The next very important part in business is a set of values that allow the company to work successfully. Stefan De Loecker, CEO of Nestle in Russia and CIS, names his main values - the importance of being happy and successful.
1. What was your vision of the people to change their way of working together?
The point was that we had a business model based on the reality ten years ago - a lot of individual restaurants, hotels, and a lot of people in the street who go to these hotels. But it was clear that is was more and more hotel and restaurants chains. So if you wanted to address these people we needed to change from the individual working to the professionalism and we were looking at more KPI than an owner of the hotel or a restaurant can do. And if we see that change, will we take it or live happily for another ten or twenty years? Or will we take the change and speak to the people of retail who will give us a little bit of overview. And here we had changed the inside. We invited the people from the retail sector to discuss how they solved the change of the last thirty years, and they spoke about the reality, not the vision of the future because for it was already the reality and they way they were learning - these are a lot of things we see but never used in our performance. And that made people realize that it will happen and if we don't change now we will be not be able to compete in this market. So most of the people understood that we had to do something. And moreover we had money, time and opportunity to do it in a more comfortable way than when if you're in the huge crisis and you have to run behind. And at that time we had an opportunity to create a competitive advantage and be the first one to do it, and it helped a lot of people to convince and say that is that had happened, they understand what would happen in our market. And that helped to convince them.
2. Do you have the challenges within your team now?
The nice thing about 2009 and the crisis is that the crisis is an absolute opportunity to change. There's a nice saying: "Don't waste the crisis", - it means that if you don't do it now you will not be able to do it afterwards. If you look back this company has been in Russia for 13 years, we have been growing extraordinary well, we're doing very well. And from one day to another you come to the reality when your core challenges are not about growing the business, you come to the reality that the growth is going to be less. And we're very lucky to grow very nicely in Russia, we still have double digits growth and it all looks very well, but it's not the same as before. And it made us to go back and look at the opportunity to think of how do we want this company look like when we come out of the crisis. What are the things when we say that the crisis is over. We made a list of the items which we would like this company look like and we're going to focus on that, some of them were short-term and another were long-term. And one of them were efficiencies because it's very clear that the efficiency of the German market compared to the Russian market are hugely more developed. So that was the point when we said that the efficiency became more important in the short term in order to continue to deliver, but everything we do now in the efficiencies will take profit even if the crisis is over.
3. What was the second challenge?
The second one was to be focused on the consumer because there's always the trend of thinking that in crisis the Russian consumer will do this or that. Unfortunately or fortunately there's no Russia consumer. Among the Russian consumers there're people who have a lot of money and who don't have a lot of money, everybody is different and we should look very carefully on how Russian consumer acts. Because all the success we had this year we achieved in the areas we even didn't expect a year ago. The crisis of ten years ago which is still remembered by the businessmen is different from the recent crisis because there was a different country ten years ago. The nice thing about our business is that we're in a food business, and people have to eat. There's no doubt that you'd either say that you'll not buy a car this year and you'd better take a bus but you'll never say that you'll stop eating for three months. You'll do very different things but you will eat, so the better we understand where the consumers want to go to, we know that there's a demand, we just know that it's not the same anymore as before. This allows us with a number of techniques and issues to focus on the consumer and it's clear that the people now have learned this, and they will not spot when the crisis is over. There're a number of issues when we point our how we want this company to come out of the crisis, what we want to do in the short and in the long term. It's important to take this advantage and to make this change happen, and in crisis it's much easier to mobilize people. For me it was a very good learning in this country because people are very much educated, very competent, though slightly inexperienced but it's because the changes go very rapidly. But people want to learn rapidly, they're open to change, and it was a very pleasant experience to see how rapidly we change a large number of issues.
4. What values are important for you personally?
I can very hardly imagine someone's completely different personal values from the values we have in this business. It's alignment again, it's important to be happy and to be successful. A couple of these values and that is the reason why I work for this company for 20 years, are very much aligned with my personal beliefs. We're a very multinational company which was founded in 1866 and in 1867 we were already an international company, as Switzerland is a very small country and if you want to sell thirty kilometers further you're already in another country. And this internationalism is a part of the business system and it involves a number of values to be successful in this business. The first one is tolerance - Switzerland is a small country so it's not like you populize the whole company with Swiss people, so you need in every country to work with local people, and they have to work together. So tolerance and internationalism is very important, it's the values that I personally find very-very important - you should respect for any person whoever he is in order to work together. The second thing is pragmatism. We're a company that became international in 1867 - there was no e-mail, no faxes, it took 12 weeks to write a letter and to send it from India to Switzerland, so basically if you did business in this times you had to be very pragmatic, and you did it - you looked for solutions. It's not the business you do today when every question is discussed by e-mail and you copy there 25 other people, and it takes very different time. It means that we're very localized, very pragmatic and not very system oriented. It's the strength which I like as well because it allows us individually to do a lot of things.
5. What are the rest of your values?
We're very human and it's the third part. Our target group is not in a weapon industry, we have a normal consumer, a normal Russian housewives who want quality products for their families. And from that point of view understanding the normal people is very important for us. It's part of the business and it's the part of the person we look for as well. Humanity of working together is a very important value, it goes together with the tolerance. For us honesty and openness is of a high priority, because if you want to work with so many people in a team you have to rely on the fact that we're open to each other. Honesty is a hard thing to do, and honesty and openness are very important because very often companies do not change quick enough because they don't want to see the problems and there's no organization without the problems. These are the number of values to deliver the kind of the products we do. The source of the company is baby food, infant formula, this is what Henry Nestle started his company with, and this is very high priority and very high status for quality, for honesty, for delivery a real product. And if you're in that kind of business, it's extremely important to subscribe those values.
6. Did you have any occasions when you had to choose between values and profit?
I told you the example of Henry Nestle, I think that every employee in our company knows this story how this company started. This company is already based on the number of entrepreneurs with a very social vocation. If you look at the brand Maggi, the founder of this brand was a person who had a very social vision, and at the factory of this brand there was a school, houses for the people working there. This business is integrated with the values of people who will deliver the goods with the people who will be the consumers. We are in a sensitive business, and that means that we drive in certain circumstances on values of reality with zero tolerance. You cannot take a risk, you cannot do something to save a little bit money, and we show it with hundreds of stories when the people check the quality. There's not compromise and no discussion about doing the wrong things, we're committed to quality for a good reason, we do not play with health of people, and that means that every day you expect all of your people work in a team. You depend every day on the decisions that 12 thousand people in the organization make for the wellbeing of the end consumer. That means not just one huge product that one person can sign up and that's it - it's about hundreds and thousands and millions of products, and with this lots of decisions that individual people take in the responsibility of the final consumer. And I think it's much more important to have this part of your company culture than of the history.
