to overlook as your famous Coca cola. Now, you
11:42
Speaker 1: used to work at Pepsi. I know, so to Pepsi
11:44
Speaker 1: people ever call you to remind you that you have
11:46
Speaker 1: coke and maybe you should be had a few dialogue
11:49
Speaker 1: over the over the years, and you know, my my
11:52
Speaker 1: short answer is the way to get pepsi into McDonald's
11:56
Speaker 1: is get people to prefer pepsi over coke. Back to
11:59
Speaker 1: the point of we're gonna sell whatever the customer wants. UM.
12:02
Speaker 1: So yes, my my pepsi friends periodically check in. But
12:05
Speaker 1: some people say that your coca cola is made in
12:08
Speaker 1: a certain way that's better than the coca cola could
12:10
Speaker 1: buy in the bottle. So what is it that you
12:12
Speaker 1: do that's different with your coca cola? So I would agree,
12:14
Speaker 1: I think it's better. Um. One of the things that
12:16
Speaker 1: we have as an advantage is because of the volumes
12:19
Speaker 1: that we do in our restaurant, um our volumes tend
12:23
Speaker 1: to be higher than than anybody else out there. It
12:25
Speaker 1: allows us to buy equipment that is able to be
12:29
Speaker 1: tight traded or calibrated more precisely than maybe some of
12:33
Speaker 1: our competitors. And so what we're able to do because
12:36
Speaker 1: of the equipment that we're able to buy, which is
12:38
Speaker 1: more expensive equipment, is we're able to deliver what Coke
12:42
Speaker 1: would describe as their gold standard product on a more
12:45
Speaker 1: consistent basis than somebody who maybe has inferior equipment in
12:49
Speaker 1: their restaurant. So I should disclose that I am an
12:52
Speaker 1: investor in McDonald's in effect because my firm bought a
12:56
Speaker 1: piece of the China business with a Chinese partner and
13:00
Speaker 1: with McDonald's UM and in China, as I understand that, uh,
13:04
Speaker 1: chicken is very popular, maybe more so than beef. Is
13:08
Speaker 1: that unusual where chicken is more popular than beef and
13:10
Speaker 1: in a given market, Uh, you know, China is largely
13:13
Speaker 1: a chicken market. I think this is one of those things.
13:16
Speaker 1: It does vary depending on which part of the world
13:19
Speaker 1: you're in. Brazil tends to be more of a beef market.
13:22
Speaker 1: US is about fifty fifty between chicken and beef. So,
13:26
Speaker 1: you know, we do see that the trends evolving, but
13:29
Speaker 1: chicken globally is growing faster than beef, and certainly our
13:33
Speaker 1: expectation over the next five years is that chicken, more
13:36
Speaker 1: so than beef, will be the dominant protein in our restaurants.
13:39
Speaker 1: So there are four ways you can buy things at McDonald's,
13:41
Speaker 1: as I understand, each begin with a D. So let's
13:44
Speaker 1: go go through. That one is a drive through? Is
13:47
Speaker 1: that a big business these days? Drive through drive to you,
13:50
Speaker 1: it's a huge business for us, particularly in the US.
13:52
Speaker 1: It's about seventy of the business in the US. In
13:56
Speaker 1: Europe you would see at the inverse you would see
13:58
Speaker 1: dining and being a much bigger part of the business
14:00
Speaker 1: in Europe, but through the pandemic we did see drive
14:03
Speaker 1: through also become a pretty significant part of the business.
14:06
Speaker 1: Another D is delivery. You have ability to deliver? Do
14:09
Speaker 1: you deliver yourself? Do you use one of the services
14:11
Speaker 1: deliver people's home? We do both. It started for us
14:15
Speaker 1: in Asia where we were doing our own delivery, particularly
14:19
Speaker 1: in China. In the Middle East, we also have a
14:22
Speaker 1: pretty sizeable delivery business where we do the delivery ourselves.
14:26
Speaker 1: And then in other parts of the world, like in
14:27
Speaker 1: the US, we have partnered with third party operators like
14:31
Speaker 1: an Uber eats or a door dash. So right now
14:34
Speaker 1: we do about six billion dollars of sales a year
14:37
Speaker 1: through delivery, which is growing, you know, high teens globally.
14:42
Speaker 1: It's it's been pretty remarkable. Another day is digital. You
14:45
Speaker 1: can buy things digitally? How do you do that? So
14:48
Speaker 1: the app? For us, everything is moving to the app.
14:51
Speaker 1: I think for us it's been it's been an interesting
14:53
Speaker 1: evolution to see where you know, for years and years
14:57
Speaker 1: the center of the relationship that we had with the
14:59
Speaker 1: customer in the physical restaurant, and what we're seeing, particularly
15:02
Speaker 1: with gen Z and millennials, is it's moving to much
15:06
Speaker 1: more of a digital relationship through the app. So yes,
15:09
Speaker 1: today UH in almost every single one of our countries,
15:13
Speaker 1: the US being a prime example of that. You can
15:16
Speaker 1: download the McDonald's app, you can order your products through
15:19
Speaker 1: the app and UH. An exciting thing we're doing right
15:22
Speaker 1: now this month is we're rolling out loyalty, So when
15:25
Speaker 1: you buy with the app, you also get loyalty points
15:28
Speaker 1: you can redeem later for food and other benefits. It's
15:31
Speaker 1: your frequent flyer version. You got it. So and the
15:34
Speaker 1: last d is dying in which used to be the
15:36
Speaker 1: thing that people did. But now is that a smaller
15:38
Speaker 1: and smaller part of your business and you need all
15:40
Speaker 1: those spaces anymore in your restaurants. It's I think still
15:44
Speaker 1: a really important part of our business because a lot
15:48
Speaker 1: of the interaction and the memories that people form about
15:51
Speaker 1: McDonald's comes from the dying in experience. But I think
15:54
Speaker 1: you're right in recognizing that it is certainly, through the pandemic,
15:59
Speaker 1: a less prov part of the business. I mean, our
16:02
Speaker 1: view is that it is going to come back. Um.
16:04
Speaker 1: I think dining and eating is such a social experience.
16:08
Speaker 1: There's always going to be an element of it that
16:10
Speaker 1: is in person. Now, how much of it comes back,
16:13
Speaker 1: time will tell. And if at some point, you know,
16:15
Speaker 1: maybe we need to reduce the space for dining seating
16:19
Speaker 1: that we have in our restaurants, we can always calibrate
16:21
Speaker 1: and do that, But for now we're kind of on
16:23
Speaker 1: a watch and c mode. I assume you have a
16:26
Speaker 1: lot of people saying the food isn't as healthy as
16:28
Speaker 1: they might want it to be. Is that the biggest
16:30
Speaker 1: challenge or just growing the company? Ray Kroc had a
16:32
Speaker 1: famous line that gets quoted around here fairly off and
16:36
Speaker 1: even today, which is if you're not green and growing
16:38
Speaker 1: your red and rotten. Let's talk about your background. Where
16:41
Speaker 1: did you grow up? So? I was born in Boston,
16:44
Speaker 1: grew up on the East Coast until we started moving around.
16:47
Speaker 1: I went to high school in Cincinnati, uh, and then
16:50
Speaker 1: ultimately went to college down in North Carolina. Well, you
16:52
Speaker 1: can say the name, it's I went to do Yes,
16:54
Speaker 1: we shared that. And after you graduated, what did you do?
16:58
Speaker 1: I went to Procker and Gamble. I went into their
17:01
Speaker 1: band brand management program at the headquarters in Cincinnati. And
17:05
Speaker 1: after that, so after that, I went to Harvard Business
17:08
Speaker 1: School UM and got my m b a UM, and
17:11
Speaker 1: after that I went into consulting for a few years.
17:13
Speaker 1: But you spent a lot of time in the food
17:15
Speaker 1: world because you were before PEPSI, you were you were
17:18
Speaker 1: after after PEPSI were a craft as That's right. So
17:21
Speaker 1: just something about food that you really appeal to you,
17:23
Speaker 1: I'd say what I love is being in consumer industries. UH.
17:27
Speaker 1: For me, what I really find sort of energizing as
17:30
Speaker 1: having a tangible product that I can see, touch, feel, etcetera. UM,
17:35
Speaker 1: and also one that you know people can relate to
17:38
Speaker 1: when I say, you know, I work at PEPSI, or
17:40
Speaker 1: I work at craft or I work at McDonald's. Um,
17:44
Speaker 1: immediately you can always have a conversation with people and
17:47
Speaker 1: kind of the fun thing for me and my current job.
17:49
Speaker 1: You know, no matter where I am in the world, UM,
17:53
Speaker 1: people have an opinion about McDonald's and want to talk
17:56
Speaker 1: to you about McDonald's, and it just it makes the
17:57
Speaker 1: job fun. So you came here, and that here was
18:01
Speaker 1: here in Okay, and then you rose up pretty quickly
18:04
Speaker 1: to become the head of America's that's right. And then
18:06
Speaker 1: in two thousand nineteen you became the CEO. That's right.
18:10
Speaker 1: And the stock is up and the market cap is
18:12
Speaker 1: up about since then. So I assume your board is happy.
18:15
Speaker 1: So far, so good. Yeah, but some of your predecessors
18:18
Speaker 1: had problems. They didn't last that long and for health
18:20
Speaker 1: or other reasons. So is there a bad karma you
18:22
Speaker 1: feel to being CEO or you think you can outlive
18:25
Speaker 1: the bad karma? Yeah? I hope not. I try not
18:27
Speaker 1: to think about it too much actually, UM. But you know,
18:30
Speaker 1: I think when you're in these jobs, you know, you're
18:34
Speaker 1: you're just very grateful for the time that you're in
18:36
Speaker 1: the role. And I don't spend a whole lot of
18:39
Speaker 1: time thinking about you know, sort of you know, the
18:43
Speaker 1: future and all that stuff. It's it's about you know,
18:46
Speaker 1: so long as I keep delivering for the company, us,
18:49
Speaker 1: long as we keep performing. Um. I certainly, you know,
18:52
Speaker 1: feel really fortunate to be in the role that I'm in.
18:54
Speaker 1: So it's a global company. UM now that COVID is
18:57
Speaker 1: not behind us, but certainly receiving a bit. Are you
19:00
Speaker 1: traveling the world? Are you expect to travel the world
19:03
Speaker 1: war I do expect to travel starting next month. Uh,
19:07
Speaker 1: and you know, between now and the end of the year,
19:09
Speaker 1: I've got five international trips lined up. Are when you
19:13
Speaker 1: travel internationally, you're trying to tell the local franchises to
19:15
Speaker 1: do work more, do better job? Or what are you
19:18
Speaker 1: trying to do when you travel you're recruiting it franchisees
19:21
Speaker 1: or are you telling them why your new food products
19:22
Speaker 1: are going to be good or why Yeah, there there's
19:24
Speaker 1: a variety of things I'm trying to get done. When
19:26
Speaker 1: when I'm out there, the biggest thing is listening, so
19:30
Speaker 1: you know, hearing what's on the mind of our franchisees,
19:33
Speaker 1: hearing what's on the mind of our people. That's one
19:35
Speaker 1: thing I'm looking at the second is making sure that
19:38
Speaker 1: the strategies that we're talking about at a corporate level
19:42
Speaker 1: are they cascading down and we're seeing those in the restaurants.
19:44
Speaker 1: A lot of times, what can happen is you think
19:47
Speaker 1: you've got clarity around what the strategy is and then
19:49
Speaker 1: it doesn't actually end up getting executed. So I'm looking
19:52
Speaker 1: at the connection between our strategy and is it showing
19:55
Speaker 1: up in the execution the restaurant. I also will just
19:58
Speaker 1: spend time being a little bit of a cheerleader. Um
20:01
Speaker 1: when I go into the restaurant. As you would imagine
20:03
Speaker 1: the role, Uh, it's it's about creating excitement and appreciation
20:08
Speaker 1: for the crew working in that restaurant. So I try
20:10
Speaker 1: to do some of that. And then I also make
20:12
Speaker 1: time when I'm traveling to meet our young up and
20:15
Speaker 1: coming employees kind of our high potential. So there's a
20:18
Speaker 1: variety of things I'm doing. So when you meet with
20:20
Speaker 1: your local franchises anywhere in the world, do you have
20:22
Speaker 1: lunch at McDonald's or do you say let's go somewhere else.
20:25
Speaker 1: We we will always eat in the restaurant. Dinner, we
20:28
Speaker 1: typically will go somewhere other than McDonald's. But breakfast and
20:32
Speaker 1: lunch will always be in a McDonald's. And do you
20:34
Speaker 1: ever go to your competitors stores and kind of see
20:37
Speaker 1: what they're doing to get some new information? We do?
20:39
Speaker 1: We do, UM, usually don't stay there too long. Usually
20:43
Speaker 1: the service isn't as good and the food isn't as
20:45
Speaker 1: good either, but we will go in there to just check.
20:47
Speaker 1: So McDonald's is always coming up with new products. You know,
20:51
Speaker 1: everybody's coming up with new products in every line of business,
20:53
Speaker 1: but you're always coming up with new food products that
20:55
Speaker 1: people will presumably like. But do you taste them all yourself?
20:58
Speaker 1: And do you have to approve a new product? Or
21:01
Speaker 1: you just say I've got to the people that do
21:02
Speaker 1: the food tasting. Yeah, we have a great menu team. Uh.
21:05
Speaker 1: It's their job to work typically with franchise ease and
21:10
Speaker 1: ulultimately customers to develop the new food items. Occasionally I
21:15
Speaker 1: might just say, hey, I'd be interested in trying that.
21:18
Speaker 1: The team will usually humor me on those types of things. UM.
21:22
Speaker 1: But if you don't like it, what happens nothing ordinarily
21:27
Speaker 1: other than just it's interesting that you didn't like it.
21:29
Speaker 1: Where I will where I do exercise as CEO authorities
21:34
Speaker 1: around our core menu, So you can't touch the big Mac,
21:37
Speaker 1: you can't touch the quarter pound, or you can't touch
21:39
Speaker 1: the fries, um, you can't touch hamburger cheeseburger and make
21:44
Speaker 1: any changes to those without my approval. But outside of
21:47
Speaker 1: the core menu you have a lot of latitude and
21:48
Speaker 1: certainly on new items. So what do you think is
21:50
Speaker 1: the biggest challenge of being the CEO of McDonald's just
21:53
Speaker 1: just keep growing the company? Or I assume you have
21:56
Speaker 1: a lot of people saying the food isn't as healthy
21:58
Speaker 1: as they might want it to be. Is that the
22:00
Speaker 1: biggest challenge or just growing the company? I mean, I
22:04
Speaker 1: think it's about UM As a business, we have to
22:07
Speaker 1: be growing. And Ray Kroc had a famous line that
22:11
Speaker 1: gets quoted around here fairly often even today, which is,
22:15
Speaker 1: if you're not green and growing, you're red and rotten UM.
22:17
Speaker 1: And I think that philosophy is part of our business,
22:21
Speaker 1: which is we are a growth business. So how do
22:24
Speaker 1: we grow is a big part of it. But where
22:27
Speaker 1: it will come up is and things that you were
22:29
Speaker 1: talking about, you know, for example, you know the menu items, UM,
22:33
Speaker 1: if we're perceived as not meeting the needs of customers,
22:36
Speaker 1: were not going to grow. So if customers are seeking
22:38
Speaker 1: healthier food options and we're slow on delivering those, it's
22:42
Speaker 1: going to impact our growth. So that that's what I
22:45
Speaker 1: viewed my job is all about. Thanks for listening to
22:48
Speaker 1: hear more of my interviews. You can subscribe and download
22:51
Speaker 1: my podcast on Spotify, Apple, or wherever you listen