Transcription
Well, James, thank you so much for joining us this afternoon. I know we have very much a full house. James is very keen to have questions from you. So I have some here already. I have obviously my own questions. We're going to talk about uh reinvention of a global icon. We're going to talk about sustainability and we're going to talk about leading in a new world.
So you are leading one of the world's great iconic brands. You've done so as a CEO now for many years. You're about to in March >> Yes. move into the chair role and I guess you know one thing that is on everybody's mind and I can see it uh coming up in the questions as well but let's just start with that is how do you lead an iconic brand like this and still respond to the many changes we're seeing in the world right now?
>> A small question um I think there There are two parts to that question. Uh one is how do you lead and the other is how do you stay relevant uh as a global brand or a global enterprise. Um, and I think they're two quite different things. So let let >> let me if the reverb doesn't get us. Um start with how do you stay relevant as an enterprise and and what's interesting about the Coca-Cola company is obviously self-evidently it's partly the Coca-Cola brand.
>> Yeah. uh which is 142 years 140 years old. And then there's a whole series of other brands which is the other half of the company. And so the the challenge is as an enterprise, how do you ultimately decide and balance what not to change?
>> Yeah.
>> And what should stay authentic uh to its past and to its origin and what should you update and change? Um, and if you think just about the Coca-Cola brand, it's the same red and white colors, it's the same script, it's the same taste, it's the same bottle since they invented it. Uh, so in many ways it's an unchanging thing in a changing world.
>> Yeah.
>> And yet they've had to make it relevant to every generation. And one of the simplest ways of typifying that is how to market to consumers. In its very origin, it was one of the first brands to use couponing.
>> Um, buy one, get a discount off. It was one of the very first brands, if you think we're talking about the 19th century now, to advertise about quality. It's the real thing because there were so many different imitations of everything in those days across all sorts of categories. But then it moved on. It moved on to outdoor. It moved on to merchandise. It moved on eventually to radio, TV, social media, etc. So the relevance is not just about what you make and do, but how you engage with people.
>> And so the leadership challenge there um with with a brand like Coca-Cola is deciding what not to change.
>> Yeah. and and resisting the temptation as we have largely always done although not always as those of you who have ever studied the New Coke >> yes >> catastrophe will know that was a moment of hesitation in thinking they needed to change the formula to stay relevant.
>> and of course it was a complete shambles and they reversed it almost immediately um and so those decisions are superant are important about what not to change. They're actually much harder than coming up with a new ad campaign or coming up with a new way of engaging people. Um and so leadership has to be very much about having a point of view.
>> Yeah.
>> Um because you know in in in the end people especially in marketing orientated companies there's a there's a certain drive to do something new.
>> Yeah. No brand manager or MBA student ever turned up and said, "I think we should just do what the last person in the job said."
>> Yeah.
>> Like that presentation has never been made. They always have a new idea. And so they're always trying to change it, which is generally good, but someone has to say no.
>> And so with that balance, we've been able to keep Coke iconic. And yet in the in the beverage industry or in the general consumer industry, people talk about brands that sell a billion dollars at retail or more. And uh which is very rare that a brand sells more than a billion dollars at retail. Uh and we have 31 of them. One's Coke and the rest we have largely invented to address more niche consumer needs. And so that's that that's the great balancing act that is actually very hard to do is not only to carry on with the thing you started with but to balance it out with other ideas >> that can address more niche concerns for for people and that's the leadership challenge.
>> Yeah, that's really fascinating. And there's a there's a question here. Um I mean I I think we could sort of pivot to thinking about consumers because I I guess one of the qu points you've made James is that the organization itself sits in a very strong iconic position but you you're in you you know you're very very responsive to uh consumers in terms of what they need and one of the questions that we have and please do continue to ask your questions because this is a very good opportunity for you to do so. I wanted um oh in fact two people are asking pretty much the same question. Uh okay Raymon who where's Raymon who's asking the question as youngest consumers drink less soda and drink less alcohol. I know you don't do alcohol. What's the biggest risk and biggest opportunity? Who who who asked that question?
>> Over here.
>> Yeah. Hi. Do you want to stand up and sort of say a little bit more about it?
>> Yeah, sure. Just we were like checking out stats that millennials were the last big group that were like consuming a lot of alcohol and drinking sodas and then new generations are like consuming healthy healthier than before. So the consumption is decreasing. So we just want to know what's the vision of Coca-Cola with this. What are the opportunities coming for for Coca-Cola in as a general and what's their strategy?
>> Yeah, it's about soda and health really isn't it? Yeah. The the first thing is to look at the data because people tend to overemphasize what they see around them.
>> Yeah.
>> Either by their socioeconomic level, their age, their country, whatever. Let's go back to the data and look at the beverage industry. And and so I think it's always key as a leader to get down into the data. What does the data say? And the first thing to know about the beverage industry in the data, it's an industry that keeps growing. So volutrically and saleswise, the beverage industry has grown. If you did a a histogram of the average growth three years going back for 30 years or whatever, basically the industry grows at 4% every year. If it doesn't grow four, it grows at five. Uh and the reason that's true is if you take the developed world, so US, Europe, Japan, Australia, etc., etc., of every 10 drinks you have, you're paying money for seven and a half of them, maybe eight. Um, and that is relatively stable. But if the other 80% of the world's population in the emerging markets, they only pay money for two or two and a half of the drinks they ever drink. So the first key insight about the beverage industry is actually it is yet to be created because consumption of commercial beverages tracks disposable income. People spend money on beverages as they earn money and they very rarely have a lot of money and spend nothing on beverages and I'm including all commercial beverages. So the first thing to understand about the beverage industry is the long-term motor is the number of people in the world and how much money they've got and that is just driving the industry uh to keep growing within the total um amount of beverages that are consumed. There's been a ongoing shift to what we would call non-alcoholic ready to drink. Something that comes in a bottle or a can rather than tea bags uh or loose uh loose granules or something. And yes, within that there has been a slow change of the mix. But again, there's a very big difference between what happens in the developed world and what happens in some other countries. So you take the UK over half the soft drinks now sodas are now zero calorie diet or zero. But actually the total number keeps growing. So when you conceptualize what's the soda, you first have to answer your question. Are you talking about the ones with sugar, with half sugar or with no sugar?
>> Yeah.
>> Because that's a very different answer. I mean, if you look at just take Coke, Diet Coke, which is people think that's been declining for years and years and years. That's been growing for the last couple of years and Coke Zero is growing volumetrically. And so it's very important to get down to the data. What you do see which is very logical when you when you stand back from any industry every industry starts with someone coming up with an idea and there's one product let's call it Coke then someone comes up with another couple of products and the industry starts with relatively few categories and relatively few brands but as it grows and grows competitors come along and go well it's going to be quite hard to compete against Coke I'm going to come up with a slightly different idea I'm going to come up with a ready to drink tea or a sports drink or some form of smoothie or whatever and so different categories appear. So then every industry naturally creates space for different brands and different competitors and this beverage industry is no different. So it has fragmented the bigger it is in any country the more brands and categories it tends to have. So our response to that has been the and solution. Coke remains the biggest basic consumer brand at retail in the world by a substantive different substantive margin in food and beverages. But now we have $31 billion brands because we too have responded by going after all those niches and now we have the biggest obviously the biggest cola, we have the biggest fruit flavor soft drinks, we have the biggest sports drinks in the world, we have the biggest ready to drink tea in the world, the biggest juices, etc., etc. Um, and so that's the question of responding to consumer needs and becoming a total beverage company and that's how we kept growing.
>> Can I um can I go on to the question that Peter's got. Um, Peter, the question that you had was about globalization and local because I think that's so what what I think we're hearing from James up to now is that there's something that sits at the center that's iconic that a CEO has to be really careful to protect and to make sure that you know people don't move around it too much, don't change it too much. But at the same time, if you use the data and the data analytics and the the data from countries, you get a sense of where the market's going. You know where the niches is. can begin to build them. But I think Peter's question is an interesting one. Um and and he's asking about, you know, how you do this global global and local approach. Um where products are customized to local markets. You said Coke seems to be able to market global brands. No, I'm not sure that you do that, but perhaps you do. I thought Yeah, I thought you changed it slightly for each market, but Peter, where's Peter? Okay, we have we have many different nationalities. So in this room so maybe we each have our own special Coke recipe for our own country that is that we don't do we no okay Peter.
>> hi thank you very much for coming yeah so the question came from the context of in B2C in B2B a lot of different big corporates they have one global product but then they try to either change the product or to go to market or some different aspect to tailor tailor to the customers in those markets. Then I was thinking about Coke, which seems to be quite similar across all markets. And I was just thinking about how have you kind of managed to build a product that is so similar across different markets and if there's a strategy behind that and and if you're trying to do that with the other brands as well. I know like there might be some tweaks to the Coke product in different countries, but it seems to be quite quite similar across everywhere. So that was that's where the question came from.
>> Thank you. Yeah.
>> the Coke. There's a famous quote by Andy Warhol, which is a Coke is a Coke. You can't get a different Coke whether you're the president or the homeless person. All the Cokes are the same and they're all good. That's the Andy Warhol quote, more or less. Um the Cokes are the same.
>> Um it is not it's not just the same recipe-wise and bottlewise, iconography wise, it's the same script. So, back to this idea that uh there's a bit that's authentic and unchanging, and that's the bit that's the same everywhere. And why is that the case? Because in the end, you can you can make an assertion that fundamental human aspirations and values are not actually that different around the world. Everyone wants to have friends and family. People want their children to have a better life. Like there's a set of aspirational elements of human need and human values that actually are pretty universal.
>> and the cult brand sits in that space and so it is able to have a brand architecture that actually links to something that is almost universal across the world. now is physical representation looks the same everywhere but the marketing representation can change around the world. Um if you're in um if you're in Mexico it's going to be celebrating Mexican food not Chinese food as if you're in China. of the representation, the ritual that it's building. Let's say Coke with meals, which is part of the um uh marketing construct of the of the Coke brand. What does Coke and with meals mean? And what's the It's not about the It's not just about the physical pairing with a food. It's about the ritual that people go through at the moment of having the food. In some cultures, that will be the family sitting around the table. So the marketing you'll see in a Mexico for example tends to be the family round the table with the Cokes. The ritual of food in in Singapore is not that.
>> or Hong Kong the apartments are too small. They're out in the street having the food with friends. And so the representation of Coke and food will be the enjoyment of sharing a meal with friends on the street. And so each Coke actually if you go and ask people around the world how do you feel about Coke? Somewhat paradoxically they feel it's very local because it's a global brand that has been brought to life in the context of their culture.
>> That's it's so fascinating. We I'm going to move off this topic of global icon but before we do that let's just remind ourselves and reflect on the three points that James made. three really crucial points. The first is as an iconic brand you as a CEO have to protect what that icon is. The second thing is but at the same time you need to understand data. You need to understand where markets are going where they're how they're changing. Uh and data is going to be very important to you. And the third which I particularly love as a psych as a psychologist is that you need to understand how your consumers are living. You need to understand their rituals. You have to be an anthropologist really. You probably employ anthropologists of course.
>> Yeah. Just to find out what the hell is going on. And I think as we think about building services, products that people want, understanding where they're coming from, I'll tell James a story which I won't repeat now because it's too blonde, but it's it's about my son going to anyway whatever. He ends up drinking a Coca-Cola. It's in my next book. drinking Coca-Cola in one of the you know slams outside of of Mumbai and it's just it's sort of an incredible moment really that this family had got their money together to bring my son 18year-old son a you know a cold bottle of Coca-Cola that's the thing they wanted to give him and you're right I mean for that family in a slum in Mumbai that's all they could do for him you know that was they thought might be helpful and significant so thank you to everyone for those questions I'm going to move on to sustainability. Um and I'm going to ask I'm going to dive straight into uh something which James has talked about and which is which is very close to his heart which is a question of waste and particularly what we do with bottles um and some of you come from countries where there's a lot of bottles around lot of bottles lot of cans and one of the things that James has said by 2030 is that Coca-Cola will for every bottle or can and can it produces it will recycle not exact of course the same can or the same bottle but a bottle or a can and as I've been thinking about that since I've been preparing to talk to James I just thought wow that's a big promise there's an awful lot of bottles around the world so I wanted to just dive straight into that question and just get a sense of how do you how do you make that happen as a CEO.
>> Yeah, if only I could make things happen as a CEO. Lots of people are involved in that. The the starting point is actually something uh relatively simple which is the intersection of you know the idea that businesses are going to prosper in the long run uh if communities prosper in the long run. And and the the relevance of that comment is businesses that create externalities i.e. costs to society that they have not paid for are storing up problems for themselves in the long run.
>> And one of those uh in the context of consumer industries is the packaging that goes with it because you take it home whether it's a cardboard box from your delivery or whatever that then has to be dealt with. and um cardboard will break down relatively quickly but glass plastic and cans does not and so there's an externality there to the environment to land waste etc. Um and that eventually starts becoming a problem because either it gets in the wrong place is in the sea or is on the street uh or it's wasted. Now in the case of our industry, we are in some ways fortunate because whether it's a glass bottle, a plastic bottle or if there was a can here, a can, each of those materials has an inherent economic value.
>> Okay?
>> If you have other packaging materials like flexible plastics, it basically has no economic value. But the reason that these three, my imaginary can here, have inherent economic value is because they are easily recyclable. So if you can collect it, you can recycle it. A glass bottle gets melted down. A can just gets melted down. A PET bottle gets chopped up and melted down. In fact, the reason I don't know if you can see, but you can see.
>> I can see mine. Yeah.
>> You see that this bottle is slightly gray?
>> Yeah. Do you know why it's slightly gray?
>> It's already been recycled.
>> It's already been recycled many times.
>> Many times.
>> And the reason it's slightly gray is you get the bottle, you chop it up, and you melt it, and you blend it in with other uh you can either blend it in with other virgin plastic, or you can make a bottle that's just made from recycled plastic, which is why it turns gray, which is that bottle. And so in the end actually in the case of beveraging beverage uh materials because each package has an inherent value the challenge is not recycling. In other words once I've got it >> I know I can make a new one out of it. The question is, can I get it back? And so what we have been pursuing over the last decade or so is essentially two different solutions in the developed world is to is to push and promote collection largely through municipal systems.
>> Yeah.
>> So we're completely in favor of the wheelie bins. People don't like the wheelie bins, but it's great. The bottle goes in the wheelie bin. It goes to the recycling center, they collect it, they put them all together because it has economic value and they sell it back to us. So actually you can and in many European countries you achieve over 90% collection of the bottles and the actually cans are even easier than plastic bottles. You achieve over 90% collection of the bottles and cans because they have the value for the for the recycling system. In emerging markets, they have not achieved the organization of municipal collection. But because at the end of the day, labor's cheaper there, you largely find industries grow up to go around and collect all these bottles and cans and cardboard. And actually, recollection rates in emerging markets are often higher than they are in the developed economies because labor's so cheap. So actually we're already closing in on 70%. Because the material has economic value and that has included uh us going to governments and saying you should mandate collection. You should mandate that industry contributes to paying the collection. You should do it the most efficient way possible which is not always what they do. And you should put in laws that require recycling m% recycling material into into virgin. That way you'll create a circular economy where everyone's economic interest is reusing the materials and it then won't be waste. So it's it's about in the end designing an economic system where all the actors are incented to make it work.
>> If that's not true, it very rarely works in the long run.
>> Yeah.
>> But with packaging materials, it can be creative. And again what I'm sort of hearing James is a really deep understanding of how life happens in these countries. You know that in a an emerging economy people will be paid to collect bottles from the streets and that's different from municipal Camden for example doing it. Um, there's there's quite a lot of questions on sustainability. Um, what Nithia let me ask you first because your question was you know that you feel that there's a push back against ESG um and and how do you how do you put your long-term shareholder value? How do you balance that? And I'm thinking just as you get ready to give to where where are you sitting Nthia? Where are you? I'm sorry we can't see you very well here. Where have we found? Okay. as you get ready I just want to you know we one of the people we've spoken to over the years has been Paul Pullman at Unilever of course whom you know and you know Paul always said that they had a very very strong sustainability program but there were aspects of that they could never deliver they've never been able to live deliver palm oil as you know they've never been able to get palm oil out of the unilver cycle and you know and that just hasn't been possible from a shareholder value and just for whole set of reasons and I think this is the question that Nitia is asking which is how do you balance what shareholders want in terms of their value with what you need to do. Nitia do you want to ask do you want to mention that?
>> Yeah I mean thank you.
>> So there are shareholders in terms of yeah you know consumers uh the people that work for you but also governments are also involved. So there have been a lot of companies that are putting up you know sustainability goals and with the push back happening couple of them have sort of it scaled it down. So in this environment should the companies lead these goals or follow government policies?
>> Um, I didn't quite hear the last bit but let me let me go with an answer and and see see whether it works. Um, I think in the end you've got to decide why you're doing them. Are they integral and inherent to your business or are they nice to have? So, the first things that always go under pressure are the nice to haves. Um, if you take the Coca-Cola company, uh, in the end, you're going to have to make the argument, uh, if we're talking about any serious amount of money, and also if it's not a serious amount of money, it's it's the nice to have, so it'll get jettison. If we're talking about serious amounts of money, you've got to be able to answer the question, why is this good for the shareholders? You you've got to be able to answer that question. And so in the end you can to me it comes back to the central argument that if you want a healthy business you've got to have a healthy community. You can't have a growing business in a declining society. Um and and therefore if one of the reasons that the society is not doing so well is the cost of the externality that you're creating it will eventually become a problem. Now, even when that is true and even when you're a company of the size of the Coca-Cola system, that does not mean you can go, okay, well, this is going to be a problem in the long term. I'm going to solve this on my own because most of these problems have very little chance of being solved by one company, which I think is part of what you referred to with with the Palm model thing.
>> Yeah. And in the end it has to be the collective action of the companies in the industry of the government sometimes NOS's and civil society to make it happen and my perspective is and often times government has to play its role of regulating and so it sounds somewhat counterintuitive and it is sometimes controversial in in in some circles in business if actually good regulation can make it better for everyone because it's a level playing field. So whatever the problem is, if you can come up with smart regulation that makes an economic system work, you can then get over the sustainability problem. If if you try and do it as one company and you compete against people who don't, you're going to start losing market share and pretty soon your shareholders are going, "Well, why are you doing this when they're not and you're killing me?" that's never going to be a long-term strategy. You need to be able to create uh in the end some degree of level playing field so it's not something where the shareholders are going to come back and say well you need to stop it.
>> and that's what I think we've done in the three biggest areas that matter to us. I'm I'm going to I'm going to move on in a moment to talk about leadership, but I just want you as an a MBA group here to to understand that what we're hearing from James is sort of worldclass what we might call at London Business School stakeholder management and and and our belief at London Business School is that as we train the leaders of tomorrow, you sitting here being able to understand and think about multiple stakeholders, governments, NOS's, competitor tors that whole system we believe that that's absolutely crucial to building a world which as you say creates healthy communities that I'm just going to finish Justine with your question um Justine you you have a question do you want to just stand up and ask it yeah there you are thanks.
>> hi uh I just wanted to hear from you about like climate commitments and as it was previously previously mentioned as well about the ASG like is it something that you are reconsidering given the push back in some regions is it possible to make Coca-Cola company net zero.
>> the climate question is made very complicated but is actually quite simple um there are two uh basic uh sources of carbon like this is a carbon question so like it's it's a carbon density uh in your in your product question And all food and beverages basically have two sources of carbon. The agricultural ingredients that they buy and the transformation of those into finished products >> through electricity. That's it. Like you got people make it super complicated but actually those are the two most important. Now from what can we do? We can tremendously reduce our usage of electricity through efficiency and we can reduce the added carbon in the agricultural cycle things like fertilizer etc etc that those are the two starting points. The second element of the equation is to get electricity that comes with no carbon.
>> Yeah.
>> You get green carbon green electricity. So the the the trivial pursuit question is which is the lowest carbon footprint Coca-Cola can in the world from which country does it come?
>> Okay, that's a good question. Who's who's got the answer to that?
>> Justine. You know,
>> come on. You're a smart lot. Who's got what country? Throw out >> has got the lowest I've got my idea.
>> Spain.
>> No.
>> Spain.
>> Who?
>> Mexico. No.
>> Norway.
>> Norway.
>> Norway. Yes. Norway.
>> Yes. Norway.
>> One. Norway is good.
>> Yeah. France too. Good.
>> Actually, the UK because of because of wind.
>> We use tons of gas in the UK.
>> There you go. So,
>> it's better than the coal we used to burn in the UK.
>> Norway because it's despite the fact that Norway sells oil to everyone else, it's actually largely >> water powered as a country.
>> France because it's largely nuclear. Ah so climate how much carbon am I getting in my electricity is a super important question and the more that the grid goes green the more it basically drives out all the carbon from my transformation uh process agriculture is much harder because you got to grow stuff and that is going to be an almost irreducible amount of uh carbon footprint is the So the as we move on to the final piece which is about being a leader and being a leader in a new world and you've asked lots of questions about that and some really wonderful ones again I just want you to reflect on what you've heard James saying and what you've heard him doing one with one thing we noticed at London Business School in terms of our our research on great CEOs is the way they tell a story and give a narrative and you just did that with total simplicity and it's a very complex question you know but actually the The capacity for a leader to to te tell a story to tell a narrative particularly about the future is very very compelling. So let's move on to that final part of today's conversation which is about about you as a leader James and we've already learned quite a lot about how you think about leadership. You think about what it is you preserve. You think about how you understand your consumers from an anthropological almost perspective. You think a lot about data. And we're also hearing that you you feel you're able to to tell a story in a way that's compelling even though this is an enormous organization with so many people employed. So um let me start with a question that Dimmitri has. Um and and Dimmitri if we could we could find you and it's a it's a really a lovely question. Um um and it's really a question I think all of us all of you face anyway at the beginning of your CEO or senior executive journey which is to say you know what did you think at the beginning that you now no longer think? Um Dimmitri do you want I know do you want to ask that question? Where where are you? Yeah there you are.
>> Hi. Um so basically the question was now I mean since you became the CEO what things what type of things you saw from a different perspective and basically what type of things that you thought that were true before um were no longer true just because from that CEO viewpoint uh you could better understand the organization as a whole.
>> Um, let me give you one one bit of an answer and then then then the second. Um, the one bit of the answer is about the uniqueness of the CEO role. Uh especially in large organizations you have a tendency to think that each progression uh in the organizational hierarchy is just a larger version of what come before. you go from running a a small country to a medium-sized country to a large country. They are all versions of the same thing. Um, and then you start going, well, okay, well, if I did a small country, a medium country, a big country, many countries, surely being the CEO is just a bigger version of all of that. And it's partly true, but it's partly wrong. And that's because if you if you think about the organizational pyramid, you you've spent your career coming up and you finally get to the top and you think you're the one person at the top of the pyramid and all the other people there uh in theory working for you. And what you discover when you reach the top of the pyramid is there's another pyramid,
>> but it's upside down
>> and you're the one person at the bottom and you've got zillions of people trying to tell you what to do. Yeah,
>> you've got the board of directors, you got the investment analysts, you got investors, you got media, you got business schools, you got NOS's. There's a lot of people who have a point of view on what you should do.
>> And you get very surprised by the amount of um opinions and approaches you get from every angle in a way that never happens.
>> Yeah.
>> When you're a manager in the organization. So the role of the CEO um is both a manager of the other managers in in the kind of the traditional sense but a representative of the enterprise and everyone's got a point of view and the more iconic the company the more the people above have a point of view on what you should do and that's quite eyeopening when CEOs get to that point which has a consequence of tremendously fragmenting your time because you got way more people to pay attention to and therefore it becomes even more important as a leader to decide on what are the very few things that I'm going to drive. So choosing what to focus on and sticking to a few priorities becomes even more valuable.
>> And how how do you do that?
>> How do you do that?
>> Yeah,
>> it's I don't know. You just either do it or you don't do it. if you don't do it, someone else does it.
>> It's but what's
>> it's I think I think part of it uh is one knowing it's true, but it's the it's the discipline to stick to it. Um, you know, some people not everyone will be cut out for that type of role. There are the there are people who do all sorts of roles in life. Um, and this role I think requires a certain degree of discipline. Um, and there are all sorts of jokes they make uh about, you know, when he gets to his show, like, you know, as I'm telling my new incoming uh the person replacing me, like pe you will be bored of your message >> before anyone has really understood what you're trying to say.
>> Yeah.
>> Because you repeat it every day. So, you get bored quickly. But most people only hear it once because you talk to this audience, then you talk to that audience, then you talk to that audience. They only heard it once and they weren't even really listening the first time. I'll give you the story. When I became CEO, we did a whole fanfare. There were town town halls and media and blah blah blah and blah blah blah. Went on for a week. The, you know, business strategy, powerpoints, all sorts of stuff. If you had done a poll on the following Monday morning, what's the one thing you can remember? What do you think it would have been? Something business strategy? No. The answer to the question was he wore jeans.
>> I was going to say what what were you wearing? Yeah.
>> What you wearing? Yeah.
>> And but there was not by chance I had worn the jeans.
>> Exactly.
>> It was part of the message.
>> What was the message with the jeans?
>> The messages were changing.
>> Okay.
>> The culture has to change. No more suits, ties, crevats, etc. We're going to become modern jeans. And so it was about making a point of culture. And in the end, another one of the co things, everything communicates. and almost inevitably not the thing you thought was communicating i.e. the PowerPoint or what you wore, how you were all these things are tremendous communicators and so there's a degree of discipline that's super important to give another story like very early on I met with uh some investment analysts and they we had an hours meeting and they sat there and they asked questions and at the end one of them said do you want to ask a question? Is there anything you want to know of us? I said yeah sure. I said, "We've spent the last hour, you know, you asking me all these zibians of questions about the business, but you haven't written a single thing down. Why not?" And her answer was, "Yeah, but those are all the answers that investor relations prepared for you. They're all boring. I came here to see whether you were tired.
>> I came here to see whether you were tired
>> because as a new CEO, if you're under pressure and under stress, you'll be tired and then there's something wrong with the business." Yeah,
>> that was that was what they were.
>> That's what they were looking. So,
>> yeah,
>> it's discipline is important. Understanding that everything communicates and and and staying on message.
>> Can can I just come on? Can I I will come back to to everybody else's questions. But let me just ask that question about energy. One thing that I notice about CEOs is the jobs are relentless and you've been doing this job for quite some time. How do you how do you stay energized? You know, how do you get up? You know, how do you do it?
>> Well, my my one piece of career advice to people, which is not very good, by the way.
>> Okay. But where if we're listening to this,
>> there was no career plan, was do something that gets you out of bed in the morning.
>> There's no harder job than the one you don't want to do. And what was it about this job that got you out in the of bed in the morning?
>> The company, I don't think it would be too exaggerated. The company sort of needed saving. We had spent the previous decade with the revenue growing at about 3% a year and the earnings of the company stuck at $2 EPS a year. Um, and the investors were restless. Uh if for those of you who can remember 3G, the Brazilian um capital company um you know they were taking over all CGP and and they were they were like famously one of the guys from 3G when asked if he was going to buy Pepsi um said why would I get a burger when I can have a filt which by which he meant he wanted to buy Coke. Um but of course they can't possibly do it now because they're worth vastly less than us. Um but at the end of the day we were stuck in a rut and we were vulnerable. And when I started the analysts asked me why are you bothering because you're going to be taken out. I said I completely disagree. Our problem is not external it's internal. We can grow and it's the only plan we can execute. People say how did you choose the strategy? I said well we could we could have a growth strategy or we could be like the 3G and say okay we can't grow. let's harvest all the take all the cost out and harvest the margin or we can just be clueless and cannon foder and so actually it was relatively simple as a strategy is that we just got to grow and obviously we did a lot so wind the clock forward our growth rate went from 3% on revenue to 7% over the last decade earnings have gone from two to getting close to three um and and so it's made a difference and and so really it was about we need to change and that was the thing that interested that we could save ourselves.
>> So, what gets you out of vet is a really big challenge and you're just about to move into a new job in March. What is going to.
>> Actually, I am chairman. I'm I know you're already chairman. Now, you're getting rid of one of getting rid of one and just focusing on the chairman's role. What What will be getting you out of bed then? What's the big challenge you face? I I
>> I think the next stage of the chapter or the next chapter in the in the in the in the story is making the successful transition. um you've got a new CEO coming in.
>> Um I'm going to stay as the chair and it's about helping them be successful.
>> Yeah.
>> Um and then there'll be another chapter when they don't need me. But that's that's the next chapter. It's like, you know, there's what's the point of setting it back up as a growth company. If it then stops when you leave, you haven't succeeded.
>> Yeah. Can we And that Sorry, I will come back to your questions, but there's Oh, no. Am I going to ask a question? Sorry. I'm very interested in transitions, but that's only my interest. So, I shall go back to the MBA students. Um, let's have a question from Alan. And I think this is sadly moving into the final question. Alan, what's your question? Looking back at your career experiences most shaped you? That's a nice question actually. Alan,
>> hello. Yeah. Hi. Thank you very much for for coming to LBS today. Um, a lot of us here aspire to be uh leaders like you and I wanted to ask, you've had a long and successful career and I wanted to know what really shaped you to be in such a successful position and to lead and deliver such successful results.
>> Um, yeah, as I kind of intimated, there was no um grand master plan or career plan.
>> Yeah. uh essentially I I took on jobs or opportunities or roles that I thought were interesting and challenging and got me out of the bed in the morning and I was successful at them. I mean in the end how did I get to where I am? You could argue it's survivor basis. Uh I just, you know, flipped flipped heads every time the coin went after 20 job rounds and therefore I'm the only one left. Um kind of like Squid Games. Um, but you know I think like you're going to build a career or a journey with multiple careers and they're going to be successes and they're going to be failures or okay stuff that you bounce back from. So I think it will like how do you get to something like that is by having some successes. I mean there like no one gets there by being the wallpaper.
>> Uh you're going to have to be famous for something in each job. So what are you going to be famous for? Which will mean taking risks, being brave, being courageous on something. But also going along with that will be you're not always going to score a home run or a goal or whatever uh on every job on every year. And so there'll be some bouncing backs from some okay years like I didn't like it kind of didn't all go my way or even failures. You've got to be able to bounce back from those things uh and get back and you know build a track record of in a way being famous for something. Um there's a there's a lot of people out there in organizations in the world um and it and it's competitive. So kind of getting some of the runs on the board is will be what it's all about and deciding you want to do it because you know in this whole work life balance thing which is kind of a weird phrase if you ask me because last time I checked work was part of life not separate.
>> Uh how much do you want to invest in work? How much do you want to invest in family or friends or hobbies or adventures or whatever? And that mix can change over time. But it's always your choice.
>> Yeah.
>> And how you choose to deploy your time will affect also the opportunities you have in 10, 20, 30 years time.
>> And you just have to be comfortable with that choice. It it just it's yours. Uh it may not work out. It may work out, but it is your choice. And
I think making it in whatever way works for you, uh, is part of the story too.
Maggie, I'm going to ask because I know you're asking the the final question. Yeah. But just to to prep you up, I just wanted to ask, um, my final question, uh, to James, which is, you know, when you think about how you deploy your energy and when you think about what you want to be known for, how do you make those choices? You said before it's about deploying choice. What's the what's the mechanism for choosing?
What where to put the? How do you do it personally?
I daydream.
You daydream.
Well, tell us about the daydreaming.
Look, there are there are some people who their modus operandi, you know, God love them. They get up at 4 in the morning. They go to the gym. Yeah. They read all the newspapers. They don't have breakfast. They're still fasting to lunchtime. Yeah. Um, etc., etc., etc. And they're like their day from, you know, 8 till 6 is back-to-back meetings.
That's not your life.
That's not me.
Tell us about your life.
Uh, I get up very slowly in the morning. Uh, have lots of coffee and I have breakfast and I generally don't do that time and and I don't fill my day with meetings. Yeah. Because especially the higher up and I think this is an answer that's relevant at the top of the house. Yeah. This is not an answer that's relevant if you're running a sales force or you're running a small country. Then how I managed was different. Um, but but the top of the house, if you go back to the idea that ultimately there's a relatively few decisions you have to make. You have to make a set of strategy decisions. You have to make a set of people decisions. And you're gonna have to make some of the unpalatable decisions because the only decisions that move up are the ones that no one wants to take because they either don't have any information or they're all choices that no one likes. So the easiest thing to do is to send them as far up the chain as you can possibly do. Um, which of course my response is then to generally try and push them back down. But eventually you're going to have to make some choices. But you can't like you can't decide everything for the company everywhere. So to get a multiplier effect, you have to get people empowered to do as much as possible and then focus on those things that you think will make the most difference, which which means as a mode of management from my perspective, um, as it relates particularly to the strategy stuff, is trying to work out what is signal and what is noise.
Yeah.
On the basis that most stuff is just noise and you shouldn't do anything about it. You should pay attention to it, but sit there and think, is this really important? Should I do something? Get the organization to do something radically different as a function of that, knowing for the sake of the argument, I'm only going to tell the organization to do 10 things this year.
Yeah.
Like, has it reached that level? Because if I need to say something, I have to repeat it many times.
Yeah.
Mobilize resources to go and chase it. You can't change your mind every day. And so most of the time I'm discarding the opportunity to act.
Wow. Discarding the opportunity to act, daydreaming, thinking about the 10 things you are going to tell the organization this year. James, thank you so much for sharing this with us. It's very been really absolutely fascinating. Maggie, you have a final a final, uh, question and then we're going to network and have
Sure.
more Coca-Cola.
I'll just e echo the thanks. Um, to wrap us up though, James, you mentioned you're of course going through a career transition and many of us are going through career transitions at the moment too. We're students looking to pivot industries, pivot roles, etc. Upon graduation in July for many of us, we'll be starting roles in August, September. What advice do you have for us in the initial days or even months as we embark on these transitions?
It's a great question.
Um, I'm not sure it would be fair to say I'm that current with starting, um, a new job. Um, look, I think the the first thing I said it earlier, do something that gets you out of bed in the morning. Um, you know, for every for for each person that's a different reason, but make it yours. Um, and I think that's the best place to start from. Um, then of course you're going to take the job. Um, my world view is turn up at the office. Uh, I know that's slightly kind of controversial these days. Um, uh, frankly, I think, you know, too much working from somewhere else or working from home or hybrid work is a disservice by senior management to people joining the workforce. Uh, it's super effective for me. When I do it with my management team, it totally works for us. We can all be in different parts of the world. We just get on the video. We We sort everything out because we've known each other for decades. But I don't know you.
Yeah.
And like there's no way I'm going to teach you as much over the video as in person. It's just not going to be true in my mind. And so I think for rejoining the workforce or joining a new company, I think the more in-person time that you get, the better off you are. And I know that's not how people see the world, but I think I still think it's true. And perhaps more importantly, the senior managers you're trying to impress still think it's true. Most of them.
Yeah. So show up, find something you really enjoy and and go to the office and drink Coke.
Execute and add value.
Execute and add value.
Execute and add value.
Thank you.