a belief and behavior activation journey!
3
this is a story about !
How Coke created value and
reinvigorated growth through brand
belief and behavior!
4
problem: sales were flat in 2004!
0"
5"
10"
15"
20"
25"
1997" 1998" 1999" 2000" 2001" 2002" 2003" 2004"
Coca-Cola Annual Net Sales!
Despite a series of company reorganizations, Coke had failed to spur growth!
Unhappy with their lack of success,
Coke’s board of directors asked 40-
year Coke veteran, Neville Isdell, to
return from retirement to help right
the ship. He identifies the problem
immediately…!
!
!
!
CEO, Neville Isdell returns in 2004!
5
We have lost our vision.!
!
There is no clarity about where we
are going and what we need to do.!
!
We need to go back to our roots
and start seeing ourselves as more
than a carbonated soda business.
We are in a creative-service
business.!
“"
”"
Coke had lost their vision.!
!
In order to get it back, Neville focused the company on activating brand behavior: !
not just what a brand believes, but what it does. !
Neville recenters on belief + behavior!
inspire
moments of
optimism and
happiness!
We believe in the
uplifting power of
happiness!
brand belief!
brand behavior!
how they did it!
At a macro level, Coke needed to refocus on strengthening their core business and
enabling greater levels of happiness, both inside and outside of their company !
!
So they set out to do it in stages!
activating brand behavior!
live it!
express it!
prove it!
Act like a company
that enables
happiness internally!
Translate belief into inspiring
moments of optimism via
external brand expressions!
Make a greater impact by
reinforcing and evolving the
vision into tangible actions!
Note: TBWA\Chiat\Day Interpretation!
Empower passionate
leaders to build a path to
achieving your vision!
plan it!
Empower passionate leaders to build !
a path to achieving your vision!
plan it -> !
Before creating a plan, HR reached out to employees to identify
what areas could improve. They asked…!
finding areas for improvement!
1. How well are we operating?!
2. What’s getting in our way to perform?!
3. What’s the level of trust?!
4. What’s your view of leadership?!
5. What is collaboration like?!
Themes that stood out!
what they discovered!
• The business and its people lacked a clear direction and a
common purpose!
• Many mentioned low morale and strained relationships resulting
from past attempts at reorganization!
• Employees were dealing with challenges reactively and not as a
unified team!
• The business model was focused on short-term results!
— Cynthia McCague, EVP Human Resources!
Calling the problems out was a critical first step in
recognizing the need for a common framework to
move the company forward. !
!
We, as leaders, spent a lot of time together looking
at those hard truths.!
“"
”"
13
Neville institutes “Principles for Change”!
LISTEN & FIND!
a core group of leaders who
want to be part of the change!
BUILD COALITIONS!
inside & outside of the
organization – then have
the courage to move ahead!
SET CLEAR EXPECTATIONS!
by being direct with people
and drawing tough lines on
performance!
DEVELOP NEW LEADERS!
by using executive talent
process & organizational
structure to drive change!
SET A GOOD EXAMPLE!
by modeling all the leadership
behaviors you expect from others
– stay away from arrogance!
In response to Neville’s principles, a task force was formed to lead
the charge, and come up with a plan to get Coke back on track!
150 passionate leaders empowered!
There were people who knew what
needed to be done and were looking
for leaders to allow them to perform,
so we let them take ownership!
So, 150 senior leaders from around the globe got together to write a
manifesto for the company, incorporating input from the top 400!
“"
”"
— E. Neville Isdell, CEO!
‘Manifesto for Growth’ kickstarts vision into action!!
The Coca-Cola Company is on a journey. It is a bold journey, inspired by our simple
desire for sustainable growth, and fueled by our deep conviction that collectively we
can create anything we desire.!
!
At its inception, the foundation for this journey has been termed Our Manifesto for
Growth. Our Manifesto represents the beginning of a journey which, in fact, will never
end. It is a foundation upon which we will build sustainable growth as each and every
member of the Coca-Cola system recognizes and invests in our rich long-term
opportunities, while also accepting a renewed responsibility for meeting our short-
term commitments.!
!
The goals are simple: We will reinvigorate growth for our Company, and we will inspire
our people. Likewise, our strategy is simple: We will accomplish our goals by building
a portfolio of branded beverages, anchored in our icon, Coca-Cola®, and by enabling
superior market execution globally and locally -- aligning and leveraging the power of
our global network.!
!
Ultimately, this journey will be propelled by unleashing the collective genius of our
organization that will make sustainable growth a reality. We take this journey because
it is in our very nature to innovate, create and excel.!
!
It is who we are.!
!
“"
”"
these powerful words act as a rallying cry!
this manifesto includes…!
behavior!
territories!
principles!
To refresh the world in body, mind, & spirit!
To inspire moments of optimism through our brands!
To create value and make a difference everywhere we engage!
!
Profit Maximize long-term return to shareowners while being mindful of our overall responsibilities.!
People Be a great place to work where people are inspired to be the best they can be.!
Partners Nurture a winning network of customers and suppliers, together we create mutual, enduring value.!
Planet Be a responsible citizen that makes a difference by helping build and support sustainable communities.!
Productivity Be a highly effective, lean and fast-moving organization.!
Portfolio Bring the world a portfolio of quality beverage brands that anticipate & satisfy people’s desires & needs.!
!
Leadership The courage to shape a better future!
Collaboration Leverage collective genius!
Integrity Be real!
Accountability If it is to be, it's up to me!
Passion Committed in heart and mind!
Diversity As inclusive as our brands!
Quality What we do, we do well!
— E. Neville Isdell, CEO!
Our people needed a new vision for the future and a
path toward growth. With the Manifesto for Growth, they
created one. !
!
This clear vision drove us to invest in our brands,
research and innovation, and our people. !
!
It helped restore belief that we could win again, which
was soon followed by actual wins as our associates and
our bottling partners helped us become the Company
that we knew we could be.!
“"
”"
the manifesto is exactly what Neville was looking for!
Principles for Change and Manifesto for Growth show people what they need to do!
clear vision creates framework!
“Principles for Change”!
“The manifesto is a framework that gives direction and helps me in my role to see
the opportunities where I can make a difference and put my ideas into action.
The manifesto is connected to everything we do.”
—Alba Adamo, Coke employee!
!
!
create value & deliver
consistent, sustainable
growth!
21
framework connected to business growth!
In order to maximize the impact of their new vision, Coke set a long-term business
objective with a clear definition of success!
TERRITORIES!
VALUES!
BUSINESS
OBJECTIVE!
BEHAVIOR!
BELIEF!
We believe in the uplifting
power of happiness!
Inspire moments of optimism
and happiness!
Create value & deliver
consistent, sustainable
growth!
Leadership • Collaboration • Integrity •
Accountability • Passion • Diversity •
Quality!
Profit! People! Partners! Planet! Productivity!
how the pieces come together!
Act like a company that enables happiness internally!
live it -> !
24
Coke’s Territories The 5P’s!
PLANET!
Being a responsible
global citizen who
makes a difference!
!
PARTNERS!
Nurturing a winning
network of partners and
building mutual loyalty !
!
PEOPLE!
Being a great place to
work, where people are
inspired to be the best
they can be!
!
PORTFOLIO!
Bring the world a
portfolio of beverage
brands that anticipate
and satisfy people’s
desires and needs!
!
PROFIT!
Maximizing return to
shareowners while being
mindful of our overall
responsibilities!
SUSTAINABLE!
GROWTH!
25
Coke defines sustainable in 3 ways!
1. Environment: practices that reduce
footprint on the planet!
2. Respectful business citizenship:
nurturing communities in which you operate!
3. Process efficiencies: working
smarter, not harder; don’t waste!
“SUSTAINABLE” !
GROWTH!
=!
PEOPLE!
!
Be a great place to work, where people are inspired
to be the best they can be.!
• Developed and implemented action
plans from Employee Insights Survey!
• Implemented system-wide metrics for
health and safety!
!
areas of focus:!
employee input!
health and safety!
workers rights!
• Formally pledged support for the
United Nations Global Compact!
• Introduce and implemented
Workplace Rights Policy in 2006!
!
action statement:!
PLANET!
!
Be a responsible global citizen who makes a
difference!
• Achieved 100 percent compliance
with wastewater standards by 2010!
• Developed water strategies and
initiative using data from global water
risk assessment!
• Continued comprehensive reporting
on our carbon footprint and our
corresponding climate protection
activities!
refrigeration!
emissions!
• Completed transition to
hydroflourocardbon free insulation for
98% of new refrigerated sales and
marketing equipment!
• Placed 2,000 HFC free CO2-
refridgerated coolers and vending
machines in the market, bringing total
placements to 4,000!
• Introduced EMS-55, a device that
can generate energy savings of up to
35% in purchase of new coolers!
!
areas of focus:!
action statement:!
PLANET (continued)!
• Strengthened the integration of
environmental considerations into the
packaging design process!
• Launched initiatives to enhance global
environmental packaging performance
metrics!
!
environmental leadership!
• Joined Global Greenhouse Gas
Register of the World Economic forum!
!
!
Be a responsible global citizen who makes a
difference!
packaging!
areas of focus:!
action statement:!
PARTNERS!
• Held first relations workshop with largest bottling
partners!
• International Labor Organization conducted an
independent assessment of human rights in the
workplace at Coca-Cola bottler facilities in
Columbia!
!
!
!
Nurture a winning network of partners and
building mutual loyalty!
bottler relations!
areas of focus:!
action statement:!
PORTFOLIO!
• Launched more than 400 new
beverage products, bringing the total
to nearly 2,400!
• Launched “Make Every Drop Count”
marketing campaign to communicate
beverage portfolio breadth and range!
• Extended availability of beverages
and nutritional information for
consumers!
• Launched web site for the Beverage
Institute for Health and Wellness!
• Expanded the range of low and no
calorie alternatives by 23% !
• Increased variety of package sizes,
including 100-calories cans!
!
nutrition!
!
Bring the world a portfolio of beverage brands that
anticipate and satisfy people’s desires and needs!
product range!
areas of focus:!
action statement:!
PROFIT!
• Established a Stakeholder
Relations department!
• Held stakeholder forums with leading
international nongovernmental
organizations!
• Launched global stakeholder
engagement toolkit!
!
Maximize return to shareowners while being
mindful of our overall responsibilities!
stakeholder engagement!
areas of focus:!
action statement:!
32
EMPLOYEE ENGAGMENT IN 5 Ps!
For employees to collaborate in activating the 5 Ps, Coke set-up
Info
Hub
to allow for feedback and discussion!
33
TRACKING PROGRESS!
Coke created report cards to track quarterly progress on
their 5P goals and set new goals!
express it -> !
Translate belief into inspiring moments of optimism via
external brand expressions!
designing on purpose!
Another pivotal moment occurred when Coke created a new position,
hiring David Butler to be their Chief Design Officer (in 2004)!
!
David brought a new level of creativity to Coke’s business objective:
create value, and deliver consistent sustainable growth !
!
Focusing on
creating value & consistency
, David broadened the use of
design beyond just aesthetics, into 3 areas that impact their bottom line:!
"The reality of the [Coke] business is that it's a flow of material and energy on a massive scale. If
you distill it down, big giant brands, big scale. You create value through design.”
—David Butler!
1. Brand Identity!
3. Sustainability!2. User Experience!
The Freestyle machine is an exciting,
innovative way to pour drinks, but for
Coke it solves real business needs.!
fun meets function!
an example of purposeful design!
Solves the following business problems:!
• How to satisfy a consumer base
moving away from carbonated
beverages!
• How to lighten the carbon footprint of
hauling gallons of syrup around the
world!
• How to offer maximum variety within
the cramped confines of fast-food
restaurant or cafeteria!
• How to get accurate, real-time
feedback on customer choices!
Product-Centric Ads!
The Coke Side of Life!
Happiness Factory!
Open Happiness!
1997!
2000!
2002!
2008!
2009!
To date, Coke ads revolved around
product desire and classic brand
without higher order or purpose.!
Coke creates an aspirational message in
the ‘Coke Side of Life’, but is largely
visual and undefined!
Launch of the Happiness Factory Coke
began to focus communications around
delivering ‘happiness’ which increased
brand preference by 6% in 2008!
Open Happiness connected belief to
product, by alluding to the concept of
happiness in a bottle. !
communication shifts from product desire to happiness in a bottle!
38
expressions in real life!
Going beyond TV & Print, Coke finds additional ways to deliver happiness to the world!
Following the success of the
Happiness Machine, the
Happiness Truck traveled the
world delivering free coke,
drawing huge crowds and smiles!
The Coke Happiness Machine
lived in the middle of college
campuses delivering not only
free Cokes, but flowers, hugs
and epically large subs!
Expedition 206 used social
media to nominate 3 people to
travel the world for a year as
“Happiness Ambassadors”
delivering happiness in the 206
markets where Coke is sold!
EXPEDITION 206!
!
THE HAPPINESS MACHINE!
!
THE HAPPINESS TRUCK!
!
39
social happiness!
Have a friend that’s feeling down? Send ‘em a Coke from a furry icon or words that heal a
woeful heart from Dr. Pemberton with the Coca-Cola Facebook “Ahh Giver”.!
SOCIAL TOOLS FOR MAKING THE NET A HAPPIER PLACE!
prove it -> !
Make a greater impact by reinforcing and evolving the
vision into tangible actions!
After spending four years getting
Coke back on track, Neville Isdell
hands the top job to his protégé
Muhtar Kent (in 2008) – with the
expectation he will build on the
company they had built!
!
So Muhtar begins a new chapter,
and further defines the vision…!
!
!
!
Muhtar Kent assumes job of CEO!
41
42
Muhtar creates the 2020 VISION!
— Muhtar Kent, CEO!
The world is changing all around us. To continue to thrive
as a business over the next ten years and beyond, we
must look ahead, understand the trends and forces that
will shape our business in the future and move swiftly to
prepare for what's to come. !
!
We must get ready for tomorrow today. That's what our
2020 Vision is all about. It creates a long-term destination
for our business and provides us with a "Roadmap" for
winning together with our bottling partners!
“"
”"
2020 VISION starts a new chapter!
43
Coke will achieve the following by the year 2020…!
“"
”"
Double
revenue and
increase
system
margins!
Become
one of the
world’s
premier
employers!
Be the most
preferred and
trusted
business
partner!
Attain
corporate
global
leadership in
corporate
sustainability!
!
Manage
people, time
and money for
the greatest
effectiveness!
1! 2! 3! 4! 5!
PROFIT!
PEOPLE! PARTNERS! PLANET! PRODUCTIVITY!
2020 GOALS!
VISION!
VALUES!
BUSINESS
OBJECTIVE!
BEHAVIOR!
BELIEF!
We believe in the
uplifting power of
happiness!
Refresh the world in body,
mind & spirit!
Create value & deliver
consistent, sustainable
growth!
Leadership • Collaboration •
Integrity • Accountability • Passion
• Diversity • Quality!
Profit!
Double system
revenue while
increasing
system margins!
People!
Become one of
the world’s
premier
employers!
Partners!
Be the most
preferred and
trusted
beverage
partner!
Planet!
Attain corporate
global
leadership in
corporate
sustainability!
Productivity!
Manage people,
time and money
for the greatest
effectiveness!
how the plan takes shape!
45
Planet: sustainability goals!
46
Created the ‘live positively’
initiative to achieve their 2020 goal:!
!
Attain corporate global leadership in
corporate sustainability!
People: 5by20!
47
Created the 5by20 initiative to:!
!
Empower 5 Million Women throughout
the Coke organization by 2020!
Coca-cola plans to double the size of its business globally by 2020 and women run
businesses play an important role in the coke network. The 5by20 plan provides women
access to finances, business skills and mentors in order to grow their business futures.!
Enhancing economic opportunities for
women in the Coca-cola network will
result in increased incomes, enhanced
business skills, increased stature within
the community and improved potential
for communities – Muhtar Kent!
5 by 20 is exactly the type of investment
that we need in order to reinvigorate our
economies and foster long-term,
sustainable growth. – Melanne Verveer,
US Department of State!
results!
a few achievements!
49
• ‘Coke’ second most recognized word in the world (after ‘Okay’)!
• World’s most valued brand ($70.5 B)!
• Servings: 1.5 billion per day !
• Products: 2,800 !
• Locations: 200+ countries !
• One million employees system-wide !
• 343 consecutive quarterly dividends!
50
portfolio: fifteen billion-dollar brands!
Coke keeps laser focus on growing what they know… beverage brands!
results: significant growth since 2004!
0"
5"
10"
15"
20"
25"
30"
35"
40"
45"
REVENUE&IN&BILLIONS&
REVENUE"
Revenue 2005: $23B!
!
Revenue 2011: $41.1B!
!
results!
52
Year Ended December 31,!
!
2010!
!
2009!
!
2008!
!
2007!
!
SUMMARY OF OPERATIONS!
!
Net operating revenues!
!
Operating Income!
!
Net income attributable to
shareowners of The Coca-Cola
Company!
!
PER SHARE DATA!
!
Basic net income!
!
Diluted net income!
!
Cash dividends!
BALANCE SHEET DATA!
!
Total assets!
!
Long-term debt!
$35,119!
!
8,449!
!
11,809!
!
$5.12!
!
5.06!
!
1.76!
$72,921!
!
14,041!
!
$30,990!
!
8,231!
!
6,824!
!
$5.12!
!
5.06!
!
1.76!
$72,921!
!
14,041!
!
$31,994!
!
8,446!
!
5,807!
!
$2.51!
!
2.49!
!
1.52!
$40,519!
!
2,781!
!
$28,857!
!
7,252!
!
5,981!
!
$2.59!
!
2.57!
!
1.36!
$43,269!
!
3,277!
!
results!
53
54
0"
5"
10"
15"
20"
25"
30"
35"
40"
45"
1997"
1998"
1999"
2000"
2001"
2002"
2003"
2004"
2005"
2006"
2007"
2008"
2009"
2010"
2011"
Neville"Takes"
over"as"CEO"
David"Butler"
hired"as"CDO"
Muhtar"Kent"
Takes"over"as"
CEO"
2020"Vision"
Manifesto"for"
Growth"
Principles"of"
Change"
Open"
Happiness"
Campaign"
Keys to Coke’s Growth!
55
! Provide a clear company vision grounded in brand belief & behavior!
! Focus and find efficiencies in core business!
! Expand business wisely (pick regions and markets that have a need)!
! Improve leadership training and employee feedback systems so employees perform at
their best!
! Foster open communication with key stakeholders (consumers, customers,
shareholders)!
! Empower employees to bring your vision to life (let them own the plan)!
! Setup unifying systems for internal communication, so everyone is on the same page
(intranet, webcasts, internal magazine)!
! Create metrics that hold everyone accountable for successfully achieving the plan
(quarterly report card system)!
! Respect the world you live in, and do things to make it better (sustainability)!
thank you!
|
@hungrystratgist
WHAT I BELIEVE:
+ The best brands view media as the space between an idea and their
audience.
+ People don't buy what you do, they buy WHY you do it.
+ Understanding people as an audience of your brand (not just
consumers of your products) drives new ways to engage - and story telling
that speaks to them.
+ When telling stories... don't interrupt your audience, do something that
interests them (entertain them, solve a problem, or help them to express
themselves).
Strategic planner with 5+ years of agency experience - acting as a thinker,
problem solver, and story teller, for a wide variety of brands.
– appendix –!
belief + behavior activation roadmap!
CEO, Neville Isdell, !
is re-hired (2004)!
Neville promotes !
4 Executive leaders!
In 2009, to stay focused
and continue growth
Coke’s new CEO, Muhtar
Kent (Neville’s protégé),
reveals next chapter:!
EVP HR: !
Cynthia McCague !
EVP Marketing: !
Mary Minnick!
Head of International: !
Muhtar Kent!
EVP Bottling: !
Dominique Reiniche!
////"
Task force
creates
Mission, Vision,
& Values –
which sets new
course for the
company/!
Enlist 400 top performers to help
expand thinking into tangible next
steps. Create internal rally-cry book
titled: Our Manifesto for Growth!
!
Book lays out a clear vision that !
inspires change and fresh thinking!
Executive leaders meet
face-to-face with all
associates to share the
new vision – and
institute specific goals
for each group!
Company creates
internal information hub
to unify all branches
within the organization!
Quarterly report card
created to track
performance and
reinforce importance of
new company vision!
HR conducts
employee
engagement survey
– finds areas for
improvement –
including need for a
clear vision and
honest feedback!
New Exec
leaders
create a task
force of 150
of Coke’s
most
passionate
leaders!
Neville institutes
his principles for
change to
provide much
needed focus to
leaders and
associates!
Neville forms an
external coalition
where 1,000 key
stakeholders !
(i.e. customers,
shareholders,
and experts) can
give feedback!
Connecting Belief to Growth – a Roadmap!
Notable Sources!
60
Refreshing a Beverage Company’s Culture: http://www.shrm.org/Publications/
hrmagazine/EditorialContent/Pages/1107awardsfox.aspx!
!
Neville Isdell’s Letter to Shareowners: http://www.thecoca-colacompany.com/investors/
annualandotherreports/2005/pdf/ar/koar_05_letter_shareowners.pdf!
!
Coca-Cola Corporate Responsibility Report: http://www.thecoca-colacompany.com/
ourcompany/pdf/corporate_responsibility_review.pdf!
!
“Designing on Purpose” David Butler Interview: http://www.adaptivepath.com/ideas/
designing-on-purpose-an-interview-with-david-butler-vp-of-design-at-coca-co!
!
Corporate Articulation of Design: http://www.pratt.edu/pratt_blog/view/
the_corporate_language_of_strategic_design/!
!
!
!
!
