August 4, 2008
Coke’s Don Keough is The Real Thing
You learn more from your mistakes than your successes, the wise old heads say. That sums up the Don Keough view. (I hope he doesn’t mind me describing him as old, but he is 81, has six children and 16 grand children.)
He was also, famously, President of Coca-Cola for 12 years between 1981 and 1993, during which time he oversaw the doomed launch of New Coke. That botched innovation is seen by some critics as one of the all-time great business errors, so we can be sure Mr Keough’s views are based on sound experience.
I spoke to him on the phone last week, before he headed off to Tuscany for a summer vacation with all of the above-mentioned family. He may have been demob happy, but there was still time for a brief but serious discussion on business disasters and how to avoid them.
Mr Keough has just published a book, The Ten Commandments for Business Failure. It is an enjoyable and succinct read (although my colleague, John Gapper, offered a slightly crisper assessment in this FT review). It was a pleasure to have the author take me through its contents in a kind of fireside management tutorial.
“Success breeds arrogance and complacency,” Mr Keough told me. “When Bob Woodruff hosted a party to celebrate 50 years of Coca-Cola, he told the company that they were lucky to still be there, considering the mistakes they had made. He believed that success belongs to the discontented.”
Mr Keough’s book lists ten stupid things leaders can very easily find themselves doing – ironic commandments that will lead to failure. Some are not completely surprising: “quit taking risks”, “be inflexible”, “assume infallibility”. Others are more oblique: “don’t take time to think”, “isolate yourself”, “love your bureaucracy”. And some are especially insightful: “send mixed messages”, “be afraid of the future”, “play the game close to the foul line”.
This last one intrigued me. “The fact is,” Mr Keough said, “if you play on the edge the organisation will step over the line from time to time. It is inevitable. Warren Buffett [a long-time friend and partner of Mr Keough – Berkshire Hathaway remains a key shareholder of Coca-Cola, while Mr Keough sits on the Berkshire board] says: ‘Play to the centre of the court’.”
The one commandment I haven’t mentioned so far puts the journalist in his place. Don’t, whatever you do, Mr Keough says, “put all your faith in experts and outside consultants”.
Mr Keough ended our chat by saying some very nice things about the FT, but in case I was in danger of succumbing to arrogance and complacency he had a final piece of advice before going on holiday: “Now, get your butt in gear!”
It was said with a laugh, of course, but for a second I had a sense of what it must have been like working for the guy.
Tags: Coca-Cola, Warren Buffett
I met Don Keogh briefly at the 2007 Berkshire Hathaway Annual Meeting in Omaha Nebraska. I had asked for a picture of me and Charlie Rose in one of the main hallways and out popped Don Keogh from one of the side doors. Recognizing him instantly from other business books I asked him to join us in a picture and found him to be a nice, friendly, and energetic man. He has the smile of a genuinely happy person. And this makes you happy to meet him. He and Charlie Rose talked for a bit, then Mr. Keogh walked out the building to a waiting limo about 100 yards north of the Quest Center. It was surprising to me that few people recognized this giant of American business. I wish now that I had talked with him more, but I did not want to bother him at this fun event. Keen readers of business will note that Warren Buffett has many kind words to say about his friend Don Keogh. I look forward eagerly to reading Mr. Keogh’s book. And, if one of your readers will forward this post to him, perhaps I can meet and talk with him again someday.
Charlie Munger talks about taking ideas and “inverting them.” I think Don Keogh’s book may be a good example of how we can begin to do more of this.
Bud Labitan, author: “The Four Filters Invention of Warren Buffett and Charlie Munger” Link: (http://www.frips.com)
Posted by: Bud Labitan | August 4th, 2008 at 2:42 pm | Report this comment