Small Business Lessons From Coca-Cola

Innovation Never Ends

When does a successful company come to the point at which it can rest on its laurels and coast? Never, according to Muhtar Kent, CEO of the Coca-Cola Co. When he took over the reins of the soft drink giant four years ago, it was a bit stagnant, struggling to keep up with the PepsiCo competition. Through a series of brilliant manipulations, he put Coke back on top of the rankings. Last year, the Fortune 500 company racked up sales of 5.5 billion cases of product in the United States alone, with more than twice that amount in top markets throughout the world.

Those numbers are staggering to smaller businesses struggling to establish themselves in a competitive market. But in a recent far-ranging article in Fortune 500 Magazine, he reveals tactics that could be applied by just about anyone. Among them:

Don’t become blasé about the possibilities.

When Kent spent five days touring Asia he cranked up employee enthusiasm by telling them “This is your once-in-a lifetime opportunity. Don’t miss it.” He describes his own leadership style as “constructively discontent.” There is no room for standing still.

Stick to business

The company talks in figures that track up into the billions, but Kent has initiated a policy of charging managers $15 if they use their cellphones for personal calls. He lives by the same rule. He bases this seeming nit-picking policy on his perception that one of Coca-Cola’s problems was a lack of respect for cash. He uses cash to fill his BMW at the service station and keeps a well-supplied money clip in his pocket for spending money. It’s a reminder that its small amounts mounting up that keep Coke in the top rankings. (Currently they are 59th among the 500.)

Look for ways to be innovative

When Kent was heading a marketing job in Rome, there were rumors that Coke planned to shut its Italy offices. He came up with the idea of putting Coke products into 150-milliliter mini cans, a much more manageable size for airline galleys than the standard 12-ounce cans. The company was first with the concept and latched onto major accounts with airlines, trains and ship lines across the Continent.

Watch out for your partners

Kent understands that while Coke manufactures its famed concentrates and syrups, the bottlers down the line are closer to the customers who buy the product. He capitalizes on that fact, treating the contributing components down the line with consideration and respect. At one point in his career with Coca-Cola, he quit over such issues, compounded by a stock-trading incident that involved short sales of Amital shares. He resigned from the company for a time. But bouncing back from reverses also is part of his approach to business. During the interim, there were several years of rapidly changing leadership and related problems in the company. He was rehired in 2005.

Be prepared to take a bold step when needed.

For Coke, one of the steps that put the company back in the lead was a deal with entrepreneur Steve Cahillane, who had founded State Street Brewing in the 1990s. Kent put together a deal that enabled Coke to acquire Cahillane’s company while giving the latter rights to bottle Coke products in Norway and Sweden, a profitable scenario for both. It was without question a bold move for Kent, but he shored up his chances of convincing his board by preparing a finely detailed plan that cogently outlined the advantages to the company.

Keep an eye open for products or services that fit neatly into your family

Coco-Cola has 15 brands with retail sales over $1 billion a year. The public’s demand for a periodic something new in the soft-drink arena suggests that the number could go up. Refusing to become bogged down in narrow interpretations of what fits has been a boon to Coke and could be for many a smaller company as well.

Capitalize on new technologies

Kent had the foresight to recognize the value of using emerging technologies to sell more product. He encouraged his vice president of innovation to head up the design of a self-serve fountain machine that allows customers to mix beverages to their own taste via touchscreen. The company has focused on marketing via digital strategies. It has the largest consumer brand fan page on Facebook, with 41.4 million likes.

Provide growth opportunity for your leaders

Coke has initiated a program called Talent 2020. Executives are assigned a research project outside their area of expertise and have six months to put up a defense of their findings to a leadership team. No Power Point. They are expected to stand up and present what they’ve found sans the glitter. Some of their ideas have already been woven into the corporate fabric.

Look ahead

Kent’s vision is incorporated in his statement that “The future of the world belongs to two groups: those that can grow and those that cannot grow. Those that don’t grow will go into oblivion.”

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Social Networks Can Boost Business Start-Ups

Getting the word out about a new e-business can be a considerable challenge for a beginning entrepreneur. Social networking on such sites as Facebook, Twitter and LinkedIn can be an inexpensive and effective way to promote, but there are some things you need to know before setting out.

In a recent Wall Street Journal column, Sarah E. Needleman offers advice for the uninitiated, with the underlying message being to take time to understand how the networks work and use good judgment in choosing where to post your messages to get the biggest payback. The sites are free and “wildly popular,” she says, but diving in without a little know-how might be counterproductive. Among the dozens of choices, the newcomer to the game might spend a lot of time spinning wheels without the desired results. Some of the fast-growing newer sites, including Google+ and Pinterest are attracting scores of competing businesses, all of them vying for attention.

The average Facebook user spent seven hours on the site in February, according to comScore, a market research firm. That’s powerful incentive to get your company’s name before the social networking public.

However, those in the know recommend that you hold off using the social network until your start-up is functional. Spend your limited time and energy on establishing the business at the outset. Networking shouldn’t rob from the demands of your start-up during the tricky challenge of getting it in motion. Acting too fast might end in embarrassment or adverse reaction. One bad reaction from an unhappy customer could “go viral” and be re-posted many times, spreading negative information about your business in the exact opposite manner you desire. Needleman quotes Kevin Ready, an Austin, Texas entrepreneur who has learned from experience, as saying: “Your first priority is to get your operation started. . . Social media is a long-term investment and not magic. It’s hard work.”

With that in mind, when you think you are ready to launch social networking in your company’s behalf, look for a network that will get your message to those most likely to be interested. LinkedIn, for instance, is an outlet that has a membership made up primarily of companies and business professionals — a logical place to post if your business sells goods or services to businesses. A few days or even weeks spent in research could multiply the benefits when you are ready. There are plenty of examples of start-ups that found themselves consumed by networking while still in the throes of getting off the ground. Some reported they had to back up, become better prepared and begin again. Your preliminary research should include noting what your competition is doing on the network you are likely to use. Looking at the competitor’s messages also will give you a consumers-eye view that may guide you in creating your own ads.

Before using a network, you should secure your business name. There is the possibility you could lose your name to another business of another individual as you concentrate on building your company. Claim your name on the network you are considering so you avoid potential frustration. Post a “coming soon” message to hold attention while you prepare the real thing.

Long experience has shown that the most popular company profiles are those that attract visitors with contests, surveys and special offers, Needleman noted. Store shopping or social networking, buyers are assessing what’s in it for them.

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Big Break For Small Business Suppliers

An exciting new opportunity has been created for small business owners. The ability to offer their products or services to large corporations is a big boost to businesses that would otherwise not be able to even put their foot in the doors of big companies.

Supplier Connection, a program recently put into effect by the U.S. Small Business Administration is a program offered by the IBM foundation and was created as a way to improve part of the Obama administration’s American Supplier Initiative. The public-private effort involves 15 major corporations that are willing to consider ordering supplies and services from the small businesses registered with them. The corporations collectively have more than $300 billion in purchasing power.

It is expected that the initiative will grow small businesses, create new jobs and add strength and diversity to America’s supply sources, said SBA administrator Karen Mills.
“While it is clear that becoming a corporate supplier can lead to business growth, breaking in can be a challenge for small businesses,” she said.

The administration recently sent letters to more than 50,000 small businesses outlining the new program and providing tools to smooth entry into the process. Supplier Connection is available to interested small business owners and registration is free online. There, they are able to register their company name and include details about what kind of products they offer. The hope is to provide small business owners an opportunity to become suppliers to larger corporations.

Among the 15 companies that have signed on to the program are Wells Fargo, UPS, Pfizer, Office Depot, Kellogg’s, John Deere, J P Morgan Chase, Dell, Facebook, CitiGroup, Caterpillar, AMD, AT&T, Bank of America and Caterpillar. They have agreed to look at the services and products of small businesses that register online. They then will determine which services or products warrant their financial investment. Small businesses can learn to supply large corporations with their unique offerings.

Small business owners often have no idea how to connect with large corporations and thus never get the chance to get contracts with corporations who have large amounts of capital. This free service can help pull small companies that have real potential into the mainstream of American business and put them on the road to success. The new revenues coming from a business relationship with successful corporations may prove just the needed edge to grow revenue to new levels. On the other side of the coin, the corporations that are purchasing goods and services will have better insights on the pulse of emerging businesses. Everyone wins.

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How To Woo The Media

The competition among small business to get their stories into the media is fierce. Getting onto the pages of the local newspaper or on radio or television, however, is basically free advertising and trying to get there is worth the effort.

If you have been sending out news releases to alert the media to new products or events without much success, here are some suggestions that might land you in the public’s eye more frequently:

Know about current events in your community and see if there is a way to relate them to your company’s products and activities. Look beyond the community, in fact, to what’s in the news in your state, the nation and internationally. Media outlets are always looking for ways to make out-of-area news more relevant by relating it to what’s happening locally. Things from the outside may, in fact, affect what you do. Let the media know that. The issue of employment is currently hot-item for news reports, whether you’re up or down. In most cases, the old saying that “any publicity is good publicity” still holds true.

Look for unique stories to tell. Within your ranks there may be good human interest stories that will get your name into the media. Many in the media refer to such “human interest” stories as “fluff,” but they nevertheless are always on the lookout for good ones. Be aware of special stories inherent in those you work with. Some of them may be dealing with unique family problems or have talents that would merit media attention. Is your company involved in charitable causes? Are there members of your group who are in the military? Plumb the depths and see what you can find.

Be as professional as possible. Press releases that contain typos and blatant errors usually end up in the trash can. Few reporters are willing to make a call to try to clarify the press release. Have two or more people proofread the press release before sending it out. Make your releases good to look at. Be certain each release has all the germane information, such as dates, times, etc., and include a telephone number or e-mail address that will direct queries to the person with the information.You might want to put together an informative packet that a news organization can put on file for future reference. Showing up in a media office in person to pass such a packet along couldn’t hurt.

Getting acquainted with the business writers/editors is helpful. And understanding the newsroom process is invaluable. You will impress those you hope to cultivate if you understand the realities of deadlines and the hierarchy that puts an editor more directly in charge of the day’s content than a reporter. An assignment editor usually is the nerve center of a newsroom, making many of the decisions on what, where and how items will be placed. However, it is the reporter who puts together that content. Develop relationships where you can, but don’t expect special favors. Remember that the number of choices editors and writers have on any given day far outstrip the available amount of press space or air time. Avoid last-minute notice of timely events if you want media announcements.

A picture may be worth a thousand words. But be sure photos, video or audio bits are good ones. Don’t waste the photo editor’s time. Provide good photo opportunities. and describe them well so reporters and photographers/cameramen are not wandering around at a loss. Remember that the media is almost always in need of information before the fact, except in “live” story situations. If you call during your company’s big event , don’t expect a news person to arrive in time to clean up the dishes.

Buy advertising. Then when a news event relates to what you do, the editors and writers will remember your business name. Ad purchases do not position you for favoritism or guarantee spots in the news columns, but they make your name familiar.

Deadline is a firm fixture among the media. Be efficient, flexible and respectful in your interactions. In most cases, reporters have one day to turn around a story. If you miss an interview, it may not be convenient to reschedule soon. If you cannot meet a request for an interview, try to find someone else in your organization who can. Good old fashioned manners work with the media, as with anyone else. Some of the media, granted, have reputations for being pesky. But if you react in kind, the chances are that the word will get around the newsroom, squelching your chances for future favorable interactions.

Don’t just expect to deal with media issues when they arise. Work on a strategy and have a plan. Develop the relationships that count and understand how the media works. You may find yourselves in the headlines more often.

The Future Of Apple Without Steve Jobs

What does the future of Apple look like without Steve Jobs? Analysts are predicting a very bright future.

Today, Apple is worth $377.83 billion dollars. Share prices are fluctuating between $401 – $409.  It is the largest company in the world and new products are in development.  The iTV, which is currently in the prototype stage, could revolutionize the television industry and it could add billions of dollars to the worth of Apple.

Gene Munster, analyst for Piper Jaffray, a $400 million dollar investment company, says “We believe that of the estimated 220 million flat panel TVs sold in 2012, 48% or 106 million units will be internet-connected, of which Apple could sell 1.4 million units,” Munster wrote. “We believe an Apple Television could add $2.5 billion or 2% to revenue in 2012, $4.0 billion or 3% in 2013 and $6.0 billion in 2014.”

Will that make investing in Apple now a good investment? David Zeiler writes an interesting article: Why Apple Stock Is Headed for $500 – And Beyond. The momentum behind Apple seems to be growing past the loss of it’s founder, Steve Jobs.

A recent book called “Steve Jobs,” by Walter Isaacson, clearly reveals the thinking that has been driving the success of the company for years. Steve’s out of the box, creative thinking has gotten the masses to use computers in a new way. From the launch of the MacIntosh in 1984, to the recent launch of the Ipad2, his products provided us with the next generation of technology.

Designing products with ease of use has been Steve Job’s philosophy. Thank goodness, because the masses are not tech geeks. His artistic sense of design, minimalistic lifestyle and obsessive attention to detail are the fuel behind the products we have come to love and use daily.

From his high school part-time job working at Hewlett-Packard, Steve Jobs found one mentor after the next to teach him about technology, product creating, business structure and relationships. Although not always the best at relationships, his demand for perfection and his drive for great product creation triumphed.

There is a future for Apple because of Steve Jobs. His vision and creative thinking will truly be missed, but his contributions to the world will benefit generation after generation.

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Related Company Valuations – October 31, 2011

 

Apple Inc.	377.68B
Microsoft Corporation	225.50B
IBM	218.78B
Google Inc.	193.01B
Oracle Corporation	166.52B
Intel Corporation	129.99B
Verizon Communications…	105.09B
Amazon.com, Inc.	97.32B
Hewlett-Packard Company	53.35B
Dell Inc.	29.15B

 

1984 Launch of the Macintosh

 
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Quickbooks Merchant Services Developer Earns Reward

On August 31, 2011, Hugh Molotsi received the “Founders Innovation Award,” for his role in the development of Quickbooks Merchant Services. An employee of Intuit for many years, Hugh discovered a business problem by talking to business owners about why they weren’t use credit card processing and the most frequent response he got was that they didn’t know how to do it.

Quickbooks Merchant Services Impact

Providing a solution to that problem was the beginning of the creation of Quickbooks Merchant Services which Hugh was instrumental in developing. It was released in 1999. Within two months, the business was profitable. Within the first year, they had 3,000 customers. The next year, business tripled to 10,000 customers and revenue tripled as well. Intuit’s future businesses were built on the fundamentals that the Quickbooks Merchant Services had. Now most of their customers, revenues and profits are from Quickbooks Merchant Services customers. Most of the Intuit businesses today and most of them for tomorrow are because of Quickbooks Merchant Services.

Through Hugh’s leadership he has earned two leadership in excellence awards and four of Intuit’s Innovation Awards. According to Intuit founder, Scott Cook, he is a classic leader and teacher. He is a continuous learner and focuses on self-improvement. He received Intuit’s special recognition, special access to Intuit events, and a financial reward of $1,000,000.00.

Intuit Company Development

Intuit has produced the popular accounting software, Quicken for personal finance, Quickbooks, and Turbo Tax. Intuit is a financial services company founded in 1983 by Scott Cook, former employee of Proctor & Gamble and Tom Proulx, a computer programmer studying at Stanford University. These two brilliant people worked together to help make people’s lives easier by creating the first software accounting program for families and businesses.

Intuit now has a revenue of $3.9 billion dollars, was ranked #44 by CNN as one of the top companies to work for and was ranked in Forbes magazine as one of the top 100 most inventive companies. Their mission statement is to remain “driven by our passion for inventing solutions to solve important problems, perfecting those solutions and delighting our customers.” Intuit makes a practice of rewarding their innovative employees by giving them special recognition and handsomely rewarding them financially. Intuit has become a success story inspiring people from all walks of life.

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Founder of Intuit

Scott Cook co-founded Intuit Inc. in 1983 and now serves as the chairman of the Executive Committee. He earned an MBA from Harvard University and received a bachelor’s degree in economics and mathematics from the University of Southern California. Cook is a member of the board of directors of eBay; Procter & Gamble; the Asia Foundation; the Harvard Business School Dean’s Advisory Board; the Center for Brand and Product Management at the University of Wisconsin; and the Intuit Scholarship Foundation.
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Bringing Bright Minds Together

Collaboration—with a capital C. In today’s business environment, what’s not to like about the concept of sharing information, asking questions, bouncing around bits of nascent, not-quite-formed ideas? Whether it’s formal, sit-down-at-a-table collaboration or the casual networking that goes on in the natural course of things, it has to be good.

It also can be tricky. Bill Gates, in a graduation address to students at his almost-alma mater, Harvard (he was introduced as the school’s most famous drop-out) defined the nature of interaction: “Being in the midst of so much energy and intelligence can be exhilarating, intimidating and sometimes even discouraging, but always challenging.”

John Abele

John Abele, co-founder and now director emeritus of Boston Scientific, a company that develops primarily medical products, expounded on the subject in a July 2011 article for Harvard Business Review. Like Gates, he recognizes the difficulties in bringing bright minds together. In fact, he says, the term “academic collaboration” is somewhat an oxymoron. Impediments include “the long-standing rituals of institutional seniority and the professional and financial incentives to build higher silos with thicker walls.”

But the effort is worth it, Abele emphasizes. “On the bright side, there’s an extraordinary opportunity for those of us non-academics who, unconstrained by those customs, see value in getting silos to collide.”

The Process of Collaborating

The process, he says, is “convincing people who don’t need to work together that they should.” That happens, he says, by inspiring the potential collaborators with a vision of change that is beyond their individual powers to bring about, convincing each that the others are not only vital to the process but that they are equal to the challenge. Then each member of the collaboration must be assured that that no one party to the collaboration is going to benefit to the total exclusion of others.

Leaders who are successful collaboration-builders, Abele said, are “passionately curious.” They have new insights and acknowledge that others may have them as well. They have the ability to bounce ideas off collaborators without being overly competitive. They care more about the success of the collective mission that they do about how success might benefit their personal fortunes.

Staying Focused

Dealing with egos when highly successful individuals come to the table can be a challenge. In an interview subsequent to his Review article, Abele described one gathering of the top thirty vascular surgeons in the world to discuss a proposed medical product. After a frustrating start, the thirty participants were each given a squirt gun. When anyone began to pontificate, Abele said, the others were advised to “use the weapon at hand.” A few doctors got completely soaked. That tactic “changed the dynamic of the meeting and it became very productive,” he said.

Five Tips For Collaboration

Those who function on the lower slopes of Mount Olympus may not have to resort to squirt guns to keep collaborators on track. But there are some rules that can lend themselves to a successful interaction. Among those advised by Abele and by commentators who responded to his article.

1. Focus on the mission.
2. Design a process beforehand.
3. Don’t allow participants in a gathering to sell their products or services or to make attacks on competitors.
4. Criticize ideas, not the people who advance them.
5. Keep conversations energetic, constructive, free-wheeling and provocative.

Collaboration doesn’t always have to be among different companies. There is ample opportunity within a single organization for idea-sharing. Coordination and the free exchange of information among the various elements of an organization are essential to success. The same rules apply.

Making Positive Contributions

In his Review article, Abele quotes Margaret Mead, noted sociologist who conducted groundbreaking research in her field. “ Never underestimate the power of a small dedicated group of people to change the world. Indeed, it’s the only thing that ever has.”

That’s the nub of Collaboration—with a capital C.

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Learning How To Think Like A Millionaire

There are three things that you can do with your money. You can save it. You can spend it or you can invest it. How well you do these things may determine whether you will be in the group of 7% of Americans that are millionaires.

Many years ago, people would have considered that being a millionaire would be the ultimate in luxury and wealth. Now, for some people, being a millionaire is not even considered enough to do much. Warren Buffet made his first million dollars when he was just 31 years-old. That amount of money is .002% of his current wealth. With rising billionaires like 26 year-old Mark Zuckerberg, founder of Facebook, there seems to be more money to be made than at any other time in recent history.

When you study what unique strategies millionaires use, you may get some ideas to improve your own circumstances. Whether you make $30,000 a year or $1,000,000 a year, improving your skills can help you on the road to becoming more financially secure. Maybe you’ll never be a millionaire or don’t even want to be. You still will need to make strategic financial decisions that will affect how much you enjoy your future life. If you could see your distant future life as well as you can see your life next week, you may decide to live life differently.

Let’s take a look at what millionaires say they do and how they got there.

Paul Lim, a writer for Money magazine, reported some interesting facts from a poll of millionaires. In his article, “Millionaires in the Making,” he shares with us the answers.

How did you get to be a millionaire?
95% said hard work, 83% investing wisely, 81% by being frugal and 41% by luck.

Do you feel wealthy?
42% said no.

What preparation did they have?
90% are college graduates, 5% have law degrees, 3% went to medical school.

What is the average amount annually invested?
$39,300.

What seems to be the number one thing that millionaires did to get where they are is a lot of hard work. All of us are capable of doing that. We can all become more frugal about what we spend our money on and although we are not all lucky, we can learn to invest wisely.

Did you notice that quite a few people said that even though they were millionaires, they did not feel wealthy? Feeling wealthy is probably one of the things we do have control of. Since your perspective on life can run the gamut of outright depressing thoughts to unrealistic elation, you choose where in that range you want to be. Of course, when the joys of seeing more money coming in and how nice it makes your life, it is easier to think about bigger income numbers than you have thought of before. If you can’t imagine the larger numbers in your income, will you ever improve your standard of living?

Another thing that millionaires do is to habitually save money to invest. The average amount per year that they invest is $39K. If your income level is not even that high, you can work on saving in percentages. Make it a goal to save a certain percentage of money every month. Financial experts advise you to have enough cash to pay your bills for at least six months. Whatever percentage you decide on the important thing is to follow through with your plan each month. Automate that savings if possible.

Some millionaires have also made a practice of living below their means. This falls into the category of budgeting and anyone can follow a budget. You just need to include your savings plan in your budget. It is one thing to have a million dollars sitting in your bank account, but it’s another thing to learn how to best use it.

Millionaires did not become millionaires by working for someone else. Many have started their own businesses. Anyone can start their own business for very little money and if you have a low overhead in your business plan, you can actually accomplish this while working for someone else. Did you know that only 12% of American households own their own business? Paul Lim, reported that the median income for business owners was $497,000 compared to $42,000 for non business owners. Would it be worth your time and effort to start your own business? When you can harness the power of entrepreneurial thoughts and put into action a good business plan, you are on your way to a brighter future.

Realistically speaking there are few people that reach the status of being a millionaire. Learning key money management skills and business building skills can only help you increase your productivity and increase your income. Start today to create a better outlook on life. Do what you can to take your first steps to a new life.

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