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Chain of Supply

While the front-of-the-restaurant experience was suffering, the McDonald’s operational efficiency hummed along, focusing on cost efficiency rather than brand effectiveness.

McDonald’s operations are second to none. There is really nothing like the McDonald’s supply chain. How many times have you been to a restaurant where your waiter says the specials are no longer available? Now think about how you do not hear crew members at McDonald’s telling you that Big Macs or fries are not available?

Think about the fact that each Extra Value Meal sandwich comes with a hamburger, chicken, or fish, condiments, a side item, and a napkin, not to mention a drink, a cup, and a straw. And that is just for the hamburger and chicken and fish sandwiches. Don’t forget the breakfast sandwiches, Chicken McNuggets, various salads, a variety of desserts, other beverages, and so on. There are also a variety of packages and cups. The complexity of ensuring that the right inventory is in each of 30,000 restaurants, more than 50 million times a day in more than 100 countries, is an awesome challenge. For example, consider just these simple products such as the yogurt parfait or fries:

  • Yogurt parfait—Plastic cup, plastic lid, spoon, napkin, granola packet, yogurt, and fruit. One size; seven items.

  • Fries—Potatoes, salt, red fry box (three sizes), napkin, ketchup. Three sizes; five items.

Customers do not really consider this logistical miracle. Yet, it is all delivered at remarkable speed. It is all very efficient.

From an operational standpoint, all the food and accompanying items were in the restaurants. Sadly, what customers were too often experiencing in the front of the restaurant or at the drive-thru was an efficient yet off-putting experience of sloppy, inconsistent, and unfriendly service; inaccurate orders; and dirty outdated facilities. One customer described to me how he held his five-year-old son over the toilet rather than allow him to sit in a bathroom that was remarkably filthy.

This was the consumer, franchisee, and corporate environment when I joined McDonald’s. It was not a pretty picture; McDonald’s was not a happy place. But at least I was familiar with the causes for the challenges that lay ahead.

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