Mike Devereux discusses balancing resources and priorities in strategic planning for Nature's Way Brands. He emphasizes the importance of defining clear objectives, conducting market assessments, and focusing on core business strengths while remaining adaptable to market changes. The presentation also highlights key learnings from mentors and the significance of digital competency in connecting with customers directly.

1. Balancing Resources & Priorities
Mike Devereux
President & CEO Nature‘s Way Brands
Lunch ‘n Learn
Green Bay, August 26, 2014

2. About Me
Me
Cat
“Bark the
Wonder Cat”
• Grew up in the western suburbs of Chicago in a 3-bedroom, 1-
bathroom bungalow.
• Learned how to balance resources and priorities at an early age,
while competing with four sisters for the bathroom before school.

3. Nature‘s Way Group

4. Balancing Resources and Priorities in the context of …
• Why?
• How!
• Does it matter?
Strategic Planning

5. Why?
“If you don’t know where you are going, any road will take you there.”
R. Rose – My Predecessor

6. How to Start?
• Diagnostic on today’s business
– E.g. SWOT analysis
• Aspiration for the future
• Capabilities to deliver
People
• Manage the competing agendas
$
Management Team
Shareholders

7. a. Outline of Strategic Plans
• Industry / Business unit / Market context and dynamics
– Industry/Business unit/Market overview
– Industry/Business unit/Market profitability
– Industry/Business unit/Market dynamics
– Customer needs
• Competitive assessment
– Performance review (Brands, Categories, SKUs (topline, bottom line)
– Achievements since last year
– Product line assessment (Brands, Categories, SKUs (topline, bottom line)
– Competitive assessment (Sales operations/ Channels, Marketing, Etc.)
• Strategic issues (Resulting from Market environment and Competitive assessment)
– Where are opportunities and threats?
– Where are our competitive strengths and weaknesses?
– What are the strategic success factors and with regards to that, where are the strategic gaps?
• Key strategic initiatives (5-10 year) strategic initiatives in detail that describe measures,
steps (timeline), investments, structural implications (Resources) and implementation
risks
– Financial projections (including scenarios if needed)
– Detailed financial projections (cash in and cash out)
– Capital plan
– NPV

8. b. Example from Pitman Moore
• Aspiration
• Focus
• Filters also
“what not to do”
Aspiration
Mission
(medium term)
Where to
Compete
Circa 1990
Make food animals more valuable to producers
by providing superior disease prevention and rearing
Create Make Sell
How to
Compete
Leading
animal health
and nutrition company
Product
categories Species Geographics
Key
technologies
• Biologicals
• Implants
• Ectoparasiticides
• Feed
• Antimicrobials
• Vet specialties
• Cattle
• Swine
• Poultry
• Sheep
• Cats and
dogs
• Base: NA, UK,
ANZ, Brazil
• Penetration: G,
F, SP, I, Mexico
• Beachheads:
Korea, China,
Japan . . .
• Deletant/
recombinant
vaccines
• Controlled release
systems
productivity solutions
• No in-house “R”
• Strong links to biologicals
science (universities, biotech
companies)
• Focus on core categories
• Develop world-class biologicals
manufacturing skills
• P-M in-house sales forces
• Superior customer service and
technical support
• Distributor-only in companion
animals

9. Profit from the Core

10. Profit from the Core – Key Points that
lead to Profitable Revenue Growth
• Focus scarce resources on the core of your business if attractive
growth opportunities remain – if not, the core needs to be extended.
• Establish a common set of facts and market insights from which
impactful growth initiatives can be found.
• Get an “A” on 3 or 4 initiatives rather than a “C” on 10.
• Master the science of making change happen within your
organization.

11. Profit from the Core
Keys to Success:
• Reaching the full potential of the core business.
• Expanding into logical adjacent businesses surrounding the core.
• Pre-emptively redefining the core business in response to market
turbulence.
All that . . .
“and some luck/good fortune helps.”

12. Natures Way Example
• Consumer Business
• Professional Business
• Canada
• Export
Specialty
Mass
Internet
Naturopaths
MD’s
Chiro
Other
Specialty
Mass
Asia
Latin America
Europe
% of
Total Product
Line
70% 800 sku’s
10% 400 sku’s
10% 200 sku’s
10% 600 sku’s
100% 2,000 sku’s

13. The Alchemy of Growth

14. Planning the future over 3 time horizons
Performance /
Profit /
Growth
Time
Horizon 1
Defend and extend
core businesses
Horizon 3
Create viable
options
Horizon 2
Build emerging
businesses
3 years
Now
Beyond

15. Nature’s Way Accountabilities and Time Horizons
Performance /
Profit /
Growth
Time
Horizon 1
Horizon 2
Horizon 3
Develop International
Markets and enter new
categories and
technologies
U.S. Market Potential
focus & Maximize
existing Brands
Enter New
Business models,
Mergers &
Aquisitions
Get an “A” on 3 to 4 initiatives versus a “C” on 10.

16. Digital Competency
• 50% of population is < 30.
• 53% of Twitter is recommending products via Tweets.
• 93% of buyer decisions are influenced by Social Media.
• 90% trust peer review.
Nature’s Way Opportunity
Becoming much more relevant to the last mile of our customer base.
Historically we transact 100% through retailers and practitioners . . .
We want to speak directly with the people who buy our supplements.
Source: Socialnomics 2014 by Erik Qualman

17. Digital Examples
Pre-emptively redefining the core business
in response to market turbulence.

18. Digital Examples
Pre-emptively redefining the core business
in response to market turbulence.

19. Digital Examples
Pre-emptively redefining the core business
in response to market turbulence.

20. Digital Examples

21. Digital Examples – Output Measurement

22. Key Learnings from Mentors (1)
3 simple rules:
• Focus on your output
• Know your resources
• Be analytical
L. Bernicky – First boss at Arthur Young

23. Key Learnings from Mentors (2)
“Mike, your biggest strength is also your biggest weakness . . .
… Idealism”
A. Chawla – SVP of Strategic Planning
and former boss during the McKinsey project
“Be okay with me accepting 1 or 2 good ideas from you versus your
entire agenda”

24. Key Learnings from Mentors (3)
“When you move into the CEO role, first reset your relationship with all
your former peers - …
…You are now their Boss.
T. Flood – CEO Collier Enterprises
– former boss at Beatrice Foods

25. Key Learnings from Mentors (4)
“As CEO, you must be able to “create a vision and articulate it verbally
with substantive support …
… If you cannot, you don’t belong in the CEO role.”
After that . . .
“Be yourself”
A. Nieto – Former Chairman of Life Fitness,
now ALS sufferer
http://www.freep.com/article/20140629/COL01/306290088/augie-nieto-als-mitch-albom

26. Summary of the Key Learnings that have shaped my thinking
Inputs
1. Bernicky – The Fundamentals
2. Chawla – Pick and choose
based on substance
3. Flood - Lead
4. Nieto –
“Be you”
The Output ! ! !

27. Does it Matter?
CAGR 2010-2013: 17% CAGR 2010-2013: 44%

28. Summary
Balancing Resources and Priorities in the context of
Strategic Planning
Why?
Good luck
How!
Does it matter?
You know where you are going the strategic map takes you there!

29. Post Mortem
• Quote from C. Jennings – Nature’s Way gummy vitamin supplier:
“The most impressive thing about your facility tour is your
People.”
• Come on, let me give your minds a ride.