Common Cause COLLABORATION AND INNOVATION
Tetra Pak's Dennis Jonsson and Coke's Venkatesh
Kini talk about collaboration and innovation
On the road to Nuh, a village in the
Mewat region of Haryana, Dennis Jonsson, President & CEO, Tetra Pak and
Venkatesh Kini, President, Coca Cola, India & South West Asia, get chatty
on leadership, innovation and working together for out-of-the box solutions.
Coke is today among the top five
customers for the 11.2 billion Tetra Pak and the two collaborate in every
sphere -including corporate social responsibility (CSR). Jonsson and Kini are
traveling to Nuh as part of a joint CSR initiative called `Support My School'.
Edited excerpts from a conversation
with Corporate Dossier during the long drive:
Developing leaders
Dennis Jonsson: We recruit
internally in a large measure and when you do that, you try to develop their
leadership qualities. We expose them to international environments so that they
get a global perspective, understand the value of diversity, learn to look
beyond the short term. That helps enormously to grow leaders.
Venkatesh Kini: We prefer to grow
internal talent, though we recruit laterally too. While we have a structured
orientation program, the process of culturisation takes months, if not years.
Culture is adopted by understanding the unstated behaviors that represent
values. That can only be imbibed through observation and experience.
On managing change
DJ: Managing change is about
communicating. One has to understand the reasons for change, and reasons for
the accompanying pain. We must ensure people understand that there is light at
the end of the tunnel and then incentivise them to cross over to the other
side. Last year, we had to close a few units in Europe because we hadn't seen
enough growth there. It was painful but we had to ensure every worker was
aligned to the reasoning for the closure.
VK: Unless people buy in to the why
of change, the `what' of the change will never be accepted. In any change
process, there will be people who will benefit and others who will not. Making
sure that the sum total of the change creates a more positive future is the
most important thing in change management. People have to understand that doing
nothing is worse than doing something. At CocaCola, we're going through a
redesign to focus more on our core business and drive it faster. As a result,
there have to be some changes on how we operate globally. One is that many of
the business unit functions now work directly with the corporate office. We are
de-layering in some ways at a global level, and that's creating some job
impacts. So it is a given to have top management conversations, townhalls,
one-on-one communication with people.
The innovation quotient
DJ: We have a system to collect
ideas, funnel them, select the ones with the most potential, farm the right
projects for them. Following up on innovation is critical too because it is
very difficult for product development otherwise. What matters in innovation is
if you have to fail, you must fail quickly because it is less costly.
Otherwise, you spend a lot of time and resources.But once you actually make it
through the funneling process, you actually have a high success rate. So after
the funneling process, our success rate is about 70%.
VK: We have launched a lot of new
products in partnership with Tetra Pak, and innovation is key there. We
launched the Tetra Fino pack riding on the affordability promise. It is the
first time in the world, Tetra Fino has been used in a non-dairy product. We
have done innovations in league with our partners. Innovation also necessarily
has to have a team accountability. When you have a project lead and a
cross-functional team supports the project lead, the team wins and loses
together. It is important for the team to be accountable. One person alone
cannot drive innovation. Out of 100 ideas that we evaluate, if one meets
marketplace success, you're doing well. But out of those 100 ideas, you take 50
through a development process. Of those 50, you might put 20 into a pilot. Of
the 20, you might put 5-6 in scaling up. And of the 5-6 ideas, if 2-3 succeed,
you're doing well.
Learnings from India
DJ: You need to have the right
partnerships in India and whatever you sell needs to have an affordable
promise. The Tetra Fino pack we developed for Coke in India comes as a chain
solution and we have used it in Indonesia to sell chocolate milk. Indonesia too
has a kirana culture. Africa is another market where these kinds of solutions
would work. Looking at India's size, we have our second biggest plant after
Lund in Sweden, in Chakan.
Managing in a multi-speed world
DJ: Europe has been pretty flat for
years. But we've seen 20% growth in India and we've had amazing growth in China,
particularly from 2000-2010. In Europe, the population is declining and some of
the categories are declining, such as dairy products since people are consuming
less of them. While you have to be realistic, you should never give up. It is
very important for us to seek opportunities in new areas, like prepared foods
in Europe, a growing category. Overall, we have a 5% growth target for the
company so it is important to look at opportunities in growth markets because
they will compensate for decline in other markets.
VK: It's about how you define
growth. In some places, growth is about getting more consumers to try the
product. Growth in other places is to get more people to consume more often, or
offering them more choices. We customise strategy depending on the market
characteristics.
Future scope of collaboration
VK: There'll be an acceleration of
Indian innovations jointly. But we can do cooperation on three
counts--economic, through products and portfolio; social, through jointly
supporting causes, like setting up toilets in schools for the girl child; and,
environmental, like `Do Bin', a citizens' initiative by both Coke and Tetra Pak
for waste segregation.DJ: We continuously bring in our knowledge in working
with various governments, and have a very clear idea of packs and costs, which
we share with our partners. It helps our customers in launching new
products.VK: We work together in product development because you can't develop
a product without keeping the package in mind. Only then do we develop a total
beverage solution.
by
Moinak Mitra CDET 20MAR15
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