Luis Phelipe Castro, CIO & IT Director at Coca-Cola Brasil, discusses Coca-Cola’s digital evolution initiatives, AI implementations, and response to COVID-19.
Avenue Code: Tell us about your career journey as CIO at Coca-Cola.
Luis Phelipe Castro: I have worked at The Coca-Cola Company for almost 30 years, and though it sounds cliché, I like to compare it to a relationship: both parties need to continue to invest. During this period, no year has been like any other. Working at Coca-Cola is challenging, and I am always motivated to do my best. I always need to stay up to date since technology changes at an impressive speed, all while improving my soft skills since I am also a manager striving to bring out the best in my team.
AC: What does Coca-Cola’s digital transformation journey look like?
LC: Staying competitive in this new digital world is a challenge for any company, especially for one founded over 130 years ago! Our business models have evolved and adapted over time, and digitization is another step in this process. Within Coca-Cola, we understood early on the need to adjust how we work and use technology to our advantage. We started by betting on three basic pillars: relationship with the consumer, e-commerce, and advanced analytics.
As part of this process, we formally created a Digital Transformation area with which we collaborate closely to implement new ways of working that are agile, innovative, and less bureaucratic. Of course, this process started small, with a few select projects. Today, probably more than 60% of the company is working in multifunctional groups in an agile way, demonstrating that the company's culture is already adjusting to this new reality.
AC: We saw that Coca-Cola USA created a powerful AI solution with low memory usage in cell phones to boost customer loyalty. Can you tell us a little more about the project and whether there are plans to implement something similar in Brazil?
LC: We have numerous initiatives using artificial intelligence in our business units around the world, including here in Brazil. I would like to mention two projects that are emblematic: the first is Coca-Cola Freestyle, a project from our US business unit that started in 2009. This allows consumers to customize their drinks on soda machines by combining different flavors and brands from our products, creating unique combinations.
Since these machines are all connected in our corporate network, we are able to capture in real time everything about consumers' choices; we then use AI to generate important insights into consumer trends to inform new product development. Finally, consumers can save their preferences through an app so that they can replicate their drinks in the future on any other machine.
The other project, implemented here in Brazil, is related to customer service. In 2018, we launched KORA, a robot with which consumers can chat via WhatsApp. KORA answers questions about our brands and products.
AC: We recently saw that Coca-Cola donated $120 million for actions to combat the coronavirus. Can you tell us a little more about this?
LC: Yes, the company donated US $120 million globally via the Coca-Cola Foundation. Locally, the Coca-Cola Brazil System - which comprises our bottlers and the Coca-Cola Institute - allocated R $45 million to combat the pandemic. Our action plan features a fund to contribute to the generation of minimum income for low-income communities and waste pickers, who are among the populations most affected by social inequality and job informality, especially in a pandemic situation.
The objective is to help combat COVID-19 in 70 communities in 14 states and the Federal District, where approximately 5.2 million people live. The resources - around R $ 30,000 per community - are being spent on raising awareness, preventing contagion with the purchase and distribution of hygiene products, protecting and cleaning, and purchasing food, beverages, and basic food baskets. For waste pickers, the focus is on helping to guarantee a minimum income to around 11 thousand cooperative and self-employed people with R $600 per month for a period of two months.
Based on the experience of other countries impacted by COVID-19, we also decided to donate Crystal mineral water to healthcare professionals with our manufacturers. The action, which focuses on field and referral hospitals fighting against the pandemic, is distributing more than 1.8 million bottles of water to 79 hospitals across Brazilian states. The water is being delivered in individual packages to safely serve medical teams on duty and in emergency situations.
In partnership with Coca-Cola Femsa, Bradesco Seguros and Grupo Fleury, we collaborated in carrying out 26 thousand diagnostic tests of COVID-19 for health professionals in the State of São Paulo. Also with Coca-Cola Femsa, plus Braskem, Fitesa, and Renner, we make our fleet available for the distribution of 600 thousand protective masks and 83 thousand hospital gowns in hospitals and health institutions in the states of Rio de Janeiro, São Paulo, Santa Catarina and Rio Grande do Sul River. Our bottlers have made substantial donations of beverages, food, packaging, and alcohol gel to communities and healthcare institutions in all regions. These include:
- 1 million liters of drinks from our portfolio;
- 30 tons of food for basic baskets;
- Half a million PET bottles for product filling;
- Transportation of 325 thousand liters of 70% alcohol;
- The concentrate factory in Manaus, Recofarma, donated 80,000 liters of 70% alcohol to the states of Amazonas and Roraima.
There was also an investment of R $2 million for the purchase of equipment for ICUs in the Federal District made by the bottler in the region. We are distributing 100,000 R $8 vouchers to be used in any order to support 54,000 small restaurants registered with iFood. We also use Coca-Cola packaging and trucks from our fleet to inform people about how to prevent the disease.
AC: What are your thoughts on the future of business after COVID-19?
LC: I am absolutely sure that in various aspects of personal and corporate life, we will not be where we were before the crisis. We have learned to work in a completely different way - remotely - and we will hardly return 100% to our old routine. We are learning to continue business, including the sale of our products, with very little contact, a fact that was almost unthinkable in times not so distant, when the physical presence of a seller was an important part of customer relations. Today, more than ever, I am sure that this is a path of no return, and continuing to rethink the way we work will be a constant from now on.
AC: What is one of the highlights of your career at Coca-Cola?
LC: In terms of concrete achievements, I am very proud of the tools and systems that I helped create. For example, Brazil was the first country within Coca-Cola to have our manufacturers' daily sales information available by product, channel, and customer. In 1997, this project was a watershed because it allowed us to have visibility of results, which was hitherto impossible. Another thing I am very proud of during all these years at Coca-Cola is to have participated closely in the development of people, many of whom I hired as interns and who are now in prominent positions inside and outside Coca-Cola.
AC: What is the culture of Coca-Cola in relation to partnerships, taking into account challenging situations like the current one?
LC: Partnerships are natural actions and very present in our history. We partner whenever there are benefits for everyone: for us, our partners, our customers, and our consumers. The most emblematic example that I can mention is happening now, and it is the union of the companies Ambev, Aurora, BRF, Coca-Cola, Heineken, Mondelez, Nestlé, and PepsiCo in the Movimento Nos. This coalition aims to help small businesses in Brazil at this critical time. They are small companies that do not have the resources to sustain their operations, so they are taking serious risks during the pandemic, and this is the moment to unite for a single objective: to help the country through this period with the least possible impact.
AC: Thank you for your time today, Luis! It’s inspiring to hear how Coca-Cola is making a difference during this uncertain time.
Andressa Lopes is the Inside Sales Lead at Avenue Code. She loves to talk to people and create new possibilities. She is also crazy about plants and piano.