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Leadership

When Unilever Bought Ben & Jerry's: A Story Of CEO Adaptability

The British-Dutch mega-giant's takeover of the Karamel Sutra creamery went smoothly thanks to an adaptable CEO. Delicious executive lessons ensued.

In 2001, the British-Dutch conglomerate Unilever bought the American Vermont-based ice cream manufacturer Ben & Jerry's. A key asset of Ben & Jerry's was its market niche among those customers who appreciated the premium ice cream with unusual flavor names like Karamel Sutra, Chocolate Therapy, and Imagine Whirled Peace. In the acquisition, Unilever needed to preserve this market niche, which was based in no small part on the corporate image of Ben & Jerry's social responsibility and left-leaning social activism.

With an image honed by the founders Ben Cohen and Jerry Greenfield over almost twenty years, Ben & Jerry's worked with sustainable, Fair Trade certified and organic suppliers; used environmentally friendly packaging; paid premium prices to dairy farmers from Vermont who did not give their cows growth hormones; and created business opportunities for depressed areas and disadvantaged people. Giving 7.5 percent of their pretax revenues to charity, publicly traded Ben & Jerry's could not be accused of corporate greed. At the time of the acquisition, however, the Ben & Jerry's alternative management style lacked the fiscal and managerial discipline market analysts and investors demanded. The company's stock had fallen from almost $34 in 1993 to $17 in 1999.

Enter Unilever and Yves Couette, Unilever's choice to be the CEO of its new oddball acquisition. As a longtime corporate Unilever executive, the French-born Couette had spent several years running businesses in Mexico and India. Couette needed to thread the proverbial needle as the CEO, to understand this alternative American organization enough to preserve the intangible assets of Unilever's new acquisition while at the same time introducing some parent-company fiscal and managerial controls.

Within his first few months as CEO (an acronym that at Ben and Jerry's means chief euphoria officer), Couette demonstrated his true cultural agility by adapting some—but not all—of his leadership style and business practices.

He began with symbolic gestures. He came to work dressed casually, and volunteered to mix mulch at a company-sponsored gardening project in the local community. These initial gestures helped build rapport and ease employees' concern that Couette was sent by Unilever to dissolve Ben & Jerry's small-town American (and anticorporate) culture. On a more tangible level, Couette also continued the corporate social responsibility approach of the founders, saying that he envisioned Ben & Jerry's to be "a grain of sand in the eye of Unilever" because these practices were more generous than those typically found in publicly traded companies.

Even after the Unilever takeover, the core of Ben & Jerry's values remain. The company continues to contribute about $1.1 million annually through employee-led corporate philanthropy and makes substantial product donations to community groups. Today, Ben & Jerry's press releases reinforce this commitment to "doing good," stating that "the purpose of Ben & Jerry's philanthropy is to support the founding values of the company: economic and social justice, environmental restoration and peace through understanding, and to support our Vermont communities." Under Couette's leadership through the postacquisition transition, the Ben & Jerry's external mission continued.

However, Couette knew that some things needed to change at Ben & Jerry's to deliver a financial return to Unilever. In a very un–Ben & Jerry's act, he downsized the company—eliminating jobs and closing plants. He provided structure and introduced some basic organizational practices, and opened Ben & Jerry's positions to Unilever's global talent pool. Knowing that these moves would be unpopular with the employees, he justified them by saying that "the best way to spread Ben & Jerry's enlightened ethic throughout the business world was to make the company successful."

There was also an integration of the Ben & Jerry's practices with those of Unilever. For example, Ben & Jerry's began using the Unilever performance management system—but added its own performance dimension of maintaining the company's social mission. Many would agree that in this critical post-acquisition integration phase, Couette successfully led Ben & Jerry's both to maintain its corporate identity and brand image and, at the same time, to become profitable.


The Keys Of Cultural Adaptability

It was not by accident that Yves Couette, a highly culturally agile professional, was able to navigate the myriad of cultural challenges embedded in the Ben & Jerry's acquisition. Over years of working in different environments around the world, Couette has honed cross-cultural competencies enviable in many global organizations today. Unfortunately, there aren't enough culturally agile professionals who share his competencies.

In a survey conducted by the Economist Intelligence Unit, more than four hundred global business executives were asked to name the primary shortcomings of management-level and other specialized workers in various markets around the world. Three of the top four areas of concern were competencies related to cross-cultural agility: limited creativity in overcoming challenges, limited experience within a multinational organization, and culture-related issues.

The report concluded that "many candidates do not yet possess the understanding and sensitivity to navigate the intricate internal politics of a global organization or deal with the very different cultural backgrounds of a diverse workforce." Karl-Heinz Oehler, vice president of global talent management at the Hertz Corporation, offered this insight on the findings in this report: "The rarest personality traits are resilience, adaptability, intellectual agility, versatility—in other words, the ability to deal with a changing situation and not get paralyzed by it."

Culturally agile professionals are able to navigate the differences in cultural norms and behaviors and to adjust—when needed—to be successful. As a culturally agile business leader, Yves Couette adapted his management style and organizational decisions to fit with the alternative, antiestablishment norm of Ben & Jerry's to gain trust and build credibility with Ben & Jerry's employees.

Reprinted by permission of the publisher, John Wiley & Sons, Inc., from Cultural Agility: Building a Pipeline of Successful Global Professionals by Paula Caligiuri. Copyright (c) 2012 by John Wiley & Sons, Inc. All rights reserved.

[Image: Flickr user Vox Efx]