Integrity of a Brand

What's the world's most valuable brand, and why?

Before answering those questions let me tell you a story.

Some time ago we were on a Delta Airlines flight from Stuttgart, Germany to Atlanta, Georgia, en route to our final destination of Orlando, Florida.

My seatmate on the Stuttgart-Atlanta segment worked for Coca-Cola and was returning home from the Middle East. It was in the familiar exchange, "what kind of work do you do," that we learned about the importance of "Coke Red." 

(C) Recognizable logo worldwide.

The beginning days

According to historical records, the original Coca-Cola recipe was formulated at the Eagle Drug and Chemical Company, a drugstore in Columbus, Georgia. The person responsible for this creation was John Pemberton. 

The first sales were at Jacob's Pharmacy in Atlanta, Georgia on May 8, 1886. Sold initially as a patent medicine for five cents, the soda became popular at the time due to the belief that carbonated water was good for one's health.

An advertisement, the first, appeared that same year in the Atlanta Journal.

Bottle as brand

Coca-Cola was first sold in bottles by Asa G. Candler & Co. at its pharmacy location. Large bottles of Coke were sold by druggists and grocers for 25 cents each. 

The original bottles were from the Biedenharn Candy Company, Vicksburg, Mississippi in 1891. The Biedenharn bottle preceded the "hobble-skirt" design created in 1915 which has since become the main brand or identity of the principal Coca-Cola products of Coke and Diet Coke. 

(C) Coke bottles over the years.

A bottle design contest in 1915 was won by Earl R. Dean of the Root Glass Company in Terre Haute, Indiana. It's reported that the designers were inspired by the cocoa bean and transplanted its vertical grooves to the glass. 

Add to the Georgia-Green tinted bottle (used until 1956) the Spencerian Coca-Cola script and the result was a distinctive product: "Recognizable by component parts, even if broken; a shape that could be identified by touch in the dark; or when submerged in a bucket of ice."

That particular bottle design became a registered trademark in 1960.

When did cans of Coke first appear? In 1955. 

Color as brand

The familiar Coca-Cola Red is an integral component of the classic design. The white cursive text set on a bright red background--or the reverse of white background and red lettering has become ubiquitous in 200 countries.

While there are estimated to be around 290 visibly different shades of red, there is only one Coke Red.

An article posted by Brandcreation says that by walking around with a spectrophotometer one can measure Pantone 185 or Pantone 485 or RGB 235, 45, 46 or RGB 218, 37, 29 or CMYK 0, 100, 100, 0, and more. 

"That’s a result of inconsistent industrial and differing production standards. According to a record at the United States Patent and Trademark Office, there is a ‘Coke Red’ defined as Pantone 484," the author stated.

Coca-Cola Red also has a long-standing connection with Santa Claus. "Jolly Old St. Nicholas" has been featured in its advertisements since the 1920s, according to the official Coca-Cola website.

Back to the Delta flight

In the early 2000s, it was reported that Coca-Cola print buyers, with the aid of color management techniques, had reduced the color appearances of their Coke Red from 20,000 to "only" 2,000 variations. 

Thus the conversation with my seatmate from Coke headquarters. 

This global marketing manager, along with others, was assigned the task of auditing print and packaging colors in different parts of the world belonging to the Coca-Cola brand.  To do this the official Coke Red was loaded into a spectrophotometer which was used to scan print packaging and advertising.

That may be how the company was able to eliminate almost 18,000 variations of red.

Valuable, but why?

Okay, you knew the answer to the first part of the question--that Coca-Cola is the world's most valuable brand.

Under the four-year leadership of CEO Muhtar Kent, the company has improved profits and is once again the No. 1 soft drink in the USA taking the title away from Pepsi. Coca-Cola had 2012 revenue of $48 billion. The positive metrics come in spite of a continued decline in sales of carbonated beverages in its home market. 

Last year Interbrand declared Coke to be the world's most valuable brand worth $77.8 billion.

(C) Muhtar Kent, CEO of Coca-Cola Company. 

But do you know why?

There are at least three reasons...

No. 1:

It starts at the top. Historically Coca-Cola's leadership has paid attention to its brand. The assignment to get the official Coke Red under better management more than a decade ago came from a future CEO, Douglas Ivester, who was at the time president and COO. Ivester confirmed the Coke Red story at a luncheon in Florida.  

Although his term in office was short-lived, about 2 years, Ivester was a stickler for detail.  And for Coke, the color red is no small matter.  It represents in large part who the company is.

(C) Douglas Ivester, former CEO of Coca-Cola Company.

Executives, along with corporate boards, are guardians of everything the company stands for. Day-to-day responsibilities for brand management may be delegated appropriately within the organization but are owned at the top.

No. 2:

The brand is protected.  Legally and in every other way. The name and reputation of the business needs protecting. For Coca-Cola, this includes copyright, the "secret formula," quality controls, product development, marketing, and succession. That protection extends to carefully screening those who are allowed to be "officially" associated with the brands in advertising and promotions.

No. 3:

The brand and reputation match.  What you say about your products and services is one thing.  What your customers and others say is quite another. Social media gives voice (mostly anecdotal) to how people feel about their interactions with brands and employees. The goal is "brand integrity" with reputation and reality matching positively.

Great--not perfect

Coca-Cola had a rough time when in 1985 under CEO Roberto Goizueta it tried to change the formula for regular Coke (before the Internet was commercialized). 

The research was flawed.  It's true that New Coke tasted sweeter than old Coke. However, consumers pushed back having had a long-term relationship with a product that was more than a soft drink. It was a friend of the family. There was an emotional attachment to Coca-Cola, something the taste tests failed to uncover and weren't designed to do.

The company acknowledged the mistake and did away with New Coke. 

As was reported in The Economist in 1999, "The world's most famous consumer brand became embroiled in its worst-ever health scare, when around 100 people in Belgium, many of them children, and 88 people in France suffered nausea, headaches, and diarrhea, some of them seriously enough to be admitted to the hospital.....Coca-Cola seemingly forgot the cardinal rule of crisis management—to act fast, tell the whole truth and look as if you have nothing to hide."

The problems under Mr. Ivester caused a loss of confidence in the Coca-Cola Board of Directors. He resigned in 2000 as CEO after 24 months on the job.   

New Coke. Late response to the European crisis. Failed acquisitions. Errors in corporate judgment. 

All organizations face serious challenges at different times.  Owning up to wrong decisions, especially those of great magnitude, and correcting them, is how leaders build credibility among their brands, shareholders, employees, media--and especially customers who make everything possible.


"Coca-Cola," "Coke," the "Coca-Cola Contour Bottle," and "Coke Red" are registered trademarks of The Coca-Cola Company.

Images are from Google and may be copyrighted.

Strategist.com

(C) Bredholt & Co. 

Leadership Agenda: Siemens USA

The idea of spending time with a chief executive officer (CEO) of a major corporation is appealing to a corporate strategist. 

So when the invitation came from Dr. Susan Bach at Rollins College in Winter Park, Florida to attend a reception and speaking engagement with Eric A. Spiegel, president, and CEO of Siemens Corporation USA, we readily accepted. 

Mr. Spiegel has responsibility for the $22 billion USA market which includes 60,000 employees and over 130 manufacturing sites. 

The parent company, Siemens AG, headquartered in Munich, Germany, was recently named one of Fast Company's "Most Innovative Companies" (#21).  Siemens's concentration is in four business sectors--energy, healthcare, industry, and infrastructure & cities.

Up close and personal

It's one thing to read about CEOs or see them interviewed on TV. However, there's nothing that takes the place of being up close as Eric Spiegel made himself accessible to college students and community leaders.

After providing an overview of Siemens's businesses, as well as changes in the marketplace, he touched on an often overlooked aspect of executive responsibility--the leadership agenda. 

What's a leadership agenda?

A leader's agenda is a plan for guiding the organization. It's not a business plan in the traditional sense. An agenda is a set of themes and priorities requiring action and progress in a given period. The agenda includes the main message and identifies critical issues needing attention.  (Briefing for Leaders HarperBusiness)

What are the benefits of a leadership agenda?

1. Clarifies the main message
2. Maintains focus
3. Is a filter for allocating scarce resources
4. Improves organizational health
5. Provides accountability for results

Eric Spiegel's agenda

Wisely Mr. Spiegel has chosen a limited number of priorities to support and complement the Siemens USA business plan: 

• Growth
• People
• Reputation
• Operational excellence 

It's obvious from the presentation that he uses communication, including the above four themes, as a steering mechanism in his role as CEO.  This includes getting feedback from a variety of internal and external sources. 

The evening was a reminder that perhaps one of the most important decisions made by anyone in leadership is the allocation of their time.  

Mr. Spiegel doesn't have any more hours in his day than the rest of us. Therefore while he manages Siemens his executive assistant, Grace D' Alessio, manages him. She is given a share of the credit for whatever success comes Mr. Spiegel's way in leading a large and complex enterprise.

Some questions

Here are a few things to think about from our time with CEO Spiegel:

• Do you have a leadership agenda?
• Is it up-to-date?
• Is the agenda clear, shared, and owned by others?
• Can you be managed?  
• Who manages you?  

Strategist.com

(C) Bredholt & Co.

 

Overcoming Barriers to Mission

What stands in the way of accomplishing the mission of your organization?

Is it the competition?  The right people?  Not enough working capital?  Maybe it's a problem with focus, commitment, or trust.  Is there uncertainty as to what the mission is?  

Perhaps it has to do with some or all of the above.  

After thinking about this I decided to make a list of reasons why some fall short in fulfilling their mission and how these barriers might be overcome. 

The underlined concepts below are drawn from the book, Organizational Culture, and Leadership, by Dr. Edgar Schein, with our commentary. Dr. Schein, an MIT professor emeritus and a guest writer on this site, is regarded by some as having written one of the more influential volumes on management. 

From our book notes, here are seven possible barriers with countermeasures for each:

Barrier No. 1

There is consensus on the core mission but the group does not share common goals.   

In fact, those who make up what is now called a "team" can have widely divergent views when it comes to setting goals.  The absence of commonality comes from different backgrounds, experiences, and world views. 

Nothing new here. 

The challenge for top management is melding these unique personalities and perspectives together to achieve a common purpose. Sharing deeply things of value is a distinct competitive advantage.

Barrier No. 2

The mission is often understood but not well articulated. 

One of the duties of a leader is to explain things.  Telling is easier but explaining requires a deeper understanding of the situation.  Repeating a statement of mission does not necessarily mean that employees and others know what's inside since no message guarantees its own meaning.

The main ideas that cause a business to exist have to be periodically clarified and updated.  Why?  Circumstances change.  The original and current contexts of the business are likely very different.   

 

Employees tend to respond favorably when leaders and managers illustrate the mission in tangible ways.   Nothing wrong with communicating values but knowing the desired outcomes is a benefit to all. 

Behavior may be the clearest articulation of mission.   

Barrier No. 3

The group does not have a common language and shared assumptions on the goals making it difficult to move from the abstract to the concrete realization of something.

Imagine the next time you're on a flight that the pilot and control tower are trying to communicate with each other at the same time using different languages and radio frequencies.  A scary thought. 

So it is with those in a business or nonprofit simultaneously communicating mixed messages on multiple channels.  Another scary thought. 

Communication, including feedback, is everything when it comes to accomplishing something worthwhile. 

A carefully constructed list of internal and external assumptions can be worth their weight in gold.  They are the basis of common understandings and should find their way into conversations and plans.

Barrier No. 4

Not understanding that mission and strategy can be rather timeless while goals must be formulated for what to do next year, next month, and tomorrow.

Part of the problem may be an omission of goals altogether.  There's talk about vision, mission, and strategy, but goals are nowhere to be found.

When properly set, the right goals complete the strategic puzzle.  They provide high resolution to the mission and facilitate implementation, including accountability.  Goals also make it possible to measure progress. 

Yet the real benefit in goal-setting, according to Dr. Schein, "is that the process often reveals unsolved issues or lack of consensus around deeper issues."

Barrier No. 5

Mixing strategy and goals since strategy concerns the evolution of the basic mission--while operational goals reflect short-run tactical survival issues.

Knowing the difference between strategy (set of options and use of available resources) and goals (desired results usually with a timeline) is essential for effective management decisions. 

Taking time to know the proper relationship between strategy and different kinds of goals could be the difference between profit and loss--and the future of the business. 

Barrier No. 6

Lack of clarity on the means by which goals will be met.

Goals need to be set and owned by those responsible for their achievement. They are also the ones to identify the best means of meeting a particular goal.  

If a major goal is to be met someone has to take the lead in communicating the goal, how it was established, and why it's being put in place.  Reaching this goal means what to the organization?

A clear goal, with credible leadership, improves the chances of departments pulling together to profitably make soap or software.  

Meeting goals is a matter of personal responsibility, even in a team environment.

Barrier No. 7

Failing to agree on what indicators to pay primary attention to in order to decide how well the organization is doing and what corrective action, if any, needs to be taken.

Ever notice when staying in a hotel how the Kleenex tissue goes from white to beige with high usage?  The color change is an indicator that the tissue supply is getting low.  Housekeepers are trained to look for this and (hopefully) take steps to keep the box filled.

Does your company have in place agreed upon, and visible, indicators to measure progress and alert everyone to a potentially serious problem?   Only a select list of indicators is of any practical use to management and staff. 

The right indicators won't be full-proof.  But they can go a long way in maintaining health, avoiding or minimizing trouble, and determining a possible course of action if something arises. 

Indicators are worthless if ignored. 

That's a key finding from the investigation into the tragic launch of Space Shuttle Challenger on 28 January 1986 which killed all seven crew members.  The vehicle exploded 73 seconds into the flight.  

Warnings about a flaw in the O-ring seals from as far back as 1977, the primary cause of Challenger's structural failure, were ignored by some NASA managers, according to the Warren Commission report.  The dangers of launching in cold temperatures (31 F/-1C) that fateful morning was also disregarded.

Final thought

No matter the size, history, or success of an organization, there will be obstacles along the way.  However, if the mission is that important, then finding the means to overcome one or all seven barriers listed above, should be a priority on your leadership agenda.  

Strategist.com

(C) Bredholt & Co.

 

Making Vision a Reality

"Perhaps God made the world round so we couldn't see too far."  

--Isak Dinesen, Out of Africa

While navigating Washington, D.C. recently I was reminded that the layout of the “District” is the result of someone’s vision.   

In fact, it all began in 1790 when, upon the recommendation of then President George Washington, Congress authorized the creation of a 100-square-mile federal district along the Potomac River that is under the jurisdiction of the United States Congress.    

Washington identified the location and at some point, his name was placed on what was called the "District of Columbia."  However, the concept came from the mind of French architect Pierre Charles L'Enfant. 

L'Enfant is responsible for a framework that, in remarkable ways, remains close to the original plan sketched out over 200 years ago.  

Beauty in simplicity   

According to Smithsonian Magazine, his concept was based on European models translated to American ideals. "The entire city was built around the idea that every citizen was equally important," says L'Enfant's biographer, Scott Berg. "The Mall was designed as open to all comers, which would have been unheard of in France. It's a very sort of egalitarian idea."

The original design of a "grand capital of wide avenues, public squares, and inspiring buildings in what was then a district of hills, forests, marshes, and plantations" is what we behold more than two centuries later.  

The biggest obstacles in the early days were funding for the project and the District's wealthy landowners who didn't share L'Enfant's vision. 

Nevertheless, the contours of the original survey have outlasted nearly eight generations of Washingtonians--something to think about in a city of mostly disposable ideas.

Mining visionary lessons

George Washington and Pierre L'Enfant offer instruction on the important, but sometimes misunderstood, subject of "vision."   

Before "casting a vision" toward a desirable destination here are some insights to consider:

Early stages 

• People first.  Washington selected the land but needed help.  So he enlisted L’Enfant.  The right person improves the chances of getting the right plan. L'Enfant was a seasoned architect when Washington selected him for this monumental task.

• The ideal starting point.   L'Enfant was able to start from scratch which is always the first choice.  It's harder to inject visionary thinking into a body at rest--although that's when it’s needed most. 

• Try collaborating.   The development of a "realistic, credible, and attractive" vision is less a solo performance and more likely the result of interaction and experience with others. 

Ingredients

• Enduring qualities.  It’s important to introduce concepts that are deep, not just wide.  ("Every citizen equally important").  Sloganeering and platitudes don't have a long shelf life and they're promotional in nature.  Well-thought-out visions hold their original value even when updated by succeeding generations and circumstances.

• Need a centerpiece.  For L'Enfant, it was the "public walk" or what is now known as the National Mall.  The two-mile-long strip of grass has become the world's stage for demonstrations and public debate as a showcase of democracy.

• The role of character. The values of the visionary become the values of the design.  What comes out is what's already inside.  This helps explain why some visions are elevating and others are grandiose.     

Other stages

• A proper horizon.  Vision becomes reality over time, not overnight.  A century later the work was far from complete.  In 1901 the McMillan Commission updated the original plan based on L’Enfant’s drawings and moved things into the next phase of development.

• Getting credit, getting paid, or both.  It's possible to have a vision or idea and not get credit for it--or get paid.  L'Enfant quit in frustration and was never compensated for his Washington, D. C. assignment unless you count having a Metro station associated with your name (L'Enfant Plaza).

• Proceed with caution.  Visions need some vetting.  Unchecked dreams often become nightmares.   A huge waterfall cascading down Capitol Hill never went anywhere.  Washington and L'Enfant were tested in many ways yet the essentials of the design are still in place.  

Final thoughts

The good thing about principles is they are scalable.  A department or business unit is not Washington, D. C. but those you lead and manage still need a sense of purpose and direction.   Associates should understand the "goal" and be able to measure progress toward its achievement.    

A shared vision is an absolute necessity for getting something done through others.  Both face-to-face communication and social media can be enlisted for support.   

And the biggest myth about vision?  That vision makes it possible to do anything. (Burt Nanus)  

 

 

Strategist.com.

(C) Bredholt &  Co.

                                                                            

The Need for Self Renewal

"To me, the greatest tragedy in life is to be ordinary."

--Emilie Griffin, The Reflective Executive

As we come to the end of another challenging year, one thing is evident: Life takes a lot out of people these days. For many, it's the price of living and working (or not working) in a hyper-culture.

More specifically it's a combination of ever-present technology, competing demands, doing your job and a third of someone else's, and the inability to turn off the devices--even when you can. 

Too much going out and not enough coming in is a problem in terms of health, family relationships, and job performance. All reasons for taking this condition seriously.

Failure to periodically refresh the human spirit is not only damaging to the person but has longer-term consequences for society.

Know thyself

An essential part of renewal is coming to terms with who you are.  This is especially true in terms of team-obsessed corporate cultures which tend to diminish the role and necessity of the "individual."

In Self Renewal, author John W. Gardner says, “Good mental health derives from a reasonably objective view of the self—including the acceptance of the self. We run away from ourselves failing to explore and probe the fearful and wonderful world within.” 

He sadly concludes, “The individual who has become a stranger to themselves has lost the capacity for genuine self-renewal.”

Some principles

Gardner, the founder of Common Cause, identifies several principles with qualities that offer realistic optimism about the renewal process, and our part in it:

1. Social and organizational renewal depends ultimately on individuals who have the capacity for renewal.

2. For renewal to occur there needs to be motivation, commitment, conviction, and values—the things that give meaning to life.

3. There will be no renewal for us, society, or a troubled world unless we share a vision of something worth saving.

4. The mind—not the external environment—is the main barrier to renewal.

5. No society is likely to renew itself unless the dominant orientation is to the future. The idea is to move forward with confidence, not blind optimism.

6. In the ever-renewing society, what matters is a system or framework with which continuous innovation, renewal, and rebirth can occur. 

Sources of renewal

Everyone is different but we've found the following to be reliable sources of renewal:

• Helping those who can't do anything for us in return
• Timely conversations with persons of great wisdom
• A new challenge or change of scenery
• Periods of quietness often with a good book
• Recreation and rest--the two go together

What is renewing to you?

A self-diagnostic

Taking inventory is a helpful first step. Here are some areas of life upon which to reflect:

· Who are you?   The answer to this question is not a title or position. It has to do with what you deeply believe, care about, and value.

· Where are you now?   In life.  At work. In relationships. Toward achieving your goals.

· Do you know what time it is?   This is to gauge your awareness of reality and the moment in which you live. It has nothing to do with a clock.

· Where should you be going next?   Think opportunity. Maturity. Moving forward or stepping aside--both with a sense of purpose and direction.

· How are you going to get there?   We can't know everything in advance. Start moving and things begin to happen. The right people enter your life. Details become clearer. Stay parked and you'll never know what might have been.

A New Year's resolution

What about including an annual reminder on the calendar that says, "My life is worth renewing."   And once underway renewal has the potential to help bring about more of the same in others.

Restoration, combined with practice and perseverance, makes it possible to move beyond ordinary to extraordinary--which may be the secret of accomplishing great things.

Strategist.com

© Bredholt & Co.

The Role of Presidential Character

"Your character is your fate." 

--Heraclitus

Did you know it's possible to predict presidential performance in the White House? The same is true for gauging the future performance of a newly minted CEO, but that's another post.  

So how can we know what to expect from the leader of the free world, living at the most famous of all addresses, 1600 Pennsylvania Avenue, in Washington, DC?   

Engaging politically

In his book, The Presidential Character, author James David Barber, says it's essential, even with a strong media filter, to get to know a person wanting to take power. Why should a citizen and voter consider expending this kind of time and energy trying to determine who someone really is?

Whoever wins the election to the highest office in the U.S. will likely affect your life. It's in our best interest, and that of the nation, Barber writes, to engage in the process and hold leaders accountable. Professor Barber says understanding a President should not be as "some abstract embodiment of civic virtue" but as a human being. They bring to the presidential task "their own character, world view, and political style," he notes. 

And the presidency is an office that requires "extraordinary sanity."  

Getting to know them

What should we know about a president?  Professor Barber underscores the following:

• Their style.  It's the most visible part of the job of being President. Rhetoric, personal relations, and homework. This is not to be confused with stylishness, charisma, or appearance.  

• Their world view.  This consists of their primary, politically relevant beliefs, particularly their conceptions of social causality, human nature, and the central moral conflicts of the time. How they see the world determines to a great extent what they pay attention to. 

• Their character.  The word "character" comes from the Greek word for "engraving."  This is the way a president orients him or herself toward life--not for the moment but enduringly, according to Barber's research. Character is how a leader confronts experience and events. At the core of the character is how a person confronts themselves.

Developing potential

What are the stages of personal and professional development for a president?  

For Dr. Barber there are three:

• Character mainly developed in childhood

• World view in adolescence

• Style in early adulthood

The more we reflect on these attributes of presidential character the more we realize they apply not only to heads of state and CEOs but to everyone who holds a position of supervision, management, or leadership in business and nonprofits.

What awaits?

While we stipulate that predicting external events is very difficult to do, behavior is another matter. Research shows that the best predictor of future behavior is frequent past behavior.  
As the years accumulate there's little deviation from established practices in someone's life.

Self-constructed images are easy to create, but with a profusion of up-close technologies, hard to maintain.  

"You can fool all of the people some of the time, and some of the people all of the time, but you can't fool all of the people all of the time."

That plain-spoken wisdom is most often attributed to Abraham Lincoln.

As one who "belongs to the ages," Lincoln embodies the idea that character remains a president's ultimate fate.     

Strategist.com

© Bredholt & Co.  

Innovation at Frito Lay

LA Times

"Learning and innovation go hand in hand. The arrogance of success is to think that what you did yesterday will be sufficient for tomorrow."

—William Pollard

In the October 20, 2003, issue of Business Week magazine, there's a picture of Steven Reinemund, CEO of PepsiCo.  He is smiling—and for good reason.  In the third quarter of that year, PepsiCo reported excellent numbers.  This was due to a 7% revenue growth from snacks and a 16% sales growth from international markets.

Profits reached $1.07 billion, a 13% gain.  New products contributed substantially to these results.

Fast forward to a different decade.  

Today PepsiCo is led by CEO Indra Nooyi.  She's guiding a much larger company, 2011 net revenue of $66 billion, in a more complex global economy. 

Founded in 1965 through the merger of Pepsi-Cola and Frito-Lay, PepsiCo went on to acquire Tropicana in 1998 and merged with the Quaker Oats Company, including Gatorade, in 2001.   

Times change and so do market positions.  According to Fortune Magazine:

• Last year between May and September Pepsi stock dropped 15%. Coke stock is up 40% in the same period. 
• Pepsi often fails to hit its profit targets—something unacceptable to the investment community.
• In 2011 Pepsi was displaced as the number two soft drink beverage losing out to Diet Coke.  Coca-Cola is No. 1.

Earlier this year Ms. Nooyi, who has a strong interest in nutritional products, outlined a new plan to support the core North American beverages business. She also removed the head of that unit in an attempt to get things moving again.

While there's a lot of back-and-forth in the cola wars perhaps PepsiCo could learn from an internal laboratory that has fueled the growth of its snack business, which a few stock analysts would like to see spun off as a separate company.

Some time ago I was allowed to go on-site and visit innovation in action at Frito-Lay, a unit of PepsiCo.

Our presenter Dwight Riskey, since retired, was a corporate vice president and chief marketing officer. In his own personable way, Riskey took the audience inside the processes of innovation at Frito-Lay. While not all business principles transfer well, there may be something on this short list of takeaways that could be helpful to your organization

All businesses get to a point where growth becomes extremely difficult.

Mr. Riskey made clear that sustained growth is hard to achieve. 

After the 90s dot com bust and the real estate debacle of recent times, we know in retrospect that much of the growth purported by many companies and market sectors was an illusion.  While high-flyers get a lot of media attention for rapid growth, the enterprise worth putting under a microscope is the one that achieves consistent results over extended periods.

Success stories like this are hard to find for two reasons.  First, these businesses tend not to draw attention to themselves.  Second, the examples are few and far between.

Growth at Frito-Lay comes through innovation.

Business leaders are in tension with themselves wanting control, creativity, and growth at the same time. This is a difficult act to pull off.

If it's true new products help PepsiCo increase revenue, how does innovation see the light of day in a large bureaucracy?   What makes the difference when it comes to identifying and implementing innovative ideas? 

It could be credible individuals such as Dwight Riskey and his talented staff.  Or as a best-selling author, Jim Collins would say, the “who.” 

Innovations don’t happen by themselves.  They need help.  There needs to be a champion pushing an idea through a system that is often quite comfortable with itself.  Product innovation is not likely to go anywhere without someone giving permission or protection to try something new. 

It’s important to understand that Riskey, in his day, had access to people who could make decisions and provide resources for innovation.  How did he get this access?  Trust.  He made time to establish solid relationships within PepsiCo.

It would be easy to look at products, advertising, and luck at Frito-Lay to conclude this is the path to profits.   These three categories are important.  However, it’s essential to give credit to the human element of successful improvisation.

It’s hard to be creative inside a mature mindset.

How we see something determines how we’re likely to respond. If your thinking and position are mature then it could limit creativity.  If so, what are ways to tap the imagination and be innovative?  

Have you ever thought of simply moving around the room to look at your idea from another angle? Or enlisting others to help you think about the product or service you’re trying to launch? What about talking to consumers who don't buy from your business and asking them why?

If it’s difficult to be creative using outmoded thinking, it’s impossible to turn on the light in a closed mind.

And that may be the most enduring lesson from our day at Frito Lay.

Strategist.com

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