07 June 2011
Michael Costello, who leads the international division of The Clorox Co. , discussed his vision of aligning bosses, setting goals and measuring it all at WorldCity’s CEO Club meeting June 3.
Key to his style: The idea of “feed-forward,” not feed-back. That is, don’t tell the child what they’ve done wrong in the past and what to fix. Instead tell them what you want them to do in the future.
“You say: Go do these five things, and I don’t care what you do with the rest of your time,” Costello said. “It’s more people oriented. It gets away from yelling at people. It gets away from sticks.”
For country managers, Costello’s style can mean a big change. In many companies, the country manager is the king in his land. The child basically rules in his apartment. But the feed-forward system holds the manager accountable to meet the company’s strategic goals without making all the decisions.
To motivate, the company bosses involve managers in the goal-setting and measuring. It also tries to hire managers “who know how to influence, not just decide,” so that they can encourage both their bosses and employees to help reach the goals jointly set for the household, Costello said.
As corporate “dad,” Costello also calls each country manager regularly to stay on top of it all. “I interview every general manager once a quarter: How are you? What’s going on? Where are the gaps?,” he said, making sure they are not straying or receiving odd messages from product category moms.
In addition, Costello visits the countries he oversees and makes sure they know he means business. He’s been with Clorox for 23 years, taking on new responsibilities every three years or so. He now has responsibility for everything outside the United States and Canada for the Oakland-based company, which has annual sales topping $5 billion a year. Clorox owns a variety of well-known brands, such as Kingsford charcoal, Pine Sol, Glad plastic bags, Green Works, Burt’s Bees and others.
“I travel 50 weeks a year in the first year in every new position. You need to get people to either get in the boat or get off the boat and enforce it so people take you seriously. “ he said, after the meeting. “I get out there and make sure they are on my team, explaining my philosophy.
”Once the message is clear," Costello said he cuts back to 30 to 35 weeks travel in year two and 20 weeks travel in year three on the job. From the office, he also uses a flip-camera to send videos to staff and uses Microsoft communicator to keep in touch through instant messages and chats, Costello said.
In addition, he keeps track of results with a score card. He’ll ask his supply team, for example, “How are we doing on these five goals?” They might give some yellow for problematic or green for going well. If country managers give different results, he will try to bring both groups together to work on problems.
“Get people in a room. If you talk about it, you generally solve it,” Costello said.
Participants asked a broad range of questions on topics from communications to sales and brands. Here are some highlights from the discussion:
On how country managers communicate with corporate chiefs in different world regions: “It’s nuanced in terms of how open people are,” Costello told Steve Bartley, managing director at Boyden Global Executive Search. Managers in Australia, New Zealand and South Africa are more straight-forward about gaps and concerns. In South America, they’re less direct and more subtle.
On the outlook for Latin American sales: Clorox has seen tremendous growth in the past decade as Latin American countries’ per-capita incomes have surged. More people now can afford bleach and other basic consumer products."
On top priorities: Besides aligning bosses to a common agenda, Costello also focuses on cutting “total delivered costs” for products, he said. That runs the gamut from obtaining the most favorable prices on ingredients such as resin to streamlining distribution of products to and from warehouses.
On brands and brand extensions: Clorox focuses more on product categories, such as cleaning products, rather than on individual brands. Brand extensions tend to matter more in developed nations, not low income ones, he told Jim Fendell, president of Aeropost International Services.
“Chile is a first-world country hidden in Latin America,” said Costello.
The CEO Club is one of seven event series organized by WorldCity to bring together executives on international business topics. The event is sponsored by the University of Miami School of Business Administration and law firm Becker & Poliakoff. The next meeting is set for July 8.