Driving Diageo’s ambition
Published:  22 January, 2010

As far as missions go, Simon Litherland’s is highly ambitious. “I would love to set about creating Diageo as the most celebrated consumer goods company in Great Britain,” says the man who landed the top job of managing director six months ago.

“There’s a number of strands to that. One is outstanding business performance – out?performing our peers and competitors continually and being sustainable in the market?place,” Litherland explains.

Just as his predecessor Benet Slay will be remembered for propelling Diageo’s social responsibility policies forward, Litherland wants his legacy to be a company that “outperforms the competition in all respective categories”.

If track record is anything to go by, he might have the ability to make this happen.

Prior to joining Diageo GB last July, Litherland sat at the helm of Brandhouse South Africa – a joint venture between Diageo, Heineken and Namibia Breweries, with a portfolio of more than 40 drinks brands.

During Litherland’s five-year tenure, Brandhouse doubled in size to employ more than 900 people and was voted the best medium?-sized employer and best consumer goods company in South Africa for two years? running.

And it’s this level of success that Litherland wants to replicate at Diageo.

A tall order“Brandhouse had a very successful five years?. It significantly increased its share in a beer marke?t dominated by SAB Miller and created a fantastic team of people,” Litherland says.

But he’s under no illusions about the scale of the task ahead in the UK. “The South African market is very different – it’s an emerging market, a product of rapid economic growth. There’s been an important growth in the emerging middle classes.

“In that way it’s quite different to a much more stable UK market?. There’s no growth in the total beverage alcohol market in the UK. It’s a very difficult challenge, that’s part of the entertainment of being here.”?Litherland, who has been with Diageo for 16 years, having joined from Pillsbury UK in 1992, believes the key to success is having a top?-notch team behind him, where staff ca?n “thrive, grow and develop”.

“I believe you can create what you choose to through having amazing relationships with each other in business and working as an aligned organisation. I believe in authentic and open communication, and for individuals to excel and take risks,” he says.

But what does his tenure mean for customers doing business with Diageo, from the multi-billion?-pound supermarkets to the independents??“We need to work very closely with the big grocers? but, having said that, every customer is just as important to us. It’s an important opportunity [to work with] the structured convenience and independent channel,” Litherland says.

However, some retailers have been critical of Diageo’s approach in the past for failing to deliver sufficient customer service and an attitude that even its employees have admitted sometimes verged on arrogan?ce.

It’s a view Litherland vehemently denies, although he’s adamant that if problems had existed previously they will be resolved?. “There’s an important opportunity for Diageo and our customers to really have a dialogue, and a relationship where we work together.

“We clearly need to listen to our customers and understand what they are seeing and their needs. We must hear their ideas and bring our expertise to deliver them,” he says?.

Diageo is “investing significantly” in collaborative projects with retailers that “create a much better shopping experience”, according to Litherland.

Innovation will play a big role in bespoke projects with retailers, he promises, such as “new brands and offerings, or different formats that fit customer needs”.

Initiatives already in the market include the Free Your Spirits campaign to encourage retailers to site spirits around stores rather than just behind the counter.

Last year Diageo invested £1.5 million in? distributing free? anti-theft kits, enabling retailers to increase spirits sales by up to 37%, the company claims.

Scottish challengeSince taking on the job, Litherland has faced a number of significant challenges, as Diageo grabbed headlines this summer when it announced 900 job cuts across Scotland as part of a restructuring plan designed to save £100 million.

With First Minister Alex Salmond joining workers, MPs and trade unions in campaigns against the proposed losses, is Litherland worried that Diageo’s reputation has been irrevocably tarnished??“I don’t believe so,” he says. “We’ve been very clear about what we wanted to do and we went about it in a very responsible way.

“It was the right decision for us to remain competitive and for the long-term future of our business in Scotland. We are still a massive employer in Scotland, we want to protect their futures.”?With such clear strategies in place to meet the economic challenges head on, Litherland is certain Diageo GB’s prospects look bright.

“?This year is going to be tough, but I’m confident we’re going to grow and work collaboratively with our customers, creating value for them,” he says.

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