8/12/2019 Creating a Better Healthier World - Interview with Rakesh Kapoor (CEO, RB)

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10. The CEO Magazine - July 2014 theceomagazine.com

In The Ofce

EXECUTIVE INTERVIEW

Creating a Better,

RB has sharpened its focus on particular brands and markets for thefuture, setting a clear-cut strategy to grow the business worldwide.

Images courtesy of RB

In September 2011,consumer-goods giant RB(formerly known as ReckittBenckiser) appointedRakesh Kapoor as CEO.

Rakeshs previous experiences inthe Indian market were anace-in-the-hole for the company.I started my career in anemerging market. I worked inIndia my whole life before Imoved to the UK, and that was avery important time for me as Iwas growing up because, first andforemost, when youre in an

emerging market, you develop afew mindsets. One mindset youdevelop is growth because yousee growth around you, andyoure not prepared to accept anyother status except one that ismade up of big growth.

The other mindset that youdevelop is that there is so much

change going on and you need tofind a way of managing thatchange effectively, otherwise thatchange can become an end initself. Our end is not to change;our end is to change in order todrive growth. In emergingmarkets, you undergo rapidchange in a very short period oftime, and when youre operatingin these markets many of thesechanges are unpredictable, so youlearn to cope with volatility andyou learn to cope with significantchange. I learned a lot about

managing change that is volatileand unpredictable.

The third thing you learn inemerging markets is that youvegot to have a longer term viewof the business simply because,in emerging markets, manypeople make the mistake ofoverestimating the short term and

underestimating the long term.For those of us who have grownin emerging markets, we knowthat youve got to have a long-term view of these marketsbecause there will be short-termunpredictability, but if you keepdoing the right thing for thelonger term then youll be in avery good position.

Since coming into the position,Rakesh has spearheaded growthand focus wit hin the company. Weare the worlds number-one in

consumer health and hygiene witha future that will look at how weregoing to drive performance overthe next decade and more, with asharpened focus on brands andmarkets. We have invested in topquality in-house research andregulatory capabilities, attractingtop talent from the health industryto mastermind our transformation

HealthierWorld As featured inThe CEO MagazineFor more info visittheceomagazine.comPanasonics Laurent Abadie Riwals Norty Turner Tekas Martin Beck UNIT4s Jos DuarteDiscoverMarrakechSwissEscape: The ValaisPorsche BoxsterSScience of club-fittingRakeshKapoorrevealsRBs historyofbetterbusiness andbetterbrands Thevalueof meetingsInsuringassetsEngagingstaffinstrategyAHealthyReturn

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8/12/2019 Creating a Better Healthier World - Interview with Rakesh Kapoor (CEO, RB)

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12. T he C EO M ag az in e - J ul y 2 01 4 t he ce om ag az in e. co m t he ce om ag az in e. co m T he C EO M

into the worlds leading consumerhealth company.

We also defined a clear vision andpurpose for the company aroundproviding people with solutions forhealthier lives and happier homes.We all know that health andhygiene matter because peoplewant to stay healthier and livebetter. I think our company canplay a unique and defining role inhow that comes to light. We haveclearly defined roles because we

have an incredible portfolio ofbrands like Nurofen, Strepsils, andLemsip, which can make peoplehealthier and feel better. Ourapproach to developing healthproducts combines ouroutstanding heritage of consumerunderstanding with the robustresearch, medical, and regulatoryprocesses essential to be a trustedprovider of consumer healthproducts. We also have a hugegeographic reach; we operate inmore than 200 countries and reachso many people around the world.Through our brands, through ourgeographic reach, through ourtremendous innovation capability,we believe that we can providepeople with innovative solutions

that can help them live betterand healthier.

Rakesh has been instrumental inhelping RB create clarity aroundthe companys growth strategy.We have a stable of more than300 brands, of which 19 powerbrands make up 70 per cent ofour business net revenue, so wewant to focus on those brands.Amongst these power brands, wehave a clear strategy of focusingon health and hygiene. Secondly,we have defined 16 powermarkets within the areas weoperate in that we want to focuson even more. Every companyneeds to define what its going to

focus on, what its going to dowell. Our focus on 19 powerbrands and 16 power markets is avery important way of drivinghigher growth and performance.

The next thing is the way wevedefined our organisation structure.We took the unique step ofcombining Europe and North

innovative without a willingness tochange. I think the success of RBis not just down to a strategy ofperformance, or a strategy ofpower brands or power markets, oreven an organisational approachthat I defined, because most ofthat can be copied by otherpeople; I think what makes usunique is our special culture, ourinnovative culture, our culture ofentrepreneurship, which is difficultfor organisations to copy.

According to Rakesh, RB aims tooutperform the markets itcompetes in. Once we determineour key indicators of performancewe have to ask whether or notwere growing faster than themarket. And weve put down a KPIof 200 business points faster thanthe market. The second KPI is howbig are health and hygiene goingto be in our companys portfolio.So we have said that health andhygiene should be 72 per cent ofthe companys portfolio by 2015.By becoming bigger in consumerhealth and hygiene, we are goingto create a company that is goingto be growing faster and moreprofitably than before.

The third KPI that weveidentified for the company is howbig we are in emerging markets.We want emerging markets to behalf of the companys business by2015. These goals, theseperformance indicators that weveput down, are to make sure thatthe company is making the rightprogress. I think the last few yearsdemonstrate that we have theability to drive that performanceand we are quite pleased with theresults, although I am the first oneto acknowledge that a lot of workstill needs to be done. Ive alwayssaid that this company is capableof performing even better and thatis what I would like to see.

While Rakesh has noted theimportance of achievement,ownership, and entrepreneurshipwithin the organisation, he stressesthat partnerships are equallyimportant to the companys growthand success, particularly since theyallow collaboration and help RBexpand its capacity. Partnership is

not just within the company,because big companies tend towork in silos so its very importantto break those boundaries downand work effectively in teams, butalso externally. We are living in aworld where no one company canclaim to have all the innovationand creativity embedded in its site.

Were a highly innovativecompany and we want to beinnovation-centric and consumer-centric. No matter how big we are,

no matter how good we are at this,we cannot drive all the innovationand creativity within our company;weve got to rely on externalpartnerships. If you think aboutthe innovation that we come outwith, we have one of the bestprocreation histories in ourindustry. The amount of innovationthat comes from outside thecompany as a percentage of thetotal innovation that we come outwith is probably one of the largestin our industry.

RB also builds active partnershipswith its suppliers, assigningspecific innovation responsibilitiesto each of the companys keysuppliers. For example, we dont

just want to b uy perfumes fromyou; we want to buy innovationsfrom you; things that consumerswant and will loveand you needto come up with ideas that we cancommercialise in the marketplace,rather than just ingredients forour air fresheners. I think wehave a culture of partnership,and many of the partners that wework with actually get moreenergised with this mandate,simply because many companiesuse suppliers simply to buyproducts or services from, but wethink of them as our partners ingrowth that provide us withinnovation and creativity.

We also use partners to drive ouragenda for advertising, so we havevery significant partnerships withcompanies such as Facebook andGoogle to drive our digitalmarketing and how we engagewith consumers around the world.We also have partnerships withcustomers. We work withcustomers such as Walmart to say,

America, which, for mostorganisations, are considered astwo different geographic areas thatthen have two differentorganisations in managementaround that. The reason we didthat is because we believe thatconsumer habits, consumer needs,and consumer cultures in thesetwo different geographies are moresimilar than dissimilar. Combiningthese organisations helps cut costsdown, speed up our decision-making, and enables us to dothings once as opposed to manytimes over, which will drive ourgrowth. We used to be declining inthe combination of Europe andNorth Americanow we are

growing in those markets.

While strategies help the companyplan for the future, RBs truestrength comes from its peopleand the culture ingrained in thebusiness. We need to recognisethat our world is changing quiterapidly outside, and I think mostorganisations fail because they

dont change inside the companyas fast as things change outsidethe company. In our case, oursuccess is not only down to ourstrategy, but our culture as well.If you read some of the literatureon our company youll find thatthis company has a uniqueculturea culture whereachievement does not meanachieving results, but achievementmeans outperforming; a culturewhere commitment means takingownership for doing the rightthing and doing it quickly; and itis a culture of entrepreneurship.

I dont see enough organisationsspelling out a culture of

entrepreneurship as somethingthey want to see. A cultureof entrepreneurship is whereeveryone thinks they areempowered to speak up and takerisks, even if they are small. Wehave built a culture that thrives onchange and thrives on progress.And innovation is part of change;you dont get an organisation to be

What kind of prodWalmart customerscan RB and Walmarprovide those custotheyre looking for?partnership is a verydimension of how tshould behave, becbe humble enough,realistic enough, to that we cannot drivgrowth, all the creatthe innovation we awithout engaging ev

this effort.

Partnerships with edont just help RB they help bolster ccitizenship. We hapartnership programChildren. One of thof children under tcomes from diarrhoknow that diarrhoeeradicated disease. the age of five shoufrom diarrhoea, so multi-year partnersthe Children whereour innovation capspending more thanto work with them diarrhoea off the to

of diseases from whdie every year.

That also recogniscompanies can actuthan just write a chehave our partnershiwriting that chequeworking on how wehow we use our innour products to profor people that can eradicate diarrhoeahow do we actuallyhand-washing solutpoorest of people dfrom unhygienic haPartnerships, when vital part of your cu

leveraged or used tcompany b etter.

Rakesh has set out growth strategies foand, by creating thidirection, he has placompany in good stsuccess across the nmarkets in which it

No matter how

big we are, no

matter how

good we are at

this, we cannot

drive all the

innovation and

creativity within

our company;

weve got to

rely on externalpartnerships.- Rakesh Kapoor

Our approachto developing

health products

combines our

outstanding

heritage of

consumer

understanding

with the robust

research,

medical, and

regulatory

processes

essential to bea trusted

provider of

consumer

health

products.- Rakesh Kapoor