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Craving Challenges

This article accompanies Investing in the Future and The 2017 HR Honor Roll.

Splitting the workforce of Kraft Foods to build two new packaged-food companies is only one of several daunting challenges Mondelez International CHRO Karen May has surmounted in recent years. 

Monday, October 16, 2017
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Anyone who knows Karen May has heard her say this, and probably more than once: "Change -- or a crisis -- is a terrible thing to waste."

That pretty much sums up May's philosophy about dealing with big challenges. And she's had a few.

The first came in 2010, when Kraft Foods Inc., where May was executive vice president and chief human resources officer, acquired 186-year-old U.K.-based chocolate maker Cadbury in a bitterly contested hostile takeover. May oversaw the integration of more than 45,000 Cadbury employees. At least three top Cadbury executives quit in protest, news organizations reported at the time.

But unarguably the biggest challenge for May began in 2012, when Kraft Foods became Mondelez International after spinning off what is now called The Kraft Heinz Co. May, who became executive vice president and chief HR officer at Mondelez International, led the effort to identify the structures of both new companies and divide Kraft Food's workforce of 125,000 between them.

Mondelez International, with 90,000 employees around the world, now owns brands that include Nabisco and Oreo, as well as Cadbury. May led the charge in developing a culture around the company's vision ("to create moments of joy by building the best snacking company in the world") and employee value proposition ("we have the scale and resources of a global powerhouse, but the entrepreneurial spirit, creativity and agility of a start-up").

So how do you reassign 125,000 employees to roles in two new companies?

May and other executives didn't ask employees which company they wanted to work for. "We never offered anybody a choice," May says. But "we did have a lot of career conversations" in order to learn about employee interests and ambitions.

For employees assigned to Mondelez International, company executives emphasized the new career paths that would be available in a company with an international focus.

Leaders also made every effort to ensure that those moving to Kraft Heinz didn't feel like second-class employees, by equally stressing the opportunities at Mondelez with those at the spinoff company, May adds.

"We started out with: What does success look like for these two companies?" she says.

May also oversaw the process of filling the many leadership slots created by the spinoff.

 "I can't think of any key personnel moves within the company that haven't had Karen's input," says Mondelez International CEO Irene Rosenfeld.

"In fact, she's been the decision maker for every single move we've made among our most senior 250 to 300 colleagues across the organization and has been instrumental not only in recruiting, but also in retaining talent," Rosenfeld says. "It's especially important that, when tough decisions are required around talent, she's made those decisions in a way that has the respect even of those leaving," says Rosenfeld, who will be leaving herself when she retires in November.

May notes that accomplishing all the work resulting from the spinoff and transformation of Kraft Foods into Mondelez International required a laser-sharp focus on strategic goals.

Sometimes, May says, a business challenge can be a tool to accomplish a goal, rather than impediment.

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She cites this example: Soon after the 2012 spinoff, Mondelez International shifted to a financial practice called zero-based budgeting. (Zero-based budgeting entails justifying expenses from scratch for each period, rather than carrying forward amounts -- or fixed percentages of them -- from previous periods.)

While some in the business world fear it as a method for radical cost-cutting, others see zero-based budgeting as a tool for developing a cost-conscious culture.

Within 90 days, "we did a review of our operating model," May says. "And we did it so we weren't just cutting costs, we were building something."

In the HR domain, May noticed an opportunity to improve the company's training, then scattered across many programs. "At that time, all of our learning was totally decentralized," she says. "I couldn't even roll up our total learning-and-development spend."

Zero-based budgeting gave May license to start fresh on the company's training efforts. "I said, 'I'm going to corral the spending, I'm going to prioritize it, I'm going to create Mondelez International University -- and save money."

Launched in 2014, Mondelez International University is now the company's integrated learning program, offering in-person and online training in functional skills and business subjects. The MIU online catalog includes 13,000 courses and is popular with employees, says Ryan Darling, the company's communication and change leader. May set a goal this year to enroll 75 percent of the global workforce in MIU, Darling says. And "our organization is already on track in the first half of 2017 to achieve this goal."

May is a big believer in the importance of articulating the overarching goal to make sure it remains the focus, even when hashing out small details.

Language is important, she says, because it "can empower people to make decisions that are [consistent with] what you're trying to accomplish."

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Karen May

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