Page 150 - Everything I Know About Business I Learned

Everything I Know About Business I Learned at McDonald’s

not happy, the pressures on a CEO to quickly improve per-
formance are enormous. The market reads every movement,
every decision, with an eye toward getting a clue on a possible
swing of financial fortunes. Instead of heeding what many CEOs
would do in such a case, which is to boost up new-store growth
to show immediate sales gain, Jim did the opposite. He
announced that he would cut the development of new stores,
and focus on getting more sales in existing restaurants. As Jeff
Stratton, chief restaurant officer, said to me of this era, “He
returned the focus of our business to the core.” Mike Roberts,
president of U.S. operations at the time, described Jim’s actions
this way: “It took extraordinary courage, in my mind, for him
to support the U.S. agenda at the time. We had to go to Wall
Street and get our primary investors aligned.”
Additionally, Jim proposed an incentive to operators who
would take profit dollars from the corporation to help the oper-
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ators pay for the “reimaging” plan to enhance the stores’ look
to the customers. It hardly seemed a remedy for a jilted stock
price. He instinctively knew his strategy was right for the sys-
tem—it was a return to some of the basic principles he had
grown up with and witnessed, and it would bear fruit later on.
That took courage, both of his convictions and to endure the
outcry from his detractors.
Jack Welch, former chairman and CEO of General Electric,
in an April 2008 BusinessWeek article had this to say about
courage: “It’s the one behavior bureaucrats shun and too many
managers avoid.”

Breaking from the Status Quo
Courage. It may seem like an unlikely principle within a corpo-
rate culture, but as I witnessed, it was a component within the
system on all levels. And the culture of courage at McDonald’s