January 8, 2014
Irene Rosenfeld, the chairman and CEO of Mondelez International, is one of the most successful and respected business leaders today.
Her communication skills and her understanding of the importance of executive communication have played key roles in her success, which includes turning around an underperforming Kraft Foods, Inc., in two years as chairman and CEO of Frito-Lay, and the launching of Mondelez as an international snack company in 2012.
Mondelez operates in 165 countries with a portfolio that includes such iconic brands as Nabisco, Oreo, Trident, Cadbury chocolates and LU biscuits. She holds three degrees from Cornell University, including a doctorate in marketing and statistics.
You were successful in turning around a chronically underperforming company in Kraft Foods. What were the keys to this?
When I returned to Kraft in 2006, despite our many strengths, we had underperformed compared to our peers for quite some time. We urgently needed to change the trajectory of our business.
So, how’d we do it? With a great deal of hard work, of course, and by focusing on four key aspects of our business: people, portfolio, productivity and purpose.
We started by getting the right people on the bus. By combining seasoned talent from within the company with new leaders from the outside, we gained new, valuable perspectives on our business.
We gave all of our people more authority to make decisions by decentralizing the organization. At the same time, we clarified the performance expectations of our leaders and made our people more accountable.
Second, we reshaped our portfolio and transformed our geographic footprint by divesting non-core assets, like cereals and frozen pizza, and through some significant acquisitions — most notably, LU biscuits and Cadbury.
In fact, the Cadbury integration and associated synergies have delivered best-in-class results in the top 10 percent of such transactions.
We also reshaped our portfolio by focusing more intensely on those markets, categories and brands that had margin, materiality and momentum to deliver the biggest growth opportunities.
Third, we improved productivity. We reduced costs significantly by driving efficiencies in systems, procurement, manufacturing, logistics and overheads. As a result, we’ve been able to offset those higher costs and expand profits, while still reinvesting in future growth.
And fourth, we clearly defined our purpose as a company, including the core values that guide our behavior and help to create our culture.
These four Ps are what turned our company around. By 2011, we’d gone from worst to first within our peer group and were delivering top-tier results.
How important was communication in turning around Kraft? What audiences did you have to reach and how?
It was vitally important. Let me tell you a story about the period after I returned to lead the company. This is a good example of strategically thinking not only about what to communicate, but also when and how.
In mid-2006, we needed to build confidence in my appointment, but I certainly didn’t want to talk about our vision for the future until I’d had a chance to talk with key stakeholders.
So, corporate affairs bravely faced the media, declining all interviews with me and declaring a media moratorium for the first 100 days.
As it turned out, it was nearly seven months before I gave my first substantive interview. Seven months! That’s a very long time to say “no comment.”
During my “quiet period,” I embarked on a global listening tour, talking with employees, consumers and customers from all over the world to hear what was working in our company and what wasn’t.
The feedback and insights were extremely helpful in creating our new strategic plan. It also gave everyone a direct channel to me — something that signaled a clear change from the past.
I used the phrase “Let’s Get Growing” from the day I returned, and it became a rallying cry for our transformation.
Candid, two-way dialogue proved to be such a powerful concept that we’ve evolved and maintained it ever since. Today, we use social media not only to connect our leaders and employees, but also to encourage them to engage with one another — which is especially important in a large and growing global organization.
I’m sure I surprised employees the first time I jumped into a conversation on our intranet, but today, they’ve come to expect it.
Of course, the fact I wasn’t talking to the media all this time didn’t stop them from calling!
Over and over, corporate affairs told reporters I would unveil our strategies in February at the CAGNY of New York conference, which is the annual consumer analyst conference in New York. It became a bit of a running joke: “Wait for CAGNY, wait for CAGNY!” (In fact, even I was anxiously awaiting what I was going to say!)
Finally, February 2007 arrived, and it was time for the big “curtain raiser.”
We gave The Wall Street Journal an embargoed interview, and they ran a terrific article the morning of CAGNY. The headline declared that we were “Cooking Up Changes at Kraft Foods.” That article set a very positive tone for the rest of the coverage and allowed us to get the word out about the strategies that would reignite our growth before I even walked on the stage.
How important is communication to a CEO’s success?
A big part of any leader’s job is to communicate clearly and communicate often, particularly in times of change.
It’s important that people know where we’re going as a company (our goals), what it will take to reach our goals (our strategies) and how we’ll achieve them (our values).
Along the way, we all need to “tell it like it is,” which is one of our core values, so that we have candid conversations about how we’re doing and what we can do better.
Finally, it’s crucial to recognize people’s accomplishments and assure them their hard work is appreciated.
Many CEOs have told me that humility is an essential ingredient of success. Do you agree?
Yes. I love the advice Golda Meir is reported to have once given to her defense minister Moshe Dayan: “Don’t be so humble… you’re not that great!”
But it’s more than just humility. I’m a big believer in two things that drive success: servant leadership and the golden rule.
Employees today don’t want command-and-control leadership. They want leaders they can learn from and who can help them get their jobs done. I believe strongly in the notion that I’m here to help the organization meet its goals, not the other way around.
And the golden rule is one of the simplest and most prescriptive management philosophies that I know. Show others the respect, dignity and candor you’d want them to show to you.
All of us have some things that we wish we had done differently. What are yours?
It’s impossible to avoid mistakes. The key is to get to the bottom of failures and truly understand the root cause. That way you can learn from mistakes.
Several years ago, we introduced Oreo cookies in China, and they nearly failed. But before we gave up, we sought to learn why the Chinese didn’t love Oreos like Americans do.
What did we find out? Chinese consumers thought Oreos were too large, too sweet and too expensive, and some people preferred more familiar formats — wafers instead of sandwich cookies. So we adapted Oreos to meet their needs, and now Oreos are the most popular cookies in China.
We couldn’t have turned that failure around if we weren’t willing to study and learn from our mistakes.
A number of business leaders have recently made comments that caused problems for them and their companies. How do you avoid such a thing?
First and foremost, don’t wing it! You’ve got to be prepared. Know what you want to say and practice saying it before you open your mouth.
Second, I try not to say anything, on or off the record, that I’d regret seeing in print.
Getting to the top still seems to be harder for women than it is for men. What advice would you give to women who seek leadership roles?
I’ve been fortunate to receive a lot of great advice from some terrific mentors throughout my career.
First, you have to make a difference. An organization or a business has to be better for your being there.
Second, be prepared to take risks. You simply can’t steal second base with your foot planted firmly on first. You have to be willing to take on the tough jobs, including the ones nobody else wants, to stand out from the crowd.
“Make a difference” and “take risks” are the two best pieces of advice that I provide to anyone who aspires to leadership. But I’ll add another piece of advice that’s particularly important for women: “Ask for what you want.”
Girls are not socialized to toot their own horns. But bosses aren’t mind readers. Speak up and let people know what you’ve done and what you want. If I hadn’t done this in my career, I might never have been considered for several jobs that turned out to be important learning experiences for me.
What advice do you have for people who want to rise to become head of global communication for a company and counsel leaders?
Let’s start with the obvious. If you want to head up a company’s global communications function, you must communicate well and execute flawlessly. Simple, precise, compelling and relentlessly consistent communication is the price of entry.
But that’s just “good.” If you want to lead the function, you’ve got to be “great.” And “great” isn’t just about communication. You must also help drive the business agenda.
How do you move from good to great? I believe there are four ways to accomplish that.
First, match the solution to the problem. Don’t build me a Lamborghini if I need a Vespa. For example, don’t produce a glossy, four-color brochure when a one-page memo is quicker, less costly and more effective.
Second, pick your battles. I always tell my people, “You can do anything, but you can’t do everything.” On any given day, there are more news articles, employee questions and policy issues than you could ever possibly handle. So you have to focus on the ones that matter most to your company.
Third, businesses don’t operate in a vacuum. A great corporate affairs professional is a conduit between employees and the outside world. You have to help us understand how our business decisions will be viewed by critical audiences and then advise us on how best to manage both the risks and opportunities.
And finally, you need to balance the short and long term. Day-to-day business has a short-term cycle, and that has to be managed. But a great corporate affairs leader also takes the long view, staying mindful of how decisions and promises we make today might affect the future.
Virgil Scudder is the author of “World Class Communication: How Great CEOs Win with the Public, Shareholders, Employees, and the Media,” which received an Award of Distinction as one of the best business books of 2012. Email: firstname.lastname@example.org.
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