Like many senior executives, Donald Keough makes clear-cut decisions. But sometimes, his snap judgments have made him appear too bossy.
Keough was president of The Coca-Cola Co. in 1989, soon after the Berlin Wall fell. In a meeting with his top international managers, Keough heard the head of German operations propose that Coca-Cola spend more than $500 million to build bottling facilities in the newly liberated East Germany.
Deeming the investment way too high, Keough rejected the idea outright. He didn’t even let the German executive finish his presentation.
Afterward, a colleague informed Keough that the head of German operations wanted to resign. Keough was stunned to learn that the German felt slighted by the president’s imperious behavior.
“You didn’t listen clearly to him,” Keough’s colleague said. “You don’t know the potential of East Germany. You’ve never been there. You rejected it out of hand without considering this could be a great opportunity.”
Chastened, Keough agreed to visit East Germany and take the proposal seriously. After his tour, he changed his mind. He apologized to the German and decided to invest $1 billion in East Germany and other parts of Eastern Europe.
This became the largest investment of a Western corporation in the former Soviet bloc—and it led to huge profits for Coca-Cola.
Keough learned to listen more openly to his team and visit potential sites before making investment decisions.
— Adapted from The Ten Commandments for Business Failure, Donald Keough, Portfolio.