Have you been in McDonald’s recently? McWOW! I was in high school when McD’s opened a few blocks away. The drive through was a morning ritual and when we could leave campus for lunch; it was the closest food venue. Years later, this is the McD’s that my youngest son had a birthday party at. Countless weekend mornings included a trip to this McDonald’s for breakfast or a Happy Meal a few hours later. Most recently, the drive through crew became close friends immediately after my mother’s heart attack – I slept overnight at the hospital and would awake around 4:00 am when the shift change occurred. On my way home to shower and change I would hit the drive through before breakfast hours began, but, they were great and would put something on for me. By the fourth day the drive through counter person asked how my mom was doing. I noticed a lot of work going on at McD’s recently. When I walked in for something to drink the place now featured modern furniture, limestone fireplace, four plasma screens, and WiFi. Jazz was playing in the background and Ronald and his kids had been replaced by large prints of Gen Xers and Millenniums.
The ability to reinvent – consistent innovation, is a unique skill and challenge. A traditional product life cycle includes start-up and early adopters, moves gradually to mainstream, and then finds a period where interest by consumers wanes concurrent with competitor entry. My high school McD’s use to sit alone and today its neighbors include Hardees’s, Taco Bell (without the attached KFC), Wendy’s, Chick Filet, Noodles, and five restaurants. Like many suburban corners, it is fast food heaven. McDonald’s wasn’t stagnant. Menu changes, indoor playground, and now coffee bar demonstrate a culture that embraces innovation and change.
It isn’t an easy journey. Leading innovation requires a keen understanding of value – value to the employee, the supplier, the consumer. Leading innovation demands a leader that is able to use all six senses to communicate a vision. The communication of vision must be sufficient to motivate others to follow – to believe.
For a business to remain in consistent innovation, an organization’s culture celebrates change and the opportunity to create value. An organization’s folklore should be filled with stories of wins and losses depicting an ongoing journey of value creation. Organizations in consistent innovation mode experience peaks and valleys and recognize everything cannot be spot on. The difference between these organizations and their counterparts (those who celebrate being not changing, honoring the past by not altering the present) is that the human and resource capital of valley periods is minimal. Mass carnage following a non win is not part of the folklore.
Consistent innovation permeates organizations’ internal systems. Truly consistent innovators have instilled its leadership and management style throughout all components of the organization. The Times in London recently ran a story about McD’s in Britain:
(Menu changes and new product offerings) strategy addressed two key objectives — first, to tackle the impact of the recession on consumers by offering them a good-value item, between £1.49 and £1.59, which sat between the cheapest dishes on the McDonald’s menu and more expensive lines such as the Big Mac. The second part of the exercise was all about continuing to attract new and different customers to McDonald’s, particularly young mothers taking their kids to the restaurant, who might traditionally only have bought a tea or coffee because they were deterred by the idea of a larger portion.
In doing so McDonald’s was continuing a process, on which it embarked five years ago, to listen more to local consumers in Britain and act on what it heard. It is something McDonald’s has sought increasingly to do around the world. This month, the fast-food giant launched a “McItaly” burger, enthusiastically supported by Silvio Berlusconi’s government. Luca Zaia, the country’s Minister of Agriculture, Food and Forestry, wrote to The Times last week after reports that the product had received a mixed reception there. Zaia pointed out that, on Wednesday alone, 100,000 of the burgers were sold. He added: “In Italy, we consider this a great success.”
All the McItaly’s ingredients are locally sourced and produced and will be worth €3.5 million a month to Italian farmers in extra income. Other local favourites around the world include the Maharaja Mac in India, which is made of lamb or chicken; the McLobster in Canada and, in Japan, the Ebi Filit-O, a kind of shrimp burger.
The outcome of McD’s strategic move is positive. In store, like-for-like sales increased last year by 10 percent. Harkening back to the golden arch signs reporting the number of hamburgers sold, the strategic growth equates to approximately 130 million more customer store visits and “going back to 2005, the restaurant giant has added around £465 million to its sales.”
McD’s had me at you deserve a break today. My sons are now adults. The display of the newest gift in the Happy Meal box doesn’t warrant a stampede from home any longer. A few weeks ago my 8 year old niece and I were running errands. Around lunchtime we ended up at McD’s. The McNuggets were her choice, salad for me. The value was still there.
McWOW!
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