Apr 4 • 23M

McDonald's Russia: Managing a Crisis

What happens to McDonalds's when money isn't worth anything?

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The business of burgers.
Episode details

After spending 14 years bringing McDonald’s to Russia, founder and senior chairman of McDonald’s Russia George Cohon faced an uncertain and volatile situation. In August of 1998 the Russian financial crisis threatened everything he had built. The country was in a state of emergency with massive inflation and widespread economic disarray.

Today we look at the 2002 case study from Youngme Moon and Kerry Herman about the difficulties facing George Cohon and Khamzat Khasbulatov, the president of McDonald’s Russia, as they met to discuss how to operate McDonald’s in an unstable economic environment.

This is a very dramatic case study which tracks the incredible amount of work Cohon and his team put in to build the McDonald’s operations in Russia, starting with his first inkling of the idea back in 1974. This story reads like a Hollywood movie, perhaps the sequel to the 2016 movie The Founder with Micheal Keaton, with twists and turns and a series of unimaginable obstacles that Cohon overcomes through the years until the fateful night when he and Khasbulatov meet up to face their biggest crisis yet.

Join us as we talk about the dramatic story and come up with our own unique solution to the problem presented in this case study.

In reading and researching this case study we thought a lot about what is happening in Russia now. In the February 1st, 1990 New York Times article about the opening of that first restaurant in Moscow there is a man from “far-off Ukraine” taking his order back home.

32 years later, in May of 2022, McDonald’s exited the Russian market after the invasion of the Ukraine. 15 of former McDonald’s re-opened as “Vkusno & Tochka” restaurants, including the famous first location in Pushkinskaya Square.

And while there are no more McDonald’s in Russia, some of the 100 McDonald’s in Ukraine have re-opened. 🇺🇦