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Can McDonald’s Be Saved?
Chapter 2 – Broken Windows, Broken Business...
[Michael Levine] 1/31/06

For those born during or after the 1950’s, a world without McDonald’s is just short of unthinkable. The golden arches making up the hamburger behemoth’s logo create a symbol so ubiquitous, so huge, so utterly pervasive, that the thought of it vanishing from the street, let alone the world, is practically laughable.

But it could happen someday. And why? Because the huge company has neglected its broken windows, and the public has taken notice.

Despite its presence in virtually every country, on every continent, in almost every town in the United States, McDonald’s is not the paragon of customer satisfaction or brand integrity it once was. In fact, consumers are fed up with Mickey D’s indifference toward them, its abandonment of its core principles, and its obvious contempt for those who patronize its tens of thousands of stores.

Consider this: The American Customer Satisfaction Index (ACSI) is compiled each year from quarterly surveys made by the University of Michigan’s National Quality Research Center, a Milwaukee institute, and CFI Group, a consulting firm based in Ann Arbor, Michigan. In February 2003, it was reported that for the tenth year in a row, McDonald’s had scored below average – and significantly so – for the fast food industry.

On the 100-point scale used by the ACSI, McDonald’s score was 61, down over 1.5 points from a similar survey done a year earlier. And the company’s average score was 5 to 10 points below the industry average since 1994, according to ACSI.

All right, so McDonald’s, one of the world’s largest corporations, is going through a rough time. Well, what does that have to do with your business? If you sell hamburgers, french fries, or sodas, you might welcome the collapse of a behemoth competitor like McDonald’s.

Well, if something of this magnitude can happen to McDonald’s because it is failing to fix its broken windows, can’t the same thing happen to you, no matter what business you might be in, if you don’t see the small things that make the difference?

Granted, some of McDonald’s troubles were not directly the fault of the company itself. An epidemic of mad cow disease in 2001 and 2002 caused some panic, particularly in Europe, regarding eating beef, and that certainly didn’t help the sales in hamburger outlets. Globally and in the United States, economic lethargy meant jobs being cut, fewer people eating in restaurants, and slower sales. Concerns about cholesterol and heart disease led to a decrease in the consumption of beef overall. These things were outside McDonald’s control, and although the corporation was capable of responding to some of them, a subject we’ll touch upon a bit later.

The point is, those outside concerns were not the main reasons for McDonald’s decline in customer satisfaction, which lead directly to decreased sells. The University of Michigan study of consumer satisfaction found in 2001 that 11 percent of McDonald’s customers where dissatisfied with their visit on any given day. Close to 70 percent of those dissatisfied customers were even more disgruntled following some contact with the company, because the complaints were not handled to the customer’s satisfaction. And here’s the part that really tells the story: More than half of all dissatisfied customers cut back on their visits to McDonald’s and told as many as ten other people about their experience.

According to the University of Michigan study, the top 5 complaints by McDonald’s customers were rude employees, not having happy meal toys, slow service, missing items, or receiving the wrong order, and unclean restaurants.

These are all broken windows, and they are not being repaired. In fact, as is the case with most broken windows, more glass is being shattered while the first cracks still await attention.

The little things that plague McDonald’s aren’t the quality of food or the promises the company makes. They are the promises not kept—the dirty bathrooms, the absent happy meal toys. Customers are disgruntled because they have been told to expect something and then are given less.

Broken windows can be repaired, but they have to be seen and fixed as quickly as possible.

It is my contention that if Ray Kroc, who bought the McDonald’s name and system and built the corporation almost single handedly into one of the largest companies in the world, were to rise from the grave and walk into a present-day McDonald’s franchise, he would die a second, more painful death.

From embarrassment.

In many locations, the cleanliness and efficiency Kroc so diligently guarded are nonexistent. The condiments areas are not cleaned regularly. The counter help is, at best, indifferent. The bathrooms… well, lets stay out of the bathrooms.

Key points are the ones that Ray Kroc emphasized a half century ago: dependable quality; fast, accommodating service; a clean, comfortable place to eat; and value for the working people who make the overwhelming majority of McDonald’s customers.

On the service, that doesn’t seem like such a tall order: the company should go back to Kroc’s principles and then enforce them strictly. But it’s not that simple. The world isn’t the same today as when Kroc walked into a San Bernadino hamburger stand in 1954.

The broken windows at McDonald’s are not all that different from those in other large businesses that have seen their star power decline in recent years. But when the business is based on speed and consumer satisfaction, and both of those begin to erode at the same time, the prognosis is not good. McDonald’s needs to get in touch with its inner Ray Kroc, and fast.

And if it could happen to them, it could happen to you. Think about it. -one-

See previous Broken Windows article at theOneRepublic

Michael Levine is the founder of LCO- Levine Communications Office, a Los Angeles-based public relations firm, and the author of 17 books, including Broken Windows (Warner Books, 2005). www.LCOonline.com

copyright 2005 Michael Levine

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