The Bernstein Perspective: Fighting Back

McDonald’s Charlie Bell discusses his health and that of the company.

By Charles Bernstein, Editor-at-Large -- Chain Leader, 7/1/2004

Charlie Bell has had McDonald’s blood flowing through his veins for the last 28 years ever since he started as a proud 15-year-old burger flipper at a unit in Sydney, Australia. Now he is the sixth CEO in the company’s 49-year history. Bell succeeded Jim Cantalupo, who died of an apparent heart attack April 19 in Orlando, Fla., at age 60.

Just 16 days after Cantalupo’s death, Bell was diagnosed with colorectal cancer and underwent surgery. Two days later, his doctor issued a statement that the surgery had been successful. Prospects are good for a quick recuperation. Bell certainly has kept his sense of humor. When his doctor told him that chemotherapy would not cause any hair loss in his case, 43-year-old Bell, the youngest McDonald’s chief executive ever, expressed relief that he would be the first McDonald’s CEO in the last 30 years to have a full head of hair.

Chain of Command
Everything points to a solid recovery. Perhaps that is why the company feels it is not necessary to indicate who the new CEO would be if Bell were unable to carry out his duties.

Asked when the company might name a COO, a post that Bell held during his presidency under Cantalupo, he indicated there was no such plan. Andrew McKenna, a board member since 1991 who was named April 19 as “nonexecutive” chairman, said there is no apparent need for a COO.

McKenna said there is a succession plan but declined to give details. Still, there is speculation that Vice Chairman Jim Skinner would be next in line as CEO and that USA President Michael Roberts and Chief Restaurant Operations Officer Claire Babrowski might be in line to move up.

With customer service surveys still rating McDonald’s below its competition, Bell has his work cut out for him. At the burger giant’s annual stockholder meeting in May, he declared, “We have continued momentum with an astounding 2.3 million more customers daily in the first quarter this year compared with a year ago.”

He is determined to improve customer service as a crucial part of the three-year revitalization plan that Cantalupo initiated. Bell intends to further speed service, improve store appearances and extend hours. He said he is confident that “cutting down on our expansion rates will continue to enable us to steadily improve our unit performance.”

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Bell also remains unruffled by the controversial movie Super Size Me and director Morgan Spurlock’s claim that it was probably the reason McDonald’s eliminated its super sizes. “It didn’t have any effect, and it was irresponsible,” Bell responded. “We had these plans in the works well before Spurlock ever thought of them. Furthermore, Spurlock’s 30 consecutive days of mass eating at McDonald’s units was a farce because he didn’t do any exercise during this whole binge and therefore it wasn’t realistic.”

Bell also said the company’s Boston Market and Chipotle concepts are “good for our future,” but he emphasized that the focus remains 99 percent on its core brand.

McDonald’s sales jumped 13.5 percent in April, marking the 12th straight month of double-digit increases. It will be a major challenge for Bell to continue these types of increases, but he has the stuff to keep moving McDonald’s ahead.