Muhtar Kent, chairman and CEO of The Coca-Cola Company, presented the keynote speech at the inaugural Colorado Innovation Network (COIN) Summit, a gathering of leaders of industry, nonprofit organizations, government and academia. Colorado Governor John Hickenlooper created COIN in 2011 to stimulate economic growth, create jobs and attract new businesses to the state by promoting collaboration and innovation among private, public and academic organizations.
Here is Kent’s full speech as prepared for delivery.
Good morning and thank you for your welcome and your warm hospitality.
I appreciate your kind invitation to be part of this very special gathering, dedicated to innovation and growth.
I want to commend my friend Governor Hickenlooper for his leadership in convening this very important summit.
As a lifelong beverage professional, I feel a special kinship with the governor, given his own very successful career brewing a very different variety of delicious and refreshing beverages.
I also want to thank your state's chief innovation officer, Ajay Menon, for his vision and leadership in bringing us together.
I also would like to recognize another iconic American institution, Western Union and its fellow Turkish American / Austrian CEO, Hikmet Ersek.
Indeed, I want to commend all of you for being here. Each of you brings something special and unique to this conference, and I appreciate you making the effort to be here.
I'm delighted to be back, once again, in this wonderful Mile High city and this extraordinary Centennial State.
One of the things I most enjoy about leading Coca-Cola is meeting people and experiencing cultures and seeing the remarkable beauty of our natural world, all around the planet.
Being here in Colorado, I can tell you that this is without question one of our world's most beautiful and idyllic places.
The majestic mountains. The rushing rivers. The lovely weather. All these things give your state a real advantage when it comes to innovation and growth.
And that's what brings us all here together today - that search for sustainable growth.
Truth is, we can scarcely talk about innovation without growth -- as strongly connected as these two ideas are.
And that's as it should be. After all, growth makes the world go 'round.
Everyone needs to grow. Individuals. Families. Communities. Cities. States. Nations.
All of them.
And we need all types of growth. Economic growth. Social growth. Intellectual growth.
Political growth. Spiritual growth. And on and on.
Because growth is, ultimately, the way I believe we will overcome the great challenges of our time.
We can't cut, spend or tax our way to better days. But we can continue to improve life in this country and around the world — if we're able to grow.
And innovation, of course, is one of the critical requirements for sustainable growth.
As countries, companies, NGOs and individuals struggle to solve the calculus for growth, they must all innovate and create new opportunities.
The question for today — and for the next decade and beyond — is: "What can we do to strengthen a culture of innovation and growth?"
My own answer to this question is shaped by more than three decades with Coca-Cola.
In business, I've seen how some organizations, after successful launches, tend to lose momentum while others accelerate indefinitely, like a perpetual motion machine.
I believe the secret formula for achieving that level of self-perpetuating success is found in a culture of innovation.
I know many of you in this room have experienced that kind of growth and success.
Today, we're striving to strengthen a culture of innovation at our company, building on our 126-year heritage in a way that defines what it means to be a twenty-first-century Coca-Cola associate.
Innovation has been at the heart of our journey from the start. Dr. John Pemberton — the Atlanta pharmacist who invented Coca-Cola — tried many, many recipes before creating the world's most refreshing beverage in 1886.
Coca-Cola wasn't just a delicious new drink: It began a new product category. In promoting Coke, our Company pioneered a host of innovations.
Among other breakthroughs, we pioneered the use of sampling coupons, differentiated our brand with our signature contour bottle, introduced the first six-pack, rolled out lightweight plastic bottles one sixth as heavy as glass ones, and even became the first sparkling beverage enjoyed in space. And on and on.
In recent years, we've sought to bring renewed focus to innovation, across every aspect of our business. And with good reason.
Our world today is moving very quickly ...
Competition is global and local and intense ...
The marketplace and consumers are demanding ...
And technology is evolving at a blistering pace.
Which means we can't sell one beverage in one package, as we did from 1915 to 1955.
In fact, we now offer more than 3,500 sparkling and still beverages, three times as many as a decade ago. And we introduced 500 new products in 2011 alone.
For Coca-Cola today, innovation is a journey.
We don't have all the answers... or even all the questions. But we're committed to innovation...and new ways of thinking... and new pathways to growth and value creation.
That value, of course, is not only for Coca-Cola but also for—
—our fans ...
—our shareowners ...
—our customers ...
—our employees ...
—our communities ...
—and our world.
All our stakeholders.
And we want to create shared value in all we do:
—from the refreshment people enjoy 1.8 billion times a day ...
—to the business opportunity our brands create for our customers ...
—to all the meaningful ways we try to improve the communities we proudly serve.
What does managing an innovation portfolio mean?
I define innovation pretty much as a novel creation that produces value.
At Coca-Cola, we follow innovation from all across the world, and we pursue innovation at three levels:
1. Tweaking, enhancing and improving existing core offerings. Coca-Cola Zero is a good example of this type of innovation.
2. Capturing adjacent opportunities. Examples here would be vitaminwater, Simply Orange Juice and liquid snacks in Europe under the innocent label.
3. Venturing into new and transformational territory. Our new Coca-Cola Freestyle dispenser, for example, is a transformational innovation.
This fountain provides consumers with more than 100 different beverage choices versus just eight choices in our legacy systems.
How? By using micro-dosing technology from the medical industry and moving our beverage flavors from large bags to small cassettes.
Giving consumers dramatically more choices, Coca-Cola Freestyle offers sparkling drinks, waters, sports drinks and lemonades.
All told, these 100-plus drink selections include over 70 low or no-calorie options, more than 90 caffeine-free choices and 80-plus brands unavailable elsewhere.
And, if that's not enough choice, you can create your own combinations of our drinks.
If you're thirsty later, by the way, there are 18 Coca-Cola Freestyle locations less than five miles from here, with the closest only a short walk away at Noodles & Company at 303 16th Street.
What can I say? I looked it up on the Coca-Cola Freestyle Facebook page!
Also, our PlantBottle, which I will reference a little later, is another good example of transformational evolution as it's the first time that a beverage container has been partially made from plants.
As I see it, there are — right now — five keys to building a culture of innovation and growth. And those are:
1. Continuous investment.
2. Global-minded talent.
3. Strategic partnerships and relationships.
4. Open-source networks.
And 5: A relentless focus on sustainability.
And I'll walk through each one with you.
First of all, innovation requires continuous investment. And not just monetary investments but investments of time and strategy and execution.
Leading companies and organizations invest in tough times, as we've tried to do in recent years.
For inspiration, we've drawn on our company's experience during the Great Depression.
While other consumer goods companies were cutting back on advertising and marketing, Coca-Cola chairman Robert Woodruff charted a different path.
Mr. Woodruff increased promotional spending — boosting brand strength, building our business and setting the company up for ever greater success.
Today, we're investing all over the world. In the U.S. and China and India and Russia and Mexico and Brazil and on and on.
For the next five years, we've already announced plans to invest — just for starters — more than $30 billion in our brands and our infrastructure as we pursue our 2020 Vision for growth.
This aggressive but, we believe, achievable plan aims to double the size of our business over the course of this decade — allowing twice as many people each day to open happiness with Coca-Cola.
Second, innovation requires experienced talent.
In fact, right now, companies, communities, states and nations are all engaged in a global war for talent.
The good news for you is that Colorado has a real and significant advantage in attracting individuals and companies, given your culture of innovation and the extraordinary quality of life in this state.
The simple fact is: People like being here. They like visiting, and they like staying.
Which makes it easier for organizations here to attract and retain great talent from both near and far.
At Coca-Cola, we seek out the best talent from all around the world — including here in Colorado.
In fact, we're delighted to be part of Colorado State's Beverage Business Institute — an organization launched last fall to educate and inspire future professionals and leaders in our industry.
And I couldn't have been more honored to talk with students at the institute's inaugural workshop in November.
A lot of excitement. A lot of vitality. And a lot of future promise for Coca-Cola and Colorado.
As a global business, we also strive to be geographically agnostic in locating people.
Which means we have people from Latin America working in Asia, Europeans in South America, Africans in Europe and so on. At our headquarters in Atlanta, we have more than 50 different nationalities represented.
Number three: Partners speed innovation.
Giving the complexity and seriousness of the challenges we face, I believe we must strengthen and build partnerships across what I call the Golden Triangle of business, government and civil society.
Fittingly, we're gathered today in Denver's Golden Triangle ... this vibrant neighborhood of landmarks, cultural institutions, restaurants and more.
As I speak about my Golden Triangle — one connecting business, government and civil society — it's clear that each has a special role to play ... and distinct strengths to leverage.
Indeed, this concept is foundational to the Colorado Innovation Network. And we have with us people from business, government, NGOs, universities — all eager to work together for the people of Colorado.
So I know I'm preaching to the choir. But I can tell you that Golden Triangle innovations are growing and flourishing and producing wonderful fruit all around the world.
The ones that work are next-level partnerships: ones focused on real results and organized with a bias for action. With those kinds of partnerships, magical things happen.
Today, for example, Coca-Cola is working with the Global Fund, the Gates Foundation and the Yale Health Leadership Institute to increase access to vital medicines in Tanzania.
Using our supply chain expertise, we've joined with Tanzania's Medical Stores Department to develop a new distribution strategy, redesign core processes, and train more than 50 medical stores staffers.
To me, this well illustrates the vast, largely untapped potential of business, government and NGOs to collaborate creatively together.
In fact, we're now working to replicate what's happening in Tanzania in Ghana.
Another focus area for Coca-Cola and our partners is promoting active, healthy living around the world.
Right now we have 250 such programs worldwide, with plans to have one in every country we serve by 2015.
Here in Colorado, we're very pleased to be discussing with Governor Hickenlooper and his health team ways we can work to improve public health and well-being as well as share some of this state's best practices across the U.S. No official news today, but stay tuned!
Part of supporting active, healthy living is providing more consumer choices. Choices in beverage types. Choices in sweeteners — caloric and noncaloric. And choices in portion sizes.
For example, we worked with our friends at Ball, based here in Broomfield, to develop our Coca-Cola mini-can, which debuted in 2009.
Available here in the U.S. and as far away as Australia and Korea, the 7.5-ounce Coca-Cola mini-can offers delicious refreshment along with portion control and just 90 calories.
Our Coca-Cola system is also working with partners to become water-neutral. By 2020, we'll return to nature and our communities an amount of water equal to what we use in making our beverages.
Since 2005 we've conducted 286 community water projects in 94 countries, working hand-in-hand with local governments and partners including World Wildlife Fund, USAID, the Nature Conservancy and CARE.
With each project, we're bringing delightful change to people — particularly the countless women and girls who used to spend much of their days carrying water.
We also proudly support the efforts of Water for People — a wonderful, Denver-based nonprofit.
Given the ongoing drought, we're honored to be part of several water conservation initiatives here in Colorado, including a drive to realize agricultural water savings in the south Platte River basin.
One of the contributions Coca-Cola brings to our partnerships is the kind of global scale that can open up new possibilities and accelerate innovation.
For example, we've invested more than $60 million over the last decade in the development of highly efficient, climate-friendly, HFC-free cooling technologies.
Ultimately, our interest accelerated the development of HFC-free-coolers, and we're moving entirely to this technology in new equipment by 2015.
Fourth: Openness fuels innovation.
Wherever I go, I like to get out into the stores and shops and restaurants — all the places that sell our beverages.
Why do I do it? Because I always learn something, and I never know where the next innovation is coming from.
In our modern era of technology and communication, new ideas can circle the globe in an instant. And, every day, it is mattering less and less where or from whom innovation comes.
In fact, innovation is now flowing from anywhere to anywhere.
For product innovation at Coca-Cola, we have a backbone of six R&D centers around the globe.
These centers advance local and regional innovation, including a juice drink brand called Minute Maid Pulpy, which came out of the Shanghai center in 2005.
An overnight success in China, Minute Maid Pulpy is now one of our 15 Billion Dollar Brands, enjoyed by people across 20 markets.
We've also set up a multicultural, multiethnic, multigeographic innovation council that meets quarterly. The team is separate from day-to-day operations. Funding, to the extent possible, comes from outside the normal budget cycle.
This council focuses on the iterative development of a few promising ideas — not the ruthless filtering of many. And the metrics also recognize nonfinancial achievements in the early phases.
Fifth and finally, sustainability spurs innovation, just as innovation spurs sustainability.
For the future, I'm convinced that some of the most important business breakthroughs will come at the intersection of sustainability and innovation.
That's where I believe the action will be — and where we're moving at Coca-Cola.
Moreover, we're striving to imbed sustainability across our entire value chain.
In packaging, for example, we're now using a recyclable plastic bottle that's 30 percent made from plants.
I mentioned it earlier in my talk. Called PlantBottle, this breakthrough package has cut our dependence on oil by 60,000 barrels since it debuted in 2009.
And PlantBottle has an interesting history. Seven years ago I attended Expo 2005 in Nagoya, Japan. When I arrived at the Toyota pavilion, I expected to spend, at most, a couple of hours there. But things didn't turn out that way.
Fascinated, I stayed for the rest of the day ... and came back for more in the morning. In particular, I liked how Toyota didn't say, "We make cars," at the pavilion entrance.
Instead, the company said, "Our business is personal mobility." And their focus everywhere in the pavilion on sustainability and respect for our planet was blatantly noticeable.
While I was returning back from the Expo to Tokyo, I had a dream for a beverage package that you could actually eat when you finished enjoying the drink inside.
While we haven't quite been able to realize that vision yet — PlantBottle moves us in that direction.
To date, we've produced and sold more than 10.5 billion PlantBottles across 21 countries. And we've shared the technology — which was partially developed in India — with H.J. Heinz for use in ketchup packaging.
For the future, we've commissioned three technology partners — including our friends at Englewood-based Gevo — to work on a big next step: a commercially scalable, 100-percent-plant-based bottle.
Even now, PlantBottle is delivering not only an environmental benefit but a business benefit: making our system significantly less dependent on petroleum and reducing associated volatility.
In distribution, we've now partnered with 3,200 entrepreneurs across Africa to get our products to places too difficult to reach in traditional ways.
In return, the owners of these Micro Distribution Centers — or MDCs — gain access to financing, training, networks and a new income source.
All told, our MDCs now employ 19,000 people and generate $600 million in annual revenue.
Thinking even bigger, we've launched our 5 BY 20 initiative to enable the empowerment of 5 million women entrepreneurs by 2020.
By increasing access to skills training, financial services and support networks, we're helping women build their businesses, support their families and improve their communities.
We expect to reach 300,000 women by the end of this year, as we test, learn and scale what works.
While there is great power in incremental innovation, I believe the best organizations must create unexpected or disruptive innovations.
As Henry Ford explained, "If I'd asked the public what they wanted, they would've said 'a faster horse.'"
In our time, no one knew they needed an iPod, iPhone or iPad until Steve Jobs dreamed them up. And who knew we needed Google or Facebook or Twitter or limitless entertainment on Dish Network until they came along?
For Coca-Cola, one of the most exciting disruptive innovations we're working on right now is a self-contained community water purifier that can operate even in the most remote parts of the globe.
Invented by our good friend and partner Dean Kamen, this breakthrough water purifier has the potential to increase the health and quality of life for countless people worldwide.
Right now, in fact, dirty water kills as many as 4 million people per year — more than all forms of violence and war combined.
I wish I could tell you more about Coca-Cola's involvement in this innovation, but please stay tuned for a formal announcement in the days ahead.
Another potentially transformative innovation — launched last month — came together as a partnership between our Company and our good friend — musical artist and producer will.i.am.
Called EKOCYCLE, this brand initiative is designed to help make recycling even cooler than it already is. Take a look at the EKOCYCLE video here.
One of the things I always share with Coke people is the need to remain "constructively discontent."
I imagine many of you share my restlessness and my consistent refusal to accept the status quo.
Leaders can't be complacent. We must keep moving forward, together with our colleagues and partners.
Personally, I feel my greatest legacy at Coca-Cola could be helping our company, our system and our people remain constructively discontent.
I'm often asked what worries me, what keeps me up at night. And I'll tell you: arrogance.
Because any time anyone begins to think they've got it all figured out, that's when they get wiped out. By a competitor. A new environment. Or some other meteor, right out of the blue.
As I look at you, I don't believe that's going to be the story here in Colorado. Not for a minute.
As the next great wave of innovation arrives at the intersection of supply chains and sustainability, you're well-prepared and well-positioned to make the most of it. And I have every confidence you'll do so.
In fact, I believe your state can serve as a vibrant model of innovation for the entire country.
Certainly, you're in the right place right now to build innovation and growth in Colorado.
And I want to make this personal, between you and Coca-Cola. If you have an idea for a way we can work together, send me a note and let me know.
Today, for all of us, in business and government and civil society, the choice is between innovation and irrelevancy.
You either innovate or you become irrelevant.
The choice, my friends, is just that stark. The stakes are just that high. And you've made your intentions very clear.
On behalf of Coca-Cola, I wish each of you every success as you innovate and grow, here in Colorado and the wide world beyond.
Thank you very much!