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The Moment explores the pivotal moments that changed the lives and careers of the world’s leading CEOs and defined their leadership journeys.
Claire Blake (00:04):
From World 50, this is The Moment where we explore the pivotal moments that change the lives and careers of the world's leading CEOs and defined their leadership journeys. Today we're talking to Greg Creed, former CEO of Yum! Brands and a board director at Aramark, Delta Airlines, and Whirlpool.
Greg Creed (00:23):
My message is be bold, not beige. In the more tough environments, you have to be more bold, not less bold.
Claire Blake (00:29):
In 2011, the American fast food brand, Taco Bell faced an accusation that sent sales plummeting. According to a lawsuit that quickly went viral, the beef served at more than 5,600 Taco Bell restaurants in the US wasn't beef at all. The accusers deemed it was a mystery meat recipe that the company was being deceptive about. At the center of it all was the company's new CEO 53-year-old Greg Creed, an Australian marketer who had made a name for himself at other fast casual food brands such as Pizza Hut and KFC. In our conversation with Greg, he discusses how his decision to publicly fight the accusation was not just good business but a battle to prove his own integrity. He offers his take on when to fight and when to fold, why today's executive should be bolder, and how to win the right way. Alright. A serious question. What's so magical about the combination Pizza Hut and Taco Bell?
Greg Creed (01:25):
What do you mean? What do you mean the
Claire Blake (01:26):
Do you know the song? Have you heard the song?
Greg Creed (01:27):
No, I have not heard the song.
Claire Blake (01:28):
You've never heard the song? I'm at the Pizza Hut. I'm at the Taco Bell. I'm at the combination Pizza Hut and Taco Bell.
Greg Creed (01:34):
No, I haven't, but I'm old. I'm old, so there's probably not
Claire Blake (01:38):
I have homework to send you after.
Greg Creed (01:39):
Okay. No, I have not heard about it.
Claire Blake (01:41):
Alright. You met your wife by playing golf with her brother 45 years ago. If I've got my facts straight, so the question is, did you let him win that day or were you already thinking, I think I need to impress this guy's sister?
Greg Creed (01:51):
No, we were on the same team. So the good news is I didn't have to beat him and he is, by the way, a better golfer. I got to be honest. But it was funny because both our parents were members of the same golf club, so you know when you meet someone, you got to do the introduction to the parents thing. We never actually had to do that because our parents had known each other for as long as we'd known each other because everybody went to the same golf course on the weekend, so that made it a little easier.
Claire Blake (02:18):
Your dad worked at Nestlé, you worked in a grocery store at a young age. Decades later, you're at the helm of a quick service restaurant. What did your dad teach you about the business of food?
Greg Creed (02:30):
My dad was an amazing guy. He was clearly smart, but he didn't have what you'd call an education. My grandfather fought in the second World War, so my dad had to leave school at 14 or 15 to get a job to help pay for the family while my grandfather was up in New Guinea fighting. So my dad was just a very positive influence as much by watching him, and then he introduced me to people. So because I could play golf, if dad was playing golf for business and they were short someone, I would go out and make up the foursome sort of thing. So I got to meet a lot of business people in my career because my being in business was not my original career choice, so I was going to go off to Duntroon, which is the equivalent of West Point, and become an army officer. At the very last minute, I decided that that would be a lot of fun while I was young, but probably not great when I got older. So I did a business degree at university and then I joined the Army Reserve, and so I sort of got to do the army thing as a part-time thing and I got to do business as a full-time thing, and so it was great.
Claire Blake (03:28):
With your dad and getting to play a foursome, which by the way, I think you peaked at 16 in golf.
Greg Creed (03:32):
I did, yes.
Claire Blake (03:33):
This is at your prime.
Greg Creed (03:34):
Yeah the last 52 years I've only been downhill from my golfing ability.
Claire Blake (03:38):
That's exactly right. You got to see him in action some, right? He gave you a glimpse of a corporate life, a business life, if you will. I do want to kind of pull on this thread because obviously you have played golf literally your entire life. You played soccer, rugby, you were just talking about the Army cadets. I think it's, it's safe to say you've got a competitive streak. But you also spent your entire career as a marketer. You came up with some iconic slogans like "Think Outside the Bun." I'm really curious about the combination of competition and creativity. Is that the secret recipe to being a great marketer?
Greg Creed (04:12):
There's two sides to competitive, right? There's good competitive, and then there's the evil side of competitive, which is the people who when they lose, they lose control and they can't handle it and all that sort of stuff. I think what I learned also from my dad was to win the right way, to do good, to be good. My dad always tried to make everyone sort of win. It wasn't like my dad never woke up to say, "Well, I'm going to screw someone today so I can be a winner." That just was never in his mentality. I do love to win, but I'd rather lose than I'm not going to win by cheating.
Claire Blake (04:41):
Yeah, a hundred percent.
Greg Creed (04:42):
It's funny, many years ago, I don't know how many years I was sent a TED Talk and this TED Talk was about you need to define your legacy early in your career so you can make decisions consistent with that legacy rather than most of us, our legacy is what we didn't consciously try to make it a legacy. It's sort of what we've been left with. So one of the tasks is: can you define your legacy in six words? And mine became proving good guys can come first. Yes, I've always wanted to come first, but at the same time, I only want to win if I'm going to win the right way.
Claire Blake (05:13):
I heard an hilarious kind of quote that I heard about something your preschool teacher said.
Greg Creed (05:18):
Oh, yeah, yeah, yeah. This is sort of third hand from my mother, but my mother said something like, my preschool teacher said, "He may not be the smartest kid in the class, but if he puts his mind to it, he'll probably be very successful." So I was like, "Man, if I'm not the smartest kid in a preschool class, then ..."
Claire Blake (05:36):
She'd watched you win the playground. She was seeing this competitive streak already. I'm sure that was what it was.
Greg Creed (05:41):
Where I've been particularly lucky in business is that I have been able to find something that I love and I think I'm okay at it, right? And I've been very lucky that the thing I happen to love, which is marketing and brand building and all that, actually provided me and my family with an amazing living. So if you can go to work every day and sort of love what you do and get rewarded for doing it, then that's pretty special.
Claire Blake (06:03):
For sure. I'm going to fast forward us from preschool reflections and childhood reflections to a moment in 2011 when you're taking over as CEO of Taco Bell. KFC and Pizza Hut, your sister brands, are down 5%. Everyone's worried about their health, and around the same time you've got Chipotle and Panera competitors coming on the scene. They're very hot. Everyone wants the quote unquote "better for you" food. I wanted to quickly just understand that backdrop for you. I mean, how did you think about competing with fast casual?
Greg Creed (06:33):
It's really funny. I never thought of fast casual or Chipotle as our competition. I always thought our competition was McDonald's, and the reason for that is because they're the biggest, they're the big gorilla, right? In fact, I remember when I got the job, people said, oh, are you going to try and turn Taco Bell into Chipotle? I'm like, "That's the last thing I'm going to do. I'm just going to turn Taco Bell into the best Taco Bell I can make it." I think sometimes what you don't do is just as important as what you do do.
Claire Blake (06:56):
That's really good. In this podcast, we're unpacking the seminal moments in CEO's lives and careers that shaped who they are as individuals and leaders. And this backdrop I think came at odds with what you literally walked into and to remind all of us early in your career at Taco Bell, you led the creation of Mountain Dew Baja Blast, now a billion dollar product. The story of how you got PepsiCo to say yes is legendary, but this moment, the stakes arguably were much higher. It's January 2011, you've been CEO of Taco Bell for a week and you wake up one day and Taco Bell is being sued for $45 million.
Greg Creed (07:32):
That's absolutely right. $45 million.
Claire Blake (07:34):
And inevitably I think you were being accused of not having beef in your beef. Is that right?
Greg Creed (07:38):
Yeah, exactly. Yeah. I'm never sure if it was enough meat in the beef or beef in the meat, but it was one or the other. It was interesting because we happened to be at a meeting down in Florida. What was really interesting was not only was this whole aura of everyone needs to eat better and eat healthier, there was this sort of underlying belief that, "How does Taco Bell sell things so cheaply?" A lot of people believe because we probably cut corners or we didn't have the same quality, whatever they believed. And so unfortunately this had a magnifying effect because now people are like, "Oh, well, now I know why they sell things so cheaply. There's no beef in the meat." There was this sort of compounding factor of this underlying question of, "Well, how does Taco Bell sell us things at a price that no one else can sell us for?" And now people sort of took two dots and connected them, so it had a compounding effect, and sales pretty much dropped by like 20% overnight, which is horrendous.
Claire Blake (08:33):
You were all together.
Greg Creed (08:35):
Yes.
Claire Blake (08:35):
In Florida. Tell me who told you? Who was in the room? Do you remember exactly how you found out at first?
Greg Creed (08:41):
There were two other people that really mattered. There was my boss, David Novak, who was in the room, and then there was a guy called Howard Draft who was the head of Draftfcb, the agency. So I go into the meeting and obviously it's all over. It's the beginning of social media days, and so it's all over social media that we're getting sued. And I also look at the sales numbers and they were like minus 20, I think everyone's discussion was around, "Well, we need this to go away." Maybe if we offered them four and a half million or some amount to just make it go away because fighting these things ends up being expensive. And I'm like, "No, we're not paying a penny." In the pecking order of the CEO of Yum!, and the general counsel of Yum!, and yes, I'm running Taco Bell, but I'm not at the top of the pecking order. I think we all collectively decided we were going to fight this and that we weren't going to pay. Howard actually was the one who came out with the line that said, "Thank you for suing us and here is our formula." And so we were able to, I think, take a really aggressive stance. The challenge with this is you don't want to be the one that keeps the story lingering. So every time you defend yourself, you are sort of keeping the story in the public domain and sometimes you just want this story to go away, but we all decided that we were going to fight this, and so it was, "thank you for suing us." And then we actually listed out the formula.
Claire Blake (09:55):
So I mean, essentially the company gets sued. You guys decide not to back down. You take out a full page ad that says, "Thank you for suing us with the formula." What was the reaction in three maybe key areas? What was the reaction from the general public, your employees, and then most important, your franchisees? Because if I learned anything from a business like yours, everything rides or dies with franchisees.
Greg Creed (10:19):
Yeah the $45 million settlement is nothing. If you think a 20% sales drop, I had 300 franchisees who probably owned in those days, I'm going to say four and a half, 5,000 restaurants that they were the ones who were stuck with sales being down 20%. I think the franchisees, they just wanted sales to go back up. So they loved the fact that we were fighting. We obviously told the franchisees if we ever had to pay anything, we would pay it. We wouldn't obligate them to do it. In the very short term, there was still a lot of distrust. One of the things that I insisted upon was I put my signature on the bottom of that ad. If you pull the ad out, you'll see my signature on the bottom of it. When they attacked Taco Bell, I took it very personally. Not that anyone cared about what I think, but I personally took it as an attack on me and I was going to defend like I would, I was going to defend myself.
(11:07):
I was going to defend my brand with every ounce of energy the right way. I think that was also part of why we decided to fight was because that's what I would've done if you'd have personally attacked me. You're in meetings and people say, "Yeah, I'm aligned. I'm good. I'm on board." And then they walk outside and they do the exact opposite. There's something about your signature that makes it personal. And so I didn't want this to be from Taco Bell. Taco Bell ... Thank you for suing us, and here's our formula. I wanted to personalize it that it was my signature on this one page because A, I am responsible for the brand, and B, you've sort of picked on me as well as you've picked on the brand. But certainly the Taco Bell lovers liked the fact that we fought and that we didn't roll over. So I think the employees liked the fact that we decided to fight. The franchisees liked the fact that if there was ever going to be any monetary issues, we would eat that. But they also liked the fact that we were fighting, and I think a lot of our loyal customers liked the fact that we also had decided to fight because let's be honest, a lot of these plaintiff's lawsuits are frivolous, and so they start at $45 million, you end up paying four and a half million because it's cheaper than going through the courts, right? I was not going to play that game.
Claire Blake (12:18):
And I mean, in reality, you're not just defending a product. I think you signing the piece shows that this is a moment for Greg Creed's leadership. This is going to be the kind of CEO you're going to be. And if I'm not mistaken, you told your Taco Bell franchisees early, "I'm not here to make you happy. I'm here to do what's right."
Greg Creed (12:34):
Oh yeah. That was my first day. So back in 2001, when I was the chief marketing officer, I arrived, I tell you, it was May the seventh, and then the first day in the office was a franchise meeting and they'd had a fair bit of turnover in the chief marketing officer role. And so I'm an Australian, we don't have Taco Bell in Australia, so they're like, "You are the Australian who doesn't work on Taco Bell." And the question was, "How are you going to make us happy?" And my answer was, "I'm not here to make you happy. I'm here to do what's right and when I do what's right, I'll make you happy." I think that's really important. I think too often people try to make decisions to make people happy. Your job is to do the right thing.
Claire Blake (13:08):
So three months go by or so, they withdraw the lawsuit. You wind up paying how much?
Greg Creed (13:14):
Zero. Not one penny.
Claire Blake (13:15):
Not one penny. I'm assuming you're pretty happy, your franchisees, everybody's pretty happy. The happiness barometer is pretty high.
Greg Creed (13:21):
Sales had turned around. I mean obviously they took a long time to turn around, but they were definitely heading in the right direction. And then we ran another full page ad that said, I think the headline was, "Would it kill you to say you're sorry?"
Claire Blake (13:34):
Oh my gosh.
Greg Creed (13:34):
Because in my mind, that's the honorable thing to do, right? If you do something and it turns out not to be correct, you need to say you're sorry, goes back to my father. It goes back to doing winning the right way. So yeah, we ran an ad that said we hadn't paid a penny and we hadn't done this and we've done this and blah, blah, blah. But I love the headline, which was, "Would it kill you to say you're sorry?" I think the thing that I'm most proud of, but this is it gets to my vindictive streak if you take me on, is that we found out where these plaintiff's attorneys lived. It happened to be in Birmingham, Alabama, and one of our best franchisees, Don Ghareeb, he finds out where they play golf, the partners of this law firm. I bought every billboard that you had to pass to drive into the golf club that said, "We didn't pay a penny." Knowing that when these guys went to the golf club, all their mates would be saying, "Oh, I see you sued Taco Bell and they didn't pay a penny."
Claire Blake (14:30):
Was that just vindiction or was that strategic? What were you trying to accomplish with that?
Greg Creed (14:34):
I'd like to say it was strategic. It was purely vindictive.
Claire Blake (14:39):
This goes back to competitive Greg Creed.
Greg Creed (14:41):
If you write it up as a case study, it was very strategic.
(14:45):
Taco Bell since then has had, never had another frivolous lawsuit.
Claire Blake (14:50):
Interesting.
Greg Creed (14:51):
Everyone will try and pick on what you think is the biggest victim, right? People realize if you pick on Taco Bell, we're going to fight.
Claire Blake (15:01):
Looking back, what did the fight cost you, if anything? Was there stress, time, relationships?
Greg Creed (15:07):
I think it actually built relationships, to be honest. I actually think people like a boss who's prepared to fight—well, prepared to fight when they're right and admit when they're wrong. I think those both go hand in hand. And I think we built relationships with everybody. I think we built relationships with our employees who realized we would fight to the death with our franchisees. And I think with our customers who we're sort of like, "We're the brand that does things that other brands don't do." I think our customers really appreciated that we fought not just for Taco Bell, we fought for them because...
Claire Blake (15:37):
Yeah, for sure.
Greg Creed (15:38):
If you buy a brand, you are buying into the brand. And so I think a lot of our customers felt they were being attacked or they were part of, not the lawsuit financially, but had they been gullible to buy the Taco Bell story, so to speak, right?
(15:52):
So I think in hindsight, I think we built an even stronger relationship with our core user base.
Claire Blake (15:59):
Let's rewind to 2006 for a minute to your first week as president of Taco Bell U.S. because I think that week there was an E. coli outbreak, more than 70 people got sick with many hospitalized, and you immediately say, "Yes, it was our fault." Walk me through that decision and how was this different from the beef lawsuit?
Greg Creed (16:17):
Most people don't want you to admit that some of the food they ate at your place has made them sick. And I came out and I said, "Yeah, it's pretty obvious that people had eaten green onions that had come from Taco Bell." Now they're also green onions from other restaurants and other supermarkets. So it was obviously a green onion problem, but everyone wanted us to say, you sort of do the, "Oh, well, we're just one of many." And I came out and said, "No, yeah, people ate at Taco Bell and they got sick." We owned it. I got asked some interesting questions like, "Have I spoken to the people that had been ill?" And the answer is no, I couldn't because they won't give you that information out. Obviously HIPAA laws and stuff. And even in that case, I worked with the governor and he and I ate Taco Bell together.
(16:54):
So I'm a big believer and you just got to tell the truth. So it goes back to doing it the right way, right? If 72 people are in hospital and 60-something of them ate at a Taco Bell, it's pretty clear they probably got it at Taco Bell. The good news is we got rid of green onions, we put in green nacho strips. I hate what I call corporate gobbly-goo speak where we don't say anything that'll get us into trouble, but we don't own up to our obligations. And it goes back to we're not doing it the right way. We're trying to win, but not the right way.
Claire Blake (17:24):
It's just interesting because you do have these two parallel moments with the E. coli situation where you took accountability, this one on beef or meat or whatever we're calling it where you said, "No, we're going to fight." Both times, maybe your counsel's telling you one thing or another, but it was you that made a decision and maybe with some help of some friends and advisors, but how do you decide when to fight and when to fold? When you zoom out in these stories individually, you're now on multiple boards, Delta Air Lines, Whirlpool, Aramark, you're still actively advising several companies in industry on their brand and marketing efforts. So what is your rubric and how do you think about when you fight and when you fold?
Greg Creed (18:08):
I think part of it is, what is your gut telling you to do? But more importantly, what's the right thing to do? To me, life is zero or a hundred.
(18:17):
You are either all-in or you're not in. My sister-in-law says I'm the most in-the-moment person she's ever met. And even if you come to food, people say to me, "Do I like this?" The answer is, I either love it or I hate it. I don't have anything in the middle. And then even I think trust, I say to people, "There's only two scores for trust, zero and a hundred, you either trust me or you don't. And trust is not like 72. You don't get a 72 score." And so I think because life is not black and white, but I think the stances you have to take are black and white. And when you're wrong, you have to admit it. And when you're right, you have to defend it like you have never defended anything in your life, and I think people respect you for doing so.
Claire Blake (18:51):
I want to thread that through to the moment that we're in now, because if you think about the business environment in this day and age, it's been years. I mean, you had some good foresight in kind of stepping down at the end of 2019, 2020.
Greg Creed (19:04):
Yeah.
Claire Blake (19:04):
It's been years that senior executives and CEOs have been under a lot of pressure, and in many cases, I mean, call it what it is, I think they've become numb to it a little bit. So what are you saying to business leaders who are facing pressure to compromise? I mean, how do they stay zero or a hundred? In the boardrooms you're in and executives you're advising, just what's your message?
Greg Creed (19:25):
My message is be bold, not beige. In the more tough environments, you have to be more bold, not less bold. And I think when things are going well, you can get away with average.
(19:34):
When things are not going well, like the economy and all that sort of stuff now, I think that's the time when you have to step up and be bold. And I think you have to be bold for your employees, for your, in our case, franchisees, the customers. I think the thing I'm most proud of, you think about Taco Bell now, they did like $17 billion last year, a number way beyond what I even set when I was running it. They'd had five, the last five years, so 20 quarters of the same store sales growth in the last quarter, they just put up plus 7%. And so I'm a big believer in the legacy you leave is not what you achieve while you're there. It's what gets achieved after you've left. I heard a great thing the other day. There's three phases of life, which is learn, earn, return. And I think that's a really simple summary of life. What's interesting is the earn part is really important, but I think the return part is actually better for the soul.
Claire Blake (20:21):
That's awesome. I love that. By the way, I don't think I ever realized how much I hate the color beige until you said be bold or beige. And I thought, I sure as heck don't want to be beige.
Greg Creed (20:31):
And nobody wants to be.
Claire Blake (20:33):
Nobody does. I love that. That's great.
Greg Creed (20:36):
But I honestly think that not enough business leaders today are being bold enough. I think they don't want to upset anybody. And the answer is, if you don't make a decision, you're upsetting everyone. I used to hate going into meetings and people would go, "Oh, we'll make a decision next week." And I'd be like, "So you made a decision not to make a decision?" They're like, "No, no, no. We're just going to decide next week." I'm like, "No, no. You made a decision not to make a decision. What the hell are you going to learn in the next week that's going to change the decision? So I'm going to lock the doors, and when you've made a decision, you can all come out." I would like leaders these days to be more bold, and I think we are too beige as leaders, and we need to be bolder as leaders.
Claire Blake (21:12):
Look, I mean the losing the corporate goobly-gobbly speak, thinking about winning the right way, I think being so authentically yourself as CEO, it's pretty remarkable to think about A, your willingness to put your brand on something pretty substantial, and also your willingness just to own, I was doing nothing but being vindictive and it felt damn good. I do want to ask you, if you bought a billboard right now, what would it say? Who are you beefing with?
Greg Creed (21:40):
Man, I'm not really beefing with anybody to be honest.
Claire Blake (21:44):
Maybe it's a positive. Maybe it's a positive that you're going to put out in the world.
Greg Creed (21:48):
I think it would be be bold, not beige. I think that's what my billboard would say. First of all, people want to be led, right? They want to be led by people who are authentic and genuine. They want to be led by people who are vulnerable. I think one of the keys to success as a leader is being vulnerable. I'm a huge believer in being vulnerable. As much as ... It's so funny, I'll never forget my first day at Taco Bell or second day at Taco Bell. I'm on stage and I go, "Yeah, I really suck at process and I can't spell." Well, the HR team wanted to tackle me off the stage. First of all, you, we weren't allowed to say the word suck apparently in America, Australia you could, and they're like, "You can't say those things." I'm like, "Oh, yes, I can because I'm really bad at it."
(22:23):
What businesses need to do is to accelerate everyone's specialness, whatever makes them great, whatever their superpower is, and then put a team together of superpowers where all of us are terrible at something, but collectively, we are super. If you wanted me to sing a song, I can't. You wanted me to play an instrument. I can't. You want me to draw up a drawing? I can't. You can be crap at a lot of things. If you can love the thing you can be great at and then surround yourself with people who have greatness that makes up for you, then that's how you're successful.
Claire Blake (22:52):
I would thank you for sharing. It's so clear that the legacy that your dad built in you, that I know you've built in your son and your grandson comes straight through, which is just being bold, being true, and winning the right way.
(23:08):
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