McDonalds 2004 Annual Report Download - page 8

6MCD 2004
LETTER FROM THE CHIEF EXECUTIVE OFFICER continued
do indeed win. 2004 was a perfect example of the strength of this alignment and
focus on our customers and restaurants.
Next, McDonald’s clearly has a deep bench of management talent, supported by
a board of directors that is admired by many. This combination of management
strength and governance expertise has enabled McDonald’s to maintain an even
keel despite two CEO transitions in less than eight months. I want to pay a special
tribute to Andy McKenna, our non-executive Chairman of the Board, for providing
such a steady hand throughout 2004.
Additionally, our entire leadership team continues to maintain financial discipline
as we work to build sales throughout the world. We are investing our resources
wisely, and reducing G&A spending as a percent of our overall sales. This com-
bined effort has translated into higher margins and improved returns on invested
capital.
McDonald’s also has a heritage of innovation that encourages our System to
embrace change and continuously improve our overall customer experience.
Whether it has been pioneering drive-thrus, creating a successful breakfast
business, staying open later, reimaging our restaurants, introducing premium
salads or encouraging people to lead balanced, active lives, McDonald’s always
strives to be better. In 2004, we remodeled restaurants, and introduced Chicken
Selects in the United States,
a Salads Plus menu in
Europe and Toasted Deli
Sandwiches in Canada. We
also increased the availability
of wireless technology in
many locations.
Finally, and certainly most
important, there is the
McDonald’s “three-legged
stool,” which is how we refer
to the owner/operators,
suppliers and Company
employees who represent the
“legs” of our worldwide restaurant System. As Ray Kroc and Fred Turner taught us,
all legs must be strong and aligned for the stool to stand. That is why we work so
hard on System communication and collaboration, because we know that when we
are fully aligned—all 1.6 million of us in 119 countries—we are a truly formidable
business.
Earlier I used the word “tangible” to describe the reasons for our success. But as
I think about the power of our people... our three-legged stool...I know there are
intangibles as well.
Performance in 2004 thoroughly
affirmed our strategic imperative—
to grow by being better, not just
bigger.
ⓦⓦⓦⓦⓦ
McDonald’s Plan to Win, our
strategic roadmap, has provided
our System the focus to become
our customers’ favorite place and
way to eat.