"Failure all the
time isn't acceptable"
Santhosh Unni, CEO, Costa Coffee India, talks about how a product introduction failure by his company taught it more than what market research did, and how it is important to take
calculated risks, while keeping a plan b ready and not accepting failures all the time
By Bachan Thakur
Issue Date - 01/02/2013
DTDIY: Your experience with introducing hot foods in the market a couple of years back did not turn out well for Costa Coffee. An outright failure if we may call it. What lessons did you learn from the disappointing outcome?
Santhosh Unni (SU): Indeed. Two years back, going by some market researches, Costa Coffee decided to introduce hot food to Indian consumers. We felt a need and to fulfil the need for the product. We launched 'Indian Pulao' in some of our stores. The response was disappointing. We learnt from this failed product launch experience that though Indians want hot food, they want Western, not Indian. At the same time, Indian consumers want Western food that has Indian taste to an extent.
DTDIY: On the flip side, recently, the launch of Snack-On marked an interesting, successful addition to Costa Coffee's portfolio. What was the objective behind the launch?
SU: Snack-On, launched at the opening of Costa Coffee's 100th store in Mumbai was a successful launch, and best, it happened under me. The objective behind the launch was to introduce a product at an entry-level price, reducing the mean-age of the Costa consumer from 28 to 23-24 years and to bring larger groups to Costa Coffee stores.
DTDIY: Whenever you come to face with a failure in execution or outcome of a strategic move, what do you tell yourself and how do you motivate your team?
SU: Bigger learnings in life happen through failures. Accepting failures, quickly learning lessons from them and coming up with the next plan to circumvent whatever has happened are some key points that should not be missed while handling failures. We have had our fair share of slips and misses too. But we move on, with Plan B.
DTDIY: A leader is supposed to forgive failures in his team but at the same time he should be hellbent on demanding great successes. What would you as a leader do if someone in your team reports a huge failure on his part?
SU: The environment that you create within an organisation should be that of accountability with responsibility. I give liberty to people in my team to operate in their respective functions. Obviously there would be mistakes, but as long as people are able to identify their mistakes, quickly learn from the failures and take corrective steps, I am alright. But at the same time, you are right, leaders should not forget that failure all the time is not acceptable.
DTDIY: You make it sound like failures are important. But your hot food failed experiment could have proven a bigger risk than it was. The bigger question is – should today's overambitious employees be risk averse to avoid failures?
SU: It's important to have failures. Failures happen to those people who take risks. So young employees need to take risks in life. But at the same time, the risks need to be calculated. As long as one keeps on taking risks with calculations, eventually there would be fewer numbers of failures. Learning from the failures, moving on and ensuring not to repeat the mistakes in future are vital. Of course employees should aim big. Every person, irrespective of the function, needs to have some element or vision. And the vision will always be a reality accompanied with a stretch. If vision is there, a person will always perform better, irrespective of how many times he fails.
DTDIY: So you mean to say that you wouldn't have become the CEO of Costa Coffee today, had it not been for the failures that you experienced along the path?
SU: No, I don't mean that. A person being successful has nothing to do with failures. It is the environment that makes a person. How a person learns from both success and failures and then applies those learnings on a day-to-day basis decides the quantum of success he achieves.