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Ray Kroc

How He Made McDonald's Sizzle

Ray Kroc was 52, working as a milkshake mixer salesman, when he came across clients

Mac and Dick McDonalds hamburger restaurant in Bernardino, Calif. Amazed their

food assembly line delivered fast service, Kroc convinced them to franchise the

company with his help. The next year, Kroc opened his first McDonalds outside of

Chicago. In 1961, Kroc bought the company and built it into what is now the worlds

largest fast-food chain, with more than thousand restaurants almost 120 countries.

Kroc, who died at 81, was the subject of a SUCCESScover feature in September 1977

written by his biographer, Robert Anderson. The following is an excerpt.

Kroc. The name rolls energetically off the tongue.

Its Bohemian meaning, I was told by an old cleaning lady, is step, as in a fl ight of stairs.Had she known Ray A. Kroc, the multimillionaire founder and senior chairman ofMcDonalds Corporation as I had come to know him in the 12 months I spent helping himwrite his autobiography, she too might have found a delightful aptness in the derivation.

For step implies a climber, and that describes Ray A. Kroc precisely.

He will be 75 years old in October. One would think he would be most interested in enjoyingthe fruits of his laborsrelaxing in the Jacuzzi at his splendid ranch near Santa Barbara,Calif., or traveling around the world in the $4.5 million jet he bought a couple of years ago.

But thats not Krocs style. He likes the Jacuzzis rolling, 100-degree waters, not so muchbecause they are relaxing and feel good on his arthritic joints, but because they stimulateideas on how to make McDonalds more efficient or more profitable. His jet is leased to thecorporation for business use at $1 per year.

In any case, chronological age is a misleading measure with Kroc. He is the oldest activeexecutive in the corporation, but he is probably its youngest thinker. McDonalds presidentEd Schmitt believes this is because Kroc invariably takes a positive approach.

"The oldest executive in the company, Kroc is probably its youngest thinker."

Suppose someone comes up with a proposal that McDonalds should serve turkeysandwiches, Schmitt says. Everyone on the board of directors can think of nine goodreasons why turkey sandwiches would be a bad thing for us. They would blow the idea out ofthe water immediately. But Ray would say, Wait a minute; lets examine what this might dofor us. Maybe we could make it work. If not turkey sandwiches, maybe we should try turkey

hash. He wouldnt let go of it until all possibilities had been considered.

Krocs enthusiasm is infectious. Perhaps thats the secret of his sales ability. On a trip I madewith him to an operators co-op meeting in Michigan he gave a talk about menu items hed

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been testing for McDonalds. One of them was a new dessert, the McSundae, and his boyishdelight in relating the texture of the frozen product and the richness of the toppings (the

best we can buy) had the audience unconsciously smacking their lips. I have listened severaltimes to a tape recording I made of that talk, attempting to analyze what it was that made his

words so evocative. In fact, there is nothing special in the words themselves. Moreover, hisdelivery is uneven, broken by dangling phrases. Yet the enthusiasm comes through, and its

persuasive.

When Kroc first talked to the McDonald brothers in San Bernardino, Calif., in 1954 aboutopening a series of restaurants similar to theirs, it never occurred to him that he really didntneed their agreement in order to copy their procedures. Others had done it. But he was toohonest to even think of it. The result was that he was able to follow the brothers systemexactly, using their well-tested production-line techniques. The imitators invariably got partsof the formula wrong and couldnt make it pay. Had Kroc been less honest his restaurantswould have been less successful.

Ray Kroc has been called the Henry Ford of the fast-food industry, and some managementtheorists like Harvards Theodore Levitt believe he has pioneered our societys successor to

the Industrial Revolutionthe Service Revolution. If so, history will recall his innovativeorganizational skills long after the Big Mac has been forgotten and (as Ray would say, Godforbid!) the Golden Arches have become museum pieces.

The elements of Ray Krocs character that Ive described here are, in my opinion, themainsprings of his success. To summarize, they could be given the acronym HOPE. It standsfor Honesty, Organizational skill, Positive thinking, and Enthusiasm.

There are many other aspects of this complex, personable, exasperating, and awesomelydynamic man, of course. Some are more charming than others. But of this you can be sure:Where theres Kroc, theres HOPE.