The document describes Heineken USA's performance management process. It outlines how they developed initiatives and metrics, created automated scorecards, and instituted a monthly meeting drumbeat to review progress. Key aspects included cascading the process through different levels, using tools like heat maps and drivers fishbones for analysis, and focusing discussions on actions rather than just results. Effective implementation involved support from top leadership, champions to staff the process, training sessions, and automation.

1. Performance Management at Heineken USAPerformance Management at Heineken USAPerformance Management at Heineken USAPerformance Management at Heineken USA
FP&A for CPG Summit
Federico Reyes
Senior Director, Finance
May 22, 2013
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2. 2
Source:understandinguncertainty.org
Nightingale’s RoseNightingale’s RoseNightingale’s RoseNightingale’s Rose

3. ♦ Share how we changed the systemhow we changed the systemhow we changed the systemhow we changed the system and ideas you can take away for aideas you can take away for aideas you can take away for aideas you can take away for a
similar implementationsimilar implementationsimilar implementationsimilar implementation
■ Who is Heineken USA?
■ Why did we start on the journey?
■ What is the new process?
■ How did we implement it?
■ What were the main enablers?
3
ObjectiveObjectiveObjectiveObjective

4. Brand PortfolioBrand PortfolioBrand PortfolioBrand Portfolio
4

5. 5
ON
Premise
Grocery
Liquor
C-Store
Other OFF
OFF
ON
17
600
Breweries Points of Entry
Demand
Points
Distributors Retailers
7
Heineken USAHeineken USAHeineken USAHeineken USA
6

6. Industry ChangeIndustry ChangeIndustry ChangeIndustry Change
FROM TO
6

7. Starting PointStarting PointStarting PointStarting Point
•Qualitative plans
•Not grounded to metrics
Link to
planning
•Different metrics for every function & level
•Bonus metrics not linked to plan objectivesMetrics
•260-page company results deck
•Prepared manually each month
Scorecards
•Discussions on results, not actions
•No follow-up
Meetings
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8. 2. Develop2. Develop2. Develop2. Develop and Automateand Automateand Automateand Automate
ScorecardsScorecardsScorecardsScorecards
1.1.1.1. Develop InitiativesDevelop InitiativesDevelop InitiativesDevelop Initiatives
and Metricsand Metricsand Metricsand Metrics
3. Hold Monthly3. Hold Monthly3. Hold Monthly3. Hold Monthly
Meeting DrumbeatMeeting DrumbeatMeeting DrumbeatMeeting Drumbeat
• CEO develops Initiatives and
Metrics
• Shares with MT; they develop
theirs
• MT aligns cross-functionally
• MT shares theirs with their
teams (MT-1); they develop
theirs
• Process continues to MT-2
for some functions (mostly
Sales & Marketing)
• MT-2 teams discuss
progress vs plan
• Team leader prepares
for own meeting with
peers
• MT-1 teams discuss
progress vs plan
• Process rolls up to the
MT meeting. CEO
prepares for own
discussion.
Reprioritize initiatives
if necessary
Performance Management ProcessPerformance Management ProcessPerformance Management ProcessPerformance Management Process
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9. 1. Develop Initiatives and Metrics1. Develop Initiatives and Metrics1. Develop Initiatives and Metrics1. Develop Initiatives and Metrics
InitiativesInitiativesInitiativesInitiatives MetricsMetricsMetricsMetrics
Subset of
initiatives;
merit & career
discussions
Subset of
metrics;
bonus
purposes
Inputs Outputs
Business
Performance
Management
People
Performance
Management
Eg: Restructure the
financial close process
(1Q)
Eg: % OTIFNE
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10. 2. Develop and Automate Scorecards2. Develop and Automate Scorecards2. Develop and Automate Scorecards2. Develop and Automate Scorecards
• Focused on plan
Metrics
• Every level looking at
the same KPIs
• Consistent
calculations
• Prepared
automatically each
month
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11. 3. Hold Monthly Meeting Drumbeat3. Hold Monthly Meeting Drumbeat3. Hold Monthly Meeting Drumbeat3. Hold Monthly Meeting Drumbeat
a. What?
•Peeling
the onion
•Tool: heat
maps
•Peeling
the onion
•Tool: heat
maps
b. Why?
•Why? Why?
Why? Why?
Why?
•Tool:
drivers
fishbone
•Why? Why?
Why? Why?
Why?
•Tool:
drivers
fishbone
c. Actions?
•Flow from
the Why
•Tool: DAL
•Flow from
the Why
•Tool: DAL
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12. Above National Premise Trend
Moderately Below National Premise Trend
Significantly Below National Premise Trend
YTD Volume Growth vs. TargetYTD Volume Growth vs. TargetYTD Volume Growth vs. TargetYTD Volume Growth vs. Target
(Brand/Region/Premise Illustration)(Brand/Region/Premise Illustration)(Brand/Region/Premise Illustration)(Brand/Region/Premise Illustration)
ONONONON
West
OFFOFFOFFOFF
Central Southeast Northeast
3%3%3%3%
3%3%3%3%
3333%%%%
14%14%14%14%
3%3%3%3%
20%20%20%20%
4%4%4%4%
20%20%20%20%
National TrendNational TrendNational TrendNational Trend
(10%)(10%)(10%)(10%)
5%5%5%5%
15%15%15%15%
3.a. Heat Maps3.a. Heat Maps3.a. Heat Maps3.a. Heat Maps
Keep peeling!Keep peeling!Keep peeling!Keep peeling!
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13. 3.b. Drivers Fishbone3.b. Drivers Fishbone3.b. Drivers Fishbone3.b. Drivers Fishbone
Quantify!Quantify!Quantify!Quantify!
WhyWhyWhyWhy are we behind target
for the brand / pack/
region / zone /
premise / channel ?Pricing?
Margins?
Visibility?
Sampling?
Features?
Ads?
Displays?
People?
Brand
health?
Distributor
or retailer
issues?
Competitor
actions?
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14. 3.c. Decisions and Actions List3.c. Decisions and Actions List3.c. Decisions and Actions List3.c. Decisions and Actions List
Discipline, not rocket science!Discipline, not rocket science!Discipline, not rocket science!Discipline, not rocket science!
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15. ♦ Co-develop with stakeholders
♦ Develop effective but simple tools
♦ Spend the time on training sessions
♦ Model with example in communications
♦ Complement with HPT dynamics
ImplementationImplementationImplementationImplementation
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16. ♦ Lock the commitment from the top
♦ Staff and define champions
♦ Analyze if consultants are needed
♦ Evaluate repository tools
EnablersEnablersEnablersEnablers
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17. ♦ Start rightStart rightStart rightStart right: Lock the support from the top
and co-develop with stakeholders
♦ Make it airtightMake it airtightMake it airtightMake it airtight: Cascade effectively
♦ Make everyone’s life easyMake everyone’s life easyMake everyone’s life easyMake everyone’s life easy: Automate
♦ Don’t cut cornersDon’t cut cornersDon’t cut cornersDon’t cut corners: Invest the time to train
♦ Remember the roseRemember the roseRemember the roseRemember the rose: Why?????
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Key TakeawaysKey TakeawaysKey TakeawaysKey Takeaways
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