With all the turnaround talk from McDonaldâs in recent months, the fast-food companyâs newly revealed ârevivalâ plan had little news to offer its customers.
The announcement by new CEO Steve Easterbrook on Monday morning may have some impact on workers, but focused mainly on satisfying shareholders. It comes just a few weeks before the companyâs annual shareholder meeting.
Here are the highlights of the changes you can expect to see at the Golden Arches.
Aligning similar markets
Easterbook plans on creating a more âeffective and efficient organizational structureâ to understand what customers want. Starting July 1, global markets will be put into four market categories: the United States, countries making the most profits, countries expanding at a high rate and markets with smaller profit margins.
Canada falls under the second category, McDonaldâs âinternational lead markets,â which accounts for 40 per cent of McDonaldâs sales. There are about 1,400 McDonaldâs restaurants here nationwide.
Canada will share and have access to information from Australia, France, Germany and the United Kingdom. All of these countries share similar economic and competitive dynamics and growth opportunities, Easterbrook said.
The CEO hopes this will create a better connection with customers and enable the company to better deliver what they want.
Trying out all-day breakfast and delivery
McDonaldâs is hoping to be more progressive than they have been in the past. The company has started serving all-day breakfast in San Diego. Starting Monday, they are also launching a delivery service in New York City.
But donât get too excited. Because these are pilot projects, it could take a while before you can order a Big Mac to your front door.
Cuts for cash
Easterbrook plans to boost the bottom line by redesigning the companyâs organizational structure and ownership, as well as reducing general and administrative costs.
By aligning similar markets, cutting the âbureaucracyâ and general costs, Easterbrook believes McDonaldâs can cut $300 million by 2017.
What wasnât mentioned in the announcement was last monthâs plan to close about 700 restaurants that have low performance.
Job losses in the future?
With more store closures in the future and Easterbrookâs focus on slashing the decision-making âbureaucracy,â business analysts are wondering whether job losses will come in the near future.
Easterbrook didnât specify where the cuts might come, but said that McDonaldâs still hopes to open 1,000 new locations across the globe this year.
And itâs not just entry-level workers who may lose their jobs. Under the new global organizational structure, each of the four market categories will be led by their own president. Canadaâs category will be helmed by Doug Goare, who is currently the President of Europe markets, for example. Other existing presidents may become obsolete when the new market categories come into effect.
More franchising
Again, Easterbrook hopes to create a better connection between local franchise owners and their customers to understand what they want from their local McDonaldâs.
Easterbrook hopes to have 90 per cent of its restaurants worldwide franchised by the end of 2018, which would be the same as the United States.
McDonaldâs already has large-scale marketing power, but with these changes, expect to see even more. Franchisees are expected to put 4 per cent of their sales toward advertising.
With such a major announcement hitting headlines, the CEO didnât outline how the company will roll out its major changes. But it was clear Easterbrook knows that McDonaldâs has to change its attitude.
âWe can no longer afford to carry legacy structures, legacy commitments or legacy attitudes,â he said. âThat is why Iâm changing the structure.â
But customers and shareholders alike will have to wait and see whether theyâre lovinâ it.