:00:07. > :00:10.Now it is time for The Bottom Line. We have burgers and fries on the
:00:11. > :00:17.menu today as we ask how well McDonalds is managing to revive its
:00:17. > :00:20.famous fast food formula. We will discuss technology. Apart from
:00:20. > :00:26.fancy gadgets, are we running out of things to invent? Each week,
:00:26. > :00:36.influential business leaders gather for this radio programme. Now you
:00:36. > :00:42.
:00:42. > :00:45.can see it as well as hear it. Firstly, let's meet the guests.
:00:45. > :00:54.Let's start with Greg Lucier, chief executive of Life Technologies, a
:00:54. > :00:59.biotechnology company in San Diego on the American West Coast. Can you
:00:59. > :01:01.tell us what you do? We are a life sciences company that provides
:01:01. > :01:04.technologies and systems software to researchers around the world
:01:04. > :01:07.that are probing and trying to figure out how disease works, how
:01:08. > :01:17.to identify people in terms of DNA and forensics, to increasingly
:01:18. > :01:19.
:01:19. > :01:24.doing genetic scans for patients if they walk into a hospital. We will
:01:24. > :01:30.talk more about the technology later. Can you tell us your
:01:30. > :01:34.experience with genetically profiling yourself? About two years
:01:34. > :01:38.ago, there had only been about eight or ten people who had been
:01:38. > :01:45.completely genetically sequenced. All of their DNA from beginning to
:01:45. > :01:52.end. We make the technology that does that. I thought I had better
:01:52. > :01:56.try it on myself. One afternoon, I sat down with a genetic councillor
:01:56. > :02:04.and they told me what they saw. Surprisingly for me, it was a
:02:04. > :02:11.connection between my mother and my daughter. It turned out I had a
:02:11. > :02:15.mutation for Parkinson's disease. It is not absolute that I will get
:02:16. > :02:22.it but it is probable. It turns out that my mother also has the same
:02:22. > :02:28.genetic mutation. The other connection to the next generation
:02:28. > :02:32.is my daughter. It turns out I had the mutations for breast cancer.
:02:32. > :02:36.There is no breast cancer in my line of the family but we probably
:02:36. > :02:42.have to get my wife sequenced to see if our daughter has inherited
:02:42. > :02:45.both of these mutations from each of us. In which case she would have
:02:46. > :02:51.to take some early action to be able to stay on top of potentially
:02:51. > :02:59.getting it. I think you're better off not knowing a lot of this!
:02:59. > :03:02.think it is better to know. You have the potential to do something.
:03:03. > :03:08.My daughter has the opportunity to take action and live a more vibrant
:03:08. > :03:18.life. Thank you. Rita Clifton is with us, the chairwoman of
:03:18. > :03:20.
:03:20. > :03:27.Interbrand, a brand consultancy firm. You recently rebranded
:03:27. > :03:33.Airmiles to Avios. It has been interesting, the coverage of Avios.
:03:34. > :03:43.I let out a little groan sometimes. Very often, there is a good reason
:03:44. > :03:44.
:03:44. > :03:47.as to why a name needs to be changed. When you're dealing with
:03:47. > :03:57.different nationalities and are bringing together things for a new
:03:57. > :04:00.feature, you have to do something. What was the reason? Even though
:04:00. > :04:09.Airmiles was a good brand and had a strong heritage, people did not
:04:09. > :04:15.know what it was about. It was a descriptive name. From a legal
:04:15. > :04:22.perspective, sometimes you have to do something new. Maybe I am
:04:22. > :04:25.thinking of it in rather parochial terms. We have a saying, it is the
:04:25. > :04:35.easiest thing in the world to approach a new name with an open
:04:35. > :04:39.
:04:39. > :04:42.mouth. That might be the case here. I have been firmly put in my place
:04:42. > :04:45.and I accept gracefully what you have told us! My third guest is
:04:45. > :04:51.Jill Mcdonald, chief executive of the fast food chain McDonalds. No
:04:51. > :04:53.relation to anyone in McDonalds? I am not! There's a concept called
:04:53. > :05:02.nominative determinism, which states that there is often a
:05:02. > :05:04.relationship between people's names and their occupations. A
:05:04. > :05:14.disproportionate number of people named Dennis become dentists for
:05:14. > :05:19.
:05:19. > :05:22.example! Is there any relation deep down? I did first try McDonalds
:05:22. > :05:26.when I was 10 or 11 years old and was profoundly impacted so maybe
:05:26. > :05:30.there is a connection. We will talk about McDonalds for a few minutes.
:05:30. > :05:34.Give us some basic facts. How big is it? We operate in virtually
:05:34. > :05:39.every country in the world. We employ over one million people
:05:39. > :05:43.around the world. We serve a lot of Big Macs and fries. We are one of
:05:43. > :05:48.the biggest employers of young people around the world and one of
:05:48. > :05:52.the biggest brands in the world. the UK, what sort of scale are we
:05:52. > :06:02.talking about? We have 85,000 employees in the UK alone. 1200
:06:02. > :06:03.
:06:03. > :06:09.restaurants. Let's talk about it more generally. It is a company, a
:06:09. > :06:15.global brand. It seems to divide people quite a bit. It is a love-
:06:15. > :06:24.hate thing. But it does seem to have enjoyed something of a
:06:24. > :06:28.turnaround in recent years. If we go back to the middle of the last
:06:28. > :06:35.decade, would you agree that when you joined, it was just about the
:06:35. > :06:38.lowest point, around 2006? I think in 2005, it was the time in the UK
:06:38. > :06:43.when we realised something had to change quite dramatically. If we
:06:43. > :06:46.were to regain our place in the nation's heart. Steve Easterbrook
:06:46. > :06:53.was promoted from within and brought in a number of people to
:06:53. > :06:57.help with that change programme. I was one of them. There was a very
:06:57. > :07:06.deliberate strategy and chronology of what we had to do to get back to
:07:06. > :07:15.a brand that customers wanted to eat and be seen to eat. We focused
:07:15. > :07:18.firstly on fixing some fundamentals. We franchised more restaurants.
:07:18. > :07:22.were majority company owned back then rather than franchise owned.
:07:22. > :07:25.We also fixed the basics, such as new kitchen equipment. Once we had
:07:25. > :07:32.done that and could feel more confident about service that we
:07:32. > :07:36.could offer, we look at making more disruptive moves. The new look and
:07:36. > :07:39.feel restaurants on the high street for example. We introduced things
:07:39. > :07:43.like deli sandwiches, more wraps, more chicken, better Happy Meals, a
:07:43. > :07:53.number of changes to ensure we were more modern and progressive, more
:07:53. > :08:03.
:08:03. > :08:11.confident. I don't know when you last ate at MacDonald Rita, but how
:08:11. > :08:20.successfully as it revived itself? I was always being asked, is this
:08:20. > :08:26.the end of McDonalds? Is this the death roll? It was doom and gloom.
:08:26. > :08:32.It had the perfect storm of the libel case, and that awful film.
:08:33. > :08:36.Morgan Spurlock's film? Super Size Me. It was an awful time. But
:08:36. > :08:46.millions of people were still going to McDonalds every day. It was
:08:46. > :08:53.still in the top ten most valuable brands. That was back then. Now, it
:08:53. > :08:58.has been one of the most impressive transformations. Because they have
:08:58. > :09:06.absolutely followed the brand's need to organise everything. They
:09:06. > :09:09.have not only changed products but people's behaviour, the outlets. It
:09:09. > :09:14.has changed the substance beneath and not just twiddled with the
:09:14. > :09:22.advertising campaign. McDonalds and Interbrand have worked together in
:09:22. > :09:25.the past. I have not personally but Interbrand has. Jill, you had a
:09:25. > :09:33.campaign with Justin Timberlake which did not seem to work. What
:09:33. > :09:36.was the message of that? Was that because the advertising had been
:09:36. > :09:43.done without the product being changed? There is an element of
:09:43. > :09:46.truth that did need to change. Another was the danger of global
:09:46. > :09:54.advertising and slapping celebrity all of the advertising and thinking
:09:54. > :09:58.this would solve a more fundamental problem. One of the things that
:09:58. > :10:06.McDonalds around the world now tries to focus on is being very
:10:06. > :10:16.clear on who your local customers are. Making sure that the
:10:16. > :10:18.
:10:18. > :10:24.advertising of products is directed to your local market. We can
:10:24. > :10:34.observe in the UK that upmarket burger joints are coming in. Far
:10:34. > :10:44.more care over the ingredients, organic burgers, natural burgers.
:10:44. > :10:46.
:10:47. > :10:50.Was McDonalds too downmarket for an increasingly affluent population?
:10:50. > :10:55.We are a very large brand and we forget who our core customers are
:10:55. > :11:01.at our peril. We serve 80% of the British population every year. We
:11:01. > :11:07.are a mass brand. It is a fine line between upgrading the experience
:11:07. > :11:15.for customers but not trying to be something that you are not. Not
:11:15. > :11:19.trying to be so posh that regular people feel it is not for them. I'm
:11:19. > :11:22.thinking of brands like Zahra that bring things off the catwalk to the
:11:22. > :11:32.high street very quickly and suddenly make accessible designs
:11:32. > :11:34.
:11:34. > :11:40.that were not accessible to the general public before. I wonder
:11:40. > :11:46.whether the science work can make McDonalds food healthier? At the
:11:46. > :11:49.transformation is a great example of us becoming very focused on what
:11:49. > :11:53.we are putting in our bodies. One of the fastest growing areas is
:11:53. > :11:58.Food Research. We are putting a lot of things into our bodies and we
:11:59. > :12:02.don't really know what they do. I'm absolutely convinced that in ten
:12:02. > :12:08.years' time, we will have engineered food for our own body
:12:08. > :12:12.that totally optimise our own behaviour and thoughts. I do not
:12:12. > :12:16.think listeners will think that sounds at all attractive. Why don't
:12:16. > :12:20.we just eat lovely Italian food which has not been put through and
:12:20. > :12:25.laboratory, which is fresh and grown in a field with a caring
:12:25. > :12:29.farmer looking after it? As we should. We should keep doing that.
:12:29. > :12:35.But if you are a Performance Athlete, you want to make sure that
:12:35. > :12:40.you are tuning up your capability to be competitive. One last
:12:40. > :12:46.question on this subject. Is it fair to say that it was moral and
:12:46. > :12:52.political pressure which motivated McDonalds to try and upgrade itself
:12:52. > :12:58.and introduce fruit and more salad? Or was it commercial pressure?
:12:58. > :13:03.There seems to be a bit of stigma attached to McDonalds. I think
:13:03. > :13:07.there was a stigma attached. But the tipping 0.4 McDonalds was about
:13:07. > :13:14.listening to customers more. We were slow in terms of responding to
:13:14. > :13:24.what customers want. Customers were saying they love burgers and fries
:13:24. > :13:29.but they like eating healthier as Ed Miliband was talking earlier
:13:29. > :13:34.this week about infusing a great deal of moral behaviour into
:13:34. > :13:39.business. Businesses that do not do the right thing get punished in the
:13:39. > :13:46.end by their customers. Market pressures force people to behave
:13:46. > :13:51.well. When it comes to things like Private Equity, the sort of Doctor
:13:51. > :13:55.evil, sometimes that is caricatured and it does bring real sustainable
:13:55. > :14:00.value often to organisations and even if they might take costs down
:14:01. > :14:04.in the early stages, the numbers would suggest that a few years on
:14:04. > :14:09.from a private equity take over, a company is doing better than it
:14:09. > :14:15.would have done otherwise. Sometimes when large businesses to
:14:15. > :14:18.transform, they forced other people to improve as well. And it
:14:18. > :14:22.infuriates me sometimes when we have this ridiculous caricature of
:14:23. > :14:26.business because it puts people off and creates the impression that
:14:26. > :14:31.business is something to be controlled whereas if we do not
:14:31. > :14:35.have successful businesses, we do not have what we need to pay for
:14:35. > :14:39.the civil society. And yet there was moral pressure on McDonald's
:14:39. > :14:42.and that ultimately forced McDonald's to look again at what
:14:42. > :14:47.they were doing. You could argue that the political pressure, the
:14:47. > :14:53.moral pressure, the application of those values and the stigma got
:14:53. > :14:57.something better out of it. I would say that there is pressure from a
:14:57. > :15:02.number of different stakeholders but it was all to let the customer
:15:02. > :15:04.pressure. When we could see that less customers were visiting, that
:15:04. > :15:09.was what the two. There were so many different stakeholders who had
:15:09. > :15:15.a different opinions on what is good and their behaviour. If you
:15:15. > :15:25.listen to the Neri and of non- customers, you can get yourself
:15:25. > :15:35.
:15:35. > :15:39.into a right pickle. -- and period. You can visit our website for more
:15:39. > :15:45.information. Amazon's Kindle Fire tablet
:15:45. > :15:50.launched this week. The iPhone 5 will also launch soon. Fans will
:15:50. > :15:54.marvel at the innovation embedded within it, I am sure. But deep down,
:15:54. > :16:04.I wonder whether the new iPhone. Just be a slightly better version
:16:04. > :16:06.
:16:06. > :16:11.of the old one. -- might just be. Some have argued that innovation in
:16:11. > :16:15.the US has slowed down. We are no longer seeing innovation of the
:16:15. > :16:23.sort that have changed lives. The refrigerator, the washing machine,
:16:23. > :16:31.the electric light poll, radios, television... Have we ran out of
:16:31. > :16:36.inventions? You are in a technology business. What area do you work in?
:16:37. > :16:42.I think that is complete bunk. If you look at the last decade, from
:16:42. > :16:46.the very first time we sequenced the first human from then to ten
:16:46. > :16:52.years later, we have gone four times faster than Moore's Law,
:16:52. > :16:56.which governs electronics and computing power. That is the law
:16:56. > :17:03.that you double the power of a processing chip every two years.
:17:03. > :17:08.That is correct. It is much cheaper now to do someone's genome. And it
:17:08. > :17:12.opens up incredible new horizons for science and innovation. If the
:17:12. > :17:16.20th century was all about electronics and the power of that,
:17:16. > :17:21.the 21st century is all about the power of science and harnessing
:17:21. > :17:25.molecules. Whether it is for Health, biofuel, we are just at the
:17:25. > :17:33.beginning of what will be an incredible innovation. If that is
:17:33. > :17:42.an important statement. It might be that commentators simply do not
:17:42. > :17:45.know what is to come in this century. Give us an example of the
:17:45. > :17:53.things in your area that are going to be ground-breaking over the next
:17:53. > :17:57.100 years. Cancer is a tizzy of the DNA and 99.9 % of patients today
:17:57. > :18:01.never get their DNA went to see what type of therapy is they should
:18:01. > :18:05.get to leave and survive. We will correct that over the next few
:18:06. > :18:10.years as genetics finds its way into how we treat cancer. Just on
:18:10. > :18:16.that, that means tailoring treatment much more closely to a
:18:16. > :18:21.particular tumour. If personalised medicine. Another example is in
:18:21. > :18:25.fuel. Everything we see in the world organically was derived
:18:25. > :18:30.randomly by Mother Nature. At some point, we can engineer biofuel.
:18:30. > :18:37.That is another size that will change the world. How far are we
:18:37. > :18:39.away from doing that? Less than ten years. Seriously? It might just be
:18:39. > :18:45.there you happen to be in the business that is generating
:18:45. > :18:48.innovation at the moment but pharmaceutical companies have found
:18:48. > :18:53.research and development to be diminishing slightly. That is the
:18:53. > :18:58.feeling I get. The number of new drugs licensed every year from the
:18:58. > :19:02.mid-nineties to today has dropped sharply and there is not a huge
:19:02. > :19:07.queue of new Glock book does -- blockbusters coming onto the
:19:07. > :19:11.horizon. That is true but make no mistake. We will actually see an
:19:11. > :19:16.explosion of new drugs coming as we are now able to handle the
:19:16. > :19:22.complexity of handling this biology. A good example is caff there again.
:19:22. > :19:25.As we read and understand DNA, we will develop treatments for the
:19:25. > :19:29.particular mutation that the individual has been their DNA. It
:19:29. > :19:35.will not be a blockbuster but it will be very important to that
:19:35. > :19:38.individual and also a very economical. Even this week, we have
:19:38. > :19:42.seen a large global commission reporting on the cost of cancer
:19:42. > :19:46.treatment, saying that it is getting completely out of control.
:19:46. > :19:53.People are over describing things that only give days of extra life
:19:53. > :19:59.to people. It is not cost-effective. Or effective just in general.
:19:59. > :20:05.are clearly in an area where there are lots of impressive gadgets. Do
:20:05. > :20:09.you think we are running out of inventions? I do not think so. The
:20:09. > :20:14.gentleman you are quoting is an economist and occasionally,
:20:14. > :20:18.economists get things wrong. I suppose history is littered with a
:20:19. > :20:23.bad predictions but what is interesting is that technology and
:20:23. > :20:27.breakthroughs are one thing but it is how they apply to humans is what
:20:27. > :20:33.is interesting. If you look at Apple, they have humanise what
:20:33. > :20:37.technology can do, making it useful, attractive and magnetic. But so
:20:37. > :20:44.many technology companies do technology for the sake of it.
:20:44. > :20:52.Apple is a good case, isn't it? It is very nicely packaged and it is a
:20:52. > :20:56.good user interface, isn't it? It is a telephone, basically. But the
:20:56. > :21:00.jump from land line to mobile phones was huge, everyone would
:21:00. > :21:04.agree. But jumping from the first generation mobile phone to the
:21:04. > :21:07.second generation mobile is nothing like as large as the creation of
:21:07. > :21:17.the mobile phone itself and then jumping to a third-generation
:21:17. > :21:17.
:21:17. > :21:21.smartphone... I think that when people in 100 years' time look back,
:21:21. > :21:26.we are right in the middle of customers really understanding and
:21:26. > :21:30.finding different ways to innovate within the technology advances. My
:21:30. > :21:35.two young children, we get the latest Wii and they instinctively
:21:35. > :21:41.know how to play with these games. I am still reading the instruction
:21:41. > :21:45.manual. Something is going on, I believe, in the brains of children.
:21:45. > :21:50.If you go to the average household and look at it, it is more
:21:50. > :21:56.affluence now than it was 50 years ago. It probably has air
:21:56. > :22:01.conditioning in the US and it probably has central heating in the
:22:01. > :22:08.UK. But fringes, telephones, television... It is all there. It
:22:08. > :22:12.was all there, wasn't it? It has not changed that much? We are not
:22:12. > :22:17.eating saw the cloves and eating astronaut food. But if you are a
:22:17. > :22:23.working mother being able to shop online and have your groceries
:22:23. > :22:27.delivered by whichever supermarket does that is huge. That is as
:22:27. > :22:32.revolutionary for me as a washing machine because it is adapting to
:22:32. > :22:37.the needs that I have. It does come back to human means. We all want
:22:37. > :22:41.things faster, easier, quicker and technology is helping us to do that.
:22:41. > :22:45.When I worked in the airline industry, there was concern that
:22:45. > :22:51.video conferencing would remove the need for air travel. Guess what? It
:22:51. > :22:55.certainly did not! People still want to meet face to face and
:22:55. > :23:01.connect. Advances that help you actually connect more to people I
:23:01. > :23:03.think have still got a way to go. We might be in for an era of
:23:03. > :23:09.stagnation if we ran out of technology to drive economic growth
:23:09. > :23:14.and efficiency and improvement. We should all be deeply encouraged by
:23:14. > :23:23.your comments. We have got to leave it there.
:23:23. > :23:27.Thank you to my guests today. I will be back with more next week.