Campbell Soup Company
When Denise Morrison took over Campbell, its future was uncertain. But the company’s first female CEO found a way to make soup hot again.
What is the recipe for successful leadership of a company with a market cap of more than US$14b?
In the case of Denise Morrison, President and CEO of Campbell Soup Company, it is a huge stock of passion, roots in family values, the perfect blend of people, a dash of lofty goals and a large measure of delivering results.
Facing the challenges
Morrison, who is only the 12th chief executive in Campbell’s 144-year history and the first woman to lead the iconic company, took the helm in August 2011. She is one of only 20 female CEOs of Fortune 500 companies and was named the 81st most powerful woman in the world by Forbes in 2013.
Yet when Morrison took the post — after eight years with the company and successful stints at Kraft Foods, Procter & Gamble, Nabisco, Nestlé USA and Pepsi-Cola — the accolades had to wait. On her first day in the job, she faced a world of challenges.
After almost a decade working for Campbell, Morrison could see the company’s operating environment had changed. “When I took the job, I realized that the world had shifted and we hadn’t shifted with it,” she reflects.
“There were a lot of good things in the company to build on, but there were also things that needed to change.”
A new generation of consumers
Morrison and her leadership team plowed through the data and confronted the hard facts facing Campbell.
Due to changing consumer tastes and trends, core soup sales and profits were down; international growth had stalled; new products were failing to address key emerging demographics; and the stock price, sales and earnings per share were flat.
“Build on the past to create the future: we need to respect the past and be inspired by it, but not be stuck in it.”
It was only by making such a dispassionate assessment that Campbell could emerge with a new strategic vision. The company would stabilize and profitably grow soup sales in North America, expand its international presence, and continue to drive sales in healthy beverages and baked snacks.
While the Campbell brand was popular with baby boomers, it faced challenges with millennial consumers, the 20- and 30-somethings who were starting families. And the Hispanic population was also growing. As Morrison notes, “We were not developing foods that delighted them.”
With 70% of the growth in the food industry predicted to come from global emerging markets, Morrison recognized that future opportunities came wrapped in a historical dilemma: how to invigorate a successful, iconic company so it could meet the realities of a global marketplace.
Building on the legacy
“Build on the past to create the future: we need to respect the past and be inspired by it, but not be stuck in it,” Morrison says. “Campbell has always put the consumer first, so that was baked into our DNA. Today, the key is getting our people to understand the importance of innovation to the future of our company.”
Working with IDEO, the Palo Alto innovation company, Morrison observed innovative firms and was impressed by their nimble, team-based approach. Seizing the moment, she acted quickly. She selected Campbell’s people who exemplified that approach from the base business.
She then created similar cross-functional teams that were charged with bringing to market exciting food for the next generation of consumers. Each team now acts like a start-up, with representatives from consumer insights, marketing, supply chain, sales, culinary and packaging.
The innovation teams immediately began reinventing the product development process, which fostered new ideas such as the easy-to-prepare Campbell’s Go soup line. These days, new products are beginning to reflect the influence of global cuisines – not only Campbell’s Go soups but also chef-inspired Campbell’s Skillet Sauces and new varieties of Campbell’s Chunky soups.
The leadership journey
Since childhood, Morrison has been studying leaders and grooming herself for a top job. For her, it is a long-term process. “Leadership is a journey. It’s never something you complete,” she stresses. “I find that I am a continuous learner. I love to observe people in leadership positions and study the characteristics of good leadership.”
After reading Stephen Covey’s The 7 Habits of Highly Effective People, Morrison crafted a personal mission statement that has served her well. “I feel that if you don’t have a good sense of who you are, it’s very hard to get people to follow you, so I spent a good amount of time developing it. My personal mission is to serve as a leader, lead a balanced life and apply ethical principles to make a significant difference.”
“Leadership is a journey. It’s never something you complete.”
To Morrison, the struggle is to blend the academic, spiritual and physical challenges of life. “I find that when I have those things in balance, it’s a positive source of self-esteem and I can lead better. In terms of applying ethical principles, integrity is everything. If you don’t have a good reputation, if you don’t do things honestly, people won’t trust you, and you can’t lead unless people trust you.”
For Morrison, what matters most as a corporate leader is her commitment to people, both within the company and her consumers. “My idea of leadership of this company is to unleash the potential of our people to do amazing things,” she says. “I believe if you do that — and you maintain an unrelenting focus on the consumer — profits will follow.”
New Campbell, new era
In the ever-changing, frenetic global marketplace, Morrison assigns great importance to being nimble. However, while Campbell has always been a solid company with good earnings, being nimble didn’t come naturally. With Morrison’s arrival, that changed.
The breakthrough teams are an example of agility. When Morrison came on board as CEO, it took two years to bring a new product to market. Now it takes about half the time and Campbell welcomes more consumer input than ever before.
While there have always been pockets of agility within the company, the immediate task was to bring that agility to soups and simple meals, another highly successful product line that was in need of refreshing.
To expand into faster growing spaces, Morrison made the strategic moves to shift Campbell’s center of gravity. One such move was the acquisition of Bolthouse Farms, an innovative producer of fresh carrots and super-premium fresh beverages.
Internationally, Campbell will focus on Latin America and Asia, with growth coming from acquisitions, as well as partnerships such as the one it recently created in Mexico with a beverage business, and in China to help distribute its product more efficiently.
“I believe in what I’m doing, and I believe in the people here. That really drives me. It’s passion, it’s ambition, it’s lofty goals, and it’s delivering results.”
Morrison also recognized how the influence of digital was changing consumer conversations, so she hired the company’s first chief marketing officer. One of Campbell’s first forays into digital was a contest to create mobile apps that help consumers with mealtime solutions. The company plans to bring the most exciting of these mealtime apps to market this fall to kick off soup season.
Innovation shows the way
Morrison has been gratified by the internal response to all these initiatives. Innovation now reigns supreme. Products that excite consumers are being brought to market at an accelerated pace through this breakthrough innovation process.
In fact, the company brought more than 100 new products to market in 2012 across all of its brands, including Pepperidge Farm and V8 beverages, and will launch more than 200 new products this year.
Bolthouse Farms has added fresh foods and more innovative beverages, which extends Campbell’s supermarket reach to the higher-margin retail perimeter. And its recent acquisition of Plum Organics, a leading kids’ nutrition company, allows Campbell to enter the US$2b baby food category.
At one of its first global leadership meetings after Morrison took office, the executive team re-examined the company’s core values of character, competence and teamwork. What they realized was that, if they were to become the innovation engine that Morrison envisioned, they would need to add “courage” to the list.
To the team, courage meant the need to take calculated risks with the highest integrity and the willingness to fail, learn and reapply those lessons to new innovations.
Morrison has been repeatedly recognized for her achievements in corporate America and for her extensive community service. But, in the end, she has her own view of what has made her so successful.
“I’m very passionate about what I do,” she says. “We work so very hard at what we do, so you need to love it. I feel for people who get up every day and don’t have that kind of passion. I believe in what I’m doing, and I believe in the people here. That really drives me. It’s passion, it’s ambition, it’s lofty goals, and it’s delivering results.”