The story: By the late-1990s fast-food chain McDonald’s had enjoyed 40 years of exceptional performance. In 1997, for example, the company had registered 10 years of 20 per cent per annum growth.
The challenge: That year, Jack Greenberg became the company’s fourth chief executive. His main concern was how to lead the business in less favourable market conditions. McDonald’s was facing concerns about fatty foods and about beef; competition was squeezing margins; and growth from international markets was slowing.
The strategy: Mr Greenberg did what the textbooks suggest. First, he focused on improving the core business, announcing it as his top priority. Then, he also set a second priority: to find a new platform for growth. With this audacious goal in mind, he supported five acquisitions of related restaurant businesses – including Chipotle, a Mexican food restaurant, and 50 per cent of Pret A Manger, the UK sandwich chain – and he set up the Partner Brands Division, to be responsible for these new businesses. Mr Greenberg also opened the door to a number of other, more organic initiatives led by his head of strategy, Mats Lederhausen.