New Food Products / Process and Operations

Top 11 Most Influential People in the Food Industry

Our picks for the 11 most influential people in the food industry don’t believe in the status quo.

By Diane Toops, News and Trends Editor

Influence. Power. Clout. There are various definitions and measures of these seemingly intangible assets. When the new president of Ukraine takes your meeting because you knew him in his banker days 1, you’ve got it. When President Ronald Reagan and former Soviet president Mikhail Gorbachev visit out-of-the-way Decatur, Ill., 2 you flaunt it. When your company’s stock goes up 55 percent in one year, you’ve earned it. 3

Footnotes: 1. Warren Staley of Cargill met with Ukraine’s Viktor Yuschenko. 2. The two presidents visited ADM headquarters. 3. Tyson stock shot up during the tenure of John Tyson.

Financial success is one clear but seldom easy route to power. At this time last year, reported investors who filled their carts with food and beverage stocks whipped up some nice gains, particularly if they held shares of Tyson Foods (up 55 percent), Hershey Foods (15 percent), McCormick & Co. (18 percent), Kellogg (10 percent) and Groupe Danone (9 percent). All of them handily beat the indexes of Standard & Poor’s 500, NASDAQ and the Dow Jones Industrial Average.

Success of these food and beverage stocks was attributed to stability. When investors get nervous, they seek out companies with familiar names and managements that seem to have been in place for decades. It helps if they make products everyone needs.

Putting your money where your mouth is requires much more savvy today. Dramatic changes occurred over the past 12 months, particularly in leadership positions. Rainer Gut, chairman of the board of Nestlé SA, retired and his successor, Peter Brabeck-Letmathe, takes on a dual role as chairman and CEO (despite some protests against that kind of power consolidation). Patrick Cescau took over the leadership at Unilever from Antony Burgmans, who retired. At Coca-Cola, Neville Isdell replaced Douglas Daft. Jim Donald is the new president and CEO at Starbucks, while Howard Schultz is concentrating on global strategy. After the passing of McDonald’s Charlie Bell, the baton was passed to Jim Skinner. When Frank Perdue died, son Jim took over the poultry company; now there’s speculation some members of the family might sell their interest in the privately held corporation.

All those people have power by virtue of their job titles. Whether it’s true influence or clout, and if they have staying power, only time will tell. Just ask Carly Fiorina, late of Hewlett-Packard.

On the following pages we present our first effort at the most powerful people in the food industry. The list was developed with input from our editorial advisory board, a poll on our web site and our core of regular contributing editors. The editors of Food Processing chose the final winners. And although we tried to keep it to a nice, round 10, we ended up with 11. There’s so much power here we couldn’t cut it down to 10!

We chose those whose expertise, ability to influence change, corporate responsibility and fine leadership inspire their teams in this highly competitive marketplace. We congratulate them for their contributions.

THE LIST (in alphabetical order)

  • G. Allen Andreas, Archer Daniels Midland

  • Brenda Barnes, Sara Lee Corp.

  • Carlos Gutierrez, U.S. Dept. of Commerce

  • Richard Lenny, Hershey Co.

  • John Mackey, Whole Foods Market

  • Steven Reinemund, PepsiCo

  • Stephen Sanger, General Mills

  • H. Lee Scott Jr., Wal-Mart Stores

  • Warren Staley, Cargill Inc.

  • John Tyson, Tyson Foods Inc.

  • William Wrigley Jr., William Wrigley Jr. Co.

Feeding the world from Decatur, Illinois

In the midst of the heartland, G. Allen Andreas sits as chairman/CEO of Archer Daniels Midland Co., a company with reach into many corners of the world from its Decatur, Ill., home base. Instead of immediately going into the business, Andreas went to law school and was an attorney for the U.S. Treasury Dept. He joined the legal staff of ADM in 1973.

He was appointed treasurer in 1986, was CFO of European operations in 1989, came back to Decatur, Ill., to hold several executive roles until becoming president/CEO in 1997. When Dwayne Andreas, a confidante of presidents and prime ministers and leader of the company since 1970, stepped down in 1999, his nephew, Allen, was ready.

Andreas leads one of the most global and pervasive of food businesses, but works in the ingredients/agricultural commodities arena rather than in branded consumer food products. ADM, which once used the motto “supermarket to the world,” continues to grow. “From a low of $226 million in earnings in 1999 to the $500 million level each of the past three years, we are on track for another solid year,” Andreas promises.

ADM has come a long way since the Daniels Linseed company was founded in 1902. The company is involved in oilseed processing, corn processing, various other food and feed ingredients, fuels and industrials and agricultural services. In all, it makes more than 1,000 products and ingredients. ADM provides that pivotal but often forgotten connection between food products and the farms on which they originate.

“Although the face of agriculture has changed over the course of our history, ADM has played and continues to play a vital role in agriculture, an essential component of the economy,” Andreas says. But Andreas’ role transcends the company. He is a member of such global organizations as the Trilateral Commission, The Bretton Woods Committee, International Policy Council on Agriculture, Food and Trade, Emergency Committee for American Trade, World Economic Forum, the G100, The Business Roundtable and a trustee of the Economic Club of New York.

“I’ve always had a strong international focus, and my involvement with those organizations highlights that global view,” he says. “Some of my efforts in the international arena include opening the Cuban market to U.S. food producers and becoming the first company to sign a contract with Cuba since the embargo nearly 40 years ago, expanding operations in China and increasing ADM’s investment in South America and the emerging countries in Eastern Europe.”

In addition to the immediate issue of trans fat labeling, Andreas sees the worldwide food industry grappling with biotechnology. “As recent issues with genetically modified corn and rice as well as concerns about plant-derived pharmaceuticals have shown, the current state of regulation leaves a lot of room for confusion,” he says. “This confusion will continue to impede global agricultural trade and create inefficiencies.” ADM obviously will make its voice heard on the issue, while working with growers and customers to meet regulatory demands and customer needs.

-Dave Fusaro, Editor in chief


From mom to magnate

When Brenda Barnes left her $2 million-a-year post at PepsiCo Inc. in January 1988, she helped spark a national debate about the pressures modern women face in balancing home and careers. Despite 22 years at the beverage and snacks company and rumors that she could be the first woman to head PepsiCo, she said she didn't want to miss "another of my kids' birthdays." Now that her children are grown, Barnes not only has re-entered corporate life, she’s at the top of it.

After just eight months at Sara Lee Corp., she recently was named chief executive of the Chicago-based company, replacing Steve McMillan. She reportedly is a shoo-in to take over McMillan’s title of chairman as well in October. With sales of $19.9 billion, about half of that in food, Sara Lee should keep its No. 8 ranking from last year’s Food Processing Top 100 © list.

All that clout doesn’t come without a considerable challenge. Barnes is charged with transforming Sara Lee back to a food-only company from a diversified conglomerate with product lines as diverse as underwear, shoe polish and bath gels. The transformation plan is built upon three pillars: organizing business operations around consumers, customers and geographic markets; achieving operational efficiency to fund growth; and focusing the portfolio.

“Through the transformation plan, we have established a clear direction for Sara Lee, and I am confident that we are well equipped to effectively execute this plan,” Barnes told analysts in March. “Our leadership team is aligned, we have the commitment of the entire organization to win in the marketplace, we have instituted a project management discipline throughout the company and we have the right resources and talent in place to drive our transformation initiatives.”

After the restructuring, Sara Lee will focus on food, including Jimmy Dean sausages and breakfast sandwiches, Hillshire Farm deli meats, and Sara Lee's own bakery and meat brands. It’s notable that the company expects to realize some $575 million to $800 million in annualized savings through the restructuring, but plans to invest $250 million into marketing and R&D.

“I am a marketing person by discipline,” says Barnes. “I’m also an operating person by discipline, and I think the transformation of those two are what is embedded in this transformation of Sara Lee.”

It’s too early to tell if Barnes can turn Sara Lee around, but she’s an inspiration to women who want to combine a career and family – without consequences -- on their way up the corporate ladder.


Grrrreat! trade opportunities

Sworn into office in February, U.S. Secretary of Commerce Carlos Gutierrez is a core member of President Bush’s economic team and oversees a diverse cabinet agency with some 38,000 workers and a $6.5 billion budget focused on promoting American business at home and abroad. Now, that’s influence!

Former chairman/CEO of Kellogg Co., Battle Creek, Mich., he was voted by Fortune as one of the most powerful Hispanic Americans in today’s business world. He had quite an impact in his years at Kellogg. Named CEO in 1999, he was the youngest chief executive in the company’s nearly 100-year history, and became chairman a year later. "He changed the mind-set of the company," David Adelman, who analyzes Kellogg for Morgan Stanley, told the Washington Post. "Seven years ago, Kellogg was waffling. It had lost all momentum as a business. Now it has industry-leading sales growth."

Born in Havana, “Carlos' family came to America when he was a boy," President Bush said at the White House ceremony. "He learned English from a bellhop in a Miami hotel and later became an American citizen. When his family eventually settled in Mexico City, Carlos took his first job for Kellogg as a truck driver, delivering Frosted Flakes to local stores. Ten years after he started, he was running the Mexican business, and 15 years after that, he was running the entire company. At every stage of this remarkable story, Carlos motivated others with his energy and optimism and impressed others with his decency."

Opening international markets to U.S. companies is a top priority for Secretary Gutierrez. He believes passionately in President Bush’s vision of a 21st century where America is the best country in the world with which to do business and where everyone has the opportunity to experience the joy and pride of ownership and to live the American Dream. “We have the best people, we have the training, we have the culture,” Gutierrez says. “I believe the 21st century is really and truly the American century.”

Gutierrez also vows to "turn up the heat" to stamp out counterfeiting of consumer goods by Chinese companies, an issue that hit close to home while he was at Kellogg. In 1996, just three months after the company introduced Kellogg’s Corn Flakes in China, counterfeit boxes appeared. The courts in China, ignoring intellectual property violations, made it difficult to get the counterfeit cereals pulled from the shelves.

Soon after being sworn in, Gutierrez emphasized the importance of a U.S.-Central America Free Trade Agreement (CAFTA), soon to be headed for Congress, and he will oversee changes to trade relations with Cuba. He walks a fine line – opening trade while clamping down on barriers to U.S. exports around the world, particularly in China, which had a $162 billion trade surplus with the U.S. in 2004, the largest gap in history. He also will face formidable challenges dealing with the loss of 2.7 million manufacturing jobs over the past four years and a trade deficit that has soared to record levels.


Becoming more than just a Kiss

Financial weekly Barron’s dubbed Richard Lenny, Hershey Foods chairman, president and CEO, "the new rock star of the food industry." And it’s no wonder. Since this wunderkind arrived at Hershey Foods Corp., Hershey, Pa., in 2001 from Kraft Foods, the company’s stock performance has been music to shareholders’ ears, nearly doubling. A one-year ROI is 48.8 percent, even though Americans eschewed sugar highs for protein-based diets and obesity was the No. 1 media cause du jour last year.

From all indications, Hershey Co. one year from now will be a very different, more diverse company than it is today. At the same April meeting that authorized the name change, shareholders also approved doubling the shares of stock, enabling management to “respond quickly as strategic opportunities arise that would better enable the company to achieve its long-term growth objectives,” according to company filings.

Lenny has dropped some hints about acquisitions. Tootsie Roll Industries appears to be in play, and Kraft’s Planters peanut division might be available. While the broader category of snacks is likely, no one expects Hershey to go as far afield as it did when it acquired macaroni companies years ago.

“The new name conveys our long-term focus on Hershey being a leading confectionery and snack company,” says Lenny. “We're retaining our iconic name and enduring heritage as the key component of our corporate identity."

The company also announced it formed two new business units -- a U.S. confectionery business group and a U.S. snacks business group -- in order to strengthen its leadership within the confectionery segment and expand its presence in the broader snacks market. “We're confident in our ability to sustain Hershey's superior performance and to extend our reach within core confectionery and the broader $65 billion snacks market,” says Lenny. “With the creation of these new business groups, we'll bring sharper focus and energy to Hershey's unique, long-term growth opportunities in each of these markets."

The first CEO in Hershey’s history to be hired from outside, Lenny was a former president at both Pillsbury and Nabisco, then a group VP at Kraft. He’s credited with Hershey’s reach into the lucrative snacks and cookies segments, and he’s brought many talented people from Kraft to the Hershey’s team.

In tune with indulgence/variety, health/nutrition, convenience and value, Hershey introduced a multitude of new products last year. With sales of $4.43 billion, Hershey ranked No. 23 on Food Processing’s Top 100 last year. The company has since acquired Mauna Loa, the leading brand of macadamia nuts and macadamia nut snacks -- a healthy snack segment with immense opportunities to build the Mauna Loa brand and extend Hershey’s brands.

And as the lead singer, Lenny should take a bow.


Counter culture

At $4 billion in sales from 167 stores in 28 states, Whole Foods Market is becoming the Wal-Mart of new grocery retailing. If you want your product in its stores, you gotta play by Whole Foods’ rules … which means no preservatives, colors, flavors, sweeteners or hydrogenated fats. The man behind this clout is the same hippie who started it all: vegetarian John Mackey.

Described as a go-getter by friends, Mackey and a girlfriend opened the first Whole Foods natural-food store in Austin in 1978, and it was operated by and catered to hippies. Success led to Mackey’s acquisition of other natural food retailers around the country. Today, its stores are built from scratch and the layout makes food-shopping fun – you could call it retail eatertainment.

Food safety concerns and wellness trends have led consumers to organic and natural foods. In exchange for bans on foods or beverages that contain artificial ingredients, Whole Foods offers consumers mega fresh, natural and organic options and a fabulous choice of nutritious fresh meals to go.

“When we opened the first Whole Foods Market, we had a simple mission: to provide a more natural food alternative than what most supermarkets were offering,” says Mackey. “Twenty-five years later, we are the largest food retailer of natural and organic foods in the world.”

Mackey pays close attention to what his consumers and critics have to say. In fact, after carrying on an e-mail correspondence with Lauren Ornelas, an animal-welfare activist, for several weeks, Mackey became a vegan and asked for her assistance in changing Whole Foods’ policies on farm-animal treatment.

In April, Whole Foods Market announced it would inform customers that its private-label brands are made with non-genetically engineered ingredients and it is re-evaluating its ingredient auditing processes. “We’ve decided that we’re going to take more of a leadership role on this issue,” says Mackey.

One of Fortune’s 100 Best Companies to Work For eight years in a row, Whole Foods has a unique culture initiated by Mackey. Executive salaries (including his own) are capped at 14 times the average worker’s pay, workers can compare each others’ salaries, insurance is paid in full by the company, the majority of stock options go to non-executives and employees earn above-average wages.

Mackey says that his workers’ and customers’ interests are always put before shareholder interests. “Business by its very nature is part of society and it is intrinsically an ethical institution existing to create value for all of its stakeholders,” he says.

Not that its stock has suffered. Whole Foods had its best year in 2004, with 15 percent comparable-store sales growth leading to a 23 percent increase in sales over 2003, to just under $4 billion. If you had invested $10,000 in Whole Foods Market’s initial public offering of stock in 1992, you could pocket $250,000 today, a substantial 427 percent profit.

“One of our core values is to create a work environment where motivated team members can flourish and succeed to their highest potential,” says Mackey. “So being a great place to work is very, very important to us, and we will work at improving it all the time.”


Committed to wellness and innovation

At the forefront of health and wellness, diversity, horizontal leadership and corporate governance, and a proponent of healthy living, Steven Reinemund jogs his way to excellence. With sales of $29 billion, PepsiCo’s brands include Gatorade, Tropicana, and Quaker – in tune to consumer desires for healthier foods and beverages that taste good.

“We look at health and wellness as an opportunity to be an active part of the solution to the nation's obesity problem,” says Reinemund. “We’ve improved the healthfulness of our existing products by taking important steps like eliminating trans fats in our Frito-Lay chips and reducing sugar in some of our products. We’ve also developed new products that deliver more powerful health benefits, like Quaker Take Heart Oatmeal, which can help reduce cholesterol and help maintain healthy blood pressure – two important factors for heart health. The Tropicana Pure Premium line of fortified orange juices is another great example, and we strengthened the Quaker snack line with new soy crisps and new or improved bar products.”

PepsiCo is also sponsor for America on the Move, a national initiative designed to help Americans achieve energy balance by taking 2,000 more steps and reducing calories by 100 each day. Most recently PepsiCo developed a new Smart Spot trademark in the U.S. and Canada for more than 100 of its products that can contribute to healthier lifestyles.

Offering a balanced and broad portfolio with a range of great-tasting product choices is PepsiCo’s ultimate goal. “While our better-for-you product portfolio is growing at an impressive clip, we also know it’s critical to drive growth in our flagship, heritage brands that comprise our fun-for-you portfolio,” says Reinemund.

A subject close to Reinemund’s heart is corporate governance. "Everyone needs to be accountable for his or her decisions," he said during a keynote address at Harvard Business School. “Rules alone won't prevent another Enron from happening without a strong system of checks and balances and every individual's belief in his or her personal value system.”

Every leader needs to find his or her moral compass, and define their own "true north," Reinemund recently told an audience at the University of Texas. He said moral grounding can come from religion or other sources, but it’s imperative that this center be found before one encounters a crisis situation, so that when the world is coming apart, in your business or personal life, you are able to maintain your balance and not come apart with it.

The other principles he adheres to are: Perspective – look for opportunities and create a vision for how you might capitalize on them; Passion – not to be confused with style or charisma, it’s an "inner enthusiasm for what you are doing that is contagious"; Perseverance – handling failure, and the ability to stumble but get back up is a critical trait of any leader; Performance – great leaders consistently achieve great results themselves, and they reward, promote and value performance by others; and People – each employee is important, because one mistake by one associate can be very costly to the company.

A believer in promoting from within, Reinemund launched an executive leadership program. High-performing senior middle managers in key jobs prepare to become the company's future leaders by focusing on personal growth, as well as corporate strategy, ethics, and promoting change and innovation.

Committed to innovation for sustaining growth, Reinemund says, “We take our competitive strengths, and invest in them to create longer-term value. Investing in innovation fuels the building of our brands; this in turn drives top-line growth. Dollars from that top-line growth are strategically reinvested back into new products and other innovation, along with cost savings projects, and thus the cycle continues.”


Championing whole grains and diversity

Last October, Stephen Sanger again was at the helm of one of the biggest announcements in the food industry. General Mills said it would reformulate all of its Big G cereals to be made from whole grains, a tremendous monetary and marketing commitment. “This improvement by General Mills could signal the most comprehensive improvement in the nation’s food supply since the government began mandatory fortification of grains in the 1940s,” said former FDA Commissioner David Kessler.

Four years earlier, Sanger was announcing the largest acquisition in food industry history: the $10.1 billion acquisition of Pillsbury from Diageo Plc in 2001. Combining strengths from each entity, reducing debt, maintaining the integrity of brands from both companies and establishing a unified corporate culture was no easy challenge. But insiders say Sanger has achieved his goal of a more relaxed and congenial company atmosphere, fortified by promotions from within. That might explain why General Mills consistently receives kudos as a great place to work, including the championing of Latinas, working mothers, women of color and executive women.

Sanger became chairman/CEO of Minneapolis-based General Mills in mid-1995, and this marketing-savvy leader has added a shopping list of credits to General Mills’ resume. Former president of both the Big G cereal division and Yoplait USA, Sanger certainly can take pride in accolades for General Mills, which garnered Fortune’s 100 Best Companies to Work For and Most Admired Companies awards.

But in the realm of products, Sanger’s focus appears to be on health. Yoplait became the yogurt market leader, surpassing Dannon. Its latest offering is Yoplait Healthy Heart, the first heart healthy yogurt with plant sterols, clinically proven to significantly reduce cholesterol. Plant sterols also will be popping up in Nature Valley Healthy Heart Granola Bars. General Mills has loaned the Wheaties and Total brands to lines of nutritional supplement products made by Leiner Health Products. And after the USDA revealed its new Food Guide Pyramid(s) last month, General Mills was the first major company to jump on board, announcing it would put MyPyramid on all its Big G cereals, meaning more than 100 million boxes would spread the new nutrition message.

It’s no surprise that General Mills was honored by retailers as Manufacturer of the Year for a commitment to understanding its shoppers, trends and demographics, and translating those insights into innovative and actionable merchandising strategies that generate profitable volume growth for retailers.


Your best and worst customer

Wal-Mart is the “business template” for the modern economy, according to historian Nelson Lichtenstein, a professor at the University of California at Santa Barbara. “In each historical epoch, a prototypical enterprise seems to embody a new and innovative set of economic structures and social relationships,” he says.

Since 2000, H. Lee Scott Jr. has led Bentonville, Ark.-based Wal-Mart, the nation’s largest company (sales of $288 billion) and (by many but not all surveys) most admired retailer. It has more than 1.3 million associates (at Wal-Mart, all employees are called associates) and nearly 5,000 stores and wholesale clubs in 10 countries.

2005 is becoming the year of radio frequency identification (RFID), largely because Wal-Mart wants it so. While most manufacturers grudgingly admit the technology is the wave of the future, nobody wanted to go first. But Wal-Mart gave a stiff Jan. 1 deadline to its 100 largest suppliers, many of them food companies, to put RFID tags on cases and pallets. Nobody was willing to forgo Wal-Mart’s business.

“Wal-Mart combined myriad technological resources to change the entire paradigm of American business in the past 25 years,” according to Motley Fool. Its relentless pursuit of efficiency through technology – from controlling the flow of information among manufacturers, distributors and retailers and adopting UPC technology in the 1980s leading to a database that tracks every item it sells -- changed the face of retail shopping. “It created the model of the dominating retailer and changed the industry dynamic from one in which manufacturers pushed product downstream to retailers, to one in which the retailer pulls product from manufacturers and distributors only when needed.”

Scott is very much behind these efforts. He spent most of his 25-year career with the retailer in logistics and transportation, so it’s no wonder that he always looks for more efficient ways of doing business. He’s betting on RFID technology to reduce out-of-stocks, labor costs and inventory and to improve product traceability, an advantage in the case of a recall. The technology also improves Wal-Mart’s data on which products sell and which don’t, invaluable information when deciding which products to purchase from its suppliers.

“We have about 100 million customers a week who come through our doors,” Scott told TV personality Tavis Smiley. “I think in some ways, we’re extraordinarily difficult to compete with because of our associates. The quality of merchandise, the pricing, the way we do logistics and systems combine to create great value for working people who work so hard for a paycheck that they appreciate the company.”


This nice guy finishes first

“I was going to be in eastern Europe anyway, so I sent a message that I’d like to meet with the new president of Ukraine,” Warren Staley says matter-of-factly. Viktor Yuschenko not only took the meeting, “He asked me how I saw agribusiness in his country and what I thought of some directions that he might take the Ukraine.”

Warren Staley is proof nice guys don’t finish last. A leader can be powerful and personable at the same time, a financial success – for himself and his company -- and yet a civic volunteer.

Staley is a member of so many civic boards, “I end up working Saturdays and Sundays sometimes because I have to put Cargill first,” he said in a recent interview, when the Minneapolis-St. Paul Business Journal named him executive of the year.

Like ADM, Cargill is something of a supermarket to the world, a supplier of agricultural commodity ingredients more than branded products. Unlike ADM, Cargill is not public, but it publicizes at least its top-line figures. In its fiscal 2004 (ending May 31, 2004) the company had sales of $62.9 billion with net earnings of $1.3 billion.

The private nature of the company has not held back Cargill. “There may be more people in countries and governments outside the U.S. familiar with Cargill than there are people in the U.S.,” says Staley. “I don’t think the rest of the world expects large companies to be publicly held. In many ways, we were a multinational before the term was invented.”

Cargill started business in Argentina right after World War II. In the early 1950s, it established a European headquarters in Antwerp, later moved to Geneva. The company’s been active in Brazil for 40 years. “We went to China weeks after Nixon was there in 1972,” Staley recalls. “We were talking to Vietnam as soon as the U.S. government said it was OK to do so. We’ve been in Russia since 1990 and Ukraine since ’92.”

Staley says Cargill often starts as a trading partner, “moving grain and other agricultural commodities from where there’s a surplus to where there’s a deficit.” When it’s time to add value to those commodities through processing, Cargill is there to transfer the technology and often to make a capital investment. Cargill also uses its worldwide transportation network, of ships, barges, railcars and trucks as well as local distributors to move products across the globe.

“Many of our customers are global, and we need to be wherever they are,” he says. “Sometimes we’re there even before they are and can help them get established.”

The Yuschenko story is symptomatic of a company with this much reach and this much history in parts of the world. When Staley first started dealing with Ukraine – in addition to commodity trading, Cargill set up a sunflower oil processing plant there -- he often was directed to the head of the central bank. That banker is now the president.

“When the new premier of China, Wen Jiabao, visited the U.S. in December 2003, we got invited to the New York luncheon. Afterward, I had a little private audience, and he invited me to China to give him our views on agriculture and for me to better understand the challenges of agriculture in China.”

-Dave Fusaro, Editor in chief


Core values define a company

“Corporate reputation is the product of alchemy — a mixture of everything from the way a company nurtures homegrown talent to how it manages its balance sheet,” Fortune writes in naming Tyson Foods America’s Most Admired Company in Food Production. “Throw in one part customer satisfaction, another part shareholder return, add a splash of community citizenship — and voila! -- you have a measure of that company’s station in the hierarchy of American business.”

Fortune ranked Tyson Foods Inc., Springdale, Ark., America’s most admired food company for the second time in three years -- no easy achievement, since the winning company is chosen by its peers. Since 1998, Chairman/CEO John Tyson has headed the No. 2 company on the Food Processing Top 100 list (and probably No. 1 when this year’s list comes out in August).

John Tyson led the company through a complicated merger with South Dakota-based IBP Inc., transforming the company from the nation’s biggest poultry company into the biggest producer of beef, pork and chicken. All the while Tyson achieved notable brand equity, with consumer awareness comparable to the most visible brands in the world, and encouraged the development of innovative, convenient and healthy protein-based food products.

Founded in 1935, when his grandfather John Tyson drove a truckload of Arkansas chickens to Chicago for a $235 profit, the company is the recognized market leader in the retail and foodservice markets it serves, providing products and services throughout the U.S. and more than 80 countries, and has approximately 114,000 team members.

“We’ve developed a strong set of ‘core values,’ defining who we are as a company, what we do and how we do it,” says Tyson, who is a stickler on keeping standards high. “According to our core values statement, ‘We are a company of people engaged in the production of food, seeking to pursue truth and integrity, and committed to creating value for our shareholders, our customers, and our people in the process.’ As part of ongoing efforts to support our people, we recently introduced a ‘Team Member Bill of Rights’ to make sure our workers understand their rights in the workplace.” Tyson implemented management-training programs focused on dignity and respect, problem-solving and team building, as well as ethics and is preparing the next generation of leaders at Tyson with an emerging leaders development and mentoring program.

“We’re in a global business and need greater access to opportunities in the international marketplace to continue to compete effectively,” Tyson says about the company’s upcoming challenges. “This means finding ways to open – and in some cases reopen and rebuild – key export markets. Developing high-quality food solutions for our customers and the consumer will continue to remain important to us.  One of our goals is to increase our percentage of value-added product sales to 50 percent over the next five years. We finished fiscal 2004 at 38 percent value-added and our goal for 2005 is 40 percent,” he adds.

“We’re bringing to beef and pork some of the same value-added, branded strategies that have worked so well for us in chicken,” he continues. “We developed 400 new products just last year to meet the changing needs of customers and consumers and are in the midst of a new, $75 million communications campaign to market our chicken, beef and pork products.”

Although some analysts think the low-carb diet craze is over, Tyson believes that meat will remain at the center of the plate. “Overall demand for protein remains strong,” says Tyson. “Diets such as Atkins and South Beach have made people ‘carb aware’ and have essentially made it okay for them to eat protein at every meal occasion.”


Good news to chew on

Chicago-based Wm. Wrigley Jr. Co. in 2006 almost certainly will not resemble the company in 2004; it will be a broad-based confectionary company, perhaps even compete in other categories. That’s due to the vision of Chairman, President and CEO William Wrigley Jr., the fourth-generation Wrigley to hold the top spot. Since ascending in 1999, he has given investors plenty of good news to chew on – acquisitions, new facilities, product innovation and expansion overseas. He’s also given them the first debt incurred by the company in 100 years. Some observers say that’s symbolic of a company that’s on the move.

With sales of $3.65 billion, which doesn’t fully include a billion-dollar acquisition, Wrigley undoubtedly will move up from its No. 28 rank on last year’s Food Processing Top 100 list.

"In Wrigley, you have a company that is focused on aggressive yet attainable goals and a powerful team committed to our long-term vision of doing what's right for the business and our shareholders," Wrigley recently told shareholders. "Our consistent positive results, in the midst of changing conditions, is testimony to the strength and resilience of our company, and the talent and passion of our people."

There were 350 food-industry mergers and acquisitions in the U.S. in 2004. The biggest one was Wrigley’s acquisition of Kraft Foods’ Life Saver and Altoids business, valued at $1.5 billion. The purchase, which moves Wrigley out of the strictly gum section of the candy aisle, was funded with a $1 billion bond issue, the company’s first debt in a long time.

But innovation and growth require investment. Wrigley not only made the largest acquisition of last year, it’s doubled its size in the past five years. The company will open three new facilities this year – in Shanghai, China, and Silao, Mexico, plus its $84 million Global Innovation Center in Chicago.

The Global Innovation Center will be "a key piece of the product development puzzle," Wrigley says. "For the first time, we're bringing together every key function critical to innovation, enabling us to work together in a whole new way.”

While many analysts and shareholders expect Wrigley to acquire other candy companies in the near future, the new plants show the company expects growth from increased worldwide demand in its core gum business, too. “Let me emphasize that we are not in any way ‘hungry’ for acquisitions,” Wrigley says. “What we are is strategic and thorough in analyzing potential acquisitions; and if the fit, the timing and the growth potential are right, then we are capable of executing them with excellence.”

If Wrigley sticks to his innovation and growth strategy, shareholders will no doubt double their fun.

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