These days it sometimes seems like all I hear and read is about how corporate America has come off the rails. Greed, stupidity, short-term thinking, even sometimes criminal minds and acts. Some of my friends throw up their hands in despair.
My own conclusion in a lifetime of watching the phenomenon called the big corporation – I recently read through Fortune’s 500 largest companies list for the 48th year in a row – is a bit different.
The troubled companies get all the headlines. Not much ink, outside of a few business magazine articles, is left for the companies which “do it right.” Companies which understand that products (or services) and people are all that really matter. Companies that understand making a profit and creating worthwhile jobs only comes from serving the customers, from making the world a better place. Companies that stay true to their purpose year after year. Companies that stay out of the headlines.
So who are these companies? My own list of greats and winners includes such names as UPS, Federal Express, (John) Deere, Caterpillar, Paccar (Peterbilt and Kenworth trucks), Target, Costco, Walgreen’s, Wal-Mart, and many others.
Which brings me to PepsiCo. This company, alongside other great consumer goods companies like Procter & Gamble, Coca-Cola, Colgate, and Church & Dwight (Arm and Hammer), has long been one of my favorites. I first read about their great leader Don Kendall in Fortune magazine as a teenager. Everything I have seen about the company tells me it really understands business, far better than the AIGs and Citibanks of the world and (in the last 20 years) my old favorites Sears and General Motors.
But I had never seen or heard one of their CEO’s, and did not know for sure what made the company tick. So when I heard that PepsiCo’s CEO Indra Nooyi was coming to the University of Texas McCombs Business School to talk to students, I knew I had to be there. Thursday of this week, I spent one of the most remarkable hours in memory.
Ms. Nooyi was born poor in India in 1955. She joined Pepsi in 1994 and became CEO in 2007 (see http://en.wikipedia.org/wiki/Indra_Nooyi). Clearly extremely bright, she earned her bachelor’s degree at 18 and came to the US where she rose through the consulting and technology industries before joining PepsiCo.
The company she leads today has over 300,000 employees. PepsiCo has 19 individual brands that each generates over a billion dollars in sales, more such brands than any other company. It is the second largest food and beverage company in the world (Switzerland‘s Nestle is #1), and #1 in the USA. In an intensely competitive field – its namesake product is usually #2 – it has been a tremendous, long-running success.
Ms. Nooyi’s hour with McCombs Dean Tom Gilligan consisted of excellent questions from him followed by more good questions from the students. Her answers blew me away. First and most impressive was her humanity. She expressed frustration with companies where work and life were seen as two compartments. She said she wants to work with the whole person. Upon travelling back to India to see her family and realizing how important her upbringing was to her success, she wrote a letter to the parents of each of her key executives, thanking them. She knows fizzy water and crunchy chips (Frito-Lay is in many ways the heart of the company) are important, but it is people who make those products, sell them, and work with each other and their customers. Many so-called “leaders” forget this.
She was asked about being a foreigner, about being a woman, and those kinds of issues. She said yes, she worked harder than others, but she attributed much of her success to the United States of America. She said that, had she stayed it India or most anywhere else in the world, it was very unlikely she, as an Indian woman, would be leading a $60 billion dollar company today.
When asked about her failures and weaknesses, she gave some examples but said there were way too many to list. A humility not often seen in the corporate suite. And all of us in the audience knew that she was speaking from the heart, not from a script. You can tell those kinds of things.
In responding to the students’ quest for advice, over and over again she said, focus on the job at hand. Don’t worry about the next job, don’t campaign for promotions. Exceed your supervisor’s expectations. Work hard to help others in the organization. If they have problems, don’t criticize or blame them, strive to make them more successful.
This woman does not run a church or a university. She makes the world better through foods and beverages. She leads Quaker Oats and Gatorade and Tropicana. Yes, she understands all that they teach in business schools – strategy and stocks and bonds and planning – but more importantly, she understands heart and purpose and vision. She understands that doing the right thing is not so much about ethics (looking at each particular case) as it is about your ethos, your view of the world.
She strongly stated that she believed PepsiCo had a soul, a personality. (Music to my ears!)
In recent years she and her colleagues have shifted advertising dollars into social causes, figured ways to make healthier products, and discovered ways to use less water in places where there is not enough water.
Indra Nooyi understands stewardship, something that seems to go over the heads of many CEO’s.
As I left the auditorium, walking past dozens of PepsiCo employees, many of them graduates of the University of Texas, all I could think is, “Do these young people realize how blessed they are to work for such a great enterprise, a global company with a tradition of innovation and awareness and picking great leaders? A company that is likely to not only survive but to prosper, no matter what technologies and economics and global shifts throw at them.”
Do they realize how lucky they are not to work for (in my opinion) badly confused companies like AT&T, H-P, Sears, and many of the famous names in banking and on Wall Street and in the pharmaceutical industry?
Do PepsiCo’s shareholders realize how fortunate they are?
I think I will do my part and go drink a Pepsi!