What is Wrong with McD's USA?

wasabi, now dats some hot **** and its a nice peaceful green too.

The change, says one industry guru, was inevitable. "Things just couldn't go on like this forever," says Christopher Muller, professor of hospitality at Boston University.

What's more, Easterbrook won't have an easy time of it — particularly in the short run, says Muller. "The students in my classes don't even think of going to McDonald's. They've been taught not to go there since they were kids.

"His challenge is immense. He's got a whole generation that wants nothing to do with McDonald's."

Repairing McDonald’s sales in the U.S. won’t be easy. The level of competition today is greater than it was in 2002, when the chain last experienced major problems.

Quick-service burger chains have improved their systems since then. Fast-casual chains like Chipotle Mexican Grill, Shake Shack and the Habit Burger Grill are attracting customers in search of better food. And Chick-fil-A has overtaken McDonald’s leadership with a key constituent — families. The Atlanta-based quick-service chicken chain was rated more highly than McDonald’s as a destination for families, the first time another brand besides McDonald’s led that category. Grocery stores, pharmacies and convenience stores have also improved their prepared food offerings.

“The competitive set McDonald’s faces is the most challenging since the company went public in the 1960s,” Kalinowski said.

The chain’s size also makes change difficult. The brand has more than 14,000 locations in the U.S., more than any other restaurant chain except Subway.

McDonald’s is also a franchise, which can make decisions more arduous. While a company-owned concept like Starbucks or Chipotle can make quick, systemwide decisions and implement them following a management directive, a franchise must go through franchise operators. And in McDonald’s system, franchisees can vote on marketing plans, which is not always the case with some franchises.

Franchisee discontent has grown over the past two years as the chain’s sales have softened. As discontent grows, operators’ willingness to follow management’s spending plans has diminished.

“When you have a large franchise model and you have a good relationship, it’s easy to sell new ideas,” said Steve Crichlow, a former franchisee and now CEO of Compass Restaurant Consulting and Research. But if you don’t, he added, it’s a bigger burden, especially when the ideas could cost operators money.

There have been recent signs that franchisees have resisted plans to remodel locations and add equipment in recent months.

“They’ve just been learning to say no,” Adams said. “That was starting to become a problem for him [Thompson].”

Here's the latest installation in the never-ending series, "McDonald's Really Doesn't Understand Millenials": A press release notes that starting February 2 the chain will allow people to pay for their food in "lovin'." So what exactly are "lovin'?" They're the new bitcoin! Just kidding, McDonald's doesn't understand technologically either.

These "lovin[s]'' are actually selfies, compliments, or even a "friendly fist bump to the crew member on duty." Apparently a Big Mac could be paid for with "a call to a loved one." Business Insider writes that "customers who order items during pre-selected times will get to participate in the deal" and that the option will be offered to customers at random. McDonald's employees, known as "Lovin' Leads" (imagine that on a resume), will let customers know if they get compromise their self-respect to "Pay with Lovin'."

The stunt is part of the struggling chain's new "brand transformation" where the company attempts to stress the "lovin'" aspect of their slogan, "I'm lovin' it." Customers have until February 14 before they start having to pay for chicken nuggets with cash again.

Adams said morale among U.S. franchisees is at the lowest point since the late 1990s, when overbuilding hurt franchisees.

"Made For You", a 90s-era burger customization program that required investments of around $55,000 per outlet, made matters worse by battering service speed and sales, Adams said.

Thompson revived bad memories of that era with a project called "Create Your Taste," which he said would succeed where "Made for You" had failed due to improved technology.

While Thompson said the plan would allow McDonald's to become more like Chipotle and Subway by letting customers select sandwich toppings, Adams said franchisees aren't buying in. Their reaction to the plan, he said, has been "A chorus of No's."

I'm going to bet on "Gut Feeling".

The overall redesign "allows us to broaden our menu," Carras (McD senior vice president of domestic restaurant development ) says. Now, "Customer experience can match menu variety."

McDonald's plans to open 1,300 restaurants and remodel 2,400 in 2012, spending about $2.9 billion. The chain pays 40% to 45% of a franchisee's remodeling costs for each restaurant, which averages about $600,000 in the U.S. By year-end, the chain will have completed interior renovations on about half its 33,000 restaurants worldwide.

At the heart of the new system, executives say, is the way it focuses the McDonald's kitchen crew on individual tasks. New software is the "brain" of the operation, sending orders instantly from the cash register to the grill person and sandwich-maker on what sandwich to start working on even before the customer is finished ordering.

New hamburger buns that can hold more BTUs of heat and a new high-tech toaster start the process. A special order, such as a Big Mac without pickles, gets its own computer-generated slip of paper that rides along with the sandwich through the sandwich-making run.

In a complete reversal of the current process, the beef patty goes on the sandwich last, just before it is served.

Executives say the process will deliver a hotter, fresher product and better taste than one that has been sitting in a bin--a big thorn in McDonald's side after recent taste tests ranked some McDonald's sandwiches well behind its main competitors, Wendy's and Burger King. Both those fast-food companies have had customers special-ordering for years.