Ray Kroc, founder of the McDonald’s franchise empire, created one of the most recognizable food businesses in history by focusing first on brand consistency — particularly through automation and training.
Kroc was born in Oakland, Illinois, in 1902.
He married thrice and had a daughter with his third wife, Joan Kroc.
When he passed away in 1984, Kroc had amassed a family fortune worth approximately $500 million. Success came from his tireless pursuit to turn McDonald’s (NYSE:MCD) into the most successful fast food operation in the world.
The McDonald’s Success Story
In his job as a milkshake salesman, Kroc first came across McDonald’s, a restaurant chain based in San Bernardino.
Stunned by the effectiveness of their operation, Kroc offered to work as a franchising agent for a cut of the profits. Soon, he took over the reins of the business and made a number of changes to its food service franchise model.
Once he retired from McDonald’s, Kroc set his sights on his favorite sport, baseball. He bought the San Diego Padres team for $12 million.
Later he handed over operations of the team to his son-in-law, Ballard Smith.
Lessons from Ray Kroc
Once he became president of the McDonald’s corporation, Kroc revolutionized the business model. He focused on automation and standardization to improve efficiency. And he did that at a time when technology wasn’t as sophisticated as what is available today.
What was also unique about Kroc’s business model was his strong emphasis on expanding into new markets. He focused on catering to customer demands for familiar food at low prices.
Consistent quality across franchises turned McDonald’s into a global phenomenon. For small businesses, that’s an important lesson to learn when expanding into new markets.
Another thing he emphasized was franchisee selection and training. Franchise owners were selected based on their ambition and drive. After their selection, they had to go through a training program called Hamburger University. The faculty trained franchisees and operators to maintain the strict quality standards of the brand.
While small businesses may not have the luxury to spend a fortune on an extensive program, employee training should be an area of focus. It’s also equally important to hire the right employees who can take your business ahead.
Ronald McDonald Photo via Shutterstock