McDonald’s as Development Aid

Much of the world seems to view McDonald’s as mere hamburger flippers. Even those with more informed opinions view the restaurant chain as a not-so-flattering symbol of the bland indistinctiveness of U.S. culture and cuisine.

But when we asked one of its headquarters chieftains what business McDonald’s is really in, we found quite a difference between perception and reality. “What people don’t understand, ” we were told, “is that our franchisees — not the company — own the bulk of the restaurants. It’s up to them to sell the food.”

The executive explained that McDonald’s, the company, is really in the logistics business — administering a huge network of suppliers, transporters and outlets. And the logistics are getting increasingly complex, given that in recent years McDonald’s has opened nearly as many restaurants in emerging markets as in the United States.

So forget about feeding hamburgers to the masses. What the company is really doing is teaching critical development skills: how to organize supply chains, implement quality control programs and run sophisticated perishable goods transportation networks.

Thus, when McDonald’s first expanded into new markets in China and India, the company trained local farmers how to grow just the right lettuce and near- perfect potatoes … and how to get their products to the restaurants on time.

Strange. For the longest time, we had thought the McDonald’s story was all about supposedly bland America food — not sophisticated development aid.