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General Mills, toys and more Minneapolis-based General Mills is the largest cereal seller in the U.S. in terms of total sales, having passed rival Kellogg in 1999. GMI, best known for its Wheaties, Cheerios, and Fruit Roll-Ups, opened its first flour mill in 1886. The company acquired a number of non-food operations since that time, including Kenner Products (toys) and Parker Brothers (board games). General Mills grew into an empire buy acquiring Red Lobster (1970), Eddie Bauer (1971), and Talbot's (1973); and started the Olive Garden food chain (1983). GMI has since contracted operations and sold off numerous acquisitions in order to refocus on its core food business. Trouble at the mills General Mills has not experienced the explosive growth enjoyed by many other large companies during the mid-1990s boom. A contractor sprayed an unapproved pesticide on millions of bushels of oats from May 1993 to June 1994 without the company's knowledge, forcing General Mills to pull 50 million boxes of cereal off the shelves and creating cereal shortages. This sales disaster, combined with plant shutdowns and cleanups, cost General Mills an estimated $147 million. From 1993 to 1995, the company's stock fell from the mid-70s to the high 40s. Need your Wheaties? In 1996, when Post cereals (owned by Philip Morris) cut its prices 20 percent a price war ensued. General Mills cut its prices, winning market share from both Post and Kellogg, but it was a pyrrhic victory - the cereal industry overall suffered lower profits. Fiscal 1997 sales in cereal dropped by $100 million. By April of 1999, however, General Mills discovered that people need their Wheaties (and their Cheerios). Consumer loyalty allowed the company its first price hike in years in 1999. General Mills abroad Continued international growth is the key to General Mills' future plans. Cereal Partners Worldwide (CPW), a 1989 partnership between General Mills and Nestle, is the No. 2 cereal maker outside North America. In 1992, General Mills and PepsiCo formed Snack Ventures Europe, the largest snack company in continental Europe. But international expansion can be costly - in August 1999 the company ended its Latin American joint venture with Bestfoods because it was less successful than anticipated. It also ended its participation in a Chinese snack food joint venture with Want Want Holdings that was under development. Cheerios etc. To successfully maintain and further achieve its lofty goals, GMI must constantly develop new products and build on already-established brands. While the almost 60-year-old Cheerios are a mainstay, the company derives an average 27 percent of its revenue from products under five years old. The company has benefited from a considerable advantage over rival Kellogg because its cereals (like Raisin Nut Bran and Cinnamon Toast Crunch) are much more difficult for cheaper grocery store brands to mimic than Kellogg's, which tend to have generic names and basic ingredients. Welcome to the Mill Like pretty much everyone else, General Mills has been acquiring competitors in an effort to diversify its offerings and shield itself from the fickle customer. In January 1999 the company acquired Lloyd's Barbeque Co. for $90 million. In February 1999, GMI bought an exclusive license to sell Olibra, a weight loss compound, and the next month released an organic cereal called Sunrise, its first venture into the $4.5 billion organic foods market. And in August 1999 it purchased Milwaukee-based Gardetto's Bakery, makers of baked snack mixes and flavored pretzels. It's the yogurt! Of course! In late 1999 and 2000, yogurt proved to be General Mills' most promising product. Sales of both the Yoplait and Colombo brands of yogurts were unexpectedly strong, and Yoplait was propelled to the venerable position of "yogurt market leader" with a three percentage point led over its closest competitor. The company has plans to expand its Go-Gurt line of yogurt in a tube for children to adult flavors under the name Yogurt Express. Other new product rollouts to expect: a cereal called Harmony targeted to folic acid- and soy protein-savvy women; a line of Milk n' Cereal Bars based on Chex and Cinnamon Toast Crunch cereals; a line of baked cheesecake mixes; and Betty Crocker Bowl Appetit rice. Rising Dough In July 2000, General Mills became the largest publicly traded U.S. food company, and the world's fourth largest food company. The company announced it would merge with Diageo PLC's Pillsbury unit for $10.5 billion in stock and cash; Diageo would own 33 percent of the company. General Mills-Pillbury would assume Pillsbury's $4.5 billion debt.
MBAs should know that marketing is the heart and soul of General Mills, and its path to the top. The department is organized into brands, and the employees in the brand group are responsible for virtually everything that happens to that brand, from determining how much is produced, to how much it will cost, to giving final approval on the product?s packaging. Says one former finance MBA employee: "I left because I didn't want to be at a company that was led by marketing, while I wanted to be in finance." Another echoes: "I looked ahead and saw all the decisions were made by marketing people." General Mills' extensive employment web page - located at www.generalmills.com/recruiting, describes opportunities in each department and provides the company's campus recruiting schedule. For marketing MBAs, GMI administers several written standardized tests. Two are given to applicants between their interview on campus and their interview in Minneapolis; the applicant mails the tests to the company. They are multiple choice, and very, very long. "It took me six hours to do them both," gripes one assistant marketing manager. One of the tests is designed to help recruiters decide if a candidate is a good fit for the position he or she is seeking. The other multiple choice test is shorter but still long. It's used to assemble a psychological profile for the candidate. What is GMI looking for? "A team player, creativity, leadership." When applicants for AMM positions interview in Minneapolis, they are given a lengthy case question, and a timed creativity test. The latter is a test that employees describe as "very stressful." Does this second test matter? "The ability to generate ideas that the test shows is important," says one recruiter.
Few levels, but still bureaucratic Employees say that GMI has a slender management structure that provides for easy communication between junior and senior managers. "There's a division president, and there's three or so directors, and then three to five marketing managers under them, and then maybe two AMMs under each of them," says one assistant marketing manager. "As far as levels go, there aren't a whole lot of [them]. The person I pitch to is the director, and my managers pitch to the president." But this cozy relationship can sometimes prove suffocating for snarky youngsters. "The senior managers are still committed to their old brands they had when they were junior-level brand people, so they get their hands all over the minor details of the brands. This is often very de-motivating," says one former brand employee. "Little decisions often take forever to make - too many hands in the pot." "The culture is very individual, not that team-oriented," says one former marketing intern. "There's lots of e-mail cc-ing your boss so you are always making sure your boss see what you're doing," says one promotion planner in marketing. "Brown-nosing happens a lot." General Mills, Minnesota, pop. 6,000 Considering the sometimes political atmosphere at General Mills, it is perhaps fitting that the company's campus, located about five miles west of downtown Minneapolis, might as well be its own fiefdom. The company compound has a barber/beauty shop. There's also a variety store that sells gifts, candy, video rentals, and discounted theatre tickets. There's another store that sells discounted General Mills products ("You buy all products for $2"). "We have a full-service station on the campus so you can have your car worked on, gassed up and washed during the day," reports one employee. "They will shuttle you to and from the employee entrance also so you don't have to walk." There's also a free health club with "weight equipment, treadmills, bikes, Stairmasters, Nordic Track, etc." At the club, employees can even sign up for aerobic classes (though they're charged for that). And there's a health center with a full-time doctor. "You can have your eyes examined, get a physical, see a nurse for a cold," say insiders. Those swingin' employees Mills employees are close-knit outside of the office, too. "Not being from Minneapolis, I met most of my friends at work," says one marketing employee. "This happens for most people who have relocated to Mills - at all levels of the company. You get a lot of after-work happy hours, parties and weekends with your co-workers." "There's 30 new employees every year from all over the country, many single" says an assistant marketing manager. "It makes it fun. There's a lot going on." Reports another employee: "People are friendly and the company tries to do things to improve the quality of life." GMI publishes a newsletter that informs employees (they have this thing called the "Employee Club") what's up socially. "For the night scene, there's some pretty great areas." Employees say that many young professionals at GMI join the Minneapolis Sport and Social Club, where they can meet other young professionals from Cargill, Pillsbury, and 3M. One employee reports that interoffice romances are actually encouraged. "They have a lot of husbands and wives working here," she says. "They think this helps keep you in Minneapolis. Otherwise, you'd rather leave the whole city, and then they lose you." Head-hunting ground Insiders say that GMI carries quite a bit of prestige. "It was head-hunting ground, at least in Minneapolis," reports one former financial analyst who has moved on to another major consumer goods company. "You can't get a better resume booster than General Mills," says one employee, who cites the company's ranking as the most admired food company in the world [according to Business Week] as a major prestige plus. Says one AMM: "It's one of the top two brand companies, Procter & Gamble being the other. Talk to a headhunter. Any one will say they want a General Mills person." This belief is widespread: "In the marketing community, General Mills is known as one of the top tier firms along with P&G and maybe Kraft." Why is GMI so prestigious when it comes to marketing? "You are given responsibility from day one," say insiders.
Jim Beirne Director of Recruiting Human Resources P.O. Box 11131 Minneapolis MN 55440-1113 (612) 540-2445
Cereals;Main meals and side dishes;Desserts;Flour and baking mixes;Snacks and beverages;Yogurt;Foodservice
Kellogg;Nestle;Philip Morris;Pillsbury;Procter & Gamble;Quaker Oats;Ralcorp Holdings;RJR Nabisco More Company Profiles For more career information, go to Vault.com ©2000, Vault.com Inc
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