What Nestlé’s Crisis Management Teaches You About Leadership

Are leaders born or are they made? Can a two-year MBA program instil all that it takes to prepare leaders of tomorrow? This question has been debated religiously over the years in the B-School circuit and is relevant even today.

B-School grads while in college do get to take up leadership roles mainly as various college committee heads, spearheading work teams or while working in group assignments. Leadership skills exhibited here are only a mini-simulation of what they may be faced with in the real workplace. Probably this is the reason why Leadership as a topic garners so much interest amongst students as every leadership story is unique and lends a new lesson to be learnt.

It isn’t then hard to appreciate the fact that it is in crisis situations like the one Nestlé India was faced within 2015, that one is put to the real acid test on how one chooses to emerge out of the situation and sets a leadership example for others. No stranger to handling challenging situations across his global career, it was then that Mr. Suresh Narayanan – Chairman & Managing Director, Nestlé India was handed over the reins of India market to steer through the Maggi crisis. While he was confident about the product, the key focus for Mr. Narayanan during the crisis was to have an open and a transparent communication channel with all stakeholders concerned – government authorities, suppliers, employees, customers and most importantly the consumer. He emphasized on brand messaging and one-to-one communication. “I am here to share my point of view transparently and reasonably and am willing to listen to your point of view as well,” Mr. Narayanan was quoted in a Forbes Article published in November 2017.

You are not always at the forefront managing things on your own or calling the shots in a B-School. There are different minds at work when you are working on a project or solving a case. “If you are part of a club, you work with a team and you learn from the minds associated with it. You absorb them and evolve,” quips Anish Malladi, a first-year IIM Bangalore management student. Similarly, feeling the pulse of the organization and understanding the people in the overall chain during a crisis is a vital aspect while solving it. Mr. Narayanan followed this path by further empowering the more experienced people in the organization to serve as contact points with the local ecosystem. “Our people were constantly in touch with local food regulators through training programs and site visits. I was thereby sending a message that I have nothing to hide,” said Narayanan further in the article.

How under the able leadership of Mr. Suresh Narayanan, Maggi made a comeback remains amongst the most successful turnaround stories of India Inc. And the role of the leader just doesn’t end with a crisis. A true leader is also someone who sees what lies ahead. Just when the Maggi crisis was getting subdued, Narayanan decided to further extend the product line of Nestle in India. With over 42 new products in less than two years, Nestle aggressively renewed its focus on volume growth across categories under his able leadership.

Again, “As a leader, you not only have to manage the resources given but genuinely inspire and motivate people to do better.” says Niranjan Jha, an IIM Calcutta management student. And this was no better evident than recently when working under the aegis of a leader like Mr. Narayanan, the team at Nestlé communicated more swiftly, confidently and transparently the right message in light of the  Honorable Supreme Court’s orders in relation to interim orders passed by the National Consumer Disputes Redressal Commission (NCDRC). Read more on this here.

As is evident through the narrative by Mr, Narayanan in the Forbes article, leadership is essentially about seeing the bigger picture and having unwavering faith in people who make up your ecosystem. And whether or not B-Schools can teach leadership continues to remain a topic of discussion, but leadership experiences such as those of Mr. Narayanan would continue to lend a wealth of learning to all budding leaders of tomorrow.


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