Week6-2 - An introduction to r McDonaldization Ray Kroc the...

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Unformatted text preview: An introduction to r McDonaldization Ray Kroc, the genius behind the franchising of McDonald’s res- taurants, Was a man with big ideas and grand ambitions. But even Kroc scold not have anticipated the astounding impact of his creation. McDonald’sistl-le basis of one of the mostinflnential developments in contem- porarj.r society. Its reverberations extend far beyond its point of origin in the United States andinthe fast-food business. It has influenceda wide range of un- dertakings, indeed the awayr of life, of a significant portion of the World. And that impact is liker to expand at an accelerating rate.” However. this is not a book about McDonaid’s, or even about the fast- food business, although both will be discussed frequently throughout these pages. Rather, McDonald's serves hereas :he major example, the paradigm, of a wide-ranging process] call McDonaidimtionf—that is, I the process by which the principles ofth fast-food restaurant are coming to domi- nate more and more sectors offing-icon society as we” a: oftherest oftbe triori'ei'.l "Citations may be found at the back of the book, beginning on p. 235. 2‘. THE MCDONALDIZATION OF SOCIETY As you will see, McDonaldiration affects not onlyr the restaurant business but also education, work, health care, travel, leisure, dieting, politics, the family, and virtually every other aspect of society. McDonaldization has shown every sign of being an inexorable process, sweeping through seemingly impervious institutions and regions of the world. I The success of McDonald’s itself is apparent: In 1993, its total sales reached 536 billion, with operating income of $3.1 billion.‘1 The average U.S. outlet has sales of approximately $1.6 million in a year. McDonald’s, .which first began franchising in 195 5, had 24,800 restaurants throughout the world by the end of 1993. Martin Plimmer, a British commentator, arcth notes: “There are McDonald’s everywhere. There’s one near you, and there’s one be- ingbuilt right noWeven nearer to you. Soon, ichDonald’s goes on expanding at its present rate, there might even be one in your house. You could find Ronv aid McDonald’s boots under your bed. And maybe his red wig, too. "5 MeDon ald's and MCDonaldization have had their most obvious influence on the rfitaurant industry and, more generally, on franchises of all types: 1. According to one estimate, there are now about 1.5 million fian- chised outlets in the United States, accounting for about a third of all retail sales. Franchises are growing at a rate of 6% a year.“ Over 69% of McDonald’s - restaurants are franchises? 2. Sales in fast-food restaurants in the United States rose to $1 1 6 billion by the end of 1998.3 In 1994, for the first time, sales in so-called quick-service restaurants exceeded those in traditional full-service restaurants, and the gap between them grew to more than $10 billion in 1993.9 3. The McDonald's model has been adopted not only by other budget- rnindecl hamburger franchises, such as Burger King and Wendy’s, but also by a wide array of other low-priced fast-food businesses. Triton operates over 29,0 00 restaurants worldwide under the Pizza Hut, Kentucky Fried Chicken, and Taco Bell franchises and has more outlets than McDonald’s, although its total sales ($ 2.0 billion) is not nrlyr as high. In Subwayr {with nearly 13 .000 out- lets), considered the fastest growing fast-food business, is aiming to "match and surpass franchising giant McDonald‘s unit for unit throughout the world.”” An Introduction to McDonoidt'zntfon 3 4. Starbucks, a relative newcom er to the fast- food industry, has achieved dramatic success of its own. A local Seattle business as late as 198?, Starbucks had over 1,568 com pany-own ed shops ith ere are no franchises} by 1998, more than triple the number of shops in 1994. Starbucks planned on having two hundred shops in Asia by the year 2000 and five hundred shops in Europe by anus. ‘1 5 . Perhaps we should not be surprised that the McDonald’s model has been extended to “casual dining"—that is, more “upscale,” higher-priced res- taurants with fuller menus (for example, Outback Steakhouse, Fuddrucl-ter's, Chili’s, The Olive Garden, and Red Lobster). Morton’s is an even more up— scale, high-priced chain of steakhouses that has overtly modeled itself after McDonald’s: “Despite the fawning service and the huge wine list, a meal at Morton’s conforms to the same dictates of uniformity, cost control and por- tion regulation that have enabled American fast-food chains to rule the world?” In fact, the chief executive of Morton’s was an owner of a number of lWen dy‘s outlets and admits: "My experience with Wen dy’s has helped in Mor- ton's venues?” To achieve uniformity, employees go “by the book": “an lngrcdient-by-ingtcdient illustrated bin der describing the exact specifications of son Mo rton's kitchen items, sauces and garnishes. A row of color pictures in every Morton’s kitchen displays the presentation for each dish.“'“’ 1“ 6. |Other types of business are increasingly adapting the principles of the fast-food industry to. their needs. Said the vice chairman of Toys ‘R Us, “We want to be thou ght of as a sort of Mid) onald’s of toys?“ The founder of Kid~ sports Fun and Fitness Club echoed this desire: “I want to be the McDonald's of the kids’ fun and fitness business?“8 Other chains with similar ambitions in- clude Jiffy Lube, AAM CO Transmissions, Midas Muffler 8:: Brake Shops, Hair Plus, I'lch Block, Pearle Vision Centers, [Campgrounds of America {K0151}, Kinder Care (dubbed "Kentucky Fried Children”‘“), Jenny Craig, Home Des pot, Barnes 5: Noble, Petstufi, and Wfll'MEIt.Lfl T. McD onald’s has been a res ou ndin gsuccess in the international arena. Just about half of McDonald’s restaurants are outside the United States {in the mid-198 (is, only 25% of McDonald’s were outside the United States) . "The vast majority of the 1,1? 0 new restaurants open ed in 1993 were overseas [in the 4 THE Me-DONALDIZATION OF SOCIETY United States, restaurants grew by less than one hundred). Well over half of McDonald’s profits come from its overseas operations. McDonald’s restau- rants are now found in 115 nations around the world. The leader, by far, is Ja- pan with almost 2,352. restaurants, followed by Canada with 1,085 and Ger- many with .931. As of 1993, there were 45 McDonald’s in Russia, and the company plans to open many more restaurants in the former Soviet Union and in thevas: new territory in Eastern Europe that has now been laid bare to the in- vasion of fast— food restaurants. Great Britain has become the “fast-food capital of Europe,”11 and Israel is described as “McDonaldized,” with its shopping malls populated by “Ace Hardware, Toys ‘RUs, Office Depot, and TOBY. M: 3. Many highly McDonaldized firms outside of the fast-food industry hare also had success globally. In addition to its thousands of stores in the United States, Blockbuster now has just over 2,000 sites in twenty-six other countries. Although WabMart opened its first interdational store (in Mexico) only in 1991, it now operates about 600 stores overseas [compared with just over 2,809 in the United States, including supercenters and Sam’s 'E'JlubfiJ 9. Other nations have dereloped their own variants of this American in- stitution. Canada has a chain of coffee shops, Tim Hortons {recentlyr merged with Wendy’s}, that planned on having two thousand outlets by the year 2000.“ Paris, a citywbose lore for fine cuisine might lead you to think it would prove immune to fast food, has a large number of fast-food croissanteries; the revered French bread has also been McDonaldized.” India has a sh sin of fast— food restaurants, Nirula's, that sells mutton burgers (about 30% of Indians are Hindus, who eat no beef) aswcll as local Indian cuisine.“ Mos Burger is a Japa- nese chain with over fifteen hundred restaurants that in addition to the usual fare, sells Teriyaki chicken burgers, rice burgers, and “Oshiruko with brown rice cake?“ Russkoye Bistro, a Rumian chain, sells traditional Russian fare such as pirogi {meat and vegetable pies), blini {thin pancakes), Cossack apricot curd tart, and of con rse, wadita.ma Perhaps the most unlikely Spot for an indige- nous fast-food restaurant, war-ravaged Beirut of 1934, witnessed the opening of Juic}.r Burger, with a rainbow instead of golden arches and]. B. the Clown standing in for Run ald McDonald. its owners hoped that it would become the “McDonald’s of the r’irabworld."19 10. And now McDonal dizationis coming full circle. Other countries with their own McDonaldized institutions have begun to export them to the United An Introduction to .McDrJi-irrffdizrrsion 5 States. The Body Shop, an ecologically sensitive British cosmetics chain, had over fifteen hundred shops in forty-seven nations in 1993,” of which three hundred were in the United States. Furthermore, American firms are now opening copies of this British chain, such as Bath and Body Works.” MCD ONALD’S A5 2‘: GLOBAL lCON McDonald's has come to occupy a central place in Anterican popular culture, not just the business world.” A new McDonald’s opening in a small town can be an important social event. Said one Maryland high school student at such an opening, “Nothing this exciting ever happens in Dale City.“33 Even big-city newspapers avidly cover developments in the fast-food business. Fast-food restaurants also play symbolic roles on television programs and . in the movies. A skit on the television show Saturday Night Live satirized spe- cialty chains by detailing the hardShips of a franchise that sells nothing but Scotch tape. In the movie Comiugro America, Eddie Murphy plays an African prince whose introduction to America includes a job at “McD oweli’s," a thinly disguised McDonald’s. In Falling Down, Michael Douglas vents his rage against the modern world in a fast-food restaurant dominated by mindless rules designed to frustrate customers. Moscow on the Hudson has Robin Wilt liams, newly arrived from Russia, obtain a job at McDonald's. H. G. Wells, a central character in the movie Tone nfiev'fime, finds himself transported to the modern world of a McDonald’s, where he tries to order the tea he was accus- tomed to drinking in Victorian England In Siseper; Woody Allen awakens in the future only to snoou nter a McDonald‘s. fin Men ends with the heroes driv— ing off into a future repr ese ntedby a huge golden arch lo omingin the distance. Further pro of that McDonald's has become a symbol of American culture is to be found in what happened when plans were made to rare Ray Kroc’s first McDonald's restaurant. Hundreds of letters poured into McDonald’s head~ quarters, including the following: Please don't tear it dOWHl . . . Your com pany’s name is a household word, not only in the United States of nrnerica, but allover the world. To destroy this major arri- fact of contemporary culture would, indeed, destroy partof the faith the people of the world have in your company.“ 6 THE MCDONALDIZATIUN 0F SOCIETY In the end, the restaurant was not only saved but turned into a museum. A McDonald's executive explained the more: “McD onald’s . . . is really a. part of Americana." Americans aren’t the only ones who feel this Way. At the opening of the MCD onald’s in Moscow one journalist described the franchise as the “ultimate icon of iimericana."’35 When Pizza Hut opened in Moscow in 1990, a Russian student said, “It's a piece of America. "35 Reflecting on the growth of last-food I restd'urants in Brazil, an executive associated with Pizza Hut of Brazil said that his nation “is experiencinga passion for things American?” 011 the popularity of Kentucky Fried Chicken in Malaysia, the nation’s finance minister said, ‘ihnyfliing Western, especiallyflruerican, people here love. . . . They want to be associated with .i‘irnerica.“at “Weds has become more imEortont than the United States itself. Take the following story about a former U.S. ambassador to Israel officiating at the opening of the first McDon ald’s in Jerusalem wearing a baseball hat with the McDonald’s golden arches logo: An Israeli teen-tiger walked up to him, carrying his own McD onald’s hat, which he handed toAmbassador Indylc with apes and asked: ‘l’ireyou thefimbass adori' Can I have your autograph?”- Soinewhat sheepishly, Ambassador Indy]: replied: “Sure. I’ve never been asked for my autograph before.” Asthe Ambassador preparedto sign his name, the Israeli teen-ager said to him, “Wong What's it like to he the ambassador from McDonald’s, going around the world opening McDonald's restaurants everywhere?” Ambassador lnclyk looked at the Israeli youth and said, “No, no. I'm the hmerican ambassador-110i: the ambassador iron: McDonald’s!” Ambassador In- dyk described what happened next: “I saidto him, ‘Doe-s this mean you don’t Want my autograph?’ And the kid said, ‘No, I don’t want your autograph,’ and he took his hat hack and walked away?” TWo other indices of the significance of McDonald's (and, implicitly, McDonaldization) are worth mentioning. T'th [n- dex” {part of Wblished by a prestigious magazine, The It—indicates the purchasing power of various currencies around the world based on the local price (in dollars) of rhe‘Big Mac. The Big Mac is used because it is a uniform commodity sold in many {1 15 ) different nations. In the 1998 survejI 'Lg Mac in the United States cost $2.56; in Indonesia and Ma- An Introduction to McDoncidiaation 7 laysia it cost $1.16; in Switzerland it cost $3.81” This measure indicates, at least roughly, where the cost of living is high or low, as well as which currencies are undervalued (Indonesia and Malaysia) and which are overvalued (Switzer- land). Although The Economist is calculating the Big Mac Index tongue-im check, at least in part, the index represents the ubiquity and importance of McDonald’s around the world. cond indicator of McDonald’s global significance is the idea devel- oped by Thomas]. Friedman that “no two countries t at or ave a Me on- f" ald's hmmfim” Friedman calls this the “Golden Arches Theory of Conflict Prevention.”“1 Another half- serious idea, it implies that the path to world peace lies through the continued international expansion of McDonald's. Unfortunately, it was proved wrong by the NATO bombing onbgoslavia in 1999, which had eleven McDonald's as of 199?. 1 P To many people throughout the world, McDonald's has become a sacred ' i institution.“ Atthat opening of the McDonald's in Moscow, a worker spoke of it “as if it were the Cathedral in Chartres . . . a place to experience ‘celestial joyJ.’ “4" Kowi nslti argues that shopping malls, which almost alvvays en compass fast—food restaurants, are the modern “cathedrals of consumption” to which people go to practice their “consumer religion. “‘4 Similarly, a visit to another central element of McDonaldized society, Walt Disney World,“ has been de- scribed as “the middle-class hajj, the compulsory visit to the sunbalced holy ' 1346 city. McDonald's has achieved its exalted position because virtually all Ameri- cans, and many others, have passed through its golden arches on innumerable occasions. Furthermore, most of us have been bombarded by commercials ex- tollingMcDonald‘s virtues, commercials tailored to a variety of audiences and that change as the chain introduces new foo cls, new contests, and new product tic-ins. These ever-present cummercials, Combined with the fact that people cannot drivevery far without having a McDonald‘s pop into view,. have emb eds ded McDonald’s deeply in popular consciousness. A poll of school-age chil- dren sh owed that 96% of them could identify Ronald McDonald, second only to Santa |Klaus in name recognition.“7 ._ _ Over the years, McDonald’s has apphaled to people in many ways. The restaurants themSelvcs are depicted as spiclc-and—span, the food is said to be fresh and nutritious, the employees are sheath to be young and elect, the man- agers appear gentle and caring, and the dining experience it seems fun- ' 3 THE McDDNALDIZATIDN OF- SDCEETY filled. People are even led to believe that they contribute through their pur- chases, at least indirectly, to charities such as the Ronald McDonald Houses for sick children. THE LONG HRM. OF McDONr‘tLDlkaTlON McDonald's strives to continually extend its reach within American society and beyond. As the company's chairman said, “Our goal: to totally dominate the quick service restaurant industry worldwide. . . . I want McDonald’s to be more than a leader. I want McDonald’s to dominate.” McDonald's began as a phenomenon ofsuburhs and mediu m-sized towns, but in recent years, it has moved into smaller towns that supposedly could not support such a restaurant and into many big cities that are supposedly too so- phisticated.”You can now findfast-food outletsin NewYorlr’s Times Square as well as on the Champs Elysées in Paris. Soon after it opened in 1992, the McDonald’s in Moscow sold almost thirty thousand hambu rgersa day and em- ployed a staffof twelve hundred young people working two to a cash register.m In early 1992, Beijing witnessed the opening of the world’s largest McDon- ald’s, with seven hundred seats, twenty—nine cash registers, and nearly one thousand employees. On its first day of business, it set a new on e-day record for McDonald’s by serving about forty thousand customers?1 Small satellite, express, or remote outlets, opened in areas that cannot sup- port full-scale fast-food restaurants, are also expanding rapidly. They have be- gun to appear in small store fronts in large cities and in nontraditional settings such as department stores, service stations,52 and even schools. These satellites typically offer only limited menus and may rely on larger outlets for food stor- age and preparation,“ McDonald’s is considering opening express outlets in museums, office buildings, and corporate cafeterias. A flap occurred recently ov er the placementofa McDonald’s in the new federal courthouse in Boston.“ No longer content to dominate the strips that surround many college cam- puses, fast-food restaurants have moved onto many of those campuses. The first campus fast-food restaurant opened at the University of Cincinnati in 1973. Today, college cafeterias often look like shopping-mall food courts. In conjunction with a variety of “branded partners” [for example, Pizza Hut and Subway), Marriott now supplies food to many colleges and universities.” The likens-I" An Introduction to McDonaldizatton 5' apparent approval of college administrations puts fast-food restaurants in a position to further influence the younger generation. More recently, another expansion has occurred: People no longer need to leave the highway to obtain fast food quickly and easily Fast food is now avail— able at convenient rest stops along the highway. After “refueling,” we can pro- ceed with our trip, which is likely to end in another community that has about the same density and mix of fast-foodrestacrants as the locale weleft behind. Fast food is also increasingly available in hotels,“ railway stations, air- ports, and even on the trays for in-flight meals. The following advertisement appeared in the Wehington Post and the New York Times a few years ago: r""‘FllP'here else at 35,030 feet can you get a McDonald‘s meal like this for your kids? Only on United’s Orlando flights, ” Now, McDonald's so-called Friendly Skies Meals are generally available to children on Delta flights. Similarly, in De- cember 1994, Delta began to offer Blimpie sandwiches on its North American flights,” and Continental now offers Subway sandwiches. How much longer befo re McDonaldiaed meals wille available on all flights everywh ere by every carrier? In fact, on an increasing number of flights, prepackaged “snacks” have already replaced hot main courses. In other sectors of society, the influence of fast'food restaurants has been subtler but no less profo...
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