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Published: August 28, 2012
 / Autumn 2012 / Issue 68

 
 

The Thought Leader Interview: Douglas Conant

S+B: What capabilities did you need to build back, and how did you do it?
CONANT:
First of all, we made a major commitment to training and development, which was part of a philosophy we called “The Campbell Promise.” If you’re asking people to do extraordinary things, they have to see you leaning in to help them learn and grow. Otherwise, your message will fall on deaf ears over time. We had high expectations of people, and we couldn’t expect them to value the company’s agenda if we didn’t tangibly demonstrate that we valued their agenda as well.

Moreover, we had brought in many new executives with different backgrounds; we had people from Pepsi, Procter & Gamble, and General Mills, all speaking the language of their old businesses. There wasn’t a “Campbell way” to think about strategy. So we set up a strategy and management training curriculum, where we brought leaders together from around the world, to work in teams on real cases, from Campbell and elsewhere. They would tear apart the strategy issues, employ a common process approach with the same language, and present their observations to senior executives. Separately, I developed a program where I took 20 to 25 young, promising leaders and met regularly with them over two years, with homework focused on significantly lifting their leadership profile. I taught this course for three separate cohorts.

We also developed our own Campbell leadership model for managerial behavior. We had functional excellence programs targeting manufacturing, leveraging proven methods. We began to create common ways of doing things across all our functions — supply chain, IT, marketing, and sales — along with more disciplined HR and financial planning systems, so people knew what was expected of them. We had tight budgets, but every year we found ways to improve the learning opportunities for virtually everyone.

S+B: What other investments did you protect?
CONANT:
We restored product quality. We put more chicken back into the soup, for instance. We started a continuous improvement program so we were making better products every year, not worse. Products are important to our employees. Neighbors would talk to them about their favorite soup, or what they liked about a new Pepperidge Farm product. We also restored our marketing spending to competitive levels — from about 16 percent of sales back up to 20 to 22 percent.

To pay for this, we shed underperforming or less-connected assets, including a very large food business in the U.K. and Ireland that went back 100 years. We sold Godiva Chocolatier, which was a magnificent brand but made no sense for our portfolio. We weren’t a confections or retail company.

We lowered some of our systems expenses. For instance, we realized that we had been overinvesting in transactional costs, so we outsourced processes to which we couldn’t add value. Although our new ERP system raised costs in the near term, it clearly positioned us to reduce costs in the mid- to long term.

In addition, we reduced our trade promotion profile and spent more on advertising directly to the consumer. We built our capabilities by leveraging our competencies across categories. For instance, we knew consumers were concerned about the amount of sodium in their diet. So we developed world-class sodium reduction capabilities in soup, and then applied them across our entire portfolio: juices, Prego pasta sauces, and even baked snacks. We also developed marketing insights around the world in the same way, and harvested global views of our customers that improved our ability to compete.

Then we incorporated a corporate social responsibility program into the Campbell success model. We had said we wanted to win first in the workplace, and then in the marketplace. Now, we said we would win in the community and that we would continue to bring a high level of integrity to everything we did.

 
 
 
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