Reflecting on the enduring success of companies can provide a fascinating journey. Despite the emergence of well-funded chicken-centric start-ups, the mounting pressure to reduce meat consumption, and society’s growing fancy for gourmet coffee, McDonald’s stands as a testament to longevity. This year, McDonald’s marks its 84th anniversary, boasting a market capitalization of approximately $191 billion (still strong, but a decrease of 10% from this time last year).
The McDonald’s saga commenced when Maurice and Richard (Mac and Dick) joined their father, Patrick McDonald, in flipping burgers at his diner, the Airdrome. In 1940, the brothers rebranded the establishment with their surname. Nearly a decade of experimentation preceded the introduction of their “Speedee Service System,” incorporating assembly line techniques to expedite customer service.
For almost 20 years, the McDonald family managed their single-location hamburger stand until Ray Kroc entered the scene, expressing interest in franchising the concept. While Mac and Dick possessed the skills to establish a successful one-location business, it was Kroc who transformed their modest eatery into a global sensation.
Navigating the Growth Conundrum
To propel a start-up toward success, certain skills prove indispensable, but paradoxically, these very skills can become impediments as the business expands. Here are three crucial skills that are essential in the early stages but may require “unlearning” for sustainable growth:
- Flexibility
During the initial phase, when cash is limited, flexibility is key. Subcontracting work to partners instead of hiring full-time employees can be a cost-effective strategy. Remaining adaptable in dealing with customers is also imperative, as startups often lack the leverage to dictate terms and must tailor their offerings to suit client needs. While this adaptability is vital in the nascent stages, it can transform into a liability over time. Contract employees may juggle multiple clients, hindering immediate availability. Excessive customization demands from clients may result in the founder being the sole person equipped to fulfill specialized requests. Eventually, clients may seek insight into the working environment, potentially devaluing the business if it lacks a conventional office space. - Thrift
For self-financed start-ups, turning a profit from day one is non-negotiable. However, an unwavering focus on immediate profitability can hinder long-term growth. Investments such as website redesigns might not yield immediate returns, but they could be pivotal for attracting substantial contracts from prominent clients in the future. While profitability should never be disregarded, a balanced emphasis on both top- and bottom-line results becomes crucial, even if the returns aren’t instantaneous. - Self-reliance
In the early days of a cash-strapped venture, founders often wear multiple hats, getting tasks done independently. The control and fear of potential mishaps can lead to a persistent desire to handle everything personally. However, as profits increase, delegating tasks to additional team members becomes essential for effective time management.
The inclination to remain self-reliant, a prerequisite for launching a business, can paradoxically impede growth. Letting go of certain responsibilities becomes imperative to ensure scalable expansion.
In conclusion, flexibility, thrift, and self-reliance are foundational to any start-up’s success. However, as a company aims for larger horizons, founders must undergo a transformative process, shedding these initial tendencies in favour of a new skill set.
If you’re interested in developing the skills needed to create an enduring business, please contact us here.