How is the role of IT changing at
IT and marketing are very
close partners at
Coca-Cola, and, with
it, your role as CIO?
How did the strategic partnership
between marketing and IT at
Our marketers started to
think more seriously about digital channels five years ago or so. As mobile
adoption expanded, they started to build a direct connection with our customers
by pushing mobile applications for social media sites and our loyalty programs,
such as My Coke Rewards.
Marketing was driving a lot of it through its own advertising and digital agencies, while IT, at the time, was struggling to be relevant. We were viewed as a back-office function, not as one of the strategic leaders and partners in our digital marketing efforts. I believed we should be bringing ideas to marketing instead of them coming to us for creative solutions and, more often than not, getting the answer: “Sorry. We don’t have the people to do these things.”
Our first step was simply to offer traditional operating, hosting and security for the sites and platforms the agencies were building. We did that quite well and now have over 600 consumer sites hosted in one platform environment with great data protection.
What did it take to get to the level of business partnership to, for example, come up with cool mobile apps and connect them with consumer relationship programs?It’s all about people. Just like
That said, we still have some ways to go when it comes to getting young people with a different kind of mindset. We used to bring in 35 IT interns each year, but we hired none of them despite the great work they did because our focus was on seasoned hires – for example, business and systems analysts and project managers. We certainly must have very experienced people for big SAP projects and the like, but for application development work using software-as-a-service, an entry-level hire may be just fine.
We’re now hiring five of our interns each year, and it’s amazing what they can do. They look at the world differently, and they come up with new answers. They help us build a new culture in which IT is a better business partner. It will take years to complete this cultural shift, but it will only happen if we address the people side of it.
What is the IT department doing today to cultivate direct consumer relationships?
Mobile played a key role in Coke's "Move to the Beat" campaign for the London 2012 Olympic Games.
Demand-driven supply chain systems is a trend in
consumer packaged goods. What is
It’s a very important area for
Coca-Cola. We’ve been working hard the last couple of years to integrate our
plant and distribution systems to make it possible for us to see exactly what’s
happening with our products as they move through the supply chain. One critical
benefit is to ensure that we can minimize out of stocks. Imagine that we direct
our Facebook fans to a local outlet with a targeted promotion and the product
isn’t available. We’ve lost a sale and negatively impacted relationships with
Coca-Cola doing in this field?
We have pretty good visibility to the inventory at the back of a store, but we lose track at the shelf point and the cooler point. We’re experimenting with some interesting methods to fill that gap, such as radio-frequency identification (RFID) and electronic tagging of our products.
Interestingly, we have a pretty cool solution to this in the United Kingdom, where we have merchandisers take pictures of our shelves and coolers when they come into stores to talk about orders, promotions and so on. We spent a lot of time trying to automate the processing of the information in the photographs, but it turned out that a better solution was to send the photos to a company in India, where its staff studies the shots and in less than a minute gets back to us with stock counts of each product. It’s a nice blend of technology and human process. Is there a better solution? We’re still experimenting.
What is the best example of IT’s new role at Coca-Cola?
The computer records all the data involved in every single pour. Each fountain knows when it’s running low on certain products. We are also using automated ordering in many
We have visions of how we will use the data as we deploy thousands and thousands of the machines in locations such as restaurant chains, entertainment venues and retail stores. We’ve got 50 million plus fans on Facebook. We’ve got some 18 million people on My Coke Rewards. If we could bring these audiences together around
What’s your advice to a CIO starting out in the consumer packaged goods industry?My advice is that there's an interesting shift going on in the world of consumer packaged goods, and IT has to stay very close to the new trends if it wants to be relevant. If you're comfortable being an operational CIO, you’ll still be needed, but I don’t think you're going to help your company grow as fast as it could.
Robert Levin is an associate principal in McKinsey’s New York office.
Note: This article was originally published by McKinsey & Company. Copyright (c) 2013. All rights reserved. Reprinted by permission.
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