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QSR Interview

One on One with Jim Skinner

And then also staffing. We’re one of the fortunate companies today that can hire, and continued to hire, not just because we’ve opened new restaurants but because we’ve been successful.

And then of course there’s the reimaging. We’re ratcheting up our efforts at re-imaging—we’ll probably re-image 2,300 restaurants or more this year. If you look at capital expenditures, we’ve upped that by about $300 million. Much of that will go against re-imaging, but we’re also going to open a thousand new restaurants, which is up from a year ago.

POS systems are ever-changing. The technology is ever-changing. It’s important for us to have the appropriate interface capability for our crew and management, so it’s easier for them with the face of the keyboard and the complexity of the menu, it’s a point of importance in terms of being able to point to the product. Instead of having to go through four different steps, you end up having one or two steps, for the speed of the order-taking.

What is the reaction from the franchisee community regarding all of this?

Good. Cash flow is at an all-time high here in the U.S. We’ve always had a good relationship with our franchisees, but it’s always better when the results are better.

We didn’t have a lot of dissention around the combined beverage program. But any time you’re embarking on a billion-dollar project and implementing something in 14,000 stores, 85 percent of them managed by franchisees, you’re going to have a difference of opinion on how to implement that. That was nothing more than the normal collaboration of leadership of franchisees and McDonald’s, which we pride ourselves on…working out the kinks in terms of how we’re going to implement this.

What’s your favorite menu item?

The Angus burger is outstanding. It’s now my favorite. I have a lot of favorites on the menu, but that sandwich is a good sandwich.

Will the Great Recession leave a permanent impression on McDonald’s?

I don’t think so, because what people have to realize is we have changed our menu as much. The only thing we’ve changed is now we have a Dollar Breakfast Menu across the nation. The rest of the dayparts, we were operating from a position of strength as we went into the recession because we had everyday affordability and value.

It was a luxury for us not to have to change.

When I screw up your order at the front counter or the drive-thru, it’s all lost, because you don’t care how good our last commercial was.”

We’ve never been at a point where we moved up and down because of our strategic response to the economy. We price according to what’s appropriate for the marketplace, for our consumers, and making sure that they get a great value.

We perform better in a robust economy than in a down economy. There’s a lot of bad information out there about us being cheap eats—“Oh, what’s McDonald’s going to do now that the economy is coming back?” We increased market share last year and the year before that, and we will be getting our fair share if we get more traffic and more spending from consumers.

This notion, Oh, I can’t go to a white tablecloth restaurant, so I’m going to go to McDonald’s. Yes, our traffic increases, but a lot of it was from customers who had always gone to McDonald’s. It didn’t change their lifestyle relative to McDonald’s.

What mark would you like to leave on McDonald’s?

If you just looked at the financial results, I’d say the best, ever. But it would be meaningless for me to say that. I think my legacy will be one of talent management and development—making sure that we had the right people in the right place and they developed their successors.

If we just looked at your five year results and your track record, I could name the starting line-up…That’s all well and good, but call me back in three years after I’m gone and tell me if McDonald’s is still the best in class and that you can really say the previous three year’s results were really because of what Skinner did while he was on his watch, you can call me the best.

When you’re in the job, there are any number of things you could do. But the true test of a legacy is to leave a better system. I’m proud of every person I’ve nurtured and put into key jobs.

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