In the final part of the series of excerpts from Gunjan Jain's book, she explores PepsiCo Chairman and CEO Indra Nooyi's path to success
Indra Nooyi (left) with former US Secretary of State Henry Kissinger at the World Economic Forum in Davos, Switzerland, in 2008
Indra had a road map and she took PepsiCo on that road map even before she became CEO—she did this when she was doing strategy, when she was the CFO, and later when she became the CEO. So I think she has had a long-term vision of not just what PepsiCo ought to be, but a long-term vision of the kind of marketplace context companies like PepsiCo would have operated in and, therefore, getting the organisation ready both strategically as well as operationally to be competitive in the markets of tomorrow.
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In a modest household in Chennai in the 1950s, two young girls were asked one question by their mother at the dinner table every night—“What will you do to change the world?” Their answers were taken seriously, and the exercise continued with similar questions, until both girls began to believe that they have the power to do something extraordinary.
The younger of those two sisters was Indra Nooyi, chairman and chief executive officer at PepsiCo, the second-largest food and beverage business in the world. The older, Chandrika Krishnamurthy Tandon, is an ex-McKinsey partner, bank turnaround consultant and now a Grammy Award-nominated musician. Indra still talks to their mother, Shantha Krishnamurthy, two or three times a day, crediting her as the motivator and early architect of her phenomenal success.
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Indra’s journey at PepsiCo started in 1994, when she joined as its senior vice president, strategic planning. In 2000, she was appointed senior vice president and chief financial officer and, by the beginning of 2001, she had become its president and CFO, and was named to its board of directors.
She was appointed CEO in 2006, becoming the first woman in the company’s history to take over that role and, under her leadership, PepsiCo’s earnings per share gained around 26 percent, and its revenues nearly doubled to more than $66 billion by the end of 2014.
As I read more about her, my curiosity kept growing with each day. How did Indra get here, and what motivates her every day to stay at the top? D Shivakumar, CEO, PepsiCo India’s words came back to me. “The obvious ones are her talent, the position she holds and the influence she wields over her network,” he says. “But the not-so-obvious one is that she is a big giver. Indra gives a lot more than she gets. Indra has a very positive influence on all the people she works with and talks often about working hard; being focussed; keeping in mind the right thing to do; teamwork; being candid; learning all the time and acquiring a unique skill-set that others don’t have. She is also extremely responsive and very approachable as a leader.”
As I prepare for our meeting, I am most curious about understanding Indra’s life mantras and the impact they can have on others, including me. As I find out, she is a delight to interview—gregarious, generous and startlingly honest as she shares the story of her life with me.
At Heart, A Student
To Indra, nothing can or has replaced plain, old-fashioned hard work—“That has been my rule over the past 20 years.” This ethic was drilled into her from a young age, by her Tamil Brahmin parents; the world in which she spent her formative years placed a high premium on academic excellence.
One of the greatest things about her is that she remains a student at heart, every day, and in every aspect of life, bringing the focus and purity of a beginner’s mind to her career, as well—“[I have a] constant desire to learn; to re-conceptualise situations and not be happy with the status quo. Aspiring leaders have got to raise the bar for themselves all the time. They have to embrace learning and be a student all their lives. You have to listen a lot, get out of your office, reach people—your employees, partners—and have as much emotional quotient as intelligence.”
Indra has lived this philosophy from her first job onwards—after she graduated from IIM-C, she joined Mettur Beardsell, a textile firm, as brand manager. She reported to work on the first day to be told that she would be in charge of printed fabrics (the company made plain dyed fabrics, too). It had no training programme for new recruits and Indra realised that she would have to learn everything on her own. Did they have any files left behind by the predecessor, she asked, more out of curiosity than dismay. Her colleagues pointed her to a cupboard, which, when opened, regurgitated files, books and swatches of fabric in a pell-mell fashion.
“So for the first week, I decided I was not going to be product manager, but staff assistant, cleaner, organiser, file-keeper,” she has said in an interview with Tom Gilligan, dean of the McCombs School of Business, University of Texas, Austin. “Because lesson number one is that if you don’t sweat the details, and if you don’t organise yourself, it’s not going to work.” And that’s precisely what she did at Mettur Beardsell; she organised every printed fabric the company had produced in a methodical way so that people after her, too, could follow the same system.
‘Do the Best Job You Can’
On graduating from Yale, Indra joined the prestigious Boston Consulting Group as a strategist. Over six years, she worked with clients from a wide range of industries—textiles, consumer goods, chemicals and retail, and learnt on the job every day. At Motorola, where she worked between 1986 and 1990, Indra rose to become vice president and director of corporate strategy and planning. Next, she was senior vice president of strategy, and strategic marketing for ASEA Brown Boveri.
I am curious to understand what she gained from each of these diverse jobs and Indra says, “In every job, I worked extremely hard. I didn’t care what the job was, I just wanted to learn and contribute.”
Indra’s broad perspective soon led to PepsiCo’s transformation into a more focussed food and beverage company, and an early mover in the health and wellness space. In 1997, PepsiCo spun off its restaurant division, which included Taco Bell, KFC and Pizza Hut. Indra joined others who believed that changing demographics and consumer demands would lead to greater growth in nutrition. In 1998, PepsiCo purchased Tropicana from Seagram for $3.3 billion, bringing into its portfolio a product seen by consumers as naturally nutritious. Soon thereafter came the acquisition of Quaker, which also included Gatorade. These moves laid the foundation for the PepsiCo of the future—a complementary portfolio of brands that could offer consumers a range of products to meet many needs from morning to night.
Becoming a Change Agent
Being a change-maker is inherent to Indra’s personality. Chanda Kochhar, managing director, ICICI Bank, points out the virtues of such adaptability when she says that even in the developed world, large companies don’t have too many brilliant leaders—“It is really to Indra’s credit that she, having studied science, started with a textile company and then got into consumer-oriented businesses. This is to do with her adaptability, not keeping any barriers in the mind and accepting change and new environments all the time.”
To me, Indra admits that she had to change in many ways to fit in—“I had to learn to be more clear, and write in a much more logical and simple way.” Her decisions on what to change and what to retain are all based on what keeps her functioning optimally—“Coming to work was not just about putting my background and individuality on display, it was more about getting the job done. I focussed on how to position myself as a better executive, get people to pay attention to what I was saying and not how I looked or what I was wearing.”