The Coca-Cola Company: Doug Ivester's Failure to Generate Expected Results
Introduction and structure
Sometimes even the most brightest of minds fail. Doug Ivester, head of the Coca-Cola Company for only a little more than two years, resigned after an unofficial meeting with the two board members Warren Buffet and Herbert Alan. Fostered by former CEO Goizueta for over 10 years, he took over this position of one of the highest ranked global brands after Goizueta’s unforseeable death. As it turned out, Ivester could not generate the results he was expected to (Morris & Sellers 2000).
What happened along his short road as CEO? How and why could such a long time inducted person flop so badly? In a first step, this essay examines Ivester’s actions, taken into account different theoretical leadership approaches. Furthermore, it will reveal a lack in ‘people skills’ like emotional intelligence and communication. This given, there will be recommendations on how Coke can find a better match.
The approach to leadership by Doug Ivester
Coming from and affected by the accounting and finance sector where he worked his way up to the very top (Watkins, Knoop, & Reavis 2005), Ivester was often described as a ‘numbers’ person, “obesessed with controlling the tiniest details” (Morris, Sellers 2000, p.115). Statements like “The highly disciplined organizations are the most creative...We operate with a rigid control system.” (Morris & Sellers 2000, p.116) indicate his rational, objective and authority driven approach to leadership. Furthermore, he even demanded regular communication with his senior executives (Hays 2004), making them inferior and demotivated. Hence, interactions between Ivester and his followers only occurred when the latter failed to respond to Ivester (Hays 2004).
These behaviors are all signs of a transactual leader using the management by exception style (Judge & Piccolo 2004). Introduced by Burns (1978) and contrasting with transformational leadership, it “is based on a fairly straightforward exchange between the leader and
Sometimes even the most brightest of minds fail. Doug Ivester, head of the Coca-Cola Company for only a little more than two years, resigned after an unofficial meeting with the two board members Warren Buffet and Herbert Alan. Fostered by former CEO Goizueta for over 10 years, he took over this position of one of the highest ranked global brands after Goizueta’s unforseeable death. As it turned out, Ivester could not generate the results he was expected to (Morris & Sellers 2000).
What happened along his short road as CEO? How and why could such a long time inducted person flop so badly? In a first step, this essay examines Ivester’s actions, taken into account different theoretical leadership approaches. Furthermore, it will reveal a lack in ‘people skills’ like emotional intelligence and communication. This given, there will be recommendations on how Coke can find a better match.
The approach to leadership by Doug Ivester
Coming from and affected by the accounting and finance sector where he worked his way up to the very top (Watkins, Knoop, & Reavis 2005), Ivester was often described as a ‘numbers’ person, “obesessed with controlling the tiniest details” (Morris, Sellers 2000, p.115). Statements like “The highly disciplined organizations are the most creative...We operate with a rigid control system.” (Morris & Sellers 2000, p.116) indicate his rational, objective and authority driven approach to leadership. Furthermore, he even demanded regular communication with his senior executives (Hays 2004), making them inferior and demotivated. Hence, interactions between Ivester and his followers only occurred when the latter failed to respond to Ivester (Hays 2004).
These behaviors are all signs of a transactual leader using the management by exception style (Judge & Piccolo 2004). Introduced by Burns (1978) and contrasting with transformational leadership, it “is based on a fairly straightforward exchange between the leader and
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