8 Leadership Principles from McDonald's CEO Jim Skinner

I have to be honest. McDonald’s is not my favorite fast food restaurant. And yet I still go there a lot. Why am I drawn back again and again? Is it my kids’ insistent cries for Happy Meals, or my love for salty fries?

And I’m not alone. Since Jim Skinner became CEO in 2004, McDonald’s has pleased both customers (5% annual growth rate) and shareholders (the stock return has been over 15 times more than the S&P 500). 

In Why McDonald’s Wins in Any Economy, Skinner reveals some principles that have helped him lead with an attention to detail, but without micromanaging.

1. Keep the base happy.  Some folks simply want their hot cakes and hash browns, or Big Mac and French fries. Give them what they want.
2. Attract new customers.  As wraps, smoothies, and specialty coffees have become popular in other establishments, McDonald’s adopted them into its own menu.
3. Execute well to satisfy customers.  There are many people involved in delivering quality food to customers, from test chefs to local crews, and from suppliers to managers. Each step of the process must be continually evaluated, and improved as needed. For example, while a deli sandwich would please some customers, the crews could not serve it in less than a minute, and Skinner knows that speed matters to most McDonald’s drive-through customers.
4. Support your staff publicly.  The article's author gives an example of how he managed a tension between an executive and a manager below her. He backed the executive’s decision in front of others, but questioned her later in private.
5. Your strengths must be your foundation.  McDonald’s was founded on hamburgers, not pizza or hotels. Everything  must support the core business. Once you have a solid foundation, you have the freedom to expand into new opportunities (think: oatmeal).
6. New products can widen your reach.  The process of introducing the snack wrap (which required a quick 18 months from concept-to-delivery) forced the development team to perfect the tortilla, which allowed them to also produce a breakfast burrito. Also, the wraps increased sales by luring in customers for between-meal snacks.
7. Don’t be fooled by false-success.  When a new product is launched, measures are taken to ensure that the sales do not merely steal revenue from another platform.
8. Have a leadership pipeline.  Skinner himself was a right-hand-man for years. He insists that all executives be training two potential successors. 

If you follow these leadership principles, your customers will also be able to say, "I'm lovin' it."


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