BK prexy Petty, Grand Met part ways: mutual agreement led to split-up after one-year trial partnership

BK prexy Petty, Grand Met part ways: mutual agreement led to split-up after one-year trial partnership – C. Ronald Petty, Burger King Corp

Bob Seligman

BK prexy Petty, Grand Met part ways

Mutual agreement led to split-up after one-year trial partnership

MIAMI — Grand Metropolitan has tightened its grip on Burger King by parting company with C. Ronald Petty, the 12-year veteran who served most recently as president of the hamburger chain’s domestic operations.

Petty and Grand Metropolitan mutually agreed to split after a one-year trial marriage, according to Burger King officials. The parties agreed to the test after Grand Met acquired Burger King through the takeover of Pillsbury Co. in early 1989.

“We both decided we would get right down to the urgent tasks at hand and take a year or so to decide whether we wanted to work together long term,” Barry Gibbons, Burger King’s chief executive, said in a prepared statement. “We have had that review and decided to change.”

“They were a partnership in running the company together,” said Don White of Reno, Nev., the president of the Burger King Franchisees Association and a franchisee of eight stores. “It was a partnership that didn’t work out.”

“Petty probably did not have a chance of remaining long term because he was a member of the old regime,” said Steve Lewis, a Norristown, Pa.-based franchisee of 30 stores.

“It was inevitable,” said Sheldon Friedman, a Chicago-based franchisee of 20 stores. “I felt a year ago he’d be going. He did a great job, but I felt Grand Met would want one of its own people in.”

Petty’s resignation came days after the U.S. Department of Labor sued Burger King for repeatedly violating federal child-labor laws. Burger King said the events were unrelated.

Gibbons, who said he would perform Petty’s duties until a successor is named, did not disclose the exact reasons for the split. But franchisees speculated that London-based Grand Met wanted to put its own lieutenant in charge of Burger King’s U.S. operations.

“The company has laid its groundwork already,” said Joe Lal, a Sacramento-based franchisee of 29 stores. “Whoever the successor is will just have to follow the footsteps.”

“I’m sure that Petty was very frustrated dealing with the executive committee,” Lewis said. “He did not necessarily agree with the direction they were trying to take the company in, particularly the marketing direction.”

Grand Met may also want a more decisive leader, according to franchisees.

Petty “appeared to be in a public-relations position rather than as a president of a company,” said Lawrence Jaro, a Denver-based franchisee of 12 stores. “Because of the change in ownership, I wasn’t sure who was making the decisions.”

“Gibbons is a no-B.S. guy who is a doer,” said Joe Della Monica, a franchisee with 17 stores based in Great Neck, N.Y. “He’s certainly not afraid to make a decision.”

Franchisees greeted Petty’s resignation with mixed reactions. The Franchisee Association is “a little disappointed because we had a long-standing relationship with Ron,” White said.

“We know Barry Gibbons makes decisions. That wasn’t the appearance when Ron was in,” Jaro said. “There may be an improvement if the guy who is put in can make operational decisions. When you, as a franchisee, are talking to the president of a company who you don’t feel has the power to make a decision, it hurts the credibility of a company. I think it’ll be improved if a new guy is put in or if Gibbons is put in.”

“It depends upon who replaces him,” said John Ragsdale, executive vice president of 18-unit Houston franchisee Gramdale Inc. “There are good people available. If we get a good person, we won’t miss a stroke. We have to think positive. We can’t think negative.”

“Petty was the common link we had [with management],” said Jim Harding, a Phoenix, Ariz.-based franchisee of 12 stores. “It’ll be a whole new ballgame.”

“Burger King will go on and survive,” Della Monica added. “It’s not catastrophic to me.”

“It’ll be a loss to the system anytime you lose an executive with this type of experience,” Lal explained. “It’ll disrupt the continuity of the plans and objectives that were set forth. When a new person takes the position, it takes him a while to understand the company.”

COPYRIGHT 1990 Reproduced with permission of the copyright holder. Further reproduction or distribution is prohibited without permission.

COPYRIGHT 2004 Gale Group