LEADERSHIP STYLE OF MCDONALD'S FOUNDER RAY KROC

Having been in sales in my younger years, I observed that top salesmen are not usually good leaders. 

Ray Kroc

The case is different though with Ray Kroc, founder of McDonald's, the world’s largest chain of restaurants.  He’s both a good salesman and a good leader.

I will not dwell so much here about his achievements as a salesman or a sales leader ( For over 30 years, he was both a good salesman and sales manager, outstanding even) but rather on his style of leadership that propelled a tiny hamburger parlor in San Bernardino, California during the 50’s into the world’s largest fast food chain that it is today.

Starting in 1954 when he paid a visit to the McDonald Brothers and sold them the idea of putting up a chain of McDonald’s all over America, Ray exhibited and utilized certain leadership skills that helped him propel the company, and made him extremely wealthy in the process.

Here's what I found to be his set of leadership skills from his book bio, Grinding It Out,The Making of McDonald's.

Visionary

While he was convincing the McDonald brothers of his plan, his mind began to visualize the thousands of McDonald stores in every city all over America.  At first, he was excited by the idea of these stores having his multi-mixers in each of them.  He was then in the business of selling those machines that turn out milk-shakes.

Like any good leader, Ray held by his vision and persuaded others to embrace that vision.

Committed

During his days as a paper cup salesman, Ray was committed to following rules and principles that made him a good salesman and later, as sales leader.  The first order of the day before he made his daily rounds was to make sure that he looked and felt good.  Tailored suits, shiny shoes, well-combed hair and pleasing appearance were standards that must be followed starting with himself, day in day out.   

This values served him well when he started McDonalds.  His fastidious adherence to operating processes and procedures became standards in restaurant operations worldwide.  He firmly believed that the quality of a leader is reflected in the standards he set for himself.

Motivator  

What set Ray apart from his contemporaries was his ability to make people do willingly what he wanted them to do,   although he is the type of a leader who would  not ask anyone to do things that he himself is not willing or able to do.  He’s known to have mopped floors and clean toilets for franchisees during store openings in the early days of McDonalds. 

Enthusiasm

A key to Ray’s overall success is his infectious enthusiasm that attracted people to him.  Whether they are potential franchisees, employees, suppliers or investors, he had a certain way of making people like him and to accept his ideas.  Apparently, this ability helped him sell millions of paper cups to hard-nosed Italian and Polish restaurant owners in the streets of Chicago during his days as a salesman. He was considered a great storyteller, socializer, and had a way with words.

Mentor and Coach

Ray never finished high school but to me he is a great teacher.  He liked and originated the idea of the “Hamburger University” that systematized the teaching of the ins and outs not only of preparing burgers and fries but running fast foods restaurants.  Even before the concept of operations analysis became a buzzword in business circles and taught in the universities, it was already part of the curriculum in the training programs at McDonald's.  

Optimist

Ray never wavered despite obstacles that come his way.  For instance, when he was having a hard time perfecting the process of preparing potatoes - a big problem in the cold and damp weather of Des Plaines, Illinois but not in sunny San Bernardino, California - instead of being discouraged, he embarked on a series of fact finding and research, until he found the solution.   

This he did in many other situations he encountered in the early days of McDonalds.  One of my favorites is the story of how he knew how many hamburgers his competitor across the street exactly sold each day.   He "researched" by checking on the competitor's garbage cans in the dead of night, the night before!

Great Communicator

A salesman that he is, communication is one skill he does naturally and well.  This is how he gets across his ideas, his vision and anything he wanted to tell people.  And he does it with style, like having President Kennedy present in the inauguration of a store or by grabbing a microphone in the stadium when he wanted his San Diego Padres to play better!

The golden arches, which Ray adopted and became a de facto symbol of the American Dream, is one example of how he made use of communications as a powerful means of persuasion. He believed in it and made use of it to the fullest.  

Then and now, when people see this symbol, an important entrepreneurial undertaking is taking place in any of the 18,710 restaurants anywhere in the world, 24 hours a day, seven days a week.  

For the consumer, it says “hey drop by for some delicious and satisfying meals”! For the franchisee, more profits from the cash register.   

LEADERSHIP SECRETS OF SOUTHWEST AIRLINE'S GARY KELLY

 Leadership is..."Effectively supporting your team of Employees." --Gary Kelly

 

How important is customer care to a company?

At Southwest, it moves all of its 47,000 executives and employees across America to act as one organism 24/7.

Gary Kelly

   Each and every one of them is empowered to make on-the-spot decisions to please the company's 100 million passengers.

For this Fortune 500 U.S. airline company, with a record of 42 years of annual profitability unmatched in the U.S. airline industry, pleasing passengers is a way of life.

Earlier this month, Southwest Airlines went out of its way to rush a woman home so she could see her ailing son.

When her flight was about to take off from Chicago to Columbus, an airline employee alerted her that her husband called to tell that their 24-year old son was in a coma in Denver.   

Right away, Southwest rebooked her on a new flight home directly to Denver for free.

The airline even went the extra mile by giving her a private waiting area, rerouted her luggage, allowed her to board first and packed a lunch when she got off the plane in Denver. 

But that’s not all.  Her luggage was delivered to where she was staying and even received a call from Southwest asking how was her son doing.

Unbelievable?

Peggy Uhle can only sing praises for the airline.  She told the travel blog BoardingArea.com:  “The care that I was shown is second to none.”  

Her son is now recovering from a traumatic brain condition.

This is just one of the many instances when customers are almost pampered by Southwest to the max.  Anecdotes after anecdotes of great customer care have been reported about the airline.

Like the pilot who decided to wait for a father who’s attending to a dying son but was stuck in traffic; or the plane and ground crews who used their credit cards to help a distressed woman get transportation and hotel accommodation in a strange city. 

Why is this so?

This could be attributed to the culture of great customer satisfaction imbued into the hearts and minds of its employees by the airline company under the leadership of its Chaiman and CEO, Gary Kelly.

Under Gary Kelly’s stewardship, everyone at Southwest is attuned to what the company’s mission is and everyone has

internalized it as almost gospel truth - and it  shows in the individual actions of every employee.

Talk about group dynamics.  Gary Kelly and Southwest have so much to teach us on the subject.   

Who is Gary Kelly?                                                                  
Since 2005, Gary Kelly is the Chairman of the Board, Chief Executive Officer and President of Southwest Airlines Co., the world's largest low-cost carrier headquartered in Dallas, Texas. 

Starting with the company in 1986 as Controller, Gary moved his way up through various positions namely Principal Accounting Officer, Vice President of Finance and finally served as Executive Vice President and Chief Financial Officer from 2001 to 2004 until he was made the President and CEO. 

Before he joined the company, he served as Audit Manager of Arthur & Young Company in Dallas and Systems Center Inc., a computer software provider.

Aside from Southwest, he also sits in the board as independent director of several corporations and trade associations. A recipient of many awards and honors, he has been honored as one of the best and influential executives in America. 

He is a Certified Public Accountant and received a BBA in Accounting from the University of Texas at Austin where he serves on its Business School Dean’s Advisory Council and Accounting Department Advisory Council. He is also a Member of Advisory Council of its McCombs School of Business.

Gary Kelly's Leadership Style

As his company’s CEO, Gary Kelly has a unique leadership style which is perhaps not found in most of America’s CEOs or at least among those who are in the airline industry.  Very charismatic, his style is so perfectly aligned with the company’s culture of relaxed, happy people. 

For instance, he is trouper enough to come to the office on Halloween in pink dress complete with size-14 high heels.  As one New York Times writer commented:  “It suggest to workers that Mr. Kelly is a little crazy…and perhaps the kind of person others might want to follow into battles”.  

                                                                                                 

Personal and Organizational Values

Gary’s personal values were shaped by the good-old fashioned Southwestern brand of good morals and integrity instilled in him by his father with whom he developed a special father and son relationship.

These qualities he brought along with him at Southwest and manifested in the way he conducted himself in his day-to-day activities.  His values are centered on encouraging a work atmosphere where people are having fun and enjoying their jobs, yet doing their jobs well. 

How Gary’s values impact the organization                    

The four work values of people at Southwest:  achievement, concern for others, honesty and fairness are all aligned with Kelly’s values. Honesty and concern for others are very present in the organization. 

The culture that he has created at Southwest emphasizes a laid back and efficient environment.  

The Main Ingredient of Gary Kelly's Success

The secret to Gary’s success that many people may have overlooked is his intelligence.  Coupled with the ability to use that intelligence to his advantage, that to me is his secret weapon.  

Since his younger days in college, this quality helped him excel in his studies and be among the top of the class when he finished Accounting at the University of Texas. 

This same intelligence led him to land a good job at Arthur & Young Company.  Call it luck but being assigned to the Southwest account placed him in an advantageous position to again use his intelligence to see a future in the company. 

As a former outside accountant of the airline company, he was bright enough to see all the signs that pointed to a bright future ahead of him. 

What he saw nearly 30 years ago is happening now.

Photo Credits:   About Southwest Retrieved from http://www.southwest.com/html/about-southwest/

Some parts of this article were excerpts of a paper I wrote at the study help site likeplum. (now studypool).

WHY LEAD LIKE SUN TZU

In times of war and in times of peace, leaders are needed to lead other people to accomplish a collective vision.  Whether this vision is building a community museum, saving a great corporation from the brink of bankruptcy or winning a protracted conflict like the Vietnam War, leaders are needed to show the way in reaching visions.

How can Sun Tzu help leaders in reaching visions?

Sun Tzu        Photo: defesabr

A Chinese military general, strategist and philosopher who lived in ancient China hundreds of years before Christ was born, Sun Tzu had been attributed by historians as the author who wrote the popular book on leadership, TheArt of War.

So popular is this book that it's been required reading by the U.S. Command and General Staff of the United States Army in all its units and headquarters for the continuing education of its personnel in the art of war.

It is also included in most management training programs of large corporations in the US, Europe and Asia and it has continued to be regarded as an international bestseller at and in bookshops worldwide.

What’s in this book that it has become virtually the international bible on leadership and has been reported to have been read and studied by many notable figures such as Mao Tse Tung who had partially credited the book on his 1949 victory against Chiang Kai Chek.

Ho Chi Min had also asked his able General Giap and his Vietnamese officers to study and learn from the book and had been credited with winning the war against the French and American forces in Vietnam.

Even Douglas McArthur and his foes, the leaders of Imperial Japan, have drawn inspiration from the work.

Upon closer examination of the principles discussed in the book, it contains 13 chapters of strategies and tactics in managing conflicts and winning battles used by Sun Tzu when he served as a general for an emperor at war against other empires in ancient China.

There is no doubt in the wisdom behind his advice, strategically and tactically speaking. The book is filled with detailed “how-tos” in the art and science of warfare and they're applicable today as it was over 2,000 years ago.

What piqued my curiosity though is Sun Tzu’s attitude about war which he considered as a necessary evil that must be avoided whenever possible and which must be fought swiftly to avoid economic loss.  

For a man who’d been tested in battles and who had written about it, his philosophy should be heartwarming enough for peace-loving souls like me.

A VICE-ADMIRAL'S 3 LEADERSHIP STRATEGIES

Not a stranger to getting things done through people, John Ryan, a retired vice-admiral and head of his own leadership research and education organization called Center for Creative Leadership, believes that effective leadership has three basic elements.

For over 40 years, John worked for and learned leadership ability from superb leaders.  From the young instructors who taught him how to fly airplanes

John Ryan

in the U.S. Navy to the very smart group of corporate chief executive officers he mingled with, he observed that these talented people differed in many aspects but are similar in three fundamental ways. 

Some are charismatic and some are low key.  Some came from poor backgrounds and some grew up wealthy.  Some are natural leaders while some have to work hard to develop their abilities.

What makes these men and women share “3 critically-important leadership skills”?

1. Leadership success starts with a vision
Ryan wrote in Forbes that leadership success always starts with a vision. Henry Ford dreamed of a mass-produced, low-priced car for everybody. Steve Jobs dreamed of a computer that would change the way we work and play. Nelson Mandela dreamed of a united and prosperous South Africa.

At first people did not believe these visionaries but their dreams were deep-seated passions magnetic enough to capture the hearts and minds of a few devoted followers and ultimately, the imaginations of millions of people all over the world.

A compelling vision is powerful enough to inspire, clarify and focus the work of individuals and ideally of entire organizations over time.  When embarking on any undertaking, aspiring leaders need to take a hard look at their vision of success, Ryan emphasized. One need to ask why he or she is doing it.  Whether one is launching a new product or doing volunteer work as a community leader, his vision of what he sees in the future should be crystal clear.  

A pilot during his 35-year career in the Navy, Ryan also served as Chancellor of the State University of New York and superintendent of the U.S. Naval Academy.  He said that “one’s vision need not be as grandiose as Mandela’s”.  Just pick something that matters to one’s aspirations.  It could be  starting a business, adopting new technology or improving customer service.  

He cautioned though that “even an incredibly compelling vision won’t do much good if it remains only in your head”.

This brings us to the second key ingredient:  communication.   

2. Excellent communication skills
As busy as we are, we always have a tendency to keep our thoughts to ourselves, because of the million and one details that we need to address each day of our existence.  We feel that there is no more time for chat with people we work with and who can help us reach our vision.

Yet, half of the fight is in the summoning of the discipline in us and sparing time to share strategies with our staff or talk directly with our clients.  We need to communicate what we want to happen and how we want it to happen.  Then listen to what they have to say. 

When strategic information needs to be communicated, sending out a memo or giving a speech is not enough. A feedback mechanism should be put in place to receive and answer questions, comments or suggestions.  Don’t leave anything to chance to avoid wondering why your customers don’t like your product or why people in the organization do not understand the new strategy.

Along this vein, the importance of communicating what you want done to the troops has been clearly demonstrated by the remarkable achievements of Procter and Gamble CEO A. G. Lafley who retired in 2010 but rejoined the company in 2013.  The core of his message:  “The Consumer is Boss”.

In his nearly ten years of being at the top, he relentlessly communicated to everyone this mantra and led by example for everyone in the organization to follow.  He holds regular meetings with buyers of P&G products, one of his top priorities.  He even visits them at home or join them for shopping trips to hear what they have to say, and he does so all over the world. He does the same with his employees, visiting them in their offices and listening to their ideas. 

3. Superior judgement
The third important ingredient of effective leadership is judgement.  To be an effective leader, you need to make the right call consistently on the big choices involving strategy and talent. To make the right judgement calls though, you need to have the right values that should be rooted in your character.

Ryan says that “good strategy judgment frequently means a leader must find a new path when his organization is heading in the wrong direction. How well you can do this depends on your ability to scan the horizon and ask the right questions.”

This is how Ann Mulcahy approached the situation when she became CEO of Xerox at the time when it was on the verge of bankruptcy.   She executed a phenomenal turn-around of the company by exercising good judgement. 

She surrounded herself with good people and asked for their commitment. Then she laid down to them her strategic plan and rallied for their cooperation.   

Like Mulcahy, the effectiveness of a leader depends on his or her judgement call to pick the right talent and position them in the right places in the organization.  

Well placed, they will see to it that your vision is achieved because you made them feel that the success of the entire organization will depend on their own judgements at their operational levels.