TIME The Drucker Difference

McDonald’s Needs a ‘Miracle’ Like the Pretzel Bun

Wendy's hamburger has become more popular than McDonald's.
Paul Vernon / AP

Alas, McDonald’s has been out-bunned.

The hamburger giant and rival Wendy’s have taken different approaches to their businesses in recent years, and Wendy’s has prospered while McDonald’s, lately, has stumbled. Why?

Evidently, things have gotten too complicated on the McDonald’s menu. “We need to do fewer products with better execution,” said the company’s chief operating officer, Tim Fenton.

Tom Gara of The Wall Street Journal concurs, finding McDonald’s guilty of “firing multiple shots in all directions” and overwhelming customers and franchisees with “chicken wings, fish nuggets, bacon habanero ranch burgers and a line of wraps, among many other things.” By contrast, Wendy’s “doubled down on its core burger lineup and introduced a very successful twist: the pretzel bun.”

So, Gara asked, “Is it better to be a cunning player of many games, or a highly focused one-trick pony?”

Actually, it depends. (Sorry, it just does.) As we’ve pointed out, Peter Drucker stressed the importance of focus, of avoiding product clutter and of keeping innovation simple. Still, while McDonald’s miscalculated, that doesn’t mean that it was being foolhardy.

Adding food items to a restaurant menu isn’t terribly drastic, after all. And, as Drucker noted in Managing for Results, “The odds against any new product’s becoming even a moderate success are roughly five to one, and the odds against it becoming a smash hit are 100 to one.” So, failing the miracle pretzel bun, you’ve got to try a few things.

What’s more, McDonald’s is in many respects what Drucker called a “creative imitator,” an entrepreneur that “does not invent a product or service” but rather “perfects and positions it” through effective marketing and management. With creative imitators, Drucker explained, the requirements are for “alertness, for flexibility, and . . . for hard work and massive efforts”—all of which McDonald’s has put forth.

However, creative imitators also have vulnerabilities. “Creative imitators are easily tempted to splinter their efforts in the attempt to hedge their bets,” Drucker warned. “Another danger is to misread the trend and imitate creatively what then turns out not to be the winning development in the marketplace.”

That apparently includes the bacon habanero ranch burger.

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