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Get Four
|  | MAY 5, 2004
By Dean Foust The Return of a Coke Classic Consummate insider E. Neville Isdell accepts the top job -- and a daunting mission: Restore the fizz and get Coke growing again In recent weeks, the biggest question surrounding Coca-Cola's search for a CEO wasn't "Who will it be?" as much as "Does anyone want this job?" One by one, outside candidates lured by Coke (KO ) -- a list that includes Robert Eckert of Mattel (MAT ), Carlos Gutierrez of Kellogg (K ), and James Kilts of Gillette (G ) -- all withdrew their names from consideration. A perception grew that Coke's star-studded board might be scaring top talent away with fears of being micromanaged. So, having raised expectations that Coke would bring in an outsider to shake things up, the board's choice on May 4 of retired Coke executive E. Neville Isdell, 61, to succeed Douglas N. Daft might be viewed in some circles as a bit of a comedown. But look closer: Isdell is home-grown talent, revered within the corporation, and his selection will likely provide a big morale boost to a company that has been dogged by a divisive discrimination suit, a government accounting probe, and several years of lackluster financial performance. "VERY CHARISMATIC." Isdell knows the Coke system cold: A citizen of Ireland, he joined the company in Zambia in 1966, and served soft-drink tours of duty in South Africa, Australia, the Philippines, and Germany, where he consolidated A hodgepodge of 106 bottlers into 30 in just 3 years. He's best known for his people skills -- a valuable asset at a huge outfit like Coke. Indeed, Isdell is cut from the same managerial cloth as Coke's legendary former president, Donald R. Keough -- a gregarious backslapper who could motivate and inspire the troops like few before or since. As the head of Coke's Philippines operations in the mid-1980s, Isdell would sometimes help clean the bottling plants, attaining such respect that local workers gave him a commemorative plate declaring him an honorary Filipino. "He's very personable, very charismatic," recalls a former Coke colleague who knows Isdell well. "He's very well-rounded. He's as comfortable at rugby matches [he used to play the game] as he is at the opera." EUROPEAN CHALLENGE. So strong is Isdell's standing inside Coke that in the mid-1990s, he was considered one of the leading internal candidates to succeed then-Chairman Roberto A. Goizueta. When Goizueta died unexpectedly, Isdell was bypassed in favor of M. Douglas Ivester. But Isdell's enthusiasm never flagged. He took on the challenge of heading Coca-Cola Beverages (CCB), the European bottler that was charged with building Coke's franchises in Russia and Eastern Europe. After the Russian currency crisis devastated CCB's business model -- and left the bottler perilously close to violating its debt covenants -- Isdell presided over its 2000 sale to a financially stronger Greek bottler. While that deal saved CCB, it also put Isdell out of a job at the age of 57, and he has been in semiretirement ever since. But no one can question Isdell's knowledge of the Coke system. On that count, he comes better prepared than any outside candidate. Isdell takes office with a few question marks hanging over his head -- chiefly, how long he will serve in this gig. He'll be 65 in four years. He could stay on longer, but he won't have the luxury of time, as the fortyish Goizueta did, to truly effect change at Coke. GET JUICED? The big question is whether Isdell will tackle the serious changes that many believe Coke needs. A protégé of Keough's, he might be more likely to challenge the board than an outsider would be. Then again, Coke has long suffered from an insular culture. Some Coke insiders say the outfit stopped innovating back in the 1990s -- and as a result, it finds itself badly lagging behind competitors in noncarbonated categories like juice, water, and sports drinks, which are growing far faster than the declining soft-drink segment. That's part of the reason why the board wanted to bring in an outsider, say some Coke watchers: to get a fresh perspective and assess whether any growth is left in sodas, or whether Coke needs to diversify into other marketing-related fields, such as motion pictures or entertainment. In the end, Isdell will be judged by whether he has the moxie to make the tough decisions needed to get Coke growing again. But you can say this much: He sure knows the product that he's selling.  Foust is BusinessWeek's Atlanta bureau chief Edited by Douglas Harbrecht
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