It is midafternoon and the sky is dark and angry. From his 25th-floor executive suite, he gazes out at the summer storm lashing the Coca-Cola tower. Lamps flicker, lightning cracks, the heavens gush forth, the wind howls like once-enraged Coke-aholics.
But this time it's only the weather. "Just like in marriage or friendship," says Roberto Goizueta, leaning back in his leather chair, "making up is a lot better after a little bit of tension."
As America's New High Priest of Fizz, Goizueta is the natty, Cuban-born chairman of Coca-Cola who gave America New Coke, banished The Real Thing, then gave in to a wildcat consumer revolt and brought it back -- the corporate surrender of the '80s that will etch him forever in soda pop history as genius or flop, keep Pepsi agloat and make devotees happy ever after.
To hear Coke tell it, those who once dispatched nastygrams to this bustling mecca in Cola Heartland (where babies are weaned on the stuff, windows washed with it and fenders burnished to high gloss) now send only love letters.
Critics may carp, but switchboard operators here field nothing but happy talk nowadays. Florists beat a path to his door with bouquets from the grateful. Golfing buddies are swinging easy again now that Old Coke is back. Goizueta sees only dollar signs ahead.
And if he'd heard the whine of the small plane circling downtown the other day, he would have glimpsed not an irate customer on a kamikaze run, but an ebullient Coke fan trailing a banner: "THANK YOU, ROBERTO!"
For three long months, Old Coke was held hostage, another American symbol under siege. Then Roberto, as everyone from janitor to president calls him, watched America's angst build, and set it free.
"People are so happy now," he says, his Spanish lilt still rich despite two decades in Georgia. "I got one letter from a 68-year-old lady. She said, 'Thank you so much for bringing old Coke back. The only thing better is sex!' "
He crackles with quiet intensity, trim and elegant in a dark pin-stripe suit, white silk shirt, matching handkerchief and Hermes tie. He favors Guccis and British wool, but eschews high-priced Savile Row for a Hong Kong tailor who stitches his suits for less than $300.
The office is beige, decorated with Korean Chippendales for economy, a seascape of crashing waves, a bronze matador dancing dangerously close to a bull, photos of his wife of 32 years and three children, assorted mementos and a statue of Robert W. Woodruff, the late Coke pioneer who handpicked Goizueta to take over five years back.
He laughs. "Mr. Woodruff used to say, 'When you're getting flak, remember that it's easy enough to be be pleasant when life flows along like a song. But the man worthwhile is the man who can smile when everything seems to go wrong.' "
He fires up a filter tip, Coke's whiz kid of 53 with the Midas touch. "We don't get paid to take actions that free us from flak, or make shareholders feel comfortable and relaxed," he says. "We get paid to maximize their investment, and by any measure you want to use, we've done that."
Although the jury is out on New Coke, the company last week reported quarterly sales up 7 percent. And four years back, if you had bet on Goizueta (pronounced Goy-swetta), today you would be rich.
Coke stock was in the low 30s when he was elevated to chairman -- a chemical engineer who fled Castro to rise through the ranks -- then kicked the stodgy company onto its bold new course of calculated risk: a $7 billion entertainment conglomerate on the run. It closed at 74 1/4 Friday, up 3/4 for the week, with most analysts ignoring critics' gloom for a two-Coke strategy.
"People joke," he says. "They say, 'Coke is the Edsel of the '80s.' I never knew the Edsel was the best-selling car. But Coke is the best-selling soft drink in the country. It's number one. By midnight tonight, 40 million Americans will drink it."
Indeed, there is perhaps nothing more American than Coca-Cola. After debuting here in a back-yard cauldron almost a century back as a hangover remedy, it was hustled, hyped, drilled into the American psyche as red-blooded virtue. Cowboys drank it in Wild West saloons frequented by Buffalo Bill. Ike saw its value as a victory tonic in World War II, a patriotic sacrament, and Coke dispatched 10 bottling plants to the front: it was available to every GI for a nickel a bottle, and soon they were hooked.
But even communists came to drink it, and presumably love it, as Coke made its way to 155 countries around the globe. President Carter, a powerful Democratic ally, helped pave its way into China. After all, Pepsi has had the GOP sewn up ever since President Nixon used a can as a prop in his kitchen cabinet debates with Khrushchev. No wonder it beat Coke to Moscow.
But Coke was still It here and around the world, the best-selling soda of all time: America in a bottle. Then its growth began to slow in the late '70s; Pepsi was gaining. It still outsold Pepsi overall, 34 to 24 percent, but Big Blue was winning the key supermarket skirmish. Goizueta seized the Pepsi Challenge when he became president in 1980, and a World Cola War was on.
As he saw it, Coke had to do something: The sugar cola market was shrinking as older devotees switched to exploding diet brands. And sweet-toothed teeny-boppers, sugar cola drinkers of the future, seemed to prefer the taste of Pepsi.
Then, in 1981, Coke chemists came up with Diet Coke, and just for the taste of it, tried it with sugar instead of artificial sweetener, and, voila , the "smoother," sweeter taste of New Coke was born. It had 77 calories to Coke's 72; initial taste tests scored well. Goizueta gave the green light to press on.
Suddenly it was discovered that without the beloved "bite" that made old Coke lovers pause mid-guzzle to gasp in ecstasy, New Coke held astounding promise for sales: people were able to gulp more before the pause. Just figure one extra swallow times 290 million a day and contemplate. After 190,000 taste tests, new was preferred over old 61 to 39. New Coke would be "the surest thing" Coke had ever done, he said at the time.
So what happened? Crystal ball breakdown? Coke has an answer: there was no way to simulate No Coke Future Shock.
"If I ask you," says Goizueta, " 'Will you be sad when your father dies?' You will say, 'Yes, very sad.' But it's not until the moment of his death that you realize the depth of your sorrow."
Consumer anxiety was anticipated, but no one figured on nostalgia frenzy, or consumer hostility sparking threats of class action lawsuits, or media mania.
"Consumers were so mad, but they were not reacting against the taste of New Coke," Goizueta says. "It was the idea that 'somebody took away my soft drink.' They had no place to go.
"Some people here said, 'We should have waited longer, it would have died down.' Possibly. But maybe not. And why make so many people unhappy? Were they more upset than we expected? Yes, but who could have expected it ? . . .
"How do you quantify emotions? Do you put electrodes on people, then say, 'I'm taking this product away?' Maybe we should use lie detectors at taste tests."
And what does it augur for the magic of market research, Coke's big gun? "There was an astrologer in Havana," says Goizueta, a wry wit bubbling up. "He used to say, 'The stars incline you, but never force you.' That's market research."
Detours are always inevitable en route to Coke El Dorado, right? "Traveler, there is no path," he likes to say, invoking Spanish poet Antonio Machado. "Paths are made by walking."
As Coke's guru of change, Goizueta has trod risky paths aplenty, so far without misstep. In March 1981, as the new chairman, he convened Coke's top managers in Palm Springs, Calif., for a call to arms: no cows were sacred, think the unthinkable for the '80s. Sam Ayoub, 66, the retired treasurer, was there.
"He said, 'Gentlemen, I want to hear everyone's opinion. Tell me what we're doing wrong. I want to know it all, and once it's settled, I want 100 percent loyalty. If anyone is not happy, we will make you a good settlement and say goodbye.' "
Out of that meeting came his "Strategy for the 1980s," a 900-word beige pamphlet that reigns as Coke's bible. It urges "intelligent, individual risk-taking."
Soon Goizueta was on the prowl for compatible growth industries. He snapped up Columbia Pictures for $695 million in 1982. Critics scoffed: Hollywood goes better with Coke? Coke stock tumbled on fears it had overpaid.
But the well-managed studio, with its mammoth film library, boosted Coke earnings 11 percent last year. And Columbia's receivables were recently spun off for $750 million, more than recouping its cost.
Again, he gambled with Diet Coke. Some feared serious brand name damage if it failed. Analysts saw it robbing Coke's cradle, stealing from both Coke and Tab. "That decision was far more agonizing than changing the taste," reflects Ira Herbert, executive vice president and corporate marketing chief.
But Goizueta was so sure of a hit he blessed it with the sacred trademark -- the first time that "Coke" had ever appeared on another drink. It was a winner, too. Less than two years after its summer 1982 debut, it had rocketed to No. 3 on America's soda pop hit parade, another risk come true.
"Remember," he told fellow chemical engineers at a meeting last year, "if you take risks, you may still fail . . . If you do not take risks, you will surely fail . . . The greatest risk of all is to do nothing."
Goizueta went on to leverage the brand's reputation by stamping the Coke name on a host of drinks. "If there was a market for a 'blue strawberry soft drink,' we'd put it out," he says. Coca-Cola clothing will be sold via a licensing deal. Toys are on the horizon. And to strengthen Coke's entertainment stable, Goizueta bought Norman Lear's television production company last month.
On other fronts, there was his crusade to weed out sluggish independent bottlers. Many sold out, with Coke playing matchmaker for aggressive candidates of its choosing.
To boost the bottom line further, Goizueta renegotiated old contracts that set syrup prices unfairly low, sold off three unprofitable or incompatible firms, borrowed for the first time to buy businesses earning at least 20 percent and risked stockholder displeasure by cutting dividends. He aimed to plow profits back into the business.
"He has tremendous courage and a marvelous sense of impatience," says Don Keough, 58, the silver-haired president who runs up the middle with Goizueta's long-term strategy of growth and change. "He'll give you plenty of time to make a decision, but once it's made, it better happen pretty quickly."
And what if it's a mistake? "You can always make another decision and correct the first one," says Goizueta. "There's no sense to fret over it."
But the Coke flip-flop has inspired critics galore. "Coke has egg on their face," says Mark S. Albion, a Harvard Business School marketing professor who shudders over the risk of monkeying with a 99-year-old mother brand.
Still, few sell the boss short. "The last thing I want to do is play strip poker with Roberto Goizueta," says Jesse Meyers, editor of Beverage Digest and a "third-generation, street-wise" New Yorker. Others hail a quiet "killer instinct," his "fairness," a photographic memory. "He listens," says one executive.
"He's a tiger, and a gentleman," says Manny Goldman, analyst for San Francisco-based Montgomery Securities, a Coke watcher for 13 years. He's bullish. "Cherry Coke looks like a winner, Sprite has gotten new life, Minute Maid orange soda is about to come out . . . Coke should come out of this very strong."
He grew up in Cuba, the only son and oldest of three children born to a wealthy sugar cane magnate, Crispulo Goizueta. But the family lost it all when Castro took over and Roberto had to start over again at 30 with a wife and three small children.
"The real tragedy," he reflects, "was for those in their fifties or older, like my father. At least I had a job as a chemist with Coca-Cola and a hell of an education, and I was young."
Indeed, he'd won top honors at the Jesuit-run Colegio de Belen, one of Cuba's two leading prep schools. But with chemical engineering on his mind and the University of Havana chemistry department offering only sugar production, he took his first of many risks. It was off to Yale, via an elite Connecticut prep school to learn English. He was 16, with no English to his name when he enrolled at Cheshire Academy. It was 1948.
When he graduated, nine months later, he was valedictorian of his 166-member senior class. He'd learned English by memorizing texts of history and literature, hunkering down in a local movie theater for dialogue.
"It's a great American story," reflects his Yale roommate, Paul Oshirak. "Riches to rags to riches. But he never played the part of the rich Latin American."
"He never procrastinated; he would always tackle the important things first," says another ex-roommate, Dick Cook, 54, a Colorado-based manager for Du Pont Co. who credits Goizueta with nursing him through his chemistry studies.
They gently ribbed him for having eyes only for his wife to be, Olga Casteleiro. "He was totally true to her," says Cook. "He never snuck any girls into the dorm. He had a one-track mind. We all admired him for it, but we kidded him, and he took it well."
After graduating in 1953 among the top 15 percent, he headed home to the family sugar business. But after a frustrating year as the "boss' son," he yearned to "try it on my own, to see how I would do."
He answered a blind newspaper ad for a quality-control chemist. Hired by Coca-Cola's Havana bottling plant, he was soon off to other Caribbean islands to assure that Coke got to the natives.
There was blue blood in his veins, but he was not above sleeping on sugar sacks when a bottling plant had a breakdown. "He's in the ivory tower now, but he got his hands dirty when he didn't have to," recalls retired chemist Mike Macias, 56, a fellow Cuban who worked the same turf.
In the late '50s, after Goizueta developed a cane derivative that got bottles cleaner cheaper, he caught the eye of Atlanta's brass and became Coke's chief technical officer in Cuba. "People said, 'That guy is going to go places,' " says Macias. "There was no doubt he was a winner."
He dispatched his family to Miami in 1959 when Castro seized control, then joined them a few days later. He rented an apartment and set up shop running Coke's Caribbean quality control from a Miami International Airport motel room. A friend fetched him a suitcase of clothes from Cuba, and that was it, save for 100 shares of Coke stock he'd socked away. Soon he was juggling family in Miami while he ran his region out of Nassau. He was eager for a transfer here.
It came through in 1964. Within two years, at 35, he became Coke's youngest vice president, and he was running the technical division by 1974. He was fast track all the way, so trusted in the secretive corporate culture that he was anointed into Coke's holy of holies: sources say he became one of a handful of people to regularly mix the top-secret formula at hush-hush locations around the world. Goizueta won't comment about such things.
Then, in 1979, with retirement looming, chairman J. Paul Austin tapped Goizueta as one of six vice chairmen in the running for his job. It was a time of high anxiety. At first Austin favored Ian Wilson, a South African who has since left the company, says one top insider.
But Woodruff, even as a white-haired old man two decades retired, still exerted enormous clout. He had executives to lunch almost daily in his office, maintained even now after his death this year as a corporate shrine. Goizueta was his favorite. Woodruff "used to take his hand and call him 'Partner,' " recalls Ayoub. "He loved him like a son. Above all, Roberto didn't have a single enemy. He never fought with anyone. He just outmaneuvered them."
To outsiders, he was viewed as a dark horse, a technical man and foreign born in a company that had a sleepy tradition of southerners at the helm. But Coke's business was becoming increasingly international, with 60 percent of its sales overseas. "He was only a dark horse to those who hadn't gone to the track," says Carlton Curtiss, the company's top PR man. He had performed superbly with mushrooming tasks and was popular among his peers.
Austin finally picked Woodruff's favorite in a letter to "the boss." Ayoub walked it down the hall. Thirty minutes later the phone rang in Goizueta's office.
"You are president of this company," said Woodruff. A year later he was chairman, and a new era was beginning at Coke.
Nervous energy crackles up and down the halls at headquarters. The mood is upbeat, vigilant. Doubts are discouraged in public, if at all, Goizueta being an optimist to a fault. "Talk It Up" urge signs tacked about small galleys that dispense free Cokes.
To get to Goizueta's tower of power, you walk past a "Rambo" poster in the lobby ("No man, no law, no war can stop him"). You change elevators twice. On one leg of the ride, an employe jokes about old Coke as "our problem."
"You mean 'opportunity,' " corrects Curtiss, 35, who also uses Goizueta's Hong Kong tailor. In the soft drink hustle, image is as important as taste, and Goizueta likes his people to look sharp, feel sharp. He might drop a gentle hint to a manager about an overweight employe, or if someone's shoes don't match his suit.
"He cares about his people," says close friend and retired colleague Ayoub. "And he wants them to be around." About twice a month, he lunches in the employe cafeteria to check on quality, wandering among his brain trust, avoiding management by memo. Associates call him impeccably polite, a "European gentleman" who eschews rudeness and yes men; encourages candor, a sense of humor and loyalty -- and doesn't suffer fools. His favorite quote comes from Nietzsche, the German philosopher: "God is in the details."
"Perfection is extremely important to him," says Ayoub, a close friend. "He's brilliant, but he wants everyone else to reach his standard."
Goizueta is not one to encourage long vacations for his top people. He figures such breaks are only for the weary, doesn't fathom why anyone needs more than a few days off at a time. He takes one week, preferring to unwind at Sea Island, Ga., with his family. Work is his life, and although he plays golf with his wife, and hunts now and then, Coke is it.
It paid him $1,545,000 last year, but having once lost it all, he shrugs off the trappings of wealth. He still lives in the same two-story frame house he bought 21 years back.
"I don't have to impress anyone," he says. "If I had a big house now, I wouldn't enjoy it. I'm not there long enough."
Friends say he hasn't changed. He still sees the same people, drinks Coke, regular or caffeine-free, and enforces a strict self-control -- even over his love for chocolate. When he orders chocolate mousse, he is renowned for only taking two bites.
Indeed, the mogul of instant gratification is a master at delaying his own. He's always looking to the future. And down the road, he envisions America awash in more Coke than ever: New Coke, Old Coke, Diet Coke, Cherry Coke, maybe even a vanilla Coke, forgiving, forgetting and moving on. Of course, he aims to take America's pulse for any leftover angst.
But Goizueta, high on the 25th floor here, his dark hair showing a few wise flecks of gray, refuses to view the reincarnation of Old Coke as a "mistake." It was always a possibility, but never the plan, he says. Yet "it would have been a huge blunder not to take advantage" of the clamor for it.
What few seem to believe is that even if Coke knew beforehand what it knows now about how the country would rally behind an American icon, says Goizueta, it would do the same thing over again. Still shocked at the reaction, Goizueta feels Coke had no choice. The marketplace was changing, and it had to make New Coke the Coke. The only difference: he would have re-released old Coke much sooner -- and had it planned all along.
So now there is New Coke for the Pepsi Generation and good old Coke for anyone who cared. He lights another True, smiles.
"Now," he says, "we have the best of all possible worlds."