Demonizing the “Founder” of McDonald’s: It’s Much More the System than the Man

Although it is rooted in the 1950s and the creation of McDonald’s, the movie “The Founder” is a not-so-subtle attack on ruthless Trumpian-style and –era business practices.

The “founder” in question is Ray Kroc (who never founded anything- not the restaurant, its system, menu additions like Egg McMuffin, the idea that the real money was in the owning of the land on which the franchises were built and the rent that came from it, and so on). After many early failures as a Willy-Loman-like salesman, Kroc was drawn to the McDonald’s brothers’ revolutionary new business model in San Bernardino, California because it had placed an unusually large order for several of the milk shake machines he was hawking. The brothers were happy with their modest success and had no interest in building an empire. Kroc did and to his credit he was willing to work hard and risk all- including his home- on the future of the business which he saw in franchising (another idea and system not founded by Kroc).

But Kroc, like Trump, was ruthless and unethical both in his business and personal life eventually lying repeatedly to succeed. He ultimately screwed the McDonald brothers out of the $100 million a year he had verbally promised to them, but had refused to put in writing. In the end, one wonders whether the deceit was worth it. True, Kroc became a billionaire but he sold his soul in the process. In addition, after his death his wife gave it all away, much of it to the Salvation Army.

The movie is strong on the system that the McDonald brothers created. Its essence is depicted in a neatly choreographed scene on a tennis court with a chalk-drawn and re-drawn floor plan of the restaurant. The system they created drew heavily on Taylorism and time-and-motion studies, as well as on Henry Ford’s assembly line. Indeed, McDonald’s pioneered the assembly-line production of burgers (and other foods) and the treating of its customers as if they were on an assembly-line (especially in the later drive-throughs).

Beyond the McDonald’s “system”, the McDonald brothers created high(er) quality burgers and shakes (both eventually compromised by Kroc), finger food that did not require utensils, a self-service restaurant that kept customers moving because there were no seats, and a clean restaurant and environment that discouraged teenagers from hanging around and making a mess and lots of noise.

Kroc also quickly recognized the value of the name and of the golden arches (also created by the McDonald brothers). As depicted in the movie, he saw a similarity between those arches and church steeples and courthouse structures. In my terms, he is depicted as implicitly recognizing that he was creating a new “cathedral of consumption”.

One of the major problems with the movie is the failure to address some of the larger issues that are part of the process of “McDonaldization”. These include the broader changes that contributed greatly to McDonald’s success (the post WWII growth of automobile sales and travel, the national highway system, and the suburbs) as well as the broader changes it has wrought, especially the McDonaldization of society and of many of its institutions (schools, churches, etc.). Also missing is coverage of the many irrationalities associated with fast food chains (adverse impact on health, the environment, etc) and of McDonaldization more generally (e.g., increased homogenization), as well as even broader issues such as the globalization of the chain, its basic ideas, and its irrationalities which all played a major role in the “globalization of nothing”.

In the end, the movie focuses too much on one “demon” (Kroc), but minimizes larger demons (capitalism) and totally ignores others (the McDonaldization of society and its many irrationalities). As is true in much of the popular media and its products, The Founder individualizes and psychologizes when it needs to “sociologize”.

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Amazon.Go: New Heights of McDonaldization

Not that I can take any credit for it, but Amazon has unwittingly managed to wrap up much of what I have been thinking and writing about for the last three decades in one nice little material world bundle, Amazon Go. The prototype of this updated version of a convenience store now exists in Amazon’s new office building in downtown Seattle.

It is a highly McDonaldized setting in which, as in all McDonaldized settings:

  • Its operations are very efficient (e.g. no checkout lines; just “walk-through”, “grab-and-go”, and “walk out”),
  • It is calculable, with an emphasis on speed in getting through the store and offering quickly eaten finger foods
  • It is predictable, specializing in pre-prepared meals and “chef-made meal kits”
  • It makes great use of non-human technologies: smartphone apps to gain entry; sensors to keep track of what is being taken off the shelf and is purchased; automated technologies to total the purchases and to charge them to the consumer’s account. This is made necessary by the fact that few employees are likely to be present since there will be no checkout counter- a clear threat to the 3.5 million cashiers in the United States.
  • The threat to jobs is one of the irrationalities of this rational system. It will help to further reduce the number of paying jobs (using technology similar to that used in driverless cars that is costing taxi drivers their jobs) and to add to the working class discontent that helped fuel the rise of Donald Trump, Brexit, etc..

 

From the point of view of consumption, Amazon Go is a place (a new means of consumption, or cathedral of consumption) to which people are drawn to consume. However, it is better thought of as a place (a means of prosumption) where people go to prosume, that is, produce what they consume. Consumption is traditionally a process where others, especially employees, produce in various ways what others consume. This has declined in recent years as there are ever-fewer employees to do such work. Consumers are required do an increasing amount of that work either on their own (carrying their own trays in fast food restaurants, gathering their own food in supermarkets) or with the help of new technologies (e.g. self-checkout and check-in systems). This is especially the case in online sites and stores, including Amazon.com, where the consumer does all of the work of finding, ordering and paying for a purchase. This kind of a system is more difficult to create in a bricks-and-mortar store, but Amazon’s Go, if it is successful and widely implemented, will be an important step in that direction.

Customer Service or Disservice?

Consumer Reports (September, 2014) offered a revealing analysis of the accelerating trend toward customer self-service, or one aspect of what, in my terms, is “prosumption as consumption”. Customers who engage in self-service are, by definition, producing as they consume. To its credit, Consumer Reports makes no bones about why self-service has been embraced so enthusiastically. The reason? “To save money”. For example, if customers themselves place an online order, the cost to the company is pennies, while ordering from a live agent could cost between $2 and $10. In most cases, the corporations involved do not pass the savings on to customers in the form of lower prices. When multiplied by thousands, if not millions, of transactions, such savings mean much greater corporate profits. While such cost savings and profits have long been possible, they have been greatly increased in recent years by new digital technologies and by consumers who are not only familiar with them, but greatly prefer using them to interacting with paid employees.
Why do consumers do this work without pay or economic gain of any kind? Among the reasons offered by Consumer Reports are consumers’ feelings of empowerment, the ability to handle transactions more quickly, and the possibility of avoiding contact with employees who are increasingly likely to be less than stellar in their work. In fact, because corporations much prefer self-service customers, they are likely to hire fewer workers of lesser ability, to offer little training, and to accept marginal performance of the job. While many customers are cognizant of the incapacities of service workers, they generally seem unaware of many of the costs of self-service such as the loss of human contact, the paid jobs that are lost because they are willing to work for no pay, and the dehumanization of their relationships with corporations.
Because of the increasing acceptance of self-service by consumers, some corporations have taken the outrageous step- with nary a peep from consumers- of charging them fees for handling tasks the corporations used to perform without charge. Among the examples are airlines charging customers $50 for a paper ticket, $25 for having the audacity to make a reservation by phone, $20 for asking for a receipt for an e-ticket, and a $10 fee for having a boarding pass printed out by an agent. Fees such as these are likely to increase in price and to proliferate in number and variety in the coming years thereby further increasing the costs to consumers and profits for the companies.
Profit-making organizations have discovered that they can increase their profits by cutting personnel costs and by exploiting consumers to an ever-greater degree. There are many more customers than employees to exploit, they accept their exploitation meekly and, indeed, they often embrace it eagerly. This system greatly reduces the possibility of class consciousness among the declining number of employees who are ever-more fearful of losing their jobs. Worse, the system can operate without fear of the development of class consciousness among consumers who are too diverse and self-interested to think of themselves as a class, to become a class, and to act as a class. As much as one might like to hear it, we are not likely to hear consumers utter the clarion call- “Consumers of the world unite, you’ve nothing to lose but your iPad”.

McDonaldization without McDonald’s?

McDonaldization without McDonald’s?

In its key U.S. market, McDonald’s sales and customer visits were down in the first half of 2014 and they were flat globally. That, in itself, is not terribly worrying to the company since such declines have occurred before and McDonald’s has always roared back. However, a recent survey in ConsumerReports (August, 2014) makes those declines much more worrisome for the company. A survey of the dining experiences of over 32,000 subscribers to the magazine showed that of 21ranked burger chains, McDonald’s was tied for last with Burger King. McDonald’s, like Burger King, had a score of 71. This compared very unfavorably to the top-ranked chain, In-N-Out Burger, with a score of 88. While McDonald’s customers were satisfied, they were not nearly as satisfied as the customers of all the other burger chains (except Burger King). McDonald’s also ranked last when customers were asked to rate burgers on a scale of 1-10 with 1 being the least delicious burgers they have ever eaten and 10 being the most delicious. McDonald’s burgers got a score of 5.8 (the next lowest was 6.6 for Jack in the Box) compared to the best score (8.3) at The Habit Burger (In-N-Out Burger was 2nd with a 8.0 score). Overall, the mass burger chains, those that are the most McDonaldized, tended to rank toward the bottom in both ratings. The same can be said other kinds of chains. Of the chicken chains KFC was at the bottom in terms of the taste of its chicken and the same was true among the Mexican chains of Taco Bell and the taste of its burritos.
McDonald’s (as well as the other mass chains) is in no immediate danger, but these data should lead us to wonder about its long-term future. Other retail giants have fallen in the past (e.g., Woolworth’s, Montgomery Wards) and still others are presently in danger of collapse (e.g. Sears). There will come day when McDonald’s falls, but given its global power and its public relations skill, such a collapse will not occur any time soon. Similarly, these developments do not spell the end of the process of McDonaldization. However, it may well be that McDonald’s position as the paradigm of that process is being undermined leaving us with the possibility of a new paradigm (In-N-Out Burger?). In that case, the lack of fit between the paradigm and process would be awkward, but whatever the new paradigm, it would still be highly McDonaldized.
One of In-N-Out Burger’s great advantages is the higher quality associated with using fresh hamburgers rather than the frozen burgers of McDonald’s and other large chains. The calculability dimension of McDonaldization points to the tendency to emphasize quantity rather than quality. More frozen burgers can easily be stored, shipped, cooked and served than fresh burgers. However these quantitative gains come at the cost of lower quality. In the end, a high degree of McDonaldization brings with it the tendency toward mediocrity. Thus, McDonald’s may be done in by the very process that bears its name, but that is not to say that chains like In-N-Out Burger (as well as others like Chipotle) are not McDonaldized. They are simply less McDonaldized in some ways and on some dimensions that give them various advantages over the most McDonaldized systems. The success of these somewhat less McDonaldized chains promises to reduce, but certainly not eliminate, the irrationalities of rationality (e.g., the tendency toward mediocrity) associated with McDonaldization.