Zero-based budgeting comes to Pernod Ricard - just-drinks Exclusive
just-drinks' exclusive interview with Pernod Ricard CEO Alex Ricard was published this week
The head of Pernod Ricard has confirmed that he has introduced zero-based budgeting into the organisation, but flagged that the measure works on a "reallocation of resources" basis.
Prior to Alex Ricard moving up to head Pernod in early-2015, the company launched its first savings programme, known as Allegro. The programme, which kicked off in early-2014, was designed to save EUR150m (US$162.4m) over three years.
Since becoming CEO, Ricard has introduced the zero-based budgeting concept into Pernod. Other drinks companies that have adopted ZBB are Diageo and Anheuser-Busch InBev.
In an exclusive just-drinks interview, published this week. Ricard provided further details behind the group's savings efforts. "We need to be efficient, of course, while at the same time empowering the people on the ground to make swift decisions and to be accountable for them," he said. "The obsession needs to be about top-line growth, but efficiency needs to be part of your habits."
When asked specifically about ZBB, Ricard said the company now uses the measure, "but, that's an irrelevant question".
"We need to do it one way or another, but we want to be entrepreneurial," Ricard added. "We'll have a junior brand manager come to us and say: 'Entrepreneurship means having the capability to seize an opportunity if and when that opportunity pops up'. In our zero-based budgeting, then, we need a line called 'opportunity that we don't know yet'."
"When that opportunity pops up, if that junior brand manager believes it's more important than some other projects that they have budgeted for, then reprioritise. This is called continuous reallocation of resources."
Pernod Ricard Austria is expected to continue to focus on offering premium quality spirits over the forecast period in order to meet the consumer demand for premium products, and thus move up to the l...
On 9 May, Diageo is hosting its latest Capital Markets Day for analysts and investors, in London. Ahead of the group's presentations, Anthony Bucalo, global beverages analyst at HSBC, has prepared a l...
Pernod Ricard’s strategy in Germany will continue to focus on premiumisation and innovation in order to generate added-value....
Pernod Ricard’s strategy is to remain one of the leading players in sales of wine and spirits in the country....
Pernod Ricard (S) Pte Ltd will continue to look at securing good partnerships with key players to further cement its leading position in Singapore....
- Ten questions for Diageo - Analysis
- Have spirits companies forgotten the mainstream?
- Does alcohol accelerate the onset of dementia?
- How craft beer has shattered its US shackles
- Ashwagandha - The next functional drinks trend?
- Moet Hennessy unaffected by LVMH Dior buy
- Distell acquires majority stake in Cruz Vodka
- BrewDog moves into spirits with LoneWolf launch
- Portman Group heads to Tesco for new chief exec
- William Grant names Europe & NA Travel Retail head
- Global Scotch insights - market forecasts, product innovation and consumer trends
- Global Champagne and sparkling wine insights - market forecasts, product innovation and consumer trends
- Battle of the Generations - The fight for iGen, Millennial, Gen X and Baby Boomer consumers
- Craft Beer: Coming of Age or Past Its Prime?
- Myanmar - ISA Country Report