Shiv Iyer, managing director and partner Accenture

Declaring “there is no reason why a start-up should know the consumer better than a big company should,” Iyer challenged the panelists over why “that is happening.”

Beginning with Grimwood, a number of the panelists discussed how size and complexity distracts employees from focusing intently on the consumer. To explain, Grimwood said companies the size of Nestle “breed complexity.” Noting that information technology costs at Nestle were going up and up and up, he described a “quiet word” he exchanged with the head of IT some time back.

He continued, “I just said, ‘You know the end of the month, you know all the reports you run? He says ‘Yeah.’ And I said, ‘Don’t. And let’s see what happens.’ So we basically switched off the reporting mechanisms apart from some very top-line reports.”

 With few exceptions the reports were not missed — 78 percent of monthly reports in all, he said. A similar process allowed Nestle to successfully reduce its stock-keeping units nearly in half, again without significant disruption.

“It’s about simplifying or taking the complexity out of an organization and a company the size of ours,” he said.

Zoghbi said still more is required to better refocus employees on the consumer.

“We don’t believe it’s enough to ask people to stop doing something,” he said. “Because if I’m doing something that is taking 20 percent of my time and I stop it, what would I do with that 20 percent? I’ll just create another thing.  Which then I do a project three months from now to stop that new thing. So two things actually, people and SKUs create complexity in an organization.”

He also said innovations often fail to gain traction in large organizations because one individual’s top idea may turn out to be number 15 when considered by a large group.

“So, it is never going to thrive,” he said.  “So what we are learning is, for strategic reasons, if we believe that trend is strategic, and it’s going to be there for the long term, 10, 15, 20 years from now, is how can we take it outside the mainstream organization and let it grow there? So these are the two things that goes back to the hybrid model that Paul talks about: How can you make the core efficient and how do you create an environment for small ideas to be able to grow?”

Asked about the rise of e-commerce in food in the wake of the Amazon acquisition of Whole Foods, Grimwood warned that change probably will occur more quickly than many expect.

“It’s all very exciting to see Amazon take Whole Foods and the pace with which they’ve adjusted pricing, and the pace with which they have changed the model in terms of direct to home deliveries, being phenomenal,” he said. “I don’t think we’ve seen anything yet. In the US, in the grocery market, in actual fact we have had a whole industry that has been trying to slow down the progress of e-commerce, home delivery, groceries delivered to home. And we’ve also had some pretty inefficient disrupters around the place that have been working on margins that frankly haven’t covered their overall cost base. I think we are going to see huge acceleration in e-commerce in grocery. What’s going to happen is that the major retailers are going to have to step in very quickly. Otherwise, their brick-and-mortar costs are going to be so significantly de-leveraged. And I think there are going to be more people coming to the party, much quicker than we’ve anticipated. I mean remember, you know, you’re probably talking US versus the UK, today, there’s five times the level of home delivery and click and collect there is in the US If you take France, it’s six times greater. Over the next two to three years, well, is it two to three years or is it two to three months, you are going to see a lot people who are going to have to engage really quick, so this digital communication with consumers accelerating will continue to accelerate but actually the e-commerce element of that in terms of how we deal with consumers to deliver the products that we have to how they want to buy them I think is going to be probably the biggest step change we’ve seen. We thought it was fast and in the last three years I think it’s going to be incredible over the next two to three.”