New CEO, Business Changes to Have Communications Impact
An unprecedented move to cut more than 400 jobs and the promotion of McDonald's Corp. [MCD] new CEO, Jack Greenberg, signal a new era for the American icon. And now the transition includes the departure of its senior VP of communications and of a review of its communications infrastructure, PR NEWS has learned.
Communications head Dick Starmann has decided to leave the Oak Brook, Ill.-based company after 27 years, according to McDonalds officials. Starmann could not be reached for comment. The veteran was one of the key communicators to work with McDonalds' lead PR firm, Golin/Harris (G/H). Although the company has yet to announce the resignation, it's expected that Starmann will leave by the end of summer for "personal reasons."
McDonalds, known for having a staid PR structure, has used the Shandwick-owned G/H since 1956 and built part of its PR division with former G/H employees. Starmann's replacement, Jack Daly, group VP of communications, is a G/H veteran.
Daly was recruited about six years ago from Taco Bell and his background includes agency expertise, as he worked with G/H in Chicago in the late 1980s. He will report to Greenberg who joined McDonald's in 1982 as CFO.
So far, G/H remains unscathed by Greenberg's initiatives to revamp the company and reduce its corporate workforce through voluntary severance and retirement packages.
"Greenberg is sensitive to communications," says Chuck Ebeling, assistant VP, corporate communications. "We have a seat at the table more so than ever."
But internal and external PR strategies surely will experience changes.
Internal PR staffers' roles will be analyzed during the next several months and several are expected to be affected by the cuts proposed by Greenberg, says Ebeling. Changes will include combining its U.S. and corporate PR into one department for global management.
In addition to the communications department, McDonalds is expected to review the 12-member investor relations department and a 40-person communications services office that handles meetings, events, graphics and other similar tasks.
G/H to Go the Way of Leo Burnett?
If the road McDonalds has taken with its advertising is any kind of sign, GH may have to reinvent its role and internal staffers may want to brush up those resumes.
Less than a year ago, McDonald's nixed Leo Burnett of Chicago as its lead advertising agency and turned that responsibility over to DDB Needham, of New York, which created the "Did somebody say McDonalds?" campaign. Burnett was the lead agency for 16 years.
The 43-year-old corporation also is looking to fill its slot for senior VP of marketing. The post was vacated when Brad Ball left several months ago to become president of Warner Bros. Domestic Theatrical Marketing, Burbank, Calif.
McDonalds PR has always been a polished mix of grassroots community relations, and GH has historically been involved in helping boost the company's image and reputation. Its long-term PR involvement includes communications revolving around the Ronald McDonald House, a 25-year-old charity for sick children.
G/H and McDonalds don't have any plans to abandon the corporation's manner of PR, which has long rested on a kind of down-home, versus hyped or glitzy, communications.
However, Greenberg's directives could result in the most exciting changes in the company's history, says G/H CEO Rich Jernstedt.
And Greenberg, recently called an iconoclast by a Fortune magazine, is known for making changes.
As chairman and later CEO of McDonald's USA (1996 to present), he worked to slow franchising as the company's main growth agent. Only about 300 restaurants, nearly 200 less than last year, will be opened this year in the United States.
And the pressure is on for Greenberg, who replaces CEO of 11 years, Mike Quinlin in August.
The company has failed to delight investors in recent years, although its financial footing is becoming more sturdy. Quinlin remains on board as chairman. (McDonalds, Chuck Ebeling, 312/552-6424; IBM, 914/499-7623; Golin/Harris, Rich Jernstedt, 312/729-4000; Needham, Dorothy Denzler, 312/552-6498)