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Compact case
Case
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Reference no. 320-0311-1
Authors: Aramis Rodriguez (IESA); Syramad Cortés (IESA)
Originally published in: 2020
Version: 1-Feb-2020
Revision date: 03-Nov-2020

Abstract

The case is based on role-playing, a technique of dramatization, simulation or role-play. After a narrative that provides the framework and synthesis of McDonald’s strategic milestones since its foundation, the case stops in 2015, when Steve Easterbrook is appointed as the new CEO, amid a cumulus of adversities. Easterbrook had to decide what should be the strategic focus of McDonald’s for the following years. After considering different alternatives, he called a meeting with two of his executives for an open discussion to come up with their ideas on what should be the focus of a 'restructuring plan' according to each one, to turn the company around and boost it as Ray Kroc did in his time. The decision would reach the Board of Directors for its discussion, but Easterbrook had to decide to propose a plan, which would have an important weight. To create a base for the study case, a moment of the discussion is recreated (using secondary information) with the three decision-makers, who have quite different profiles. Students take the roles of these three characters: Steve Easterbrook (CEO), Chris Kempczinski (CIO) and Kevin Ozan (CFO). Each character has a position regarding McDonald’s future, based on each one’s bias and the information they have about the company. Easterbrook was a world-class CEO and besides, he had the power and legitimacy to propose the Board any idea to bring McDonald’s out of the rut. His experience gave him the confidence to make decisions, but before making them he gathered information, opinions and ideas from his colleagues. Until that moment, he had met with most of the executive team (with 10 leaders), but he was missing the opinion of two of the most determining ones: Kevin Ozan (who managed the numbers) and Chris Kempczinski (who would put in new perspectives). Ozan’s position was oriented towards financial order and cost reduction. No new adventures were to be undertaken; order was required - that was his suggestion. Improving sales in the short term, increasing profitability in the mid-term to recapture the trust of the investors, were his favorite actions. On the other hand, Chris Kempczinski (the innovator) considered that McDonald’s business model and value proposal had expired, and the improvement in sales would not be enough to rescue what was in constant decline. According to Chris, they had to take advantage of the current motor that was creating income to experiment with new business models. What should McDonald’s do? What should Easterbrook propose? After a meeting with these three characters, Easterbrook had to think about the main guidelines to start developing a plan for the future of McDonald’s.

Teaching and learning

This item is suitable for postgraduate courses.

Geographical setting

Region:
World/global

Featured company

McDonald's
Employees:
10000+
Type:
Privately held
Industry:
Fast Food Franchises
Other keywords:
MCD; NYSE; ambidextrous; innovatio; strategy

Featured protagonists

  • Steve Easterbrook (male), Chief Executive Officer and Director (CEO)
  • Chris Kempczinski (male), Vice-president for strategy, business development and innovation (CIO)
  • Kevin Ozan (male), Corporate Executive Vice President and Chief Financial Officer (CFO)

About

Abstract

The case is based on role-playing, a technique of dramatization, simulation or role-play. After a narrative that provides the framework and synthesis of McDonald’s strategic milestones since its foundation, the case stops in 2015, when Steve Easterbrook is appointed as the new CEO, amid a cumulus of adversities. Easterbrook had to decide what should be the strategic focus of McDonald’s for the following years. After considering different alternatives, he called a meeting with two of his executives for an open discussion to come up with their ideas on what should be the focus of a 'restructuring plan' according to each one, to turn the company around and boost it as Ray Kroc did in his time. The decision would reach the Board of Directors for its discussion, but Easterbrook had to decide to propose a plan, which would have an important weight. To create a base for the study case, a moment of the discussion is recreated (using secondary information) with the three decision-makers, who have quite different profiles. Students take the roles of these three characters: Steve Easterbrook (CEO), Chris Kempczinski (CIO) and Kevin Ozan (CFO). Each character has a position regarding McDonald’s future, based on each one’s bias and the information they have about the company. Easterbrook was a world-class CEO and besides, he had the power and legitimacy to propose the Board any idea to bring McDonald’s out of the rut. His experience gave him the confidence to make decisions, but before making them he gathered information, opinions and ideas from his colleagues. Until that moment, he had met with most of the executive team (with 10 leaders), but he was missing the opinion of two of the most determining ones: Kevin Ozan (who managed the numbers) and Chris Kempczinski (who would put in new perspectives). Ozan’s position was oriented towards financial order and cost reduction. No new adventures were to be undertaken; order was required - that was his suggestion. Improving sales in the short term, increasing profitability in the mid-term to recapture the trust of the investors, were his favorite actions. On the other hand, Chris Kempczinski (the innovator) considered that McDonald’s business model and value proposal had expired, and the improvement in sales would not be enough to rescue what was in constant decline. According to Chris, they had to take advantage of the current motor that was creating income to experiment with new business models. What should McDonald’s do? What should Easterbrook propose? After a meeting with these three characters, Easterbrook had to think about the main guidelines to start developing a plan for the future of McDonald’s.

Teaching and learning

This item is suitable for postgraduate courses.

Settings

Geographical setting

Region:
World/global

Featured company

McDonald's
Employees:
10000+
Type:
Privately held
Industry:
Fast Food Franchises
Other keywords:
MCD; NYSE; ambidextrous; innovatio; strategy

Featured protagonists

  • Steve Easterbrook (male), Chief Executive Officer and Director (CEO)
  • Chris Kempczinski (male), Vice-president for strategy, business development and innovation (CIO)
  • Kevin Ozan (male), Corporate Executive Vice President and Chief Financial Officer (CFO)

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