Irene Rosenfeld, Kraft Foods Inc.
Now that it has kicked the Altria tobacco habit, Kraft Foods Inc., once considered a stodgy and oversized company, is delivering stellar results. In the first quarter of this year, revenues increased 20.8 percent to $10.4 billion. In 2007, Kraft delivered its strongest revenue growth since 2001, the result of investing in new products and its most successful brands, and beat Wall Street forecasts.
“2008 is off to an excellent start and we expect our results to continue to strengthen as the year progresses,” said Chairman/CEO Irene Rosenfeld, who has been presiding over the turnaround. “Our investments in product quality, marketing and innovation are leading to better price realization, stronger top-line results and sequential improvement in margins from the fourth quarter of 2007. While input costs remain high, I am confident that our ongoing programs to lower overhead costs and invest in our brands will enable us to deliver our targeted earnings in 2008 and beyond.”
Like Mackay, Rosenfeld left Kraft, Northfield, Ill., for several years before returning as CEO in June 2006. She reportedly spent the first month talking to employees about what worked and what didn’t, then shook up the management team. Advertising Age reported she sent a memo to employees indicating her belief that the company was too bureaucratic, confused and lacked clear lines of responsibility.
At a time when many called for cost-cutting, she informed Wall Street analysts that Kraft would spend an additional $300-400 million on advertising and marketing to better connect its brands with consumers. “We will be telling the consumer that Kraft is back,” she said.
She returned to behemoth Kraft after a stint as chairman/CEO of Frito-Lay, a division of PepsiCo. Rosenfeld began her career with General Foods in 1981. She spent more than 20 years with Kraft, advancing in a variety of leadership roles. Division. She is credited with leading the successful integration of the Nabisco acquisition, and the restructuring and turnaround of a number of key businesses. She served on the senior team that led Kraft's IPO in 2001.
Last month, Rosenfeld told shareholders that Kraft will raise prices this year to offset increasing commodity costs, adding that the company needs to protect its margins and profits, which dropped last year due to the soaring costs of wheat, dairy and other commodities, reports Crain’s Chicago Business.
While that could drive consumers to private label, she also has promised more money to market its portfolio of iconic brands, including nine with revenues exceeding $1 billion which are available in more than 150 countries. With some 80 new or improved products in the pipeline, Kraft seems to be cookin’ again. Kraft’s “better-for-you” products are growing two to three times faster than others, and healthy initiatives are in place in 30 percent of its product lines (beverages, snacks, cheese, grocery and convenience), a good place to be in 2008.
Kendall J. Powell, General Mills Inc.
Many of the top CPG companies are promoting their CEOs from within, a strategy that was out of favor in the past decade. After a 28-year career with Minneapolis-based General Mills, Kendall Powell was elected CEO in September 2007, a fine reward for his years of service and worldwide expertise in GM brands across the board.
Having earned a Harvard degree in biology and a Stanford MBA, Powell joined General Mills in 1979 as a marketing assistant and held a series of assignments: marketing director for Cereal Partners UK (a General Mills/Nestle joint venture) in 1990; president of the Yoplait Division 1996-1997; president of Big G Cereals 1997-1999; CEO of Cereal Partners Worldwide 1999-2004.
He was named an executive vice president of General Mills in 2004, with responsibility for the company’s Meals, Pillsbury USA, Baking Products, and Bakeries & Foodservice businesses; and was appointed COO-U.S. Retail in May 2005. He served as president and COO of General Mills from June 2006 until his election as CEO last September. He added the chairman title this May, when Stephen Sanger retired after a distinguished 34-year career with the company.
While General Mills, too, raised prices in the past year in response to higher commodity prices, consumers aren’t giving up their Big G cereals for less expensive private labels. Perhaps that’s partly because of the Brand Champions initiative, in place since 2003, which immerses more than 900 employees in cross-functional teams in the intricacies of building and maintaining strong brands.
For just over a year now, General Mills’ Worldwide Innovation Network (G-Win) has sought outside partnerships with entrepreneurs, inventors, universities and other food companies to generate new product ideas. Yoplait’s Fizzix carbonated yogurt started out on the Brigham Young University campus. Progresso Light, the first consumer packaged product in any grocery category to carry the Weight Watchers endorsement with 0 Points value per serving, also resulted from the G-Win program.
On the international front, Powell has targeted opportunities in central and Eastern Europe, Saudi Arabia and the lower Gulf States, Latin America and expansion in China.
Gary Rodkin, ConAgra Foods Inc.
Perhaps no new CEO in any category had to face as much adversity in his first two year as ConAgra Foods’ Gary Rodkin. First on his to-do list was the halving of the company. Early last year, a leaky roof at a plant caused salmonella in Peter Pan peanut butter and a huge and painful recall. Later in 2007, the bug was in Banquet pot pies.