McGovern’s Approach to Managing Campbell’s
Business Portfolio
Every Saturday morning McGovern did his family’s grocery shopping, stopping in the store aisles to straighten Campbell’s displays and inspect those of competitors, studying packaging and reading labels, and trying to learn all he could about how and what people were eating. He encouraged his managers to do the same. Several board meetings were held in the back rooms of supermarkets so that afterward directors could roam the store interviewing customers about Campbell products.
McGovern decentralized Campbell management to facilitate entrepreneurial risk-taking and new-product development, devising a new compensation program to reward efforts in these areas. He restructured the company into some 50 autonomous units, each with the leeway to develop new products even if the new-product ideas were closely related to another business unit’s products. Thus, the Prego spaghetti sauce unit-not the frozen food group-initiated frozen Mexican dinners. And although it wasn’t his job, the director of market research created Today’s Taste, a line of refrigerated entrees and side dishes. “It’s like things are in constant motion,” the director said. “We are overloaded but it’s fun.”3
McGovern believed the new structure encouraged managers of business units, who had to compete for corporate funding, to be more creative and venturesome in developing products: