McDonald's to Eliminate COO Position After Fenton Retirement -- 3rd Update

McDonald's Corp., which has been trying to regain momentum after a series of missteps, said its chief operating officer would retire in October.

The company said it won't replace operating chief Tim Fenton, age 56, who will step down Oct. 1. Instead, it will restructure its senior ranks so that global division presidents would report directly to CEO Don Thompson.

Mr. Fenton had been considered a contender for the CEO position at the Oak Brook, Ill., restaurant chain. A 41-year veteran of the company, Mr. Fenton got his start working at a McDonald's in Utica, N.Y.

In a news release, he said his decision was related to his severe asthma. "I simply cannot continue to meet the global travel demands of this position and will focus on improving my health closer to home," he said.

A McDonald's spokeswoman said Mr. Fenton's "retirement and the timing were both his personal choice."

Mr. Fenton will serve as a special adviser to Mr. Thompson focused on global franchising and restaurant portfolio optimization, among other things.

Mr. Thompson, who is nearing his second anniversary as CEO, has previously made changes in response to slowing sales growth. In December 2012 he replaced McDonald's U.S. president and veteran executive Jan Fields.

Earlier this month McDonald's reported its fourth consecutive month of same-store U.S. sales declines. Executives recently conceded that McDonald's complicated their kitchen operations with too many new menu items, resulting in slower service.

On Thursday, McDonald's said it would broaden responsibilities for two other senior leaders. Chief Financial Officer Pete Bensen will oversee world-wide supply chain, development and franchising functions, and Global Chief Brand Officer Steve Easterbrook will oversee the restaurant solutions group and corporate strategy and the sustainability and philanthropy department.

This isn't the first time a high-ranking McDonald's executive has retired, citing health reasons. In December 2009, Chief Operating Officer Ralph Alvarez, 55 at the time and widely regarded as the likely successor to then Chief Executive Jim Skinner, abruptly announced his retirement, saying that chronic knee problems made the global travel required by his job too painful.

Write to Julie Jargon at [e-mail]

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