How Employee Engagement Turned Around Campbell's - Forbes.com

How Employee Engagement Turned Around Campbell's - Forbes.com


How Employee Engagement Turned Around Campbell's
Terry Waghorn, 06.23.09, 06:00 PM EDT
An interview with Douglas Conant, CEO of Campbell Soup Co.

Excerpts:

When Douglas Conant was brought in from Nabisco to be chief executive officer of the Campbell Soup Co. in 2001, Campbell had devolved into what one magazine called "a beleaguered old brand." Sales for its largest product line, condensed soups, had declined amid intense competition, and the company was rumored to be near being taken over by one of the food industry's best performers. Eight years later, Conant is well on his way to fulfilling the mission he then set for himself, taking what he called a "bad" company and lifting its performance to "extraordinary." He has done it with cost-cutting, smart innovations, increased marketing and, especially, a concerted effort to reinvigorate the workforce.

The strategy isn't complicated. "To win in the marketplace," he has said, "we believe you must first win in the workplace. I'm obsessed with keeping employee engagement front and center and keeping up energy around it."

Gallup, the polling and research firm, studied the engagement levels of Campbell's ( CPB - news - people ) managers in 2002 and found that not only did 62% of them consider themselves not actively engaged in their jobs, a full 12% felt they were actively disengaged. Those numbers, Conant says, were the worst for any Fortune 500 firm ever polled. Today, the story is far different: 68% of all Campbell employees say they are actively engaged, and just 3% say they are actively disengaged. That's an engagement ratio of 23-to-1, and Gallup considers 12 to one to be world-class.

That massive shift has led to a dramatic turnaround in the firm's performance. In an industry that is known more for stability than for growth, Campbell has organically increased its earnings (exclusive of acquisitions, divestitures and the like) by up to 4% a year over the last eight years, with earnings per share growing 5% to 10% a year. Those figures put it near the top of its industry. Investors in Campbell have done quite well too. The total return on Campbell stock, assuming reinvested dividends, is more than 30% over that period, during which the Standard & Poor's 500 index has lost more than 10%.

Conant's use of employee engagement has been so successful that it is held up as a model in the book Closing the Engagement Gap--How Great Companies Unlock Employee Potential for Superior Results, by Julie Gebauer and Don Lowman.

Forbes recently spoke with Conant to discuss how he engaged his employees so effectively.

Read Full Article: http://www.forbes.com/2009/06/23/employee-engagement-conant-leadership-managing-turnaround.html?partner=executive_picks_newsletter


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This posting was made my Jim Jacobs, President & CEO of Jacobs Executive Advisors. Jim also serves as Leader of Jacobs Advisors' Insurance Practice.