From the Ground Up - McCain Foods Limited

LEFt: Randy Myles (left)
vice-president of finance and
CFO, McCain Foods USA, with
Randy Wieland, senior vicepresident,
food service sales,
McCain Foods USA.
RIGht: Research and
development at the Othello,
Washington, plant. Bill Skorick
and Sharon Nelson are on the
left; Liz Jensen, research and
development manager, is on
the right.
great fanfare on December 1 when it came onto our system,” says Van Schaayk. But
the excitement quickly turned to disappointment when the service levels of the former
Ore-Ida division plummeted overnight. “It was almost a catastrophe. There were
so many things that had not been understood and anticipated as large issues. People
were just overwhelmed.”
The case fill rate fell to the mid-seventies, meaning that if a customer ordered one
hundred cases of product, only about seventy-five got delivered – an unacceptably poor
level of service. This was because of several problems, including information technology
issues, organization of the sales force, production planning, and inadequate forecasting.
The Ore-Ida acquisition forced McCain to upgrade its entire business system
to a different standard. “It made us get better in all areas of the business,” says
Van Schaayk. Before the acquisition, McCain was the fifth-largest potato company in
the United States, points out David Sanchez, who became vice-president for integration
in 1997 to supervise the integration of Ore-Ida. “Our systems and processes were
extremely weak. It was an around-the-clock fight for four to five months just to do
the basics of shipping product and collecting money. In the meantime, the factories
got completely out of control, and we ended up with three hundred million pounds
of inventory, most of it stuff we did not need.” For example, McCain had a two-year
supply of one product that had a shelf life of only eighteen months.
Integrating systems is hard, but integrating people and company cultures is even
harder. The Ore-Ida organization, says Van Schaayk, “had a culture closer to what
you would expect from a corporate food company like Heinz – it had deeper training,
it was well organized, it had high expectations for personal growth, and it was dealing
with a greater number of premium customers. It was a real scramble to get in front of
that sales force, to begin to paint a picture of what McCain could be with its help, to
begin to try to energize that group and get it excited about helping build McCain as a
premier food service business in the United States.”
Randy Wieland, who as of 2007 was senior vice-president of food service sales
for McCain USA, is a U.S. food industry veteran who joined McCain in 1991. He met
with each Ore-Ida salesperson individually. His goal was to inform the sales force of
McCain’s global scale, explain how the company operated, and have it embrace the
challenge of building McCain into a great U.S. food company.
To help the new arrivals to the company better grasp what McCain was all about,
several of the key Ore-Ida people were brought to Florenceville for a sales planning
meeting in the boardroom. Florenceville is a rural village, but the illuminated map
on the wall of the boardroom impressively displays a McCain world that spans the
globe. Harrison McCain spoke passionately to the group about the company and its
ambitious plans for the U.S. operations. The point of the exercise was to convince
the Ore-Ida people that they had joined not a small U.S. frozen food company but a
major international frozen food company. “I think the people at Ore-Ida were surprised
at the roll-up-your-sleeves attitude at McCain and the involvement of senior
management in all aspects of the business,” says Randy Myles, vice-president and
chief financial officer of McCain USA.
Most of the people who came on that trip to Florenceville were still working for
McCain USA in 2007, several of them in high-level positions in the food service sales
force. The larger scale that came with the Ore-Ida acquisition had another important
impact on McCain USA. It meant that the U.S. company could justify recruiting top
personnel from other parts of the global McCain organization.
178 f rom the Ground up
south of the border 179
toP LEFt: Rice Lake,
Wisconsin, appetizer plant:
Theresa Schultz and Sherri
Becker position onions for
cutting.
toP RIGht: Amy
Christensen and Cindy Payne
check product in the qualitycontrol
lab at the Grand
Island, Nebraska, appetizer
plant.
bottoM: Poppers – stuffed
and breaded jalapeño
peppers – are a popular
Anchor finger food.