CEO Chris Kempczinski wrote in a memo that the company is "unfocused" and in need of some serious trimming. With roughly 200,000 people working in corporate roles at McDonald's, there are plenty of cuts soon on the way.
Kempczinski wrote that there will be "difficult discussions and decisions ahead" for the company, which no longer sells a consistent product to customers. (Related: When McDonald's introduced fake Beyond Meat burgers, nobody wanted them.)
"We had across the globe 70 different, distinct versions of what a crispy chicken sandwich would look like," Kempczinski wrote. "I don't need 70 different permutations of a chicken sandwich."
The vast majority of those 200,000 corporate positions from which McDonald's will soon initiate layoffs are outside the United States. The company, after all, is multinational with a greater collective presence outside America's borders.
"Today, we're divided into silos with a center, segments, and markets, "Kempczinski added in the memo, which was titled "Accelerating the Arches 2.0."
"This approach is outdated and self-limiting – we are trying to solve the same problems multiple times, aren't always sharing ideas and can be slow to innovate."
On the one hand, Kempczinski wants to see McDonald's speed up the rate at which new restaurants open in order to meet demand. On the other, the company needs a major trimming and adjustment over the coming year to keep it on track for the future.
McDonald's is just one of many large corporations that is planning layoffs in 2023. With a large-scale recession looming – some would argue, based on pre-2022 calculation methods, that a recession has already arrived – many are trying to be the first out of the gate.
McDonald's is also among the corporate giants that pulled out of Russia following Vladimir Putin's invasion of Ukraine – having also closed all stores in Kazakhstan, which borders Ukraine, due to supply chain problems resulting from the war.
"While there's a lot for us to be proud of, you've also told us that there's more we can do," Kempczinski added. "We're performing at a high level, but we can do even better."
McDonald's is set to publish its fourth quarter earnings on January 31 following a third quarter of 2022 published earnings of $5.8 billion, down from $6.8 billion during the same period in 2021.
Other companies cutting jobs include Amazon, which announced recently that about 18,000 positions will be slashed this year – the largest set of layoffs yet in the company's history.
Most of Amazon's layoffs will occur in the Amazon Stores division, which encompasses Amazon's e-commerce business as well as brick-and-mortar stores like Amazon Fresh and Amazon Go.
"Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so," announced CEO Andy Jassy. "These changes will help us pursue our long-term opportunities with a stronger cost structure."
Salesforce is another company cutting positions – 8,000, to be precise, or 10 percent of its workforce. These, too, are the largest cuts in Salesforce history, according to reports.
"McDonald's lost their way when they decided to go upscale and offer supposedly healthier menu choices," wrote a commenter from Canada. "People go to McD's for affordable 'fast' food, not a $7 Big Mac, salads and freaking apple slices in a Happy Meal."
"Did they finally figure out laying off a single minimum wage part-time cashier actually slows profit and does nothing to help a top-heavy salary setup?" wrote another. "But laying off a six-figure executive who does the job of less than one and has a huge perk package does help."
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