Slowdown? Growing competition? Harish Manwani has an optimistic counter for all Levers' challenges
As soon as the tea arrives, Harish Manwani volunteers to add milk to it, but only a few drops in each of our cups and says the reason is simple: he doesn’t want us to corrupt the taste of the fantastic tea with too much milk. No prizes for guessing that the “fantastic” tea happens to be Brooke Bond Taj Mahal, one of Hindustan Unilever’s (HUL’s) largest-selling beverage brands. We now know why apart from being a gracious host, Unilever’s chief operating officer is also known to be a master marketer in action 24x7, write Shyamal Majumdar and Viveat Susan Pinto.
We are at “Alhambra”, HUL’s imposing guest house on Mumbai’s tony Carmichael Road. Singapore-based Manwani prefers to stay in the frugally- yet tastefully-decorated duplex flat whenever he is in town — that is once every two months. Though it is doubtful if he gets to see much of the leafy neighbourhood, given his travel schedule.
In the seven days before our meeting, he has already been to four countries and will be visiting another one the next day. “I am getting paid for something I enjoy,” Manwani, 57, says with a laugh. The enjoyment includes rolling up his sleeves and making customer visits in every single country to which he goes — for example, the minute he landed in Germany after attending the World Economic Forum meeting in Davos, Manwani went straight to the stores and spent half a day just watching what customers were buying or not buying. “That’s the only way to stay connected; churning out papers in air-conditioned offices doesn’t help,” Manwani says.
That’s why, he says, HUL still insists on making all management trainees work in rural areas for at least six months despite suggestions that today’s bright kids may not be willing to go through the grind. “That’s non-negotiable. This is our culture: Leverites must be equally comfortable on the dusty roads of rural India and in the corridors of our London headquarters,” he says.
Manwani says rural postings have given him the most defining moments of his life, teaching him three things: first, how to unlearn what you learnt in B-schools; second, lessons in real leadership — how to get off your high horse and be part of a team; and third, how to respect people.
Manwani, however, isn’t too sure whether his wife is “terribly happy” with his enjoyment at work, but what he knows for sure is that he has chosen to “build his life around his job”. The only things he does apart from work is playing golf occasionally (his enthusiasm, he says, exceeds his skills) and devouring news (no matter what the time is) on his tablet PC. And the only occasions when he doesn’t talk business are his rather infrequent meetings with a few old friends in which they “just shoot the breeze”.
More From This Section
His only regret is not having enough time to read. But going by the seamless flow of quotable quotes during our almost two-hour-long meeting, it seems Manwani can easily give management books a run for their money. Sample this: “leadership is about having a point of view, who knows what is right or wrong?” (that means leaders must have belief in their opinions and not keep thinking whether they will work or not); “HUL is competing for non-consumption” (HUL’s strategy is geared towards getting new consumers who don’t buy fast-moving consumer goods for various reasons, including socio-economic ones); “a problem doesn’t become less just because you take long to decide” (managers have to be proactive and not wait for problems to emerge); “you need to walk and chew gum at the same time” (Leverites need to ensure they are excelling in the market place); and “you can’t be a good leader if you are not a good follower” (leaders must keep their eyes and ears open for suggestions coming from any quarter).
So what has changed after he became global COO? Manwani says his elevation is part of the One Unilever strategy that helps the company in dynamic resource-allocation and transfer best practices without bothering too much about geographical boundaries. It also helps in rolling out innovations faster across the world. For example, the re-launch of Dove, which is the fastest-growing premium product in the personal care industry, happened in 40 global markets simultaneously.
Manwani says this simultaneous launch of products has brought down the lead time for product launches in developing countries such as India where an increasing number of consumers are willing to experiment with such affordable luxuries. “Please remember we no longer call India the fastest-growing market; we now call it the largest- and fastest-growing market. We don’t deal with products that cost thousands of rupees. We deal with products that cost only a few rupees, but serve consumers who want a little better out of life,” he adds. Examples: Cornetto, Knorr soupy noodles, Kissan and so on. These are products that cost a little more, but are positioned to sustain the “biggest consumer migration in the world’s history” — in India an unbelievable number of consumers are shifting from rural poor to middle class to upper middle class and so on owing to the increasing purchasing power.
Sometimes, there is some downtrading during an economic slowdown, but that doesn’t bother Manwani. In all his presentations, he compares India to a huge mall or an airport where there are scores of escalators — some going up and some going down. “But if you look closely, the escalators going up almost always outnumber the ones going down,” he says.
His optimism can be infectious, but we tell him it is not in sync with Unilever’s own guidance of a slowdown in emerging markets. Predictably, Manwani dismisses these concerns. Unilever, he says, has been growing consistently at nine per cent in emerging markets over the last 20 years and a temporary blip here and there just doesn’t matter.
Apart from the long-term growth story, there are two specific things in India’s favour. One, the tremendous entrepreneurial streak in people; and two, the middle-class mentality of wanting your children to do better than you.
We try our last card. Isn’t he disappointed with HUL’s food play in India? But Manwani is unstoppable: “We are the largest player in beverages. Ice cream is one of our fastest-growing categories, etc etc.” Just when we thought it’s a re-run of the optimism story, came the reality check, as Manwani says: “You are right. Given the opportunity, we haven’t yet started in India considering that half of Unilever’s global turnover comes from foods.”
Part of the reason, he says, is the demographic, socio-economic and infrastructural (lack of cold chains, for example) factors. “Forget the US and the UK, India’s consumption in many categories is not even one-tenth of the rest of Asia. In packaged foods, the brand equities of Knorr and Kissan, for example, are Olympian, but the size of the market here is still small. But I am confident they will live up to the potential a few years later,” he says.
That optimism is the reason he thinks the share of emerging markets in Unilever’s turnover will increase to 70 per cent from 55 per cent now. “Look at the white spaces in our India map. In nine out of 11 categories, we still haven’t played out our products across categories,” Manwani says.
As we wind up, Manwani says he strongly believes in two things: first, leadership is all about having the right people around you and respecting them. That’s why the attrition rate in HUL’s management positions is just six per cent compared to at least 10-12 per cent in the industry. And second, “there will be rivals who are always doing something smart, but all of us at Unilever know we will have to keep doing things smarter. That’s what we are paid for”. That’s another quotable quote for you.