Noted that 2014 has been a challenging year for the industry, Kathy Waller, Chief Financial Officer for The Coca-Cola Company, said the company plans to revise incentive metrics to spark employee and customer engagement.
During the companyís Dec. 15 Modeling conference call, as reported by Seeking Alpha, Waller outlined some strategic initiatives The Coca-Cola Company is taking.
"We are driving revenues through improved pricing in North America and we'll further focus on revenue and profit growth through revising our incentive metrics to include revenue and to provide a clear line of sight between our employees around the globe and the metrics they can best influence," Waller said. "2014 has been a challenging year for the industry given the tough macro environment and continued currency headwinds. These factors have driven a deceleration in personal consumption expenditures, and as a result the non-alcoholic beverage industry has grown 1 to 2 points slower than our initial forecast at the
beginning of the year."
Building personalized 1-to-1 customer relationships and creating value are two brand loyalty drivers for executives at The Coca-Cola Company. What's more, creating value and engagement for customers is the core lever for Coca-Cola.
"Given the current operating environment, we recognize we need to move quickly to address these challenges and we are taking actions to return our business's top- and bottom-line growth trajectory through our expectations," Waller said.
Waller outlined some strategic actions with their current status:
--"First, we announced the streamlining of Group functional layers, the standardization of business units, and the formation of a single Western Europe business unit. These actions will speed decision making and enhance our local market focus to drive growth.
--"Second, we identified an additional $2 billion in annualized savings by 2019, something I would speak more about in a few minutes.
--"Third, we continue to move forward with the North American refranchising efforts with approximately 5% of the annualized volume transferred in 2014 and we expect to double this rate in 2015.
--"Fourth, earlier this year, we created incremental value with a strategic investment in Keurig Green Mountain and intend to further do so with our pending investment in Monster Beverage Corporation which underscored not only our ability to adapt to changing consumer trends but also our commitment to further innovation."
"While we still have much to do, we are confident that the actions we have outlined would drive long-term growth," she added. "We will spend the rest of the time addressing how these items impact our 2015 outlook beginning with productivity. The first phase of our productivity program started last year which culminated in the original $1 billion target. The intent of that plan was to fund an incremental $1 billion step up in media investments to fully fund our brands and accelerate growth."