The McDonald brothers' first restaurant, founded in 1937 in a parking lot just east of Pasadena, California, did not serve hamburgers. It didn't have a playground or Happy Meals. The most popular item on the menu was the hot dog, and most people ate it sitting on an outdoor stool or in their beloved new cars while being served by teenage auto repair shops. That model was a resounding success, for about a decade. Then American tastes began to change, and the Golden Arches changed with them. As cars lost some of their appeal, indoor restaurants took over. When adults grew bored of the menu in the 1960s, a new sandwich called the Big Mac won them back. When consumers grew tired of beef, McDonald's introduced chicken nuggets in the early 1980s and within four years became the nation's second-largest poultry seller. The changes were vital, but never radical. McDonald's gave us what we wanted before we even knew we wanted it, whether it was movie tie-ins or Egg McMuffins. Along the way, he built one of the world's best-known corporate icons and its most ubiquitous store. The philosophy was well summed up by Ray Kroc's cheeky promise: Whatever people ate, McDonald's would be the only one to sell it. But now, two years after Kroc sets his sights on the distant future, that goal seems less assured than ever. Forget for a moment all the recent talk about Burger King Corp. and Wendy's International Inc. stealing customers from McDonald's. With a 42% share of the U.S. fast food hamburger market, McDonald's still easily outpaces its rivals. However, the problems beneath the famed Golden Arches are much more serious than a failed Arch Deluxe here or a French Fry War there. Quite simply, McDonald's has lost some of its relevance to American culture: a... mid-1960s, which rewards managers who start young and stay for life. Headhunters, noting that virtually no alumni of McDonald's headquarters in Oak Brook, Illinois can be found leading other companies, say that's not where they're looking for talent. “I'm no longer the beacon of great success I once was,” says one Chicago-area recruiter. Wall Street appears to share this sentiment. Over the past two years, while the Standard & Poor's stock index has risen 63%, McDonald's shareholders could have made more with an insured savings account. If you had invested $100 in the company two years ago, you would have $103 today. Of the 10 most powerful brands in the world, only the beleaguered Eastman Kodak Co. has performed, according to rankings compiled by Interbrand, a New York consultant. worse in that period (table on page 71). Gillette Co. shareholders, meanwhile, more than doubled their money.