As president and COO of McDonaldâ€™s Corp. for the past year, Don Thompson has been working on flipping the business model at the worldâ€™s largest fast food restaurant chainâ€”and heâ€™s loving it. Flying from the Philippines to New York to receive the Achievement Award from the Executive Leadership Council, the highest honor from the pre-eminent organization of black senior executives, the energetic, 20-year veteran met with editors of Black Enterprise about major developments taking place to transform the Golden Arches.
He discussed adapting the corporate â€śPlan to Winâ€ť for todayâ€™s environment including the $2.4 billion the company has allocated to radically redesign 2,000 restaurants and build another 1,000, as well as new menu offerings such as oatmeal, smoothies, and frappes that promise to broaden the iconic corporationâ€™s customer base worldwide. Innovation, Thompson says, serves to buttress the $23.5 billion companyâ€™s focus on customer service and affordability.
The recipe is clearly working: Third quarter earnings for McDonaldâ€™s, which serves 47 million customers a day at 32,000 outlets in 100 countries, rose 12% on the strength of global sales. In fact, sales were up 5.3% in the U.S.; 4.1% in Europe; and 8.1% in Asia/Pacific, the Middle East, and Africa.
Thompson also believes that further development of its diverse talent pool will propel the company forward in the coming decades. Thereâ€™s a reason why McDonaldâ€™s has made our 40 Best Companies for Diversity list for six consecutive years: More than 50% of McDonaldâ€™s managers are women and minorities. The following are excerpts from our exclusive interview with Thompson on how the fast food chain maintains its competitive edge.
How do you define corporate leadership in todayâ€™s environment?
Corporate leadership today is transitioning. Historically, corporations decided to define themselves around both short- and long-term profitable growth and if they were publicly held it was about [making] sure that they had provided total shareholder return. Today, I think the additional point relative to how corporations are defined is much more by consumers. Itâ€™s not just financial anymore. Itâ€™s also what role corporations play in the overall community and overall corporate social environment.
Thereâ€™s a lot of fear and uncertainty due to the economy. What strategies should companies employ to attract customers and boost sales?
The challenge today in business is that although thereâ€™s quite a bit of economic uncertainty and disposable income is quite depressed, you have to stay tied directly with customers. For us that means weâ€™ve got to remain a part of their lives even though
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