Page 32 - Everything I Know About Business I Learned

Everything I Know About Business I Learned at McDonald’s

Oak Brook, Illinois, home office, all indicators pointed to McDon-
ald’s transparency—a culture where doing the right, moral, and
ethical thing was important. And that was very deliberate. That
culture lives on today. As Don Thompson noted to me: “I tell
everybody, there are a lot of things that can be fixed and resolved,
but there are three that cannot. Don’t lie. Don’t cheat. Don’t steal.
Because if you do any of those, I can’t trust you.”

Doing It Right
“Ray had seen abuses,” Fred Turner recalled. “Tasty Freeze was
getting money on the side. Ray was selling mixers and originally
ice cream, but then liquid mix and soft serve. And shake mix.
So that was his industry, and he saw what they did. And he was
convinced that we shouldn’t make money off the suppliers. It
gives the company a selfish interest and a conflict. He saw that
2
that wasn’t healthy, and he didn’t want that. So day one, he was
saying no kickbacks. ”
Willis Smart, former regional vice president and currently an
operations vice president with Dunkin Brands, saw integrity as
integral to the system. “I believe there was a gentlemen’s agree-
ment that we were going to treat each other ethically,” Willis
told me. “The fact that we didn’t get into the distribution busi-
ness and keep those profits, I think, is an example of us bypass-
ing a growth opportunity on behalf of keeping the relationship
with the franchisees to be a very strong one.”
Ray’s position might be considered unusual even today. But
his business acumen would still be spot-on, especially consider-
ing the fate of companies that do not put the needs of the fran-
chisee first. Take, for example, Krispy Kreme, a hot company at
one point. By 2005 the company saw double-digit losses, and
franchisees filed for bankruptcy for a number of reasons, includ-
ing that they could not pay the company’s excessive franchise
and supply fees, as reported in the New York Times.