Thursday, January 29, 2015
McDonald's Fires Black CEO After Just 2.5 Years
After just 2.5 years in the position, McDonald's CEO Don Thompson is stepping down and retiring as the CEO of McDonald's after receiving pressure from the board of the one of the world's most popular fast food restaurant chains.
According to the company, Thompson will be replaced by Steve Easterbrook, a company veteran who rejoined McDonald's as its chief brand officer in 2013.
51-year old Thompson was the first African-American to head the company since it was founded in 1955. He had spent nearly 25 years working with the company. He commented, "It's tough to say goodbye to the McFamily, but there is a time and season for everything."
But why was he pressured to step down?
Well, it started when criticism for the chain’s sluggish financial performance began to be aimed at the company’s directors. Customer traffic at the company's 36,000 locations in the U.S. fell 4.1 percent last year, following a 1.6 percent decline in 2013.
The company also experienced a major supplier scandal in China that greatly damaged its reputation.
Even worse, the company's stock (NYSE: MCD) has declined about 6 percent in the past year while broader markets are up in the double digits.
The problem is not so much whose in charge. The issue is that consumers are becoming more health-conscious, and fast-food restaurants have bad reputations for selling people food made with "cheap, greasy and made with mysterious ingredients."
People are therefore gravitating towards restaurants and eateries where they feel the food is more wholesome and made with higher quality ingredients, such as Chipotle and Panera Bread.
Experts say the real solution is for McDonald's to join their competitors and start producing healthier food - that is, food without antibiotics, pesticides, and other mysterious ingredients.
Even Mike Andres, president of McDonald's USA, asked, "Why do we need to have preservatives in our food? We probably don't."
For more details on corporate McDonald's, visit www.AboutMcDonalds.com