The Ten Commandments for Business Failure - Don Keough [46]
A Need for One Sight, One Sound, One Sell
But in the 1960s, the world was changing rapidly. Even faster in the 1970s. Markets were coming together, transcending borders. The marketing of Coca-Cola that had heretofore been merely suggested with certain pattern advertising provided by the Coca-Cola Export Corporation in New York was in need of new energizing that would dovetail with the global marketing efforts of global customers, such as McDonald’s or hyperlarge supermarkets. We needed more availability of new packaging, such as cans and larger bottles. Plus, we were finding that while we had a series of separate companies running separate businesses, our consumers around the world were becoming more homogeneous in their tastes.
In the 1970s, then chairman and CEO Paul Austin moved the Export Corporation from New York to Atlanta, and to gain some global continuity, meetings with Coca-Cola executives from around the world were more regularly scheduled. But once you have such a divergent culture, as we did, it’s difficult to change it.
By the middle of the 1970s, when recession hit in the United States and inflation exploded and while we were renegotiating contracts with our domestic bottlers, political turmoil was affecting South America. Meanwhile, Europe and Asia were rapidly changing. At the same time, our principal competitor was granted an exclusive contract in Russia, and the Arabs wanted nothing to do with Coca-Cola because the company had granted a bottling franchise in Israel. The competitor’s marketing was being revitalized. The Coca-Cola Company’s stock price was way down. In short, the world of Coca-Cola was seriously unsettled.
A Need to Shake Up the Old Order
In 1981, when Roberto Goizueta and I moved into the senior leadership positions of the company we faced a number of challenges. For instance, there was the immediate need to reinvigorate our image by introducing a product that we had known we needed for several years—Diet Coke. But our greatest challenge was to unify the direction and goals of the whole worldwide organization. It was risky to stir around and shake up some of these long-established fiefdoms, but we had to in order to modernize our marketing and gain efficiencies in our distribution system and to serve our global customers.
The first order of business was to unmix the mixed messages and convince everyone that while each sector of our global business could remain relatively autonomous, as markets had become more transnational, we needed to do likewise.
Red Auerbach, the legendary Boston Celtics coach, said that if a player missed a pass from another player it was the passer’s fault because, as Auerbach put it, “if the passer was communicating properly, the receiver would get the message and be at the right place at the right time to catch the ball.” The burden was on us to make sure every leader of the business from every part of the world would catch the message that our business—their business—had to change.
All the leaders of our business from around the globe participated in a meeting in Palm Springs, California. Roberto began the meeting with an astounding proposition, which he called “slaying a sacred cow every day.” It was necessary to reinvent the company almost from the beginning, he said, and then we presented a clear, straightforward mission statement that we had worked on for some time. Fundamentally, we were consolidating the control of the international business in Atlanta with a single driving purpose while still maintaining the strengths and individuality of each local operation. We succeeded in implementing a “think-global, act-local” strategy long before it was fashionable.
One More Mixed Message About What Business We Are Really In
I mentioned earlier the perceived need for Coca-Cola to diversify. In the case of the wine business, we found that promises of synergy were unrealized and we sold that business.
There was another