McDONALD’S IS DOOMED: McDonald’s New CEO Chris Kempczinski Tense Franchise Relationship.
The new chief executive officer of McDonald’s Corp. is a Harvard MBA who played a critical role in the revamp of the fast-food chain that has turned the stock into a Wall Street darling.
But what Chris Kempczinski isn’t is a guy who once flipped burgers — and that doesn’t exactly endear him to owners of McDonald’s franchises. Already upset over bearing the burden of the costs from that makeover, they may be one of his biggest challenges as he takes over from Steve Easterbrook, who was fired as CEO on Sunday for having a consensual relationship with an employee.
The 51-year-old Kempczinski, known as “Chris K” around the office, was hired by Easterbrook in 2015 as an executive vice president of strategy and business development, part of a massive shakeup of management ranks. A little over a year later, he was named to run all U.S. business. He previously worked at Kraft Foods and PepsiCo.
Easterbrook, by contrast, spent most of his career at McDonald’s, joining in 1993 in London. He once worked as a restaurant manager for McDonald’s before being named to head its U.K. division.
McDonald’s shares fell as much as 3.1% in New York Monday, hitting the lowest intraday point since April. The stock had almost doubled since Easterbrook took over in March 2015, more than twice the gain in the S&P 500 Index, giving the company a market capitalization of $147 billion as of Friday.
McDonald’s was further shaken Monday when it announced that its top human resources manager, David Fairhurst, left the company. No reason was given.
As Steve warned in April of 2015, “McDonald’s is almost certainly doomed. Or at the very least, Easterbrook is the wrong guy to head up the burger chain — any burger chain, for that matter. To understand why I’ve come to this conclusion, read the very next line from the story: Easterbrook plans to unveil his plan for turning McDonald’s into a ‘modern, progressive burger company’ on May 4…Would it surprise you to learn that Easterbrook is a Brit? Me, neither. Meet you at Steak ‘n Shake?”