McDonald’s MCD 2.79% Corp. announced on Friday that it plans to make “difficult” decisions about staffing changes at the company by April, as part of a broader strategic plan for the burger chain.
McDonald’s plan to cut or reorganize the company’s staff comes as the company said it plans to expand its business globally, including by adding new and more types of restaurants.
Chief Executive Officer Chris Kemczinski said in an interview that he expects to save money as part of the staff review, but doesn’t have a set dollar amount to cut or the number of jobs he wants to eliminate.
“Some jobs that exist today will either be postponed or those jobs will go away,” Mr. Kempczinski said in an interview on Friday.
McDonald’s expects to speak to employees affected by the changes by April 3.
“There will be difficult discussions and decisions ahead,” McDonald’s said in a company statement.
According to the chain’s annual report, McDonald’s employs about 200,000 people in corporate functions and its own restaurants, three-quarters of which are based outside the United States.
US companies across all sectors have announced smaller, targeted corporate job cuts as inflation has risen and the economy has cooled. PepsiCo Inc. told employees in December that hundreds of jobs will be eliminated at the headquarters of its North American snack and beverage divisions. The layoffs at Ford Motor Co., Walmart Inc. and fast fashion company H&M Hennes & Mauritz AB are targeting white-collar and clerical workers rather than manufacturing or retail workers.
Mr. Kempczinski told investors last October that the company was planning for a mild to moderate recession in the US and a potentially deeper and longer downturn in Europe.
In 2018, McDonald’s downsized its regional corporate staff as part of a major restructuring led by former CEO Steve Easterbrook. The company shifted from a regional organization to local field offices. It then reduced the number of branch offices from 21 to 10.
The company said at the time that the US reorganization would improve its operating model, provide better support for franchisees and make it more flexible. Franchisees have said the field office reductions have resulted in less support from the company to operate their restaurants and meet the standards set by McDonald’s and local governments.
When asked if the company would consolidate its field offices as part of its new strategic plan, Mr. Kemczinski said McDonald’s will not significantly change its structure in terms of franchises and the impact on the company’s restaurant owners will be minimal.
“Organizing, frankly, is about putting our own house in order,” he said.
Mr. Kemczinski said McDonald’s learned to work more efficiently during the pandemic when it had to act quickly to respond to new ways of doing business. The company now needs to make faster decisions and have less siled departments to move forward, he said.
McDonald’s previously had 70 different types of crispy chicken sandwiches that didn’t differ significantly, while in Asia it had one successful sandwich it could have drawn on to expand its offering, Mr. Kempczinski said. It also had 11 different loyalty programs around the world, with the company only needing one good one, he said.
“Because McDonald’s is a decentralized company, we solved the same problem several times,” Mr. Kempczinski said.
McDonald’s said Friday it would appoint four current executives in new roles next month to better connect different departments and grow its business.
McDonald’s plans to open new restaurants in Europe, the United States and parts of Asia to meet demand, Mr. Kempczinski said. The company expects to open a mix of traditional restaurants and newer formats, such as those focused on takeout-only sales, he said.
McDonald’s wants to try different formats, including more standalone kiosks selling desserts or coffee, which the chain currently has in some countries, Mr. Kempczinski said.
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