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Power of People

2014 HR Summit

Nashville, Tennessee

Belief Check…

How do you feel about the following statements…

Business is People

People will contribute to what they understand and feel is in their best and self interest

The success (survival) of a company depends upon the capabilities and contributions of all people in the organization

A companies success is linked to the level of the discretionary effort of it’s people

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Discretionary Effort…

‘…the level of effort people could give if they wanted to, but above and beyond the minimum required’ Aubrey Daniels

The Power of People…

…a systematic approach of fostering discretionary effort

Developing exceptional performance with a culture of respect

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Learning Objectives…

In this session you will learn…

Guiding principles that empower employees

A cultural framework that supports both business and employee growth

A cross functional approach to problem solving and decision making

Practical strategies for fostering discretionary effort

We are a global leader in the manufacture, marketing and distribution of spices, seasonings, specialty foods and flavors to the entire food industry.

Our customers range from retail outlets and food service providers to food processing businesses.

We employ ~7500 people worldwide.

About McCormick & Company, Inc.

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Our History

1889 McCormick & Company was started in

Baltimore in a one-room cellar by 25 year old Willoughby M. McCormick

First products

― Root Beer, Flavoring Extracts, and Fruit Syrups sold under the “Bee Brand” and “Silver Medal” labels.

― Iron Glue (Sticks everything but the buyer) ― Uncle Sam’s Nerve and Bone Liniment (For

Man Or Beast)

About McCormick & Company, Inc.

Our History

1932 Willoughby McCormick died and his nephew, 36 year old C.P. McCormick was elected President and Chairman.

About McCormick & Company, Inc.

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In 1933, was faced with the serious crisis of the Great Depression. Instead of the typical and timely ‘cutting of wages and jobs’, C.P. McCormick:

cut employee hours

raised wages

established profit sharing

Our History

About McCormick & Company, Inc.

“The Power of People” was published in 1949

• The Power of People

– Participative Management & Multiple Management

– Dedicated Workforce

– Culture of Respect, Recognition, Inclusion and Collaboration

Business is People, C. P. McCormick

There is a deep respect for

the capabilities of all people

People will contribute to what

they understand & feel is in their

best & self-interest

The success of the company

depends upon the capabilities &

contributions of all people in the

organization Power of People

CORE BELIEFS

Cultural Imperative

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2 for 1

Think twice for the Company and once for yourself and the Company will think twice for you and once for itself

People that do the work are the experts

Capitalize on collective knowledge of the business

Participative (Multiple) Management to ‘cross functionally’ solve problems, grow the business and develop leadership

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Multi-Management

Every employee can make a difference.

For decades, the cultural backbone of McCormick has been the philosophy of Multiple Management. In 1932, when C.P. developed this concept, it was revolutionary.

…the cornerstone of leadership development and McCormick Culture

Multi-Management

Purpose…

Management & Leadership Development

Action learning projects that make substantial contributions to the Company

Networking and exposure to senior leadership

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Multi-Management Board (MMB) History

Yesterday Today Tomorrow

1932, C.P. McCormick organized first board, helping our Company return to profitability in the midst of the Great Depression

Junior Board was quickly followed by addition of a Factory Board, then a Sales Board. In 1974, all were renamed Multiple Management Boards

2010, MMB was transformed to reflect our global organization when the first Global MMB, and three Regional MMBs (Americas, EMEA, and APZ) were formed

Expectation all future McCormick leaders will have MMB experience

13 unit MMBs are developing local leaders

MMB Cultural & Values Alignment

Internal professional networking is promoted

Aligned closely with business to ensure project relevance

Strong support from top management

Risk taking and innovation encouraged

Open development feedback among members

Teamwork and sharing best practices for innovation and high performance is supported

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Multiple Management Boards 2012

Corporate Headquarters McCormick Foods Australia

McCormick Canada

U.S. Consumer Products Division HQ

U.S. Industrial Group Sales and Operations Hunt Valley Supply Chain

U.S. Industrial Group U.S. Consumer Products Division Sales

Asia Pacific Zone Regional

Global MMB

Americas Regional EMEA Regional (Europe, Middle East, Africa)

McCormick China

McCormick France

McCormick United Kingdom

McCormick Pesa

McCormick de Centro America

MMB Levels

6 month term

4 levels of membership – Orientee, Associate, Regular, Executive Committee

Forced 20% turnover each term

Top 40% rated form membership committee

Board size ranges from 10 – 16, maximum is 20

Operate according to bylaws

12 month term

Members nominated

Development feedback from peers

All members are “Regular”

Must have achieved Regular status on a local MMB

All members have formal mentors

Project Chairs and MMB Executive rotated

18 month term

Members nominated

Development feedback from peers

All members are “Regular”

Must have achieved Regular status on a local MMB

Achieve “Emeritus” status upon completion

All members have formal mentors

Junior Management

Mid-Management

Senior Management

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MMB Project Examples

BRIC GROWTH STRATEGIES

Researched Brazil, Russia, India and China (BRIC) markets for business growth

White papers delivered on markets

Proved critical in successful mergers and acquisitions work in these emerging markets

SHARED SERVICES STRUCTURE

MMB researched, benchmarked and gave recommendations for a pilot shared services organization with the company

Financial Shared Services (FSS) brings together backroom functions into one group

Helps improve efficiency and overall effectiveness

SUSTAINABILITY

CEO-led company focus on corporate sustainability issues

Each MMB around the world initiated corporate sustainability projects in same term

Projects include a carbon footprint study, facility water usage reduction and waste recycling

POST ACQUISITION INFORMATION HANDBOOK One-third of company growth results from acquisitions

Clear plans for integrating companies is critical to success

MMB developed the company’s first post- acquisition information handbook to make processes more efficient and effective

B R

C I

MMB

MMB – The Cornerstone of Leadership Development

Ensuring a pipeline of ready candidates for key leadership roles locally, regionally and globally

Leveraging our successful local MMB model to prepare our future local, regional and global leaders with skills to work across diverse geographies and cultures

“My greatest satisfaction as president of a company has been in watching people who work with me grow as the business grows.”

Charles P. McCormick McCormick President (1932 – 1970)

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A Culture of Respect…

…just saying it don’t make it so

Productive use of Differences: Diverse interests, capabilities and opinions increase the number of alternatives for consideration

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Americas Regional Diversity &

Inclusion Council

Purpose

The Regional Diversity & Inclusion Councils will

plan, lead and implement the regional diversity

and inclusion initiatives in alignment with the

global strategy.

Mission

To enable McCormick to achieve greater

business success, by implementing a regional

diversity and inclusion approach and initiatives

that support our global objectives and Shared

Values.

Inclusion…

Engaging both the hearts (passion and willingness) and the minds (knowledge and ability to contribute)

Team - Based High Performance Culture

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Practical Applications…

Information Systems/Information Sharing

Monthly Meetings – Plant Management

General Meetings – Corporate & Divisional Levels

1 on 20 – Networking with Senior Management – Q & A

Voice of Employee – Follow up with Action Planning

Practical Applications (continued)…

Training & Development

Leaders 1st, functional expertise 2nd - leadership is transferrable

Leadership is not a job title

Total Task

Broad Skills for Business Flexibility

Factory Acceptance Testing

Onboarding – Peer to Peer

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Practical Applications (continued)…

Problem – Solving & Decision – Making

Common Objectives

Goal Setting

Results Focused

Practical Applications (continued)…

Reward & Recognition

Team & Individual

Internal Competition

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Self-transcendence (Maslow Revisited)

Maslow revised his hierarchy later in life…

…the highest need is not Self-Actualization

Self – transcendence…

Living for a purpose higher than self

One reason people feel a lack of significance in their jobs is because they don’t see how it relates beyond themselves and the company

To keep people genuinely motivated – keep before them a line of site to the wider purposes that their work serves

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Self-transcendence

Community outreach recognition

Charity (contribution) day – 1st Global in 2014 McCormick matching donations

Donating hours worked

Self-transcendence

Charity Day is an important part of McCormick history and we are excited this year to continue this very important tradition that is

meaningful and impactful in today’s world. Our activities and efforts are a great opportunity to show our commitment to our communities

through volunteerism and charitable contributions.

This year, McCormick is sponsoring 5 opportunities to Maryland based McCormick employees to give back to our community and earn

volunteer hours for Charity Day. There are two remaining opportunities at this time.

House of Ruth - Baltimore, MD

Saturday, August 25 from 9:00 am - 1:00 pm

Limited to 20 McCormick Participants

To signup contact Doreen Wu via email or x6428

First Fruits Farm - Freeland, MD

Saturday, September 8 from 8:00 am - 12:00 pm

Unlimited Participation – volunteers must be at least 6 years old

To signup contact Debbie Ohl via email or x7942

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Power of People

Cultural Imperatives

Every employee can make a difference

People-based systems and principles Information sharing

Productive use of differences

Leaders 1st

Team-Based

Reward & Recognition

Self-Transcendence