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'We Feel The Weight Of India Increasing In Nestle'

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Jean Marc Duvoisin, global HR head of Nestle, says with Africa, Latin American and Asia becoming key markets, the challenge for the company is to make sure that "the talent pool reflects where our sales are coming from". He pointed to the rising number of Indians in the company's top management, citing the case of Nandu Nandkishore, the new executive vice-president for the important Asia, Oceania, Africa zone. Duvoisin, who was earlier Nestle CEO for Mexico, was in India recently, crisscrossing the country. He spoke to BW's Chitra Narayanan on a number of issues, including HR and Indian talent.

 
You have moved from the business side to HR? Is the shift challenging?
To have a strong HR function, it should be aligned to what is needed by the business. Coming from the business side, I can make sure that what the HR function delivers is what the business needs and that is what I am driving in the organisation.
 
Is there a conflict between business imperatives and HR imperatives? Typically, when budgetary resources are made, it's the HR budgets that get slashed first.
No, if there is alignment, then there is no conflict. The advantage we have at Nestle is that we work with a long-term vision. HR is a function of midterm and long term. When you develop and train people, it's to make sure that you are developing the talent the business needs for the future. The line managers know that part of their responsibility is to develop the line managers of the future.
 
I often ask leaders how many people can replace you. The difference between good and not so good leaders is that the good leader has at least three people to replace him or her. The HR function is to put into place what the line manager needs to be able to deliver. The big challenge for the company is to make sure we are developing the diversity background we need for the future.
 
If you look at the pie of sales ten years ago, west Europe and north America were very important. But now Africa, Latin America and obviously Asia are getting much more important. So the challenge is to make sure the talent pool reflects our sales of the future.
 
FAST FACTS

NESTLE
Established 1866

Chairman
Peter Brabeck-Letmathe

Main Businesses
Food and beverage

Employees (2011)
328,000 (worldwide): Zone Asia, Oceania and Africa 37.4%; Americas 33.7%; Europe 28.9% 

Revenues (2011)
Total Sales:CHF 83,642 million
Americas:CHF 26,756 million
Asia, Oceania and Africa:CHF 15,291 million
Europe: CHF 15,243 million

Trading operating Profit (2011)
CHF 12,538 million

So, does that mean you are investing more in India?
In India we are investing a lot in factories, new factories, and new lines, because we know we have strong growth here. However, we need people for that. So we make sure we hire more people here. And develop more people here. Our approach to the talent need in the organisation is to invest a lot in training and development and exposure of our people. At our training centre in Switzerland we have got people coming over every week, and run three parallel courses every week. That's where we expose high potential talent to the centre. The usual average course would have 30 participants from 25 nationalities. In the headquarters at Vevey, we have 97 nationalities.
 
We believe a strong manager is somebody who has been exposed to different environments. And we do that through expatriation - it can be to headquarters but can be to other markets too. You learn from being in Australia, in Oceania, in Asia, in Africa, so that you get a global vision of how to do business.
 
So we are making sure that Indian talents of the future are being exposed to different environments. At the corporate level, this is one of our tasks, to develop higher the Indian talent in the Nestle way, to understanding the different cultures and environment.
 
Has the percentage of Indians being expatriated gone up?
Yes, it's gone up. It is already pretty high. But it has to go up much more. The weight of India in Nestle is going to come every day much more. It is going to grow very strong. And we have to make sure we have the talent for it.
 
Who are the Indian high achievers?
We have Nandu Nandkishore, who is the best example of how Indian people are growing in the organisation - he is my colleague in the executive board and he is heading what is going to be the biggest region - the AOA (Australia Oceania Asia) region. It is not yet, but is going to be the biggest zone among our three zones.
 
Then we have SanjayBahadur, who is senior vice president and heading the mergers and acquisitions, one of the most important functions in Nestle. We have Suresh Narayanan who is chairman and CEO of Nestle Egypt, there is Suraj Baksh Singh, CFO, Nestle, Japan, and Charanbir Singh Sarao , Vice President and Head of Finance and Control of Nestle Professional.
 
We should be developing the future Nandus, future Sureshes, the future Sanjays.. and that's what we are doing.
 
In my HR team I have got two Indian people. One of whom is Amit Narain, who just came over a few weeks ago and has taken charge of an enormous project - the implementation of NCE - Nestle Continuous Excellence worldwide. And I have handpicked him, because his implementation in India has been very well done. 
 
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We see this trend of Indian talent rising in other MNCs too. Rakesh Kapoor of Reckitt for instance. So, what are the factors that are suddenly making Indian managers so hot?
First of all, these are very successful people. They are obviously very talented, and they know the business extremely well. But I would say, why these people are so successful is that India is very diverse, and you have a good understanding of diversity when you are growing up in this country. To manage large companies, you should be well aware and understand diversity.
 
If you work in a homogenised country you will be doing what that country needs. But if you work in a diverse country, you will be doing things what each culture, each region, each background needs. And this is what big companies are looking for. If you have the capability of being successful in every region of India, you will be successful in northern America, in western Europe, in Africa, everywhere. I would say perhaps this is one explanation of why Indian people are rising in MNCs - because they understand diversity.
 
Have you ever felt that Nestle's size — you have a headcount of 3,28,000 people across 83 countries — can be a disadvantage?
No. Size if well managed is a strength. And, how do you manage it well? I believe, it is by keeping things simple. In my function too, I always try and simplify things.
 
Take India also. If you look at the portfolio of products Nestle has here we have kept it simple and straightforward - we develop only those products that are in line with consumer expectations here. And deliver them to the consumer in a cost efficient way.
 
The other part of the Nestle model is decentralization and empowering people - we have decentralized the business right down to the countries, to the factories, to regional sales, to each of the functions. That's why it all goes back to the talent, and training. For, to work in a decentralized way, you need empowered people, who are aligned with business directives, objectives and values of the company.
 
These days, a popular phrase in HR circles is employee first. It's not the old consumer is king. Your take?
It is not one before the other. It is both together. If everyone within the company understands that what we are doing is to benefit the customer, where is the contradiction?
 
How do you view the challenges of the new Internet environment, where you have sites like Glassdoor.com in which employees freely criticize companies?
The challenge is how you can use this information to be a better company — for employees, for the people who want to come in, for consumers. At Nestle, we are setting ourselves up in the marketing department as well as the HR function to try and access all this information, all the outside conversations.
 
We set up the DAT - Digital Acceleration Team, where we bought 18 young people from different countries to feed the business units on these outside conversations. We have screens all over where we see what's hot, what people are talking about the brand, about consumptions, about the company.
 
For internal conversations, we have our internal blogs and NEST, where people can post things. It's open. And in fact, it's because of  the Internet that we rolled out our new employee branding initiative. 
 
Till now many countries had their own employee branding programmes, with  different positioning, but with digital media opening up and Nestle employees from every geography talking to each other through blogs, we felt the need for one common initiative. Hence the new 'There'smore to life at Nestlé' initiative which has been rolled out in 2012.
 
Globally, in companies, the age of CEOs is coming down. Is that happening at Nestle?
In Nestle, it is the experience that counts. Someone who delivers nice performance will always find an interesting position - a new geography to head, a new business to take charge of. But it needs a certain experience to get to the top position.
 
The executive board average age is around 55-60. Market heads too it is from 45-50. Is it getting younger? No, I would not say so. It has remained stable. That's because doing business is more complex than before. I had said earlier that we should keep things simple, but the business environment is more complex today. The competition is tougher, the environment is also more demanding. The efficiency is also better than before. So you need to develop the people more before they can take over important positions.
 
What about gender balance?
It's a journey. But we want to push more the gender balance. We are empowering the local markets to develop the plans for this.  And there is a business imperative. We are doing it because most of our shoppers and consumers are women. We are doing it because we need more talent in the organisation and also because decisions in a team are better decisions when it is a gender balanced team. Those are three business drivers of why we want to hire more women.
 
HR innovations such as Open office, flexible working, remote working and so on seem to be coming from IT sector and not from the FMCG sector. Why is that so?
We are perhaps not the prime mover of such innovations, but we don't want to follow the trends just like that but study whether it is suitable in our environment or not. We also leave such decisions to local offices.
 
I feel that you should only implement trends that make sense for organisations. Flexible work environments I am in favour of and that we are pushing. We want people to feel comfortable in a company. It is more adapting the organisation to new requirements. If you are getting stuck in traffic jams getting to work, and losing valuable time, then yes, flexible work hours is a better option.
 
And, also why do you want open offices — is it to get your neighbours to understand your job function, is it to facilitate more communication? For that, our work on NCE (Nestle Continuous Excellence), which works in open spaces serves the purpose. At special places, we have boards and we have meetings every day, where people show where they are with their projects. NCE is a work of integration and understanding for others.
 
We do it in factories, we do it in every department. It's a process of debriefing. At factories, during shift change - workers of the night shift tell the workers of the day shift what happened in the next line. At Kolkata I saw the best example of NCE in the sales department. We had the actual sales man and sales woman coming in and explaining to other teams what sold well and what didn't, sharing their experiences. 
 
Finally, three of the most important HR challenges, priorities for you personally.
I always say it is people, performance and culture.  On People - how we make sure that we have engaged people, aligned people, careers for the people. On performance, how they perform as individuals and as teams, and how we reward the performance.
 
And culture is how we everyday consolidate our Nestle culture — which is our competitive advantage.

(This story was published in Businessworld Issue Dated 03-09-2012)