Starbucks new boss L Narasimhan is used to feeling like an underdog.

Laxman Narasimhan was Managing Director of Reckitt Benckiser. (case)

The new president of Starbucks. He’s used to feeling like a stranger. Luxman, who runs his chain of the world’s largest cafés without running a retail or restaurant business, said Narasimhan, who three years ago became president of the British consumer goods company Reckitt. I was a relative newcomer at the time.

It was the first time in the history of Lysol and the Nurofen makers that an outside CEO was appointed, and he had no consumer healthcare experience. He joins a company that has just emerged from his tumultuous decade of failing to meet its financial goals, plagued by scandal after scandal and crisis.

Narasimhan, 55, has never been afraid of a quick change.

Within three months of taking office, Mr. Narasimhan replaced the chief financial officer and stepped down as president of the home hygiene division after 32 years at Rekhitt. He hired a senior executive from his former employer, PepsiCo, to fill the new position of Chief Transformation Officer. As he prepares to leave, Reckitt’s entire management team will be different from what he started in 2019.

Half a year later, Narasimhan formulated a strategy to turn Reckitt’s performance around. This was to prioritize growth and investment in the health, nutrition and hygiene sectors and cut back on non-essential brands. The sale included the China division of infant formula maker Mead Johnson. It was an ill-fated $17 billion acquisition by his predecessor, Rakesh Kapoor, and was higher than all of Reckitt’s previous deals combined.

Analysts, investors and those who know him have no qualms about making big strategic decisions at Starbucks. But he plans to work closely with his longtime chef, Howard Schultz.

fast mover

According to Investec analyst Alicia Foley, Narasimhan was a quick decision maker and quickly imposed a “massive turnaround strategy” on Reckitt.

“It took him about two-quarters of the time to find, communicate and deploy this strategy. upgraded its entire supply chain infrastructure.

Executives who prefer one cup of espresso a day are the main cause behind the cultural shift at Reckitt.

Not only was it trying to digest a disastrous acquisition at its inception, but it was also trying to recover from a serious cyberattack, manufacturing problems, failed product launches, and a health scandal that left hundreds dying of deadly lungs in South Korea. It was a company that had contracted an illness caused by exposure to a humidifier sanitizer sold by the group.

Narasimhan met with a committee representing survivors of the toxic air purifier scandal shortly after his arrival and wrote a personal apology letter to South Korea’s Independent Social Disaster Investigation Commission.

He visited factories and warehouses to better understand the business and improve relations between Reckitt and its major retail customers.

“After joining the company at the end of 2019, he was among the third quarter results going around all the major markets, talking to people on the ground, talking to customers and seeing where the company needed help. “Increased investment,” Berenberg analyst Fulvio Cazzol said. “It proved that he was very keen to get into and understand the business.”

Cazzol added that when Narasimhan joined the company, he showed the understanding necessary to prioritize customer service for large partner retailers and run consumer-oriented businesses such as Starbucks.

Two Bedroom Apartment

Narasimhan, who holds a degree in mechanical engineering from the University of Pune, India and an MBA from the Wharton School of the University of Pennsylvania, came to work at Rekit less than a year ago when the world was brought to a standstill by Covid-19. 19 spreads. Initially, he was estranged from his wife and adult children as he worked for Reckitt from a two-bedroom flat in the UK he shared with his elderly mother.

Early media calls with Mr. Narasimhan included stopping to help his mother answer the door for grocery delivery and slamming the door as he talked about the performance of Reckitt’s Durex condom brand. It was often interrupted.

Narasimhan, who speaks three languages ​​- English, German, Indian and Spanish – was trying to turn things around, overseeing the explosive growth of his Lysol sanitizer during the pandemic. He then oversaw the explosive growth of his Lysol sanitizer during the pandemic, followed by an unprecedented surge in the U.S. infant formula business, driving sales after a significant shortage earlier this year. have started.

However, Narasimhan will leave before Reckitt’s turnaround is complete, leaving the company as a custodian while the company searches for a permanent replacement. With ambitious growth targets and a time of unprecedented inflation and turmoil, the ultimate assessment of Reckitt’s short tenure may be different in the years to come.

Joining a company that employs more than 383,000 people and faces the first organizing effort in the United States will face significant challenges. Bill Campbell of management analyst firm Paragon Intel said the due diligence conducted by Narasimhan when he became president of Reckitt found him to be a “strong strategist, but he’s not a trader, he’s a trader.” He said he did not have the ability to carry out Execute long-term strategy. “

Known as a hard worker, Narasimhan once broke his elbow after falling down a flight of stairs the night before Reckitt’s results were announced, but continued working as if nothing had happened. His colleague says it’s not uncommon to receive emails before sunrise. Mr. Narasimhan can be a difficult taskmaster, but he strives to drag his team out.

“Luxman is definitely a class man. “He’s got a lot of personal charisma and obviously a top-notch resume, having worked for McKinsey and Pepsi. My hunch is he’ll do well at Starbucks.”

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