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Cases Strategy Documents C12/2012 Reputation Placing reputation at the heart of business strategy: the case of Tetra Pak Many organisations include reputational management as part of their daily operations, integrating its principles and tools into corporate management to a greater or lesser extent. Yet few introduce the vision of reputation into the very heart of their business strategy, making it their main asset when taking business decisions Tetra Pak is one of the few examples that can be made in this sense, which is a truly remarkable feat for an organisation whose aim, however paradoxical this may sound, is somehow to go unnoticed, at least for its own users: all those people who 460 million times a day use their recycled containers or cartons of milk, juice, shakes or tea for breakfast, lunch or dinner. The mission pursued by this company –which has already been trading for over 60 years and has operations in more than 170 countries– involves providing safe foodstuffs that are available anywhere in the world, enabling them to be transported, stored and consumed on a long-lasting basis. This same long-term vision is what guides its responsible action and conduct as a partner to many firms that are its true customers, and which have been trusting in it to provide the finest solutions at any given moment, always with the utmost care for the environment and within the shortest possible timeframe. Reputation for looking ahead Tetra Pak recently implemented an international project with its eyes set on 2020, according to Nicolas Georges Trad, Executive Partner of Reputation Institute, in which all the organisation’s employees were actively involved in safeguarding and realising the brand motto that has been linked to its name for many years now: Protect what’s good (foodstuffs-food safety, people-human progress and future-environmental protection). This project –which was undertaken in tandem with an internal climate survey for measuring engagement and another one on customer satisfaction to assess loyalty–involved rolling out a strategy designed to continue upholding and reinforcing an excellent reputation built up over time in the sector, and whose main starting point was the understanding of two key factors: 1. Tetra Pak is successful when its presence goes unnoticed by consumers because it is doing its job well. This document has been prepared by Corporate Excellence – Centre for Reputation Leadership. It has cited, from among other sources, the speeches by Nicolas Georges Trad, Executive Partner of Reputation Institute, and Khaled Ismail, Corporate Brand Director at Tetra Pak, delivered at the 16th Global Conference “Going Global in the Reputation Economy”, organised by the Reputation Institute in Milan from 30 May to 1 June, 2012. 2. Tetra Pak is successful when it understands and predicts the needs of all its other stakeholders to increasingly improve the way it does business. According to Khaled Ismail, Tetra Pak’s Corporate Brand Director, the company was assessed by these five stakeholder groups, including consumers themselves, using Reputation Institute’s sevendimensional model, ReptrakTM. A comparative study was made between each one of the different dimensions at global level, between the different countries and a contrast was also drawn between each one of the different dimensions and countries. As a result of this process, during the first half of 2011 Tetra Pak held meetings in its 28 main operating countries with over 15,000 key stakeholders for the company (from distributors through to producers, and including opinion leaders and employees –over 22,000 all over the world). The gatherings were vital for discovering their concerns and expectations, and the needs and challenges they face both now and in the immediate future. The outcome: an action plan for reinforcing strengths and addressing weaknesses, specifically in each one of the 28 markets analysed, with specification of the key indicators and priorities over the coming five years for each area and each one of the countries. This plan provided a better understanding of which stakeholders really do impact upon and shape Tetra Pak’s reputation, to what extent and in which dimensions. The following are Tetra Pak’s key stakeholders: 1. Consumers 2. Distributors 3. Producers 4. Employees 5. Opinion leaders That was the project’s goal, namely, to ensure that what the company wanted to be and how it wanted to be perceived (ambition) were consistent with Tetra Pak’s capacities and culture (competence), as well as being aligned with the visions and requirements The last one of these groups includes the media, non-governmental organisations in environmental matters, international regulators and institutions, brand and reputation experts and public opinion itself. Graph 1: Reputation Management Pe r ance m r fo Profitable Better results than expected Strong growth prospects Stands behind High quality products Meets customer needs hip hi p h at T ‘s Good Offers equal opportunities Treat its employees well Be a great place to work lac e Trust Fair in business Behaves ethically Open and transparent kp ns ize Cit Environmentally responsible Support good causes Society responsible Protects food W Tetra Pak Adapts Quickly Innovative Improve its products or Feeling Protects vation Well organized Excellence management Appealing leader Clear vision for its future o Inn Esteem Admire Leaders Produc ts/S erv ice High quality service s “Tetra Pak is successful when its presence goes unnoticed by consumers because it is doing its job well and predicts the needs of all its other stakeholders.” Merging ambitions, realities, perceptions and expectations M Placing reputation at the heart of business strategy: the case of Tetra Pak W Governance Source: Reputation Institute, 2012. Cases 2 of the different stakeholders (perception and expectation); in short, to strike a balance between what is said, what is done and what is expected. management through to the last of the professionals it employs, including the teams in each one of its operating countries and in its different departments (Marketing, Human Resources, Sales, Environment, Communication, Operations, Finance, Operations and R&D&i). They have all been involved in the same way in the definition of the plan’s major guidelines, as well as their implementation in the form of projects and campaigns. From vision to action: theoretical goals and practical experiences were interconnected, thereby rendering it possible to improve the brand’s direct interfaces and trigger the attitudes towards the same that Tetra Pak initially sought at the start of the project. Furthermore, Tetra Pak’s vision regarding the relationship between brand and reputation and their contribution to the value creation process was clear: they both operate in unison when helping the company to conduct its business. Reporting plays a key role accordingly when aligning them and ensuring the right brand messages (sent consistently) reach the right people (with expectations for improving reputation) in the right places (through relevant communication channels) and in the right way (efficiently and sharing best practices). 1. Research: involving all stakeholders 2. Analysis: current situation 3. Identification: global and local priorities 4. Development: action plans 5. Implementation: action plans 6. Assessment: degree and efficacy This was the path followed for aligning the pledge of Tetra Pak’s brand identity with what it actually delivers and its subsequent appraisal in the guise of its reputation, closing the circle of the value chain of intangibles for this international organisation. Reputation Institute was the one responsible for Yet the organisation’s approach to the design of recycled carton packaging is both strategic and operational: from the company’s senior Germany Switzerland United Kingdom Ukraine Russia Korea Canada Japan 17 14 13 Cares about the environment Corporate selected attribute - priority Socialy responsible Corporate selected attribute - priority Set industry trends Corporate selected attribute - priority Protects food Corporate selected attribute - priority Is a great place to work Open and transparent Behabes ethically Corporate selected attribute - priority Clear vision for its future Corporate selected attribute Adapts quickly to change Corporate selected attribute - priority High quality products Corporate selected attribute Treats is employess well Corporate selected attribute Products respect environment Local selected attribute Strong and appealling leader Local selected attribute Well organized Local selected attribute High quality services Local selected attribute Improves its products Local selected attribute Fair in business Local selected attribute 1 Support good causes Local selected attribute 1 Local selected attribute Corporate selected attribute - priority USA Vietnam Pakistan Turkey Australia Graph 2: Priority areas by market Saudi Arabia “There is a need to bridge the gaps between the brand pledge, the business strategy, stakeholders’ expectations and their true perceptions.” Its main stages were as follows: India Placing reputation at the heart of business strategy: the case of Tetra Pak 10 9 7 6 5 5 5 3 3 10 4 2 1 Source: Tetra Pak, 2012. Cases 3 Placing reputation at the heart of business strategy: the case of Tetra Pak recommending specific measures to Tetra Pak for bridging the gaps between that selfsame pledge, the business strategy, stakeholders’ expectations and their true perceptions on the matter. The CEO’s internal leadership One of the key aspects behind the project’s success was the direct involvement of the company’s president and CEO, Dennis Jönsson, who featured together with a selection of employees from all over the world in a video that was used both to launch the process and as a tool for engaging all the other collaborators in the project and encouraging them to actively take part in it. Jönsson also chaired a series of cascade briefing sessions with the different staff departments at Tetra Pak to involve them effectively and kickstart the process for the analysis and management of reputation in each one of the 28 key markets selected previously. Finally, hands-on involvement and leadership are important when seeking to ensure that a major and farreaching process such as the one begun by Tetra Pak reaches a successful conclusion: this is possible only when the CEO acknowledges and accepts the value contribution reputation makes to the business results. Jönsson’s achievement, therefore, was to ensure the entire organisation embraced the project as its own, while strengthening the link between collaborators and bringing about real change driven from within. Conclusion: a silent reputation Thanks to this comprehensive project, Tetra Pak managed to uphold a silent reputation as regards its consumers, yet at the same time maintain a solid and robust one with all its other key stakeholders, such as producers, distributors, employees and opinion leaders. The company implemented what may be considered six essential steps for taking good strategic decisions in matters of reputation: 1. Define the impact of the business 2. Identify stakeholder expectations 3. Establish a reputational platform 4. Define the key points of influence 5. Integrate the platform in said points 6. Implement the decision-making process By following this roadmap, it is possible to incorporate reputation, placing it at the heart of decisions and the business strategy, thereby ensuring they both tread the same path and do not head off in different directions as occasionally happens in some organisations. Cases 4 Leading by reputation ©2012, Corporate Excellence - Centre for Reputation Leadership Business foundation created by large companies to professionalize the management of intangible assets and contribute to the development of strong brands, with good reputation and able to compete in the global market. Its mission is to be the driver which leads and consolidates the professional management of reputation as a strategic resource that guides and creates value for companies throughout the world. Legal Notice This document is property of the Corporate Excellence - Centre for Reputation Leadership and has as its objective to share business knowledge about Brand, Reputation, Communication and Public Affairs Management. Corporate Excellence - Centre for Reputation Leadership is the owner of all the intellectual property rights of the images, texts, designs and any other content or elements of this product and has the necessary permission for its use, and therefore, its copy, distribution, public release or transformation is prohibited, without express authorization from the owner.
