Day 1 of Spectra, the online conference focused on reputation management, saw Economist and Thought Leader Rama Bijapurkar engaging Nestle India’s Chairman and MD Suresh Narayanan in conversation.
The duo began with how the pandemic has changed consumer behaviour and business. Narayanan said, “For businesses, the equation between people, purpose, partnerships and profit has changed. Some of the old models of increasing growth, market share, profits, number of partnerships and impact on people are also changing.”
Business targets versus fundamental reshaping
Bijapurkar and Narayanan moved on to the oft-discussed business targets and a fundamental reshaping of organisations. Narayanan believes that there needs to be a balance of both, attributing the success of companies like Nestle to its leaders’ thought processes.
“Companies with longevity have had purpose, values, culture behaviour etched into their DNA. Businesses which have always been looking to engage the ecosystem rather than just building revenues and profits have typically also had the kind of leadership,” he said.
Narayan sees this manifestation at three organisational levels:
– Central leadership
– Core purpose
– Revenue streams at the time of distress, resulting in mixed voices
Would his answer have remained the same if Narayanan was at the helm of a courier company or a restaurant business that’s affected by the pandemic?
Here, he re-emphasised the importance of purpose. “We are at a situation today where business, society, purpose, people, partnership and profit are all enmeshed and no company can say that its only business objective is to keep making a profit year-on-year.” The importance of Environment Governance and Sustainability is trying to bring certain features that are not part of the unidimensional profit maximisation model and making it a little more encompassing and intrusive, he explained.
India’s businesses and societal impact
Narayanan stated that while the US and Europe are ahead when it comes to business’ societal impact, India is starting that journey. He believes that the “shrill cry of climate change, inequality or of societal goals and sustainability goals are coming from the West”.
“The country that talks about Vasusdhaiva Kutumbakam cannot be now talking about excluding parts of its own family from the impact of business. We are starting that journey but still need to accelerate and need champions of change,” he said.
Pause, pivot or moat?
Next, Bijapurkar asked whether companies need to pause, pivot or moat. Narayanan thinks they need to pause rather than pivot or moat since the fundamental principles of business – engagement, relationship, output, input and impact – aren’t going to change. “No sociologist, economist or geopolitical expert can say 2021 will be a certain way. Pausing says two things – continuity and humility. Pivoting a business is showing overconfidence while moat suggests complacency,” he felt.
Businesses need to build on trust
Narayanan doesn’t think that the pandemic will change the Indian consumer’s aspirations, attitudes, consumption and outcomes.
He explained, “The consumer will become more acute in the trust placed in brands. Brands need to do the right things as far as the consumer experience is concerned and also for the larger impact in terms of business.”
He closed the session by saying that this new line of thought is not limited to the metros, also adding that the family as a unit has become stronger. Regardless of whether one earns Rs 10,000 or Rs 10 lakh a month, everyone worries about their families’ well-being. It’s just that the expressions could be different, he finishes.