Launching a new brand
The two companies that joined together to form Ingredion each had their own legacy of success. The key to making the acquisition work was building an integration plan that took the best each company had to offer.
“This wasn’t the matter of a big company swallowing up the small company,” Gordon says. “If one culture versus the other was allowed to bleed through, we weren’t going to get the best of both worlds. I’ve been in experiences where one big company buys a smaller company, or where one of them prevails. Right away, I sensed that we could fall into that trap. I said to everybody, ‘I don’t want one culture or the other. I want the best of both worlds. I want the best of Corn Products and the best of National Starch.”
One of the keys to meeting this goal was choosing a new name for the organization.
“It wasn’t just branding and marketing people, but it was manufacturing and supply chain and investor relations,” Gordon says. “And I put them in a room and I said, ‘Anything’s possible. We need a new name that really depicts who we’re going to be in the future.’ They came up with about 800 names. And they had a boutique branding consultant to help guide them. We actually were able to whittle it down to about 20 names that we could claim for ourselves. We did some focus groups, worked with our board and came up with the name Ingredion that everybody loved.”
The name can be a symbol of camaraderie, but the new partnership has to extend into how you set up the company’s operating structure.
“Take human resources,” Gordon says. “We took capabilities from the regions of Corn Products and from the essential expertise at National Starch and we put together an organizational development process. Then we evolved it to the next step. If you look at how our company is run today, you wouldn’t say, ‘Well, that came from Corn Products or that came from National Starch.’ It was really developed by the team for the future.”
Ingredion’s performance management system is another example of this collaborative spirit, Gordon says. Performance goals are entered into an information system from which goals are developed.
“We communicate to people what’s important for leadership criteria and then we communicate with people very formally in the middle of the year and during the year to make sure we’re communicating,” Gordon says. “I would say that came from both companies.”
Strong companies are able to develop trust with their people and get them thinking about the new company’s future, and not what may have been lost. The approach throughout the integration process is crucial.
“Collaborative is a very important word and we use it in leadership meetings,” Gordon says. “It’s all about listening and learning from other people and then being willing to evolve your ideas to come up with the best solution for the customer. So it’s a combination of your leadership team, your cross-functional teams and your willingness to be open to changing how you make decisions.”
On the right track
Gordon was asked to bolster Ingredion’s global presence and she has plenty of examples to demonstrate where that has happened.
“Many of our customers want gluten-free products,” she says. “We have key ingredients from the tapioca plant that we process in Thailand and Colombia that are gluten-free and are very attractive to consumers, so we want to build on that portfolio.”
The gluten-free ingredients are part of a larger group of ingredients that are considered specialty starches. This group now comprises over 20 percent of the company’s sales and the hope is to keep the growth going.
“We are intent on using our strong balance sheet and strong cash flow to continue to increase our presence in specialty ingredients,” Gordon says.
Net sales at Ingredion have grown from $3.7 billion in 2009 before the former Corn Products bought National Starch to $6.3 billion in 2013. The company owns about 900 patents and patents pending which relate to a variety of products and processes, and a number of established trademarks under which the company markets its products.
The growth and evolution of the company has also been done with a firm eye on employee safety.
“The two companies evolved to track not only how safety is practiced in all of our facilities, but to share best practices to make sure that everybody who arrives at work that day goes home in the same condition,” Gordon says. ●
Takeaways:
- Take the time to listen to your people.
- Make acquisitions about the future, not the past.
- Promote a collaborative spirit with your team.
The Gordon File
NAME: Ilene S. Gordon
TITLE: chairman, president and CEO
COMPANY: Ingredion Inc.
Education: Bachelor’s degree in mathematics, Massachusetts Institute of Technology (MIT), Cambridge, Massachusetts. Master’s degree in management, MIT Sloan School of Management.
Memberships: Gordon is a director of Northwestern Memorial HealthCare and World Business Chicago, a member of the board of trustees of The Conference Board, a member of The Business Council and serves on the board of directors at International Paper Co.
Gordon on the acquisition process: What is very important to us is to find acquisitions that broaden our ingredient portfolio, that add features that will help us formulate solutions with our texture leadership and sweetener leadership for our customers. But the clues we’re looking for are things like, is it a well-run company? Does it have good management and good assets?
We’re looking to bring on even more capable people and technology and at the same time, as we put it together with Ingredion, create value for our shareholders. Are there synergies in being more efficient on the cost side in developing products? Can we grow on the revenue side with the technology?
Gordon on getting the facts: Often, people will come in and give you an emotional, ‘We should do this’ or ‘We should do that’ or ‘I wish we were better at this.’ But they don’t have the facts. And I learned that from my early consulting days, and early business leadership experiences, that understanding the facts and cost position really help long-term strategy.
