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HJ Heinz finance director, Garry Price

Garry Price is full of beans. There’s no other way to describe him. We meet
him on an auspicious day: it’s exactly 23 years since he started his career as a
trainee with HJ Heinz in Canada and yet, even after almost a quarter of a
century with the same company, he still talks ten-to-the-dozen, pinging from
people to products to performance like a pinball, peppering his speech with
imagined conversations with other people to illustrate his point and bubbling
with an enthusiasm you couldn’t put in a bottle if you tried and which contains
absolutely no artificial ingredients. It’s a wonder we got him to stay still
long enough for the photoshoot.

He has a passion that has taken his CV ­ and his family ­ from Canada to
Pittsburgh, back to Canada, then Holland, France and now Hayes, Middlesex, where
he is CFO of Heinz’s UK and Ireland division. “I was supposed to come to Europe
for two years,” Price says. “It’s been six. We’re loving it. The whole family
absolutely loves it. It’s a fantastic experience.”

As far as we’re concerned, families are usually off-limits in the
Financial Director interview, but the family factor can’t be ignored
when you’ve taken two daughters to three schools in three countries in about as
many years. He admits it can be hard on children, but as far as he’s seen, “the
benefits outweigh the cost,” he says.

The oldest daughter has been admitted to top US university Cornell, “and I
think a big chunk of that was her international exposure and her cultural
understanding. She’s been in 32 countries in her life now and she’s lived in
five and it’s not bad for an 18-year-old, I think.”

Life’s a beach
Price recalls the excitement when he told his family that he was in the running
for a job in Australia ­ “I made a mistake in telling them; you don’t do that.
They were really pumped up.” ­ and their disappointment when he turned it down
for a posting in Holland. “‘What happened to the beaches?’ ‘The beaches in the
Netherlands are fantastic on the North Sea!’” (You see what we mean about the
imaginary conversations.) “I’ve been extremely lucky because each time we move
[the family is] positive about it. We’ve had no problems. Well, we’ve had the
typical problems,” Price admits, “but nothing that would force us to go home. So
it’s been a super ride.”

Back to business and, over and above all the international travel, there’s
another reason why Price is just fizzing: in the two years he has been in the UK
he’s played a pivotal role in getting significant growth back into the British
and Irish business which had been flat for around five years. Britain and
Ireland are important to the Pittsburgh, Pennsylvania, branded food group, he
says. “If this company isn’t growing it’s very hard for the rest of the company
to hit its growth targets because everyone has to [grow] by a factor of 10.”

(Apparently, many people in Britain think Heinz is a British company, though
not without good reason, perhaps. “Outside of New Zealand, the sales [of Heinz
products] per capita is larger in the UK than anywhere else. So, substantially
above the Americans.”)

Price describes what was wrong with the business when he came here. “We got a
little lazy; I think we got complacent. The products we had were number one in
most of the things we do and I guess we took a too-relaxed view.” Then, he says,
fresh competition came in from Premier Foods in red sauce, brown sauce and
beans. Heinz, however, had been suffering from “a lack of innovation, there was
a lack of true, really talented marketeers that understood consumers and
understood what the consumers wanted. And I don’t think there was the right
drive and the right level of accountability. A lot of people flew below the
radar screen and were getting through each day and going home.”

In virtually all areas, including marketing, supply chain, HR and sales, new
people were brought into the UK organisation from Gillette, Coca-Cola, Mars and
from some far-flung bits of the Heinz empire. “I don’t think we’ve used this
model before,” Price says. “We’ve taken people from other areas around the
world, put them in another place and said, ‘Go fix this; make something out of
it. Let’s look at this, forget about what’s happened. In reality, we’re not
stuffed with some precedent or ‘You have to do it this way’; let’s look at it
completely new, fresh view, and pooling all of our experiences together.’ And
it’s been incredibly successful.”

Price rattles off a list of performance statistics to prove his case: 3.6
points up in ketchup, four points up in salad cream, six points in soup, seven
points in bean meals, frozen ready meals up six points. “Our business is
growing: 88% of our portfolio is in growth.” Core to this is a significantly
higher proportion of sales coming from new products ­ everything from ‘Farmer’s
Market’ soups to little, microwavable tubs of baked beans. In fact, 120 new
products were launched last year alone. So forget about there ever having been
just 57 varieties.

Sense of urgency
To achieve these sorts of figures, finance wasn’t exempt from the turmoil made
necessary to throw off the complacency that had set in. About half the finance
staff were replaced in the space of 18 months. “Some at our request and some at
theirs,” he says. “One of our values is ‘sense of urgency’ and everyone has to
have accountability. Some people weren’t up for that because they just
weren’t.” The new structure requires everyone to deliver against objectives: “We
have 90-day objectives and four-year goals. We do reviews semi-annually and
annually with career planning as part of that, so we’ve really taken it up a
notch from an HR perspective as part of a high performing organisation.”

Finding the right people wasn’t easy, and Price says he is frustrated by
headhunters, most of whom don’t do the proper due diligence on candidates. It
took eight months to find a financial controller, for example ­ “but we weren’t
going to make a mistake”. Price wanted to get people who understand consumers
and the pressures on retailers.

And he’s changing the culture of finance, getting away from its traditional
role as “reporters of the news after the fact. Everyone’s waiting: ‘How did we
do this month?’ We’re trying to become more ‘business partners’ than just a lot
of accountants around the place,” he says. “We’re trying to take away the
monthly build-up. ‘We’re closing the books next Wednesday.’ ‘Okay,’ ­ and
there’s this big build up. It shouldn’t be like that; it’s [just] another day.
So we’re trying to do things weekly now. ‘Let’s tap into our yield reporting,
our labour reporting, our overhead recovery and our gross profit. What did we
earn last week? What did we ship? What were the sales? What was the gross
profit?

“I want my finance guys to understand what’s behind the numbers,” he says.
“Sometimes they struggle. A lot of the finance people have a tough time putting
words on a piece of paper with numbers. And what you find is, ‘Hey, give me the
summary of those numbers,’ and what they do is they read the numbers. They’ll
say, ‘We’re up 2.6% driven by higher volumes’ and it’s like, ‘Look, guys, tell
me what’s behind that,’ ­ which stretches them a little bit. And then, ‘Okay,
well, we’re down in Sainsbury’s.’ ‘Why? What do we do about it?’ ‘Oh, shall I go
check?’ ‘Why don’t you?’”

To help make this happen, Price has his finance people literally sitting with
the operational people: “We’re located throughout the business, so [for example]
our factory finance people have dual reporting: they report into the factory
managers, but also into our supply chain finance director who works for me. We
have people in sales areas. We have a sales finance manager [who sits] with each
major customer team.

Part of our drive of becoming a business partner is to have a seat at every
table so every decision that’s made in this corporation, I want finance to have
a part of it. I want finance to be a valued member of that group at that table.
So we’re going to launch a new product, finance has a say in it. We’re going to
launch a marketing campaign, finance has a say in it, because we can add value
to it.”

We ask what value finance can add to such a marketing-orientated business
given that, as we dare to suggest, finance managers obviously aren’t expected to
actually create new products. “You’d be surprised!” he exclaims, proceeding to
tell us about a range of baked beans that have slurried vegetables mixed up in
them. “We do these ‘Dragon’s Den’ every once in a while and people from the
organisation get together in teams and come up with new products. And this was
an idea from one of the women who works in HR. The whole purpose of this is you
give your kids the vegetables, but they don’t know it. Fantastic idea!”

Taste for new ideas
So if HR can dream up new ideas, surely finance can think up new types of beans.
The real role of finance, of course, is to do the modelling, the costings, test
whether the projections meet the necessary hurdle rates and then, after launch,
to do the one, three, six and 12-month reviews. Part of that exercise involves
making sure the product has been costed properly: real-life factory costs can be
different from experience in the pilot plant. Not all launches survive this
process. “New products are hit and miss,” Price says.

One interesting aspect of new products, though, is that the cannibalisation
effect can be a lot less than one might expect. The little snackpot tub of
beans, for example, “is creating new uses for beans” (and we bet you never
thought you’d read a sentence like that). “It’s convenience, it’s a come-home
from school, the children can pop one of those in the microwave, it’s 200 grams,
it’s a snack before dinner.”

If you cut Price he’d probably bleed ketchup, as he admits, though the same
seems to be increasingly true of his colleagues. Schemes such as
“Adopt-a-store”, “Consumer closeness sessions” and working shifts in the
factories help even the most senior executives understand the whole of the Heinz
operation ­ to say nothing of the new products that immediately land in the
staff canteen (“We eat the soup”). Price has a store in Chesham,
Buckinghamshire, that he is supposed to visit once a month “and actually do a
survey of the product on shelf,” he says. “What is the price point? Are we
getting three facings on the shelf or two? What’s on promotion? What are the
competitors doing?” There are around 225 senior execs with a store each, “which
is also providing market intelligence back into the company.”

On the consumer closeness sessions, Price spent an afternoon with a young
mother in Ruislip, west London, listening to her talk about her shopping habits
and even going to the store with her, finding out “what’s important when she’s
walking through the aisles, what upsets her, what intrigues her, what is she
looking for? Is she looking for health and wellness? Is she looking for reduced
sugar and salt? Is she looking for organic? Is she looking for colour and
flavour and new experiences and all those kind of things?”

And as you might expect in a business where manufacturing quality is so
crucial, a shift on the beans canning line helps round off the education for
this highly operational FD. Oh, and in case you’re wondering, Price tells us
(without being asked) that Heinz’s beans production is 336 million units a year.
That’s 14 cans a second. So now you know: you can take the finance director out
of beancounting, but you can’t take the beancounting out of the finance
director.

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