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McDonald’s plans reorganization, job cuts because it accelerates restaurant openings

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McDonald’s is planning job cuts and a reorganization as the corporate refocuses its priorities to speed up restaurant expansion, CEO Chris Kempczinski told employees Friday.

The fast-food giant said the job cuts aren’t a cost-cutting measure but are as an alternative intended to assist the corporate innovate faster and work more efficiently. As a part of the reorganization, the corporate shall be deprioritizing and halting certain initiatives, based on a company-wide memo from Kempczinski. It’s unclear what those projects are.

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“Today, we’re divided into silos with a middle, segments, and markets,” Kempczinski wrote. “This approach is outdated and self-limiting – we are attempting to unravel the identical problems multiple times, aren’t all the time sharing ideas and might be slow to innovate.”

Currently, McDonald’s organization is split into three segments: the U.S., international operated markets and international developmental licensed markets. The corporate operates in 119 markets internationally.

Moreover, McDonald’s said Friday it can speed up its development plans for brand spanking new restaurants.

“We must speed up the pace of our restaurant openings to totally capture the increased demand we have driven over the past few years,” Kempczinski said within the memo.

McDonald’s hadn’t previously released a forecast for the way many recent restaurants it plans to construct in 2023, but the corporate said in November that recent units would contribute about 1.5% to system-wide sales growth in 2022.

The corporate has not decided what number of recent restaurants it can construct yet nor what number of jobs shall be eliminated as a part of the reorganization. Kempczinski said that the corporate will finalize and start to speak decisions on the layoffs by April 3.

Kempczinski also announced a handful of internal promotions, effective Feb. 1, to assist the corporate perform its recent strategy. Global Chief Marketing Officer Morgan Flatley will even oversee recent business ventures. Skye Anderson will move from McDonald’s U.S. west zone to global business services. Andrew Gregory’s role as global franchising officer will even include leading global development, and Spero Droulias will transition from senior vice chairman of finance to the corporate’s chief transformation officer.

Shares of McDonald’s closed up greater than 2% on Friday. The corporate is predicted to report its fourth-quarter earnings on Jan. 31.

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