Kristy J. OHara
Each of the 11 leaders reporting to him was operating on his or her own, which created a slew of problems from the onset.
“We had 11 countries, so we had 11 different advertising agencies, 11 different product names, nothing was common,” de la Vega says. “We were not buying equipment as 11 united countries — we were buying them as individual countries, and we were never getting the best prices.”
In addition to that, the unit was struggling financially.
“The business as a unit had never made money, because it was a company that had been set up and was still in development mode when I got there,” he says.
Aside from the internal issues he faced, that particular part of the world also presented plenty of political issues for him. Right as he took over, Argentina went into a depression that devalued the peso 4-to-1, which took the revenue in that country from $1 billion to $250 million overnight.
Then there was Venezuela, which had been the most profitable country in his region, where Hugo Chavez was run out of office for a day and a half, a new leader was elected and abolished the country’s constitution, and then Chavez came back, resulting in business strikes and a gasoline crisis.
Oh, and then there was Brazil, where the unit’s partner decided to not put up a payment that was due on some debt, so it defaulted on a $1 billion loan, and de la Vega had to try renegotiating that with 34 Brazilian banks.
And don’t forget about Colombia, where the government started a new company to compete with him, and the rebels were blowing up his towers.
“Other than that, it was an incredibly stable environment,” he jokes.
De la Vega clearly had his work cut out for him. But by creating a new strategy, holding people accountable and taking a fresh look at things, he worked toward aligning those 11 entities as one business unit.
“You’re obviously up to your neck in alligators in so many different issues that sometimes it’s difficult to think about how you set a long-term strategy and create a vision and align people, but that’s exactly what we had to do to win long term,” he says. “I knew I was fighting fires in all those countries, but I knew that unless we had a longer-term vision for the company and we aligned those 11 countries to act as one, not 11 different ways, we were not going to succeed long term.”
Listen and get buy-in
The first thing de la Vega did was issue airline tickets to Miami to each country’s CEO, where he started by listening to each leader.
“That’s part of the coming together,” he says. “You have to storm to form. That’s what we did. We let each one of them talk about their view of how we address the challenges that we faced.”
Keep your mouth shut during this initial step.
“You have to have patience to hear them out,” he says. “I always like to start with a green-light session where it’s, ‘Let me hear your ideas — I’m not going to say that’s a good one or not,’” he says. “I just want to hear them all.
“You want to create an environment that’s not threatening. Otherwise you’re not going to get somebody’s big idea because they may feel internally that it’s not a good idea but it may be a huge idea if they give it to you.”
Then he started to highlight what he had heard from them and build common ground.
“Well that’s fine, that’s a good view for one country, but how do we win against multinational corporations that are attacking us and not in one country but 11 different countries?” he asked them.
Getting people to agree to a new direction requires two things.
“The key thing is to paint a picture of the future that is going to want to make them sacrifice and do the hard work because there is a better, more promising future for them,” he says.
And the other is to just be honest and realistic.
“It’s confronting the brutal facts and realizing that the course we were on was not sustainable and we needed to change,” de la Vega says. “If you’re upfront with them and don’t pull any punches and you’re honest and eventually you give them time, they will come around.”
Getting people to agree to a new direction requires them to compromise.
“You have to give up something you consider to be a compromise or a sacrifice but you’re doing it for the better good,” de la Vega says.
For example, each country was purchasing its own headsets, but as a result, they weren’t getting the best prices. By agreeing to purchase just four different kinds of headsets for the whole region, everyone would lose some of their individuality and choice, but it would reduce costs, so they ultimately realized it would help them win.
“It’s always trying to paint this vision of the future that makes them want to follow you,” de la Vega says. “That’s what leadership is all about — people wanting to follow what you’re suggesting they do. Otherwise, it’s not leadership.”
Put a plan together
Once you have people on board with you, then you can put together a plan to move you forward, but you have to be sure not to dictate to them.
“Sometimes I felt like I just wanted to dictate: ‘We’re going to do A, B and C, and that’s it,’ and that would have been more expedient for the short term but never would have accomplished the long-term objectives of getting the buy-in and getting people engaged and getting people enthusiastic for our vision for the future when they had a part in it rather than when it was dictated to them,” de la Vega says.
Instead, he asked his people to brainstorm what the top strategies should be.
“If we were going to go that [new] way, what would be the top 10 strategies and tactics to follow that?” he asked. “What are the must-dos?”
Limiting it to just 10 things will also help get buy-in down the ranks and across your organization.
“When you have unstable environments, people look to leadership for guidance, and if you’re all over the place and your priorities change and your strategic vision changes, people get very unsettled,” de la Vega says. “It’s very important to be very clear, very crisp and very consistent in what you want them to do, and then they’ll do it exceedingly well, and in some cases, it’ll probably surprise you how well.”
You might be thinking that it could be difficult to limit yourself to 10 things and are unsure of how to do that, and that’s where data comes into play.
“No. 1, you get input from those CEOs, but then you put a process in place where you just don’t listen to opinions, but you put the facts down by a creation of a plan, and that is you have to put some rigor into the financials of, ‘If we’re going to do X, Y and Z, what are the impacts of doing each of those 10 things?’” he says.
Pull out your calculators and do the math.
“We go, ‘If we execute that well, it should increase revenues by this much, reduce expenses by this much, acquire X number of new customers,’” he says.
Having a set plan is crucial to the overall turnaround process.
“Hope isn’t a strategy,” de la Ve
ga says. “Hoping things will get better or just coming up with ideas is not good enough. You have to come up with a plan that’s executable.”
With people on board and strategies set, then he had to find a way to make sure things got carried out.
“The key to making those initiatives into a reality is they have to be measurable — you can’t just say, ‘I want to go from A to B.’ I want to go from A to B, and I want to have these milestones that tell me I’m on the right path, I’m on the right timetable, and that I have people who are accountable that are going to make sure it gets done.
“Sometimes people have a vision or a goal that is not measurable, and I tell my people, ‘If you can’t measure it, you’re not going to be very effective in getting it done.’”
To do that, de la Vega instituted two mechanisms to measure people by. The first is the “Four R’s.” These break down the success rate into four indicators: rate of penetration — how many customers use your services?; revenue intensity — what revenue do those customers generate?; return on operations — are you making margins or not?; and reputation — how is the customer satisfaction?
When talking to employees, progress on these four R’s is always communicated so it’s ingrained in them that these are important.
“It’s keeping the metrics simple, keeping them consistent, keeping them so that people know exactly where you stand,” de la Vega says.
Then he breaks things down even more. For each individual initiative in those categories, he uses a color-coding system: red for missing goals, yellow for near misses, green for hitting goals.
“If you’re not doing well, you’re going to have a lot of reds next to your name,” he says. “Everybody knows if you’re doing well or not and that increases the accountability. Nobody can say, ‘We don’t know how we’re doing.’ Typically, if you challenge people with a goal and you give them a good plan and good goals, they will strive to achieve them. But if they don’t know the goals or the goals are unclear and there isn’t the plan, that’s when bad things will happen.”
Having this kind of accountability system allows you to see high-achievers and celebrate successes with your people. On the other end, it also helps you see where there may be problems so you can address them.
“The first thing, when something goes in the red, that I look for is an outlier — is it some specific event in that week or that month that caused that to happen, and if that’s what it was, just a one-time event, and we don’t expect that to happen again in the future, then it’s a short conversation,” de la Vega says. “Then I’ll look the next month to see if it was a one-time event. If you see a particular thing begin to get off track consistently for several periods, you need to have a call with that leader to find out what is going on — do they know what’s going on; do they have a plan for fixing it? And that’s how you can get a pretty good read on whether the leaders you have really know what’s going on. And the good ones always know.
“The more difficult situations are when something happens and they don’t know what caused it to go wrong and they don’t have a plan to fix it and you may need to get more involved, watch that person closely, coach them or get them the help that they need to be successful.”
Eventually his BellSouth division went on to be profitable which led to a series of business transactions and career moves that landed him at AT&T. Today, de la Vega is president and CEO of AT&T Mobility and Consumer Markets, a $49 billion division of the telecommunications giant.
“The best measure of a good leader is when he or she can make people do things that they were thinking is impossible to do,” he says. “When you, as a leader, have a group of people do something they thought was impossible to do, I would say that you have reached a pinnacle of leadership.”
How to reach: AT&T Mobility and Consumer Markets, www.wireless.att.com
Jerry S. Wilson gets paid to eat and drink his way around the world. Right now, he may be in Atlanta, but tonight, he could be in Miami. Then he’s flying off to Hong Kong tomorrow and up to Japan just a few days after that. And this is typical for the president of The Coca Cola Co.’s global McDonald’s division, which serves 56 million customers a day throughout 118 countries.
“I spend 70 percent of my time in the market with the customer and with my people,” Wilson says. “In fact, my office is my BlackBerry, if you think about it. The beauty of such a device is you’re always connected, and the sun never sets on my job.”
The problem with being on the road — or in the air — so often is that he has to figure out what’s the most important way to spend his time.
“I think the biggest leadership challenge that certainly I’ve had, and I think a lot of other executives have in this day and time, is you have finite time with infinite ways to spend or invest that time,” Wilson says.
He prefers to focus on the things that will move his division of the $28.9 billion beverage giant forward, such as balancing the art and science of business, developing his people, and setting attainable stretch goals for his employees.
“Your goal is to spend your time in the highest impact zone as often as you can, and generally speaking, that’s going to include other people.”
Here’s how he does it.
Balance art and science
In every business, there is a delicate balance behind its makeup and success.
“The reality of great leadership is it’s a combination of science and art, and knowing when to leverage the science of business with the art of leadership is the real X factor for any leader,” Wilson says.
First, tackle the easy part.
“You start with the science,” he says. “There’s plenty of data on almost any business anywhere. If you don’t have it, Google it. The outside world may be more aware of some of the issues than the inside corporation.”
Wilson enjoys spending time quietly studying different types of reports — consumer, sales, profit analysis — to get a baseline of information, but you also need the art, which is where people come in.
“Go to the point of contact and observe,” he says. “Get out there. Sometimes the data will suggest a situation that, when you observe it, it may take a different texture. Then listen to the people closest to the situation. Then investigate what they’re saying, have great discussion and make great decisions from that.”
You need to ask myriad questions when you’re interacting with your people.
“The very first thing I’m looking for is how are they doing,” he says. “How is this individual doing? How is their professional career progressing? Are they getting the kinds of resources they need to succeed? How is their personal situation? If they’re living overseas, is there any issue we need to be aware of? How is their family?”
Beyond just asking questions, you also need to actually listen to their responses.
“First and foremost, don’t listen in order to provide a rebuttal,” Wilson says. “... If you’re listening to learn, that leads to great questioning because you’re hearing something that will spark a few more questions for greater precision.”
As you listen, make sure you’re thinking like a business owner, even if you’re not. For example, instead of thinking of his business as part of The Coca-Cola Co., Wilson imagines that if his division was just simply Wilson Inc., how would he want things done? Personalizing it helps him make better decisions for Coca-Cola.
“If you think and act like an owner of the business, then you’re going to have a longer-term perspective, you’re going to be concerned about share owners, about the employee base, about quality, about consumer relevance ...” Wilson says. “It’s amazing what great solutions can come from that way of thinking.”
Lastly, you need to make your own observations, as well. Wilson likes to observe the customers in the restaurants to see what’s happening.
“The danger in business today is to take an inside-out approach,” he says. “The winning strategies are much more outside-in. Figure out what the demand or need is for your product or service and then back in to the kind of strategy that will succeed in the market.”
By doing all of these things, you’ll be able to better balance the art of leadership with the science of the hard numbers and data.
“If you look at it from that perspective, you become more of a listening leader, and then when you’re ready to make a decision, you have the science of the information, but you also have the art of the people on the front line that can help you understand any situation better than just the data.”
Develop your people
One of the other things Wilson spends his time doing is focusing on things that help create a solid reputation for his organization.
“Develop a reputation as someone who is focused on people development and leadership development,” Wilson says. “Then you meet people internally over the course of years, and you become a magnet for talent. That’s another objective for any great leader — to develop a reputation that people want to work in that division. They want to work in that company because they know they’re going to get great leadership, great mentoring, honest and fair reviews — all those things that people want from an employer.”
One of the best ways to do this is to open the lines of communication by giving people constructive feedback on their work.
“One of the most valuable things that a leader can do is provide really useful feedback to their people,” Wilson says. “In order to provide useful feedback, they need to be thinking about observing the people doing their work, being in the moment, spending time with their people and the customer talking about their business issues.”
For example, a few years ago, one of Wilson’s managers came to him and told him that one person wasn’t going to make it in their group. Wilson asked why, and he learned it was because the person had presented to a customer group and had failed to hold the group’s attention, but the presenter thought he had done a good job. The manager said he simply didn’t get it, so he wouldn’t make it.
Wilson saw a different situation and suggested he go back to that person and ask why the person thought it went well. He also suggested to ask why there weren’t any questions, then use that to segue into explaining that the audience may have drifted and show him ways he could better hold people’s attention next time.
“Great leaders know how to provide useful feedback in the moment,” Wilson says. “Imagine that individual that the manager would have told, ‘You don’t get it; you’re not going to make it.’ That manager had already written that person off versus taking five minutes and saying, ‘How do you think the meeting went?’”
In order to provide good constructive feedback, you have to have open conversations with people to build a trust with them.
ly speaking, people want to know the truth, but they want to hear the truth in a manner that is encouraging,” Wilson says. “What I have found is there are leaders that have difficulty providing feedback because they are concerned that it will be perceived as negative reinforcement. In reality, you can sit down, and once again, it’s a great questioning opportunity.”
He says to ask what’s working in their role and what’s not working. Ask what areas people have concerns in. By opening up with these questions each time you interact with people, it shows your concern for them, and they will be more likely to listen to constructive criticismin the future if they feel you understandthem and their role.
“The power in identifying a gap in performance isn’t identifying the gap,” Wilson says. “It’s identifying the solution to close the gap, but you have to baseline it around the gap and then work together to find the best way to close the gap.”
Set achievable goals
In the past 10 years, Wilson has met his numbers every single quarter, but that’s not because they were easy to meet. Instead, he takes a unique approach to setting goals that are achievable while also being a stretch for his people. He has what he calls an open-based planning model.
“Before you build your plans going forward, I set a system in place where we actually quantified all of the opportunities in the market that we currently don’t capture,” Wilson says.
That may be selling more to existing customers, expanding the customer base or even expanding brands.
“Use the idea of an opportunity approach to say, ‘What are some of the opportunities that are out there?’” he says. “If we are successful against those, how can we capture those? What are the barriers to capturing those types of growth objectives? Then you say, ‘If we can capture X percent of that goal, what would it look like?’ Then it becomes a quantitative objective that needs to be tested for reason.”
This kind of approach is very empowering to your team.
“It creates a sense of optimism in the employee base, and it allows your people to wrap their minds around going and capturing the opportunity versus comping success,” Wilson says.
He says that oftentimes leaders and their teams will psyche themselves out with the types of goals they set. For example, if you have a business that traditionally grows at 5 percent a year, and then you grow at 6 percent, there is now a goal to grow at 6 percent.
“That’s the wrong way to think,” Wilson says. “Six percent or 5 percent growth is just what you happened to get last year over the prior year, but in terms of the opportunity that’s out there, we have a tremendous ceiling of growth.”
For example, he looks at the number of consumers who go to McDonald’s and don’t order a drink.
“You have 56 million consumers coming in a day, and any percentage of that number is big,” Wilson says. “So how can we create offerings that would meet the needs of these consumers that, for whatever reason, are not buying a beverage versus saying, ‘How do we grow 3 percent?’”
Then you have to look at what are the barriers to getting there, what strategies you can use to eliminate those barriers and what quarterly targets you would need to meet to make it happen.
“Then, bang, there’s a plan,” he says.
“Then we focus on the execution of that plan, which is the other part. In my world, it’s not real unless it’s real in a restaurant. Everything that comes before that is just interesting discussion.”
The key to this entire process being successful goes back to the people and involving them in the process.
“Bring them into the goal-setting process, and you let them identify the opportunities so they can see it and discuss it,” Wilson says. “Then we determine what percentage of this is real.Then we put a stake in the ground, and we go do it. It’s really the idea of getting buy-in the entire way as you create the goals. That’s where the excitement comes in.”
HOW TO REACH: The Coca Cola Co., www.thecoca-colacompany.com