16 Economy

Q&A

THE ECONOMIC TIMES | MUMBAI | MONDAY | 27 JULY 2015

SURESH NARAYANAN

WAN LING MARTELLO

CEO, NESTLE INDIA

EXECUTIVE VICE PRESIDENT, NESTL SA

Weve been trying to engage with the government to try to get this issue resolved... the
government and industry can come together for the good of the Indian consumer

Confident of Resolving Maggi Crisis

As Nestles recall of Maggi noodles across the
country winds to a close, the task of
rebuilding the brand, regaining trust and
reintroducing the product will fall to Suresh
Narayanan. Hes taking over as head of Nestle
India, having been reassigned from his job as
managing director of the Philippines unit.
Narayanan, 55, cut his teeth at Hindustan
Unilever in the company of peers such as
Nitin Paranjpe (president, home care
business, Unilever), Mukul Deoras (global
chief marketing officer, Colgate Palmoive)
and D Shivakumar (chairman and CEO of
PepsiCo India). His boss Wan Ling Martello,
executive vice president at Nestl SA and one
of the companys directors, is in Delhi to
oversee the transition in India. In a joint
interview to Ratna Bhushan and Chaitali
Chakravarty, the Nestle executives said the
worst was behind them and the company is
keen to bring one of Indias most-loved
brands back on the shelves. Edited excerpts:

You are known as a turnaround specialist.

But this is a crisis of a different kind.
Whats the strength you have that gives
you the confidence of pulling Nestle back
from the brink?
Narayanan: Nestle India is not on the brink
and I want to say this with all the emphasis I
can muster. Yes, we face a challenging
situation, but I am confident that we will
resolve this issue through engagement with all
stakeholders. I am a peoples person and
business is all about relationships with the
people who buy and sell our products, with our
business partners, our employees and of
course the authorities. I will focus on ensuring
that all those relationships are as strong and
professional as they can be.
Is this the start of a new culture in Nestle?
Will we get to see the CEO more?
Narayanan: Yes. You will.
Its been argued that Nestle allowed the
Maggi incident to snowball into a
controversy by not reacting on time. It
took the company 10 days or so to issue its
first statement. Do you think you should
have been more proactive?
Wan Ling Martello: Just like a sports game,

theres always going to be, in hindsight, could

we have done this better? How do you learn?
You learn by five things. You learnt by going
to school, reading, listening, observing and by
self reflection. This unfortunate incident has
happened to us. And guess what? We are
going to learn individually and collectively
reflect on what happened.
I was not here. The local team was working
with the centre. We were also getting test
results. I dont want to dwell on what could
have gone well. We should have probably
gone on TV and be seen eating a bowl of Maggi
noodles. I mean, look, I heard a lot of that
comment. And youre right. Perception
becomes reality. Do you think media handled
it properly? There was a bit of a trial by media
as well.

ON MAGGI

Our product is safe and we

stand by that. Reams and
reams of tests show that
which is now public. Weve
got proof points. Weve got
black and white data
Had this crisis not happened, would
Suresh Narayanan been here?
Narayanan: Well, its a bit like this. We are
part of the international talent pool of Nestle. I
think in the wisdom of things, depending on
the development of the market and
depending on what stage we are in, you get
called upon to take on assignments. I think
Wan Ling is better suited to answer that
question. She is my boss and shes the one
who takes the call.
In 1998, Nestle let go of its Indian MD
Darius Ardeshir for financial
mismanagement and replaced him with an
expat to clean up the books. Now Nestle is
replacing an expat CEO with an Indian to
clean up another mess. Isnt that ironic?
Martello: The average tenure for somebody

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retiring from Nestle is 10 years. And it isnt

going down. One of the incredible strengths
of Nestle as a group is the commitment and
loyalty. Nestle is a global company. I came in
from outside. I am Chinese American, I am a
woman. I am surrounded by colleagues who
are male. But from day one, I have never felt
an outsider.
Suresh is Indian. But he was in Singapore,
Egypt, Philippines. He has capabilities. The
last bit was the icing on the cake that Suresh
happens to be Indian. As we look at
appointments, it very much depends on at
what stage and lifecycle the business is. We
also look at whats good for the individual. We
say here is a high-potential, high-performing
individual. What does he or she need? He or
she needs an emerging-market experience.
We look at it from both ends what the
business needs and whats good for the
individual. We try to marry that together. We
have not had an Indian MD (in India) but we
have so many Indians in senior management
positions (globally). At the centre, we have 80
different nationalities. We dont pick people
depending on nationalities... I know Sureshs
track record. He has the ability to inspire a
team and nurture talent.

But in this particular case, nationality of the

CEO would be important because you need

to engage with various stakeholders, isnt it?
Martello: Of course, at this stage having
somebody who understands the local
landscape helps, though I must say that in my
meetings (with stakeholders in India) I never
for a moment felt that just because I was not
Indian they did not engage with me. Even
other managers from the centre have been
well received by local stakeholders.
As the recall process comes to a close, we are
looking at rebuilding. It is very much about
how we can take Nestle India to the next
phase of our journey. Suresh, for me, is
perfect for the job. When I scanned the world
for different talents who could do this, it was
Sureshs capabilities that I thought about.
First and foremost he is very much a peoples
person. Our Nestle India colleagues have
been through a lot. It has been a Herculean
task from what the teams have been doing. I
was here for seven days and I saw up close
and personal. They worked tirelessly, the
weekends, the nights. Its just incredible.
Narayanan: I joined Nestle India in 1999 as
head of sales. In 2003, I was sent to Indochina.
I was called back to India to fix issues in sales
channels across the region. It was an
enhanced assignment. Nestle keeps giving
you varying degrees of stretch seeing your

capability. That worked out well for me. Every

assignment was stretching me that much
more to see whether I was capable of taking it.
After that I went to Singapore as the MD for
about two and a half years. That was again
during the downturn and the business grew.
Thereafter, I went to Egypt, which was quite
a time. That was in September 2010, just
before the revolution started. That was a
humbling experience because a team that
was not particularly known for any great
performance actually blossomed. It showed
in four years some of the best growth we
have had. We also invested in Egypt what we
didnt invest in 10 years. As Wan Ling said, I
enjoy working with people and teams. We are
not talking machines here nor are we talking
about impersonal brands. We are talking
about people. I am really energised when I
think we have 7,000 people and more than
half a million others who are associated with
us in some form or other. Deep down in my
gut, the words that come to me are, we shall
overcome. I want to tell Maggi consumers
trust me, trust my brand. It is safe. To all
employees, colleagues and associates who
have been on the cause of Nestle for years, I
want to pass on a single message that we can
build back brick-by-brick and together. And
to all the associates, partners, distributors
and suppliers, I just want to say you can
trust me.

You were saying there are varying

degrees of stretch. Is this your biggest
challenge?
Narayanan: Every assignment has had a
different challenge. Some assignments had
the challenge of building teams while some
had the challenge of building strategy. The
four-and-a-half years I spent in Egypt, Libya
and Sudan were the most challenging. Paul
Bulcke (Nestle SAs global CEO) visited me and
asked, what are you looking at? He laughed
and said, what else? You couldnt have asked
for a more potent combination of things that
were happening. Each of the assignments
have had a facet that has been energising and
stimulated me to give my best.
Whats the first message you will give

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PUBLIC NOTICE

ON R&D

We will not stop innovating.

We have built an R&D centre
here in 2012 precisely to
bring innovation to the Indian
market. We look at innovations differently.
employees when you formally take over
as CEO?
Narayanan: I will tell them lets get our
self-confidence back. We will work as a team. I
dont have a magical wand. It will be consistent,
systematic hard work. We will step up
engagement with government. I am not
confrontational. For us quality is trust.
Whats the tangible and intangible hit that
the company has taken on Maggi. An
article in ET estimated it at about `. 12,000
crore.
Narayanan: We are in the silent period so we
cannot comment on this. We have already
provided the broad cost estimates to the
stock exchange and will announce the
financial results for this quarter on July 29.
Do you think Indias image in the world
outside as a safe destination for
investment has taken a hit? Does it in any
way jeopardise Prime Minister Narendra
Modis Make in India project?
Martello: I dont want to speak on behalf of
others. Weve been in India 102 years. Weve
always been part of the solution versus part
of the problem. We have half a million people
we touch indirectly. The unfortunate thing
about this whole episode is how thousands of
people are impacted. People might say, oh,
this is another multinational taking a hit. No,
Im sorry weve got people. We buy over
90% of our ingredients locally.

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