Summary of Situation (very brief)
From the early 90s to 2003, McDonald’s had a declining decade with ineffective leadership. Since 2003, McDonald’s has made huge strides in improving customer service, quality of food, revitalizing the look of the restaurant, and have created many new popular menu items, from healthy choices, like salads and fruit, to the many new choices of coffee-based drinks and fruit smoothies all in the attempt to stay in front of the competition to attract new customers while retaining its current customer base.
Key Issues—Identification and Analysis
The Downward Spiral
Service became a big problem for McDonald’s after the huge expansion of the 80s and 90s. As a result, it tarnished McDonald’s image and reputation for providing quality food fast. With the attention on expansion, training was no longer a major priority. This affected the quality of the food production and also had an effect on the speed of delivery to the customer creating longer wait times and disgruntled diners. During this time, 40 products were introduced. None were really successful due to poor execution resulting from improper training. Effective leadership would have recognized the necessity of maintaining a high level of training to ensure a high level of quality of both food and service, as well as expanding the chain globally.
CEOs Quinlan and Greenburg did more to try diversify the product line by purchasing other chains and introducing new items instead of placing the emphasis on making sure the fundamental elements of service, speed, and quality of its primary product line. Quinlan made matters worse by stopping the practice of inspecting the stores to ensure they met the required standards of speed, quality, and cleanliness. A 60% decline in the value of the stock forced McDonald’s to bring back Cantalupo to hold of the reins. Cantalupo was successful in shifting the focus from expansion to quality and speediness through a renewed emphasis on making sure franchisees were performing to standard with a tougher grading system. He also got rid of the things that were not making McDonald’s better by divesting in the chains that were no profitable. He concentrated on creating more revenue from existing locations with new items, offering healthier options, as well as innovative ideas that became popular with the public. The sudden death of Cantalupo brought in Bell to take over until his sudden retirement for health reasons. Skinner came in as the new CEO in late 2004. His primary focus was to improve the unhealthy image of McDonald’s after Morgan Spurlock’s documentary “Supersize Me”. Skinner’s plan of attack was to implement healthier processes in preparation and production, as well as more healthy choices for the customer. This was smart on his behalf as McDonald’s image suffered greatly from the documentary’s exposure and the resulting litigation from customers claiming McDonald’s made them fat.
The first thing McDonald’s...