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McDonald’s planning job cuts and reorganization as the company refocuses its priorities to accelerate restaurant expansion, CEO Chris Kempczinski told employees there.
The fast-food giant said the job cuts were not a cost-cutting measure, but aimed at helping the company innovate faster and more efficiently. As part of the reorganization, the company will be deprioritizing and ending certain initiatives, according to a company memo from Kempczinski. It is not clear what the project is.
“Today, we are divided into silos by centers, segments, and markets,” Kempczinski wrote. “This approach is outdated and self-contained – we try to solve the same problem many times, don’t always share ideas and can be slow to innovate.”
Currently, McDonald’s organization is divided into three parts: US, international operated markets and international development licensed markets. The company operates in 119 markets worldwide.
In addition, McDonald’s said Friday it will accelerate new restaurant development plans.
“We have had to accelerate our restaurant openings to meet the growing demand over the past few years,” Kempczinski said in the memo.
McDonald’s has not previously published a forecast for the number of new restaurants it plans to build in 2023, but the company said in November that new units would contribute about 1.5% to system-wide sales growth in 2022.
The company has not decided how many new restaurants it will build or how many jobs it will eliminate as part of the reorganization. Kempczinski said the company will finalize and begin issuing decisions on layoffs by April 3.
Kempczinski also announced several internal promotions, effective February 1, to help the company implement its new strategy. Global Head of Marketing Morgan Flatley will also oversee new business ventures. Skye Anderson will move from McDonald’s US west zone to global business services. Andrew Gregory’s role as global franchising officer will also include leading global development, and Spero Droulias will transition from senior vice president of finance to chief corporate transformation officer.
Shares of McDonald’s closed up more than 2% on Friday. The company is expected to report fourth-quarter earnings on January 31.