Newell Brands CEO Chris Peterson: Organization Transformation Through AI

SPEAKER_02 0:00

Hi, I'm Chris Peterson, President and CEO of Newell Brands, and welcome to the CPG Guys Podcast.

PVSB 0:07

Hello and welcome to the CPG Guys Podcast, set at the intersection of commerce and tech. Your hosts, Sri Raja Gopelin and Peter V. S. Bond, explore how brands and retailers engage consumers in a digitally driven world. And now, here are the CPG guys.

Sri 0:26

Hello and welcome to this episode of the CPG Guys Podcast. I'm of course Shri, your co-host and also CRO and co-founder at ThinkBlue Consulting, your trusted partner in your omnichannel development journey, where you can get in touch with me at Shri at thinkblueconsulting.co. Please do listen to my older daughter's music at www.rearaj.com and follow Laura Raj, my younger daughter, as a member of now the largest global girls' band in the world called Cat's Eye. They've just come off a clean sweep at the AMAs this weekend at Vegas. Of course, Papa Raj was around to see it right from front row. And I can't tell you folks how much, what a special moment it is to see your offspring succeed. Three AMAs, my head is still spinning. Of course, I'm joined today by my co-host and co-founder, PBSB, who also moonlights as head of industry and climate engagement at Flywheel, the Commerce Acceleration Division of Omnicom. Peter, I know we're headed to Cannes very shortly in a week's time.

PVSB 1:51

And then of course, off the heels of that, we're heading to upstate New York. What do we got going on there, Shri?

Sri 1:56

Cooperstone. It's Porter Shi's bucket list. As y'all know, I'm a diehard Yankees fan, but I've never been to Cooperstone. We've created budgets to pick up stuff.

PVSB 2:05

We negotiated with ourselves on the budget limit for how much we can spend on swag. Actually, there is There is no limit. Much I need with the Cooperstone. Much to our accountant's chagrin.

Sri 2:18

Peter's a diehard Dodgers fan, so I'm sure he's gonna go straight for the Otani one. Yes. Of course, make sure you're subscribing to our podcast on your preferred listening platform where you can get our latest episodes, go back and consume some of the 598 plus episodes we've had before this one that we've already published. And now let's get to the moment. We were at Cagney 2026 a few months ago, and we're still buzzing from some of the incredible presentations we saw from CPG, publicly traded, some of the largest Fortune 500 brands that exist on Planet Earth, the CEO presentations. One of the presentations in particular floored us on the approach to AI. The conversation was so fantastic, we had to find a way to be here and record this episode with the CEO who made that presentation. So we made a conscious decision for this episode to step away from the earnings for Shan PL conversations, which would be weekly on Tuesdays as it is every single week. And we've covered that ad nauseum. So we're gonna stay away from that entirely today. What we want to talk about today is the story of operational transformation and leadership. And at the 2026 CAGNE conference, no one told that story better than the president and CEO of Newell Brands, Chris Peterson. He's been generous enough to make time for us in person. We're at Noel's headquarters in Atlanta, and he's gonna help us uncover the reality of AI at the executive level in our industry. There's a lot of misconceptions in the industry about how executives think or don't think about AI. And today Chris is gonna solve that for us and inspire everybody at CPG and retail. Chris, welcome to the CPG guys. It's a pleasure to have you on.

SPEAKER_02 3:52

I'm very excited to be here and excited to talk to you guys about AI and what we're doing at Newell.

Sri 3:57

In the digital line, I know so there's an episode, of course. We'll include links to Newell's company's corporate websites for our listeners to access and browse their products, of course, while we go on with our conversation. So, Chris, I'm gonna jump right into it. The first word that came to my head, and I've been waiting to ask you this, is the word quantum leap. Isn't that two words? That's a two word. Two words, Chris. My apologies. Quantum leap it is. At CAGNI, you spoke pretty extensively about an enterprise AI program internally called Quantum Leap. You mentioned that in mid-2025 you shifted from isolated use cases into a very strong, broader how work gets done. The people who attended CAGNE, which is mostly the analysis is only three media houses. CPG Gaz is one of those, along with Wall Street Journal, and I think who is it, Peter, New York Times? But we love to hear everything about Quantum Leap from you, how you moved into broader, how work gets done at Newell. Can you talk to us of the geniuses of Quantum Leap and what it looks like today?

SPEAKER_02 4:55

Yeah, happy to do it. It's been a passion of mine at Newell over the past couple of years. You know, when ChatGPT came out in the fall of 22, it was sort of like a starting gun going off. And at that point in time, the large language models had a lot of promise, but they didn't really quite deliver. But the pace of change in the large language models has been so remarkable that I believe AI is going to fundamentally transform this entire industry and really all parts of the industry. So we got started on AI in 2024. And when we started by putting a steering team together, we had a grassroots program. People that wanted to do AI across the company would come and say, Hey, I've got this idea. Can I do it or not? And we wanted to do that from a governance standpoint to make sure that we were number one, ensuring security, but also number two, uh keeping track of what was going on. The big change happened toward the end of 24 and into 25 when we there was a pivotal moment when the large language models crossed the threshold. We had gotten started with machine learning, largely in the supply chain, largely in the SNOP process. But what we saw was the opportunity not just to do machine learning, but to move into generative AI, particularly in the marketing space, and also move into agenci AI to better manage workflow management. And so we decided to make a strategic pivot and we kicked off this quantum leap program. And the quantum leap program was sort of designed uh with three pillars in mind. Uh the first pillar was let's get the organization trained and equipped on personal productivity. So we rolled out ChatGPT, co-pilot 365 to now the top 3,000 people in the company. And we did a broad training. Conscious choice. Conscious choice, top-down. And we for and we told everybody that they had to attend the training. We did hours of training so people could start to use it for their everyday use. They could use it for emails, they could use it for meeting assistance, they could use it for scheduling, those types of things to drive individual productivity. That was the first pillar. The second pillar was we it was a functional pillar. We asked every function in the company to reimagine what that function looks like five years from now, fully AI enabled. And it was important to sort of pick a five-year out mark because if you do pick a five-year out mark, you're not constrained on what you can do in the next three or six months, but you really start to reimagine how the function could operate with effectiveness. And so we did that, and each of them have now come back with ideas of what that looks like and so forth. And then the third So each function now has a five-year outlook.

Sri 7:36

Yes. How AI will save time live better within the computer. And that rolls up. And that rolls up. Yeah.

SPEAKER_02 7:43

And we then uh uh to enable that, we name 33 functional navigators.

PVSB 7:49

Each of them I love that term navigator, because you're recognizing the fact that you they have to act as guides to bring these people along on the journey.

SPEAKER_02 7:58

So those 33 navigators have a function that they're responsible. So for example, we have one navigator who's in charge of our consumer insights function. Okay. These are named people. Named people. The responsibility of being champions. Correct. They own this the five-year strategy vision, they own the glide path. And then uh we've got a steering team that I uh sponsor that's multifunctional, that uh we prioritize uh across the company based on return on investment. And we look at sort of on a two-vector basis. We looked at uh how easy is it to implement and what's the payback because we're seeing very strong ROI, which what which I'm sure we'll get to. The third pillar of this strategy of quantum leap is looking at multifunctional processes that are not within a function. These are generally harder processes that if we can crack them with AI, yeah. So so it could be like the entire product development process. Um or the new item setup process is one that we're currently working on, which is more complicated than we do. Yes. And so that's that's really the quantum leap program. And uh, and we've now created as part of that, since CAGNI, in fact, uh, we've taken the next step, which uh I mentioned the navigators, the 33 navigators. We've now created a term that we're using called voyagers. So within each function, I love the navigator is the leader, but we have 10 Voyagers that uh on average that are helping the entire function move into the AI uh journey uh at pace.

Sri 9:31

Now, with navigators and these journey folks, you've got to have program management on top of it, or is this more of a representative role?

SPEAKER_02 9:39

We have program management. So we have a quantum leap steering team. We've developed a very uh strong center capability. And and one of the things that was interesting is uh we made a choice early on that not very many people knew about AI. And so we didn't want to go to the consulting firms because we thought we knew as they're consulting firms are known for two things.

PVSB 10:03

One, listening to your people and telling you what they said, and number two, charging you a lot of money for that. That's exactly right. That's exactly right.

SPEAKER_02 10:10

I think in the AI space, I don't think there's a true expert like this. Yeah. So we went directly to the tech companies. And so Salesforce, uh Microsoft, Google, Anthropic, and so we are partnering directly with the tech companies, and we've now developed internal capability uh to do this.

PVSB 10:29

Aaron Powell So you're not relying on any one LLM, you're relying on a multitude of them, all with different focuses and to create the tool set you need to get the all of these different outputs and outcomes that you're looking for.

SPEAKER_02 10:43

Aaron Powell 100%. And in fact, one of the more recent things that we've been doing, just to give you a little bit of uh in the in the weeds on this, is we've been thinking about when we should use which LLM so that we maintain control of our token cost. Uh, because some of how we're using AI across the company, and we've stood up now 150 plus uh AI use cases across the company, and that number is accelerating. But some of the use cases don't require the most advanced Claude model from Anthropic, which is very expensive. Yes. We're happy to be able to use a sort of a mid-tier or even some cases a small language model that's much cheaper and much faster.

PVSB 11:22

Yeah, I don't think enough people understand within each of these LLMs that there are different levels and what to use them for. So I think that's very fiscally responsible that you've sat there and said, okay, for lower grade requirements, there's no purpose to using the Cadillac when we can when the Chevy will get us there exactly the way we want it to.

SPEAKER_02 11:41

Aaron Powell That's right. But if we're trying to solve a very complicated scientific problem, then we're going to use the more advanced models. And we've we've brought in and have access now internally and experts on each of these models.

PVSB 11:55

Aaron Powell So one of the questions I have for you, Chris, around this is okay, you've got different user archetypes, you've got the navigators, the voyagers, you've got all of the employees. I don't think any of this happens unless it becomes a core component of how they perform. So how do you think about building out KPIs that feed into the annual objectives of all these? So it's not just a side-of-the-desk nice to do, but it's, hey, I've got a vested interest in learning how to do this.

SPEAKER_02 12:27

When we put our priorities together for this year, we had five priorities as a company. Some of them are not surprising. We wanted to ignite top-line growth. Uh, we wanted to continue to fuel the business through margin and overhead discipline. But we picked one of the five is driving AI and quantum leap. So it's one of the few initiatives that we've taken to the top of the company.

Sri 12:50

I do want to point out you're the first, and Peter and I are out and about in the industry talking to leadership every day. This is what we do for a living. You are the first C-suite leader who has said, I'm going to put it on the agenda of my top five priorities for the year. And therefore, we should be able to take advantage, leverage it, and deliver all the other four against it. Yeah, exactly.

SPEAKER_02 13:12

And we're not doing AI for AI's sake. We're doing AI in service of the company strategy. Yeah. And we're being very come focused.

PVSB 13:20

Exactly. Chris, I want to double-click down on the navigator aspect of what you shared. Because at your recent leadership summit 2026, you mentioned this in great detail. How much of a cultural shift to build AI fluency across the enterprise is it really to enable these navigators? And how do they act as change agents to make that transformation occur?

SPEAKER_02 13:44

Aaron Powell It's a pretty big cultural shift. And one of the things that we when we got started on the journey, there were some people that were afraid that, boy, AI is coming in and it's going to eliminate my job. And then there's there's sort of the doomsday sayers about AI.

Sri 14:00

But the reason for that, Chris, we strongly believe is leaders in your position, you're an exception. We've already declared that, but most leaders in your position aren't exactly articulating AI the way you are to this level of this is the first one.

PVSB 14:13

There were people on on the stage at Cagney that were reading it off the slide, and that was the extent we could tell. It was obvious who was and who could go one level down when asked during the follow-up. So back to culture influence.

SPEAKER_02 14:38

We've done it uh uh when I go around to parts of the organization, and we've done it through the training that I mentioned of we're gonna try to get people educated on AI. And we recognize that some people don't know anything, and we've got to get them up to speed. Some people are very advanced, and we want to take advantage of those people because they have a lot that they can contribute. And really what we've said is hey, our job is to delight consumers with great products under our leading consumer brands. And if we can use AI to do that better and offer a better value product for consumer and become a better partner for retailers enabled by AI, I think that's the winning model. And so that's what we're trying to drive in the organization. So it's not about, hey, let's get rid of a bunch of people. It's about how can we speed up our development process? How can we get our marketing materials to be more compelling, more complete, and more timely? How can we improve our SOP process so that our customer service levels and our inventory get optimized and those types of things?

Sri 15:48

I can already see Newell being one of the first in the industry moving from joint business planning with retailers to joint value creation, because you put in the consumer at the center. And that becomes who both retail and newal will serve through the use of AI. Make the whole process better, more quality products, better outcomes, value. Yeah. All of the above. So you mentioned ROI. In any large company, any company, ROI is important. Yes. So when you execute, you measure outcomes. So let's get into that a little bit, the tangible outputs. The numbers you share at Cagney were actually pretty staggering. Staggering. Like for example, you noted a 500% increase in AI-enabled digital content creation creative in 2025 versus 24. Yep. Without additional investment, if I may add. Right. How has AI accelerated your innovation pipeline from concept to launch? So let's just get into innovation. We just talked about joint value creation.

SPEAKER_02 16:43

Yeah. So let's let's sort of go through there's two pieces to this. One is the innovation process, which I'm very excited about. The other is the marketing development and activation. On the innovation process, if we start there, we have uh made a tremendous amount of progress on consumer insights. So we started with our brand strategies. Uh in any good brand strategy, you do a consumer segmentation study and you pick which consumer segment are you trying to uh prioritize as part of your strategy for what you're trying to offer.

Sri 17:12

Your team is actually giving us a tour of new products, and we will remember to ask them about the segmentation strategy for pressure on your team's not.

SPEAKER_02 17:20

Very good. Uh and and uh and I expect them to be able to answer. So Vernard, that's also recording. That's just Peter and Sri just Very good. So what we did next was we we looked at this, these consumer segments, and we said, hey, rather than going out and doing the old process of going out and getting a focus group of people, you have to schedule it, you've got to hire find the people, and then you go and test ideas with them. What if we could create digital personas with AI that were available 24 hours a day, seven days a week, that we could we could talk to and test our ideas uh immediately? And so we've now done that. So we've created digital personas that are based on the consumer segments, and we've developed not just one of them, but many of them. So we have now digital focus groups. And so that enables us to fast cycle test concepts. We also uh we did sort of a circle that we're internally we've branded Inogen. So from that consumer understanding, we used to then have if we came up with a new idea, we would have a sketch artist that would develop a sketch and then we'd have to go hire a photo shoot. But we put another AI app in that says from the sketch, we can go to a finished photograph in about five seconds, as opposed to uh and and not just one photograph, but many. We've then developed another AI app that can take the finished photograph and go to 3D CAD design work. Design. And we've then uh stood up a rapid prototyping uh 3D printing to actually create a physical Wow, you can actually produce the physical item. Correct. So that whole process from ideation to uh finished photography and uh and a sample used to take four or five months. We can now do it in five days. So that's fascinating.

PVSB 19:05

Chris, I have a I have one follow up question and I'll get to my main question. But with respect to the focus groups and the digital focus groups, like one of the biggest criticisms I hear about LLMs is they're way too agreeable. You give them an idea and they say, that's the best idea I've ever heard. Yes. I have got to imagine that was in the back of your head. And when you built these digital personas, you tried to make sure that didn't happen.

SPEAKER_02 19:31

You're exactly right, and it's a very good observation. Part of this you can manage through the prompt. Yeah. So, you know, if you're ever using AI, one of the things I tell our people is you have to tell AI in the prompt to be tough on me. Don't be nice. No more Mr. Nices. I love that. And if you say that in the prompt, you'll get a little bit more direct.

Sri 19:51

We uh we make sure we're clear about this innovation process. Yeah. So you can theoretically go from concept to some sort of uh prototype, yeah.

SPEAKER_02 20:03

In five days, like one of Yeah. Now the prototype, I don't want to overstate the prototype. It's a 3D printed classic.

Sri 20:08

Yeah, it's a 3D printed digital classing. Right. But it's better than anything else that exists in the industry. Most people struggle with six months. Yes. And uh have you put any of those in front of retail yet? We have, yes. How's the feedback been?

SPEAKER_02 20:23

Feedback has been phenomenal. Uh so in fact, one of the things that's happening as we interact with our our uh retail partners is we've made such advances in AI in certain parts. There's there's some parts of the company where we're still, you know, nascent, and there's other parts where we're we're at we're at the tip of the spear, I think. But uh what we're hearing from retailers is they're asking us, hey, can you come in and teach us how to do this?

PVSB 20:49

I'm not surprised at all. You know, we think a lot, Sri and I talk about this, and uh we talk about traditional retail and category management, right? That was very much about the physical store. I'm gonna help you in product assortment. I'm gonna do all these other things. In the digital world, category captaincy very much now incorporates this. It's about the consumer navigation, it's about the product innovation. They have really great data sets that you can use through clean rooms to help feed the LLMs and ultimately get better outcomes to develop products that are going to sell in their store. So the the to Shri's earlier point, this concept of moving to joint value creation seems to be so much more real than it ever has been. Yes. Because of this.

SPEAKER_02 21:36

And I'll give you a good example in a different area, but with one of our largest retail customers, we'll tell you which one, uh, we've stood up a clean room and we are putting our data and cost into the clean room. They are putting their data and cost of logistics into the clean room. And we have a large language model that's looking at that and saying, How do I optimize the logistics chain between Your company and our company to drive cost out, and then we'll share it 50-50 type of thing.

Sri 22:07

I'm just listening to you speak and I've captured a whole bunch of notes. I think the management consulting companies might have to hire you for Yeah. I think they need to tap into your capabilities.

PVSB 22:17

So talking about clean rooms, you can't run advanced AI without really clean data. And you have done a massive amount of rationalization. You've cut your active SKUs by over 80%. You've rationalized a brand portfolio from 80 down to just 50 brands. And by this fall, 95% of your global sales will be supported by a single instance of SAP. Wow. That's how critical is that ERP integration to feeding the Quantum Leap program?

SPEAKER_02 22:50

Absolutely critical. And it's funny, you know, when I I started with Nool seven years ago, we had uh at that time 35 ERP systems. Oh if you can imagine. It was a real mess. And as you say, by the end of this year, and really in about four or five months, we will be 95% on a single global instance of it.

PVSB 23:10

I have four email addresses, then that is too confusing for me. 35 ERPs. Wow. Congratulations on the consolidation.

SPEAKER_02 23:17

But if you think about it, all of this work we're doing on AI, we're doing based on the core SAP ERP. So for if there's a part of our business that isn't on that core SAP, they don't get access to any of the tools that we're building because we're not going to build duplicate versions of this. That makes sense. And your other point on data quality, absolutely critical. We have spent a lot of time, particularly in our supply chain, on data quality. We have now data bricks across the organization as sort of a base platform. And that is proving to be um, and I think for a lot of companies, that's going to be the gating factor to how fast you can go with a lot of this uh AI uh momentum. Brilliant.

Sri 23:59

A reminder to our audience that we are speaking today with Chris Peterson, president and CEO at Newell Brands, and this is episode 599. Moving on, Chris, you know, let's get into the people aspects of this. You know, driving a transformation of this magnitude. We've talked about some technology. We just talked about the SAP consolidation, which is a big deal and achievement for the company. It's about the people that actually have to go and execute this every day and live the true values of the company. We studied some of these values, integrity, teamwork, passion for winning, ownership, leadership. As a CEO and the captain of the ship, how do you lean on this principles to guide your 24,000 teammates around the world through such a massive operational and cultural mindset shift?

SPEAKER_02 24:41

It's interesting. When we started on the Quantum Lead program, we went out and started with the training. And what we found was a lot of particularly the younger generation who there's a narrative out there that, hey, maybe the younger generation is a little bit more scared about AI because they might be worried about their job being displaced. We found the opposite. So what we found was the younger people at Newell want to be trained on AI. And they felt like, hey, if you're not going to give me access to tools or train, I'm probably going to quit and go someplace that will. So it was not what we were expecting at all. Because I think what we're seeing is for our more junior and younger employees, they know that the world is going to become AI enabled. And what they're looking for is a workplace that's going to train them so that they know how to leverage the skills so they become super employees because they're AI enabled. And so we've sort of flipped it on its head and said there's so much opportunity that we have to better serve consumers and retail customers. And through our values that you mentioned, leadership, ownership, passion for winning, integrity, and teamwork, you know, we think that uh this is a way that both creates value for employees from a skill set development standpoint and uh creates value for consumers and retailers. The the example that you mentioned on the marketing side, where last year our digital content, our number of digital assets went up 500%, but we did that with the same number of people. So we didn't we we could have chosen to re-reduce the number of people. We did not do that. We said, no, no, we're gonna keep the same number. We're just gonna provide produce more content that's more compelling, that creates a better experience for our uh consumers and for our retail partners.

Sri 26:27

In any transformation, Chris, there's always a 10%. That's what the industry average is, of people who always question the motives, the outcomes. How do you bring those people along on the journey? How do you inspire them? Yeah. Are you having town halls every six months, quarterly, where you're communicating? You seem to have a complete leadership mastery of AI, which is rare in the industry. Do people get to hear it at this? Now they will on the podcast. Yes. But do they get to hear this level of mastery?

SPEAKER_02 26:56

So whenever you're in a large organization, uh we've got on-the-ground operations in 42 countries around the world. Communication becomes one of the key uh roles, particularly my role, but not just my role, but the entire leadership team's role. So I do a global uh quarterly town hall that's available to all employees, including questions, and we always talk AI as part of that every quarter. I also uh intentionally visit uh our top 10 geographies every year, and I do a uh town hall when I'm there. So uh last week I was in uh Tokyo and Shanghai, and I did a town hall in Tokyo with the Japan team, and I did a town hall in Shanghai with the uh with our China team. Next week I'll be in uh France and Germany doing the same thing with our French and German team.

PVSB 27:45

So my daughter wants to go to Shanghai. She found out there's a Disney property there, and that's one of the ones she hasn't. That and there's one in Hong Kong. And she's already gearing up for the one they're building in Abu Dhabi. But and I haven't been to the one in LA yet. No, you have you haven't been to Disneyland? Come on, Shri. I went there over Christmas. It was great. So uh 15 years ago, I was here in Atlanta. I was calling on my client. It was another consumer packaged goods company, Shall Remain Nameless, near the campus of Georgia Tech. We'll leave it at that. And I organized a meeting. I had seven people come into this meeting. They were from different operating groups, functional responsibilities. And I said, I bet you're all wondering why I've assembled you all here. I said, Raise your hand if you're working on this. And the all the hands went up and they looked at each other and they're like, what? I said, okay, this is one of the benefits of being on the outside and not operating in a silo where you're very focused on your thing. So, what I want to talk to you about is legacy silos. You've been driving a unified one-nool go-to-market model and consolidating what used to be five separate operating segments into now three. So, my question is, how does the value of teamwork, which you define as succeeding together, play into actually breaking down those silos so something like that doesn't occur that people aren't aware of? There's work being done and probably a lot of it redundant throughout the organization.

SPEAKER_02 29:07

What we did uh when I became the CEO three years ago, uh, we started off with a broad capability assessment. And we looked at the 11 capabilities uh that are required to win in consumer products broadly defined. Things like consumer understanding, innovation, brand building, brand communication, go-to-market, supply chain procurement, et cetera. And uh we evaluated where we stood as a company against those, and that then led to a deliberate uh strategy, a where to play, how to win strategy. And importantly, from that, we made a decision to change the operating model of the company. And what we did was we said there are some areas of the company where we need um 100% dedication, and there are other areas where we don't, and we need scale as an enterprise. And so, as an example, when we do brand management, we need 100% dedication. So if we're working on the writing business, we want people that are working on the writing business that work every day on the writing business, and that's all they do. They know the writing business better than anybody else. And that leads to us having category knowledge, category expertise. We can come out with a sharpie pen and sharpie innovation that's better than anybody else in the world. And that's what we need to have in that area. If you look at an area like supply chain, running a manufacturing plant, running distribution across the world, that's an area where we actually can scale across all of our businesses and drive more value through scaling than being dedicated by business. We historically were dedicated by business. We had 23 supply chains in the U.S., which was which was crazy. So that meant 23 master vendor numbers with our large retailers, less than truckload shipments, 23 orders, 23 invoices. It was a lot of complexity. And what I heard from our retail partners was hey, we don't want to do this. We want to send you one order, get a full truck and one invoice. And so we put that organization supply chain together, and we've now consolidated and we have a single integrated supply chain around the world. That is huge.

PVSB 31:21

Shri reminds me, I was working with our operations head Suzanne two days ago, putting together a list of supplies to bring to candy. You know what's the top of the list? Sharpies. Sharpies. Yeah, many colors. Not just the black ones. We want the silver ones, we want lots of different ones. Different weights too. The thin ones, the fat ones. We've we it was detailed the top of the list.

Sri 31:41

There's a funny story about Sharpies and the functional use of it. So I'm out and about at industry awards a lot because of my daughter, and also at the concerts, we take people backstage and things of that nature. I always have a Sharpie because people want an autograph. Yeah. And they don't have a Sharpie. Right. And you can't use anything but a Sharpie to actually make that autograph permanent. You know where I do it? What football players do? In my socks.

unknown 32:05

Yeah.

PVSB 32:05

So you can keep Sharpies in your socks. Okay. Concerts and awards. I love that. It's good to know. That's great.

Sri 32:10

Yeah. So one thing as I was thinking through you speaking about the global, how you reach um your outreach globally to get conversations going, I did want to ask you if someone within the company, irrespective of function, because you bought a lot of stuff together, whether it be supply chain, whether it be uh five to three operating units, things of that nature, if someone wants to make recommendations on how to leverage AI, productivity, something of the product, is there a mechanism how you collect feedback in? There is.

SPEAKER_02 32:41

And that's where the navigators come into play. So the 33 navigators that are by function solicit ideas from their functions. We we have a quantum leap steering committee that is operating and meets every week or every two weeks. I meet with that group once a month. And we review both top-down priorities and progress we're making, ROI, KPIs, but we also review bottom-up. And some of the bottom-up stuff is pretty remarkable. And that's why that's why that first plank of giving the AI tools to the organization was an important plank because uh oftentimes a lot of what you can do with AI maybe an individual that has a certain process that they can automate and make better that is never going to make it to the priority list of the company, but the but the individual may have enough uh knowledge that we want to enable them to be able to do that.

Sri 33:34

Aaron Powell By giving them the tools, you've essentially empowered them to do their research and put them up with ideas. Aaron Powell Exactly. And then you have a process to qualify it, which is terrific through the navigators and the steering committee. Yep.

SPEAKER_02 33:45

Knowledge. And and we keep track of it too. So one of the one of the other things I'll mention that we're doing on that is, and again, this is uh I think sort of a little bit more tip of the spear, but we're standing up a control tower. And so we now have a software that we've implemented that uh keeps track of all of the agents across the company and monitors their performance because uh when you develop an agent and turn it on, it may not last forever. And so you've got to know, well, just like an employee, when is the agent's performance starting to wane, or uh when did they require attention and maybe need a refresh type of thing.

Sri 34:22

I I'm tempted to ask you where you picked up this mastery of AI. This is rare in the industry.

SPEAKER_02 34:28

Aaron Powell You know, I I I graduated from Cornell. You mentioned you were going to Ithaca. I spent four years.

PVSB 34:38

It's our second year that we're doing the OmniCommerce Leadership Program. We've got I think about 80 students coming up this summer. It's going to be a full week of immersion.

SPEAKER_02 34:47

So I I graduated with a degree in engineering from Cornell, although I never became an engineer, but I I still think like an engineer a lot of the time. And I've always had an interest in technology and innovation and continuous improvement. And as I've gotten more exposed to AI, I just am very interested in it. And so I'm pretty connected in the tech world and try to talk and go to some of these tech forums directly to keep myself on the leading edge. And then equally as important, the team that we've developed and Quantum Leap, they can run circles around me. And so I try my best to I can't imagine the teasing.

PVSB 35:24

Here's my big question, Chris. Is there any better ice cream than the dairy bar at Pornell? That stuff is good. And it's uh you've got to be careful about not overdo it.

Sri 35:33

I know, I know. Thinking about the industry, this is an important one. There's a lot of conversation about agentic AI impacting shopping. Yes. And early research that's come out from Nielsen IQ, others in the industry indicates there's a lot of shopper distrust in AI overall, but they're using AI trade to hunt for value. Yes. Give us some advice, whether it be to the industry in general or to retail, how do you expect AI to impact shopping and agents to guide consumers? The early outreach says it's value.

SPEAKER_02 36:05

I think it's going to come probably faster than what we all think. And one of the things that we're doing is if you think about uh the whole digital path to purchase, uh, historically, one of the big uh areas that companies focused on and Newell focused on was search engine optimization. So you would you would go to Google, you would buy ad terms, uh, you would try to get uh make sure that if somebody searched for a certain topic, your uh brand and product came up to the case. Correct. With agentic uh commerce, that is changing because now what's happening is uh you need to gear your content not to win with the search engines, but to win with the large language models. And what's required from a digital content standpoint to win with the large language models is different than what is required to win with the search engines. And so one of the things that we're doing is we're starting to modify the digital content with the AI capability we've built in marketing to make sure that we're winning with the large language models. And so things like the Reddit lists, uh, some of those things become much more important. Your own direct-to-consumer websites become much more important because the large language model can read all of that.

PVSB 37:21

So your D2C website is not only you're you are concerned with the customer journey because you are selling directly on that site, but you're also recognizing that it has to be ready for the LLMs to be the primary source of data to fuel how they feed results to consumers doing contextual conversations. Trevor Burrus, Jr. 100%.

Sri 37:46

Today it's that's the way ChatGPD is shared. But I would say today and tomorrow, the number one source is going to be brands on website, because it's easy for the AI engines and LANs to pick them up versus individual retailers, which will have sponsored ads, that's right.

PVSB 38:03

You're you're unique in that well, not unique, but you uh you have a lot of D2C business. Right. When I talk to manufacturers that don't have D2C that operate purely through retail, their shift on how they organize their brand websites has been dramatic. They have abandoned customer journey. They say, why would I take them down a customer journey and then leave them at a point where they can't convert? My primary purpose for the brand website is purely as a repository for data for LLMs. Yeah. You can't quite do that because you're still doing the customer journey is important, but you still recognize the LLMs is a very important part of how you are structuring your data.

SPEAKER_02 38:45

One of the things that we've done on our direct-to-consumer websites is uh we've gone through a pretty deliberate process to say there's really three types of websites that we have. There's fully commerce enabled, which is to your point where yes, we we do need to make sure that we have a conversion for actual consumers who are buying through that, and that's a meaningful business for us. And there's a group that are in that direct-to-consumer where we do the full end-to-end uh journey. There's a second group that we call a catalog site, uh, which does not is not commerce enabled, but enables people to get to a product and then connect them with an outside transaction agent, usually one of our retail partners. And then there's a third group of websites that are marketing websites that are more in the category that you're talking about. And I think to your point, on those marketing websites where we where we're not fully commerce enabled, increasingly those are going to be targeted to the large language model rather than to the consumer. That makes sense.

PVSB 39:39

Chris, I'm I get to close this out. Uh I know Shri agrees this has been an absolute masterclass in enterprise AI adoption and operational leadership. So thank you for that. So you're home at night, you're sitting in the chair, you get on to your chat group of non-competing CEOs, and one of them says to you, Chris, how do I get going on this journey? What are you sharing with those people that are trying to figure out how they take their businesses to this kind of outcome success?

SPEAKER_02 40:12

You know, one of the things that uh inspired me was uh I was in a meeting two years ago with Satya from Microsoft, and somebody in the room asked him that exact same question. And he said, uh, which I then took back and replayed. So I'm giving you what he said, not what I said, but because I thought it was good enough that I would just repeat it. The way you get started is by getting started. Well, it's just gotta step in. And the key is you're gonna learn along the way. And as long as you're learning, this space is moving so rapidly that that uh you're you it's hard to make a big mistake if you've got the governance and the security system set up okay. Then and you can adjust as you go along.

Sri 40:55

So well said indeed, Chris. You're not just learning, but you're also leading. I don't want to forget that aspect because you made it a priority in your top five priorities for outcomes. That's the keyword that goes after priority. Let me remind our listeners, you can find all of our content by simply going to a web browser and typing cpgguys.com as the URL. If you or someone you know or something to contribute to this ongoing discussion on the CPG guys, please send us an email at reachus at cpgguys.com. That's R-E-A-C-H-U-S. To our audience, thank you for the clicks, likes, comments, direct messages, meeting us at trade shows, coming to our events, recording episodes with us, and to our sponsors, we're always grateful for you. The show doesn't exist without all of you. You work with us all year. Grateful to have you as your audience and partners. Thank you deeply from Peter and my heart. Chris, Peter, it's been a pleasure doing this episode with you.

PVSB 41:45

Coming down to Atlanta for this, doing a live interview, Big Five Nine Nine. I've got to ask you, what are the big takeaways? Not just one, my God. First of all, the journey requires a lot of participants. They have different roles. It requires a lot of leadership, encouragement. You have to get your hands into the muck. It's the only way you're going to do it. And it has to be pervasive throughout the organization. It can't just be we're going to do one little department here, one little operating group there. It's got to be everyone and they have to be inspired to want to figure out. I love the fact that Chris inspired everybody to look five years into the future. And that gave you enough time to figure out how to get there with all of these tools, knowing that the step change rate of growth of these capabilities is going to carry you. If you don't, you can't envision right now how you're going to get there. Trust me, in six months, you're going to be a lot clearer on how you're going to get there. So that to me was incredible. Just the fact that the innovation process has been truncated so dramatically. And you can actually have call it a prototype, call it a minimum viable product, call it a replica of a product that you can sit there and have conversations with retailers, share data in a clean room, and ultimately come up with better outcomes. Sri. This is the example that we point to going forward as a company that knows what it's doing right with AI. It doesn't have all the answers yet, but figures out how to create the framework for everybody to get engaged.

Sri 43:23

I got a few more to add at the time. All right. So I'm going to start with I we've already said complete mastery of AI, but I'm going to say mastery of AI tech. And what do I mean by that? Details of an LLM.

PVSB 43:34

Again, you're the first senior leader to come on the show and get into details of and knowing and being able to articulate the different LLMs and knowing that they have different not only that, but even within an LLM, different different levels within an LLM saying, no, no, that's too for what we need to do, that's too expensive. We can use an earlier generation. I mean, my goodness, Sheree.

Sri 43:53

Pointing out three groups of websites, the user clean rooms for data to be able to be able to bring data together. Digital personas based on consumer segments making AI deliver outcomes with a consumer backdrop. To me, it's a mastery of AI. And focused on outcomes. Chris, it's an absolute pleasure to have met you here in person and record this live from the dual headquarters. Thank you for making time today. I've I enjoyed it a lot and great to be with you guys. So this is an inspirational episode. Thank you. That's a wrap of episode 599. See you soon in another episode of the CPG Guys.