« Freakonomics Radio

A Conversation With PepsiCo C.E.O. Indra Nooyi (Ep. 316 Update)

2018-08-07 | 🔗

One of the world’s biggest and best-known companies just announced that its C.E.O. would be stepping down in the fall. We interviewed her as part of our series “The Secret Life of a C.E.O.," and we thought you might like to hear that episode again, or for the first time if you missed it back then.

This is an unofficial transcript meant for reference. Accuracy is not guaranteed.
This podcast dynamically inserts audio advertisements of varying lengths for each download. As a result, the transcription time indexes may be inaccurate.
If you'd like to listen to free economic radio without ads the place to do that is sticker premium five dollars a month and you can get a free month trial by going to stick your premium dot com and use a promo code freak. You also get access to all our bonus. Episodes and you'll be supporting our show to that sticker premium. Dot, com, promo code, freak thanks, one of the world's biggest and best known companies, Pepsico announced on August sixth that sea ingenuity would be stepping down in the form we interviewed Neue into thousands. Seventeen is part of our series, the secret life of a ceo, and we thought you might like to hear that episode again or for the first time, if you, MR back their ingenuity of Pepsico
there is one the most prominent female see Yos in the world and when it most accomplished, but new herself isn't putrid visible, which seems to be just how she likes it. She's, not flashy, just smart, reliable forward. Looking just about any, positive, adjective, you can come up with its Theo's got reviews like an Amazon. This one would have five stars from people who shop foresee Ios for living, like David Rubinstein, Carlyle Group of Motor for quite a lot of issues on a spectacular job from other members of the relatively tiny group of women who run companies like former taxi O Karel parts? Any time we can put up some, unlike her hold Europe is an example of what females can do and in she did. She did things against the ITA Wanna say advise against popular opinion, she's, been very strong and from professionals,
your watchers like just Simon, filled up the yell school of management. She wants to delegate for others to grow Allow them to make some mistakes that she knows she could have prevented Andrew Duff. I want to tell you a sheet, but generally as the smartest person in the room today: I'm with radio ingenuity CEO Pepsico, on how to deal with activist investors? Wants you to split up the company the end of the day? We view them as a free, consulting painful but free consulting on how hard it can be to make your any change with the times when people say culture, its strategy. I looked at first hand on why you have to accept some people. As they are, because if we don't we're gonna start feeling then fuller angry with what was happening around us and what happens when this especially the female seo, goes home at night,
try to pretend that you still the big boss because you're not I'm happy stature and definite productions. This is Reaganomics radio broadcasts. It explores the inside of everything. Here's your host Stephen governor in renewing, grew up in India and went to college and business school there. She played cricket and we guitar in an all girl rock band in nineteen- Asia came to the states and got a second masters degree at the Yale School of Management short for several years in management, consulting then in corporate strategy, enjoined Pepsico
in eighteen, ninety, four, as chief strategist, twelve. Years later, she became it ceo and now oversees two hundred and sixty thousand global employees and a snack empire that includes Fredo, lay chips, Tropicana Juices, Gatorade Quaker Foods and, of course, lots and lots of soda. We spoke with her not long ago, a Monday morning, Stephen. How are you very well? Thank you. So let me do this, if we knew let's say twelve year old ingenuity in Madras India, attending and all girls catholic Convent School. How surprised would we be to know that today she CEO of Pepsico in Purchase New york- probably incredulous, because what you would have assumed was dead She was gonna, be a firebrand. She was gonna, do something that was nonconventional, but you,
gonna do it in India, in probably happily married with lots of little kids taking, of all of the older people in the home and just as little concerned have gone around, but somebody was going to be a fire Brandon make trouble, see open to go in the United States of such a global company. Absolutely not was a turning point I think has been instead of gradual moves even the day before they told me that I was gonna, be see you. I didn't think that I was gonna be see. Also, there wasn't a plan to become seal. The plan was to just keep doing a very, very good job and making sure the company was in a good place. I think one thing just lead to another. You once said when we, but I'm ceos, they give a ceo pills and that allows us to remain strong in the face of all this criticism. So what's the toughest thing,
there that you ve gone through a ceo or on a kind of routine basis about being ceo of a company like Pepsico you're. The biggest surprising becoming seal was that down when you were sent to the number one job you are it as they say when you, president of the company, or see a fool, still have a very important job, but has always see you out there who was on the line who was being focused on a new becomes overnight, you other the calling all the shots. Your response, making sure you get all the information from the company crystallized down to in a simple ideas and then the organization what to do, and so it's a very daunting job to be a seal so day one. You have to be ready to take on the mantle of being seo
he was installed as president and CEO of Pepsico in October of two thousand and six and became chairman in May of two thousand and seven timing turned out to be not so wonderful people, what a honeymoon pleaded but the release into honeymoon period because from the one you want to see you and when I took on the sea a job, the one was a different place because a few months after I became seo, there was a financial collapse we know the written environment changed the? U S, market slowed down So one had to learn in the hurry: how to run this company through extreme peers of adversity and there's no book you can read all you have to develop the book as you go along and that's what was really really really tough. After you became ceo, you spent
a lot of time and money, essentially reformulated Pepsico as it as a food and beverage company, much more in line with modern ideas about nutrition. I like to speak about the up front costs of that we formulation, including a dip in market, share and some very unhappy shareholders. I think, as we looked at consumer trends and we looked at there we thought the markets for growing. We knew we had to read tool a portfolio that was does not even a question. We knew that if we didn't do it, our future was in jeopardy. Did you feel at any point that Pepsico might come to be seen as tobacco companies came to be seen kind of peddling an indefensible unhealthy product was never that drastic rise, more you know consumers to change all the time of the change in our food and beverage faster.
The change anywhere else, and this was a sea change that was happening because it on the whole society and their habits and their lifestyles for changing. So my point is this: is a great opportunity is a great opportunity for us to change our portfolio go by the consumer, going and gain market share. But I was not at all you know stupid enough to say this can be done overnight. I mean I knew this journey was gonna, be long, arduous and was gonna be filled with pitfalls, because it's not just that the design to change the board fully with line up the entire companies, innovation, marketing execution and budgets to go where the marketplace was going, and then we have to change the culture of this company when people say a culture, its strategy, I lifted first hand, because I saw how many peoples are said. Why should we change? Our company has been so successful for a future
don't quite understand, and so one had to paint the future in a very postal way. I mean I had to use our own employees to say: look your own eating and drinking habits are changing if you're eating and drinking habits are changing, as evidenced by a b c and d, which I was observing at work. Why do leave the rest of the consumer's out there, their habits and or changing. So once you start to change the culture of the company, everything else happens fast. So I think this call cultural changes. What took so long and through that process Obviously, people were impatient because in other we are holding, resting works its yeah? You need to make the strategic changes. Yes, we know but the marked basis changing and you have to change, but you ve got to do everything while delivering phenomenal returns in the short term. I mean that's a tough because I'll change takes a little longer
then norm? Investors expect you, like most big public companies have dealt with activist shareholders. You seem to have taken most firm line with them, including Nelson pelts, who might need a spin off Fredo. Lay he eventually exited his position and Pepsico with a pretty nice profit. I'm curious what you did to celebrate when Nelson pelts exited that position, You don't believe me in this might sound incredulous, but we didn't a great many came and we didn't celebrate when he left because of the the day. You know we're all activists inside the company mean ion almost fifty times my salary Pepsico stopped. My entire network is tied up in Pepsico If somebody as an activist came into the company and suggested we do things differently, we study every idea very, very carefully, because they have an idea for us to run the we need better than we are. We will incorporated
but if there their idea has more risks than upsides, then we have to worry about become He saw the end of the day. We are monopoly, focused on the successful Pepsico and our shareholders and been or just listening to ideas. We think about the implementation, And there were Nelson bells came and believe me when he presented his white paper to us. We studied every chart The idea had multiple conversations with him because at the end of the day,. We view them as a free, consulting painful, but three five hundred or so they all little operational things that Nelson opened our eyes to Not until the end of the day, any activists has been in Pepsico stock will tell you that we treated them with great respect we listened to them, we took in whatever we thought made sense and varied. LA strategy was in a better place. We state from until the early ninety nine, these Pepsi
oh, was mostly about selling soda and salty snacks. Then it began to diversify under we, the company, now groups its products into three categories: fun for you better for you and good free good for you, products include fruits, vegetables, whole greens, nuts, and so on. With an emphasis on less sugar fat, this category includes brands like Tropicana, Quaker and Vienna, which is water better, for you includes lower calorie sodas and baked potato chips and fun for you. Well, those are the brands you're, probably most familiar with Pepsi Mountain do less and Gmos I understand that men and women each chips very differently. Can you tell us the differences? I think I you know when you get out of afflicts bag in one of our single serve bags, expressed because you are watching
the young guys eat the chip they loved Doritos until they lick their fingers with greatly and when they reached the bottom of the bag. They pour the little alarm broken pieces in her mouth. Because they don't want to lose the taste of the flavour and the broken chips in the bottom. Women, I think, would love to do the same, but they don't. They don't like to crunch too loudly in public and our dinner. They don't like their fingers generously and they don't like to poor little broken peace in favour and their mouth so is like a male and female version of ships that you're playing with her. Now, it's not me and female as much as others snags for women that can be designed and packaged differently. And, yes, we are looking the tender we're getting ready to launch a bunch of them soon for women in a low crunch. The fourteen,
file, you do not have so much the flavor stick on the fingers and how can you put it? You know purse, because women love to carry a snack in their purse, the whole design capability we built in Pepsico was to allow designed to work with innovation, not just on packaging colors, but two through the entire cycle and say all the way to the product in the pantry. Your house being carried around or how they eat it in the car or drink it in the car. What should be the design of the product? The package, the experience stead begin influenced the entire chain. If this exchange sounded familiar to you that maybe because shortly after we spoke with Neue and published her interview on the pod cast her answer about
chip eating, went viral. A british tabloid twisted her words and launched a phenomenon that became known by the Hashtag Lady Doritos, the internet, aided up Neue, was accused of sexism and tone deafness. Can you imagine that a tabloid newspapers and the internet creating a fake scandal? In any case, let us remember, the Neue is considered when the most highly regarded scenarios You are known for being really involved, down to the micro level on how the product is in stores and so on. Someone a clear on one thing. Ah, business leaders, all run their own businesses. I don't run their businesses, but what I
do do, is I'm constantly out, then the marketplace looking to see how our products look on the shelf and then I come back, and I talk to my people about what I saw was good and what wasn't really good to push them to higher levels of performance, especially versus competition. We have to look at the product all the way to the retail shelf, maybe sometimes the consumer's pantry at home. That's what caused this even do home visits at times to really figure out how the consumer's talk the product is. Our package size right is it so both the refrigerator sizes that people have in their homes. In various countries. I'd like to talk to you about the scientific thrust of of the firm you ve got a science background yourself. You hired Derek Yok, a former World Health Organisation
an official to develop you're dietary guidelines. So I'd love to talk about the kind of interface between the scientific method that you grew up as a student appreciating, and how that's incorporated into a modern food and beverage company in along the things that my experience has taught me that if you are trained as a scientist any or in a youth it through your high school in college, if you stay with the stem disciplines, you can learn pretty much all the subjects as you move along in life. And your scientific disciplines play a very important role and drowned you very well as you moving to possess. Of higher and higher authority, whatever the jobless, it's very hard to learn science later on in life. So why
please I would have for most young people today is stay with him as long as you can now. Let me get to the question that you asked. I think one of the big thing we realized and Pepsi goes. I do a very good and line extensions of our products. We had more development in Pepsico than we had research, so we could do flavour extensions of products. Occasionally we good bye and build on a new product, but we are not very good at meaningful. Innovation are meaningful package. Transformational meaningful ingredient development that could. Fact apply to multiple products. We knew we needed to build a very strong aren t capability because the aim of the game going forward was incremental innovation incremental in terms of time, fine growth, an incremental in terms of a pricing and profitability.
The only way to do that was to have a strong aren't department inside the company. We had very good people, but they were more development focus and they were Aren t focus. On top of that, as you are shifting, the board followed more good for your products be realised that we needed products. TED functionality claims whatever aims we made had to be rooted in science. They couldn't be afraid he claims, because when it comes to nutritious products in particular, people are very sensitive as to exactly what you see on the package, because the ingredient list has to reflect. You know exactly what you said testing in the front of the product. I'll give you an example when we will also be one of the soul, be products was called liquid, liposuction and that was so be lean, liquid, liposuction elements,
Toby was energy small business. They could use these interesting words to describe the product the May Pepsico bought it. Liquid liposuction had to come off the bottle. And we had to explain what we meant by so be lean in the back of the product, because big company people, who, to a higher standard than they do? It was small startups, so we needed a very, very good team that could be very serious about what have we put on the package on the label on food safety, food security, food, traceability, ok, I met no, your chief research scientist an endocrinologist with an expertise in diabetes? Yes, I interviewed a lot of candidates, but to tell you a memo, can absolutely impressed me because he was somebody you from the pharmaceutical background a medical doctor, but was very interested in the whole food beverage space and had a
the two approaches demeanor that I thought would fits very well within Pepsico, so you didn't wear medical credentials honestly and sort of lecture to us is what we shouldn't shouldn't be doing. He wasn't talking down to us and he was so well networks and connected in the scientific world that I felt he could come into Pepsico build bridges with people in Pepsico, further scientific agenda and bring the right talent into the company, and all I had to do as a couple of things. One Tell the organization that members here to stay. I didn't want people rejecting him HU, I D, to give him all the resources needed to get going and three to understand what he was doing so that if people were That is why we investing in this all mixed lab or why we resting in a high throughput, I say machine. I could actually explain to people in sort of terms as to why we are doing what we were doing so that they and that this was not just into the sea,
supporting an Aren T head. It was the sea or basically saying these are the best we're gonna take us a company whose is gonna get us to a better place, and this is where the scientific drawn held, because I could understand what name would say and I can also check the only department to do things that danger by doing we invent, often and write them an old saying. Look, I've six challenges, I'd like to give you an business I am putting these challenges out to you and they loved it. Somebody else my say: God she's wasting our time, but the only people one of this. Most interested she wants to users move the company to a better place, give me a for instance of one the kind of challenges you would have put to guarantee, one of them I told them was that I wondered take the waste from or appeals you know when you squeeze in orange. You have all of the peoples in the flesh
the orange after you take out the juice that's converted to animal feed, I wanted to extract the fibre and figure out a way to put it back into the branches, because orange juice doesn't have fibre, yet that orange job pulp has so much of the fibre how'd? You extract the fibre from that and put into the juice Accomplish that and the list goes on and on. I guess I have two things: I'd love to know about the future of Pepsico, one. And of specific and then one broader. The specific one is about working with non traditional proteins, whether from inside sir plants or fungi or what not and then may be related to that. I'm really curious to hear your thoughts on personalized news. Chicken and where you see Pepsico playing a role in that eventually many of these areas, a new emerging areas, even in some areas of progress, quite full
Another area is on a mainstream basis, the new emerging. Remember. Has lost child of companies in silicon. I need that are playing around personalized nutrition playing with new sources of protein and they haven't. You come to the big companies and into the mainstream. We have bet that we're making with lots of little companies to think about personal, nutrition for athletes through gate red we're working through other a visa. Is to see how we can place bets on a group of companies working on non traditional protein sources are. The thing we have to be careful about is not trying to accelerate into the big leagues, something is still on the edge and something that people are still getting comfortable with. So we're very judicious and making sure that
You know when it comes to Pepsico, it's ready to be scaled up. I mean example is Chiquita when we first investment, Kavimba can This delay emerging trend and but the way we struck the deal with Kavimba June. We felt this was becoming a mainstream trend. We could bite and scale it within the political system If you look at the history of american industries american companies over the course of let's say fifty four hundred years, most of the big firms disappear rate because times change and it's really hard to change a company to keep up so keep bear in mind, if indeed the global appetite for the kind food and beverages that you make were to decline substantially. Could you imagine Pepsico repositioning itself, as a very very very different kind of company may be personalized nutrition company per se
yes and no. I think we have to understand very clearly the core competencies is a company and Clearly we will do what it takes to keep our companies successful, when does no pride of what the ship you all that we want to do. To make sure that this entity called Pepsico in whatever shape form on our own, in combination with others remains a vibrant company that is in a group. I am thus creating shelled value for the short and the long term. That's what we're singularly focused on I have it means are changing a business model, but doing in a way that doesn't take us. We offer our core competent, so we don't fall flat on our face. Absolutely we'll do it, but we have to do what
transformation, keeping in mind that there are things that we are good at, that things were not good at it for start up companies better doing personalized nutrition. The question is: how do we partner with them to best deliver personalized nutrition? Coming up on economics, radio, a different kind of partnership for ingenuity, the one that happens at home go then the day of close priorities being set of a wife and mother and daughter doctrine on all those rules we have great and if you enjoy for economics, radio, please leave a review or rating on Apple podcast or whichever podcast asked you use. It helps more than you think tanks and we'll be right back.
Pepsi COLA was invented by North Carolina pharmacist in the late nineteenth century. In the early twenty first century, Pepsi CO has more than a hundred brands and trademarks, including twenty. Who did each do more than a billion dollars and annual sales, the company as a market cap around a hundred and seventy billion dollars, were speaking today with the seals, Pepsico ingenuity You are known for working hard twenty hours a day days a week. I read out enough: that's even possible that true close, I'm just curious what you actually doing given day considering, there is probably no given day in your job, but maybe today just give us a sense of what your work days actually link today. I woke up forum and I read that the balance of the stuff I hadn't read over the weekend,
from my mail and then I play tennis for an hour. Then I came to work at eight thirty this morning and I go to about ten o clock tonight. I have back meetings are then I go to the designs to do this evening. I spend the evening with all the designers of Pepsico and I'd take them to do, all of them in over dinner they get to ass. Many questions they want in any topic, then, probably last for two or three hours Then I'll get home by about ten thirty eleven tonight, I've already read whatever mail. Came from today's till about midnight, go to sleep and be back up at four p m tomorrow and that's a normal routine. Most important question. Out of all that, did you win tennis this morning I don't play competitive, and as I have approved- and I guess the head for the pro- because you know this
I have no time to go playin the league right. Let me ask you: this is a standard question. We ask a lot of people. I am very curious to know how you'd answer, what something ingenuity that you believe TAT, true for a long time until you found out that you were wrong. Hump something which you might actually chuckle about for a long time, We especially given my cultural upbringing. I thought you know you just listen, barons and you did whatever they asked you to do until I had my own kids and it told me no we're people do we have our own mind. We do our own thing and I the tough way that The rules that apply to me from my parents. To me I mean I was a very beautiful kin, many ways and dumb. If the parents to jump over the line he jumped over the line- and you didn't ask questions you know, as I had children here and my husband and I we learn that their people to their
in our thoughts and ideas and we have to do currently evolve a point of view, as opposed to you will listen to me. So this is one of the item in life. I'm running a lotta lessons that are different from my own cultural upbringing. Talk for a second about Being a mother and daughter to your mother, dear parents and being ceo, you know, I think they grow up in a culture where there is basically said all that these jobs get you whatever your job is, The end of the day of first priority is being said of a wife and a mother and a daughter and a daughter in law and all those roles we have to play. So I have a mother. One particular believes that fiercely and believes that these jobs give you crowns and those crowns in the garage when you come home, don't try to pretend that is still the big boss, because you're not does that seamen.
Unfair, because if you were born mail that she probably wouldn't say that deal that's correct, but you know I can change our. So I can either spend my time trying to change You say you know one little thing whatever she wants them all. I'm so she's with me. I leave the crown the garage rested in time at least bringing to leave on the front somewhere a table of in the garage. You know that these demon, I think we all have to develop an adaptation strategies, because if we don't, we start feeling resentful or angry with what was happening around us. From my perspective, my mom says the ground, the garage, fine, I left it in the garage, not I've been met, thirty, seven years the same guy. I don't think I could have balanced. All of this had I brought my crown into the house every day. There's no way would have worked, and would I have liked him
I didn't know not at the expense of my marriage and my children. I made a great guy, but it requires constant sort of farm adjustments to make sure that we both were equal. Versus each other into our children. We both appearance and one was now seal one- is not see you. I don't think that works at all at all. Do you think one reason there are relatively so so few female ceos in in the states and elsewhere is that there is a kind of standard model for what we think of ass, a sea Oh, and that standard model is someone Never takes off the crown not even Home- is at an issue. Do you think I don't think that's the issue. I think these that we get a lot of women in the entry level positions you get the middle management.
Women rise to those positions and then that's the child, bearing goes and when they have children. You don't difficult to balance having children, your career, your marriage and cannot be a high potential. Performer who's going to ground. Company in an organization, that's in every one of them, is a pyramid so starts to ten hours you move up. We have to solve for that, we're going to attract. And who are more than fifty percent of all the college graduates who getting all the top grades. How are you going to attract women to the workforce? Will we need them but allow them to balance having a family? I'm taking care of aging parents, because it all part of a sandwich generation today and still allowed them to contribute productively to the workforce. Don't have an end That is going to be a concerted effort on the part of governments. Societies are Youtube. Family
these companies, all of us coming together. You know I was lucky Stephen, because a lot of tended family, that old chipped into help us take out of our kids, My husband and I worked in partnership with each other to make sure that our schedules didn't keep us both out of the office of this time, but then our families, all chipped into help, take out the kids supervise the nannies. If we want to call it that an entire on retail ghetto, far aging parents today, and so I think this asian model of having extended family coexist with the young people today may have to be, imported into that we can take it off our children and take care of the aging parents at the same time A few years ago, Neue was interviewed by David Bradley Chairman, the Atlantic, the Aspen ideas festival. She was asked
women can indeed have it all a career family centre, and I'll tell you a story that happen when my daughter of into cattle school comment of secret and every Wednesday morning they have class coffee with mothers class coffee. Others for working women who had been a work, I'm not gonna, take off. And the clock on Wednesday morning to go for glass coffee, so I missed First class coffees model. What come home is a list of all the mothers that, but there and you were not there- mom first futile. I would die with guilt, but I've developing mechanisms. I called cool, and I said Gimme a list of mothers were not there. When she gave her. Words came home in the evening. She'd say you were not there. You were not there in our home, Missus rag. Wasn't there, you know, MRS so, and so was not the only bad mother. You have to call because you'd die with guilt. You just die would give my my observation David. Is that the violence
o Clock and the Korea Clock on in total conflict with each other total complete conflict. Pepsico is the biggest company by market camp with a female ceo what kind of responsibility, if any, does that come with that isn't present for a male suit. You I don't know about you, know the monk cap and the size of the company, but I will tell you that where we have female seals today, women are searching for role models. They want to talk to people who made it to the sea or sweet under the sea, Sweden, say more generally, to learn from them as to how they evolve. You know operated any more meal setting. How did they trade off having families and down you know their job and dug trying to learn some lessons. So that they can apply their own life. So there's that choice
of being a role model to women at large. Then, of course, a lot of fun, diverse people turned to me to say. Tell me: is it immigrant women. How did you move forward in now An american business contacts and then I have run of demands from India, chicken people, men and women alike, Jose. Can you tell us how ended Americans can move forward in you know global business environment so interesting that I get the tongue and pulled from all three institutions. Are you I'd say, when you become a see you and you're, a woman, you are looked at differently, Whatever you say, people do, they say things like well you know, guy see, you won't have said that or a guy would have set it differently. You held a different standard, there's no question about it: eyes: that you have become see you, and now you get a whole pass. You don't everything is
you do guess analyzed a different way. But do you know any industry in any profession in any part of society? Trendsetters went through this sort of scrutiny. Criticism, men, dumb commentary, and so I think this group men seals. All of us are going through that right now hope, he is a numbers get begun. I hope they do nobody's looking. Ass, his women seals, but just as leaders of began a prices I hoped that day comes. Then later? Its depletion, but is it lonely at the top? I mean when your president, as you were previously a fear of vice president feared you know in any other executive capacity. You know that you defer ultimately to the judgment of the sea, urine and they'll, take the he and the and the glory. Of course, when you're it, though at the
What do you do about that and really beer? Is it lonely. Incredibly lonely. But again, as you said, is a cliche. What you gotta do is talked a lot of people, especially the seals, you trust to learn from them in terms of what they did when they were faced with similar situations. And so there is no question as lonely, but you ve got a creed you don't ecosystem in your own kitchen cabinet, so you can sort of elite some of the loneliness without giving away any confidential information I remember that dumb we had a group of five seals that we would meet. Tell you know. Every quarter there was Jeff email from G. There was some attention of samples, Amazon and Engineering Committee meeting. And then we had done the change you see Alex Gorsky and the five of us would get together. Every quarter we try to get together every quarter
Talk about issues that were on our mind, Do you know it was a good, safe group for us to sort of bounds, ideas off each other? That is really interesting. I'm curious. What are the kinds of issues that might have come up there? The outsiders wooden expect so as agreed. We might talk about the problem of doing business in emerging markets and how do you judiciously balance developed? like it was emerging markets, or it might be something to do with them. Ah, you know: how do you groom succession with a day become Syria to think about drumming success you? How do you, you know, take people and give them bigger assignments, especially
the time when the economy is so tough? You want safe hands sitting in save jobs, but really develop succession. You want safe hands and uncomfortable jobs to see if they can do more. You know you have to constantly think about taking the risk, verses, retreating to save positions. So you talk to your fellow see us as it. How did you do it How did you accomplish the same challenge in your own visa, those kinds of things we talk, but everything ranging from big broad portfolio? Bed too. I know how do I take laden investors story to how do you think what people development that you recently gave a very large gift to Yale which will go to the school of management which will name it's dean ship after you? I see that your sister she and her husband, are behind? The naming of the tend in school of engineering it and why you talk criminal about the kind of experience of you coming from an immigrant.
Family and becoming in the space of really a half a generation so thoroughly ensconced in not only the business community here at the highest level, but the educational community. Just what that's been like for you I think in many ways rule just grateful for what the United States has given us in terms of education and opportunities, and we want to make sure people after us benefit from those opportunities, but I think at least I kissed my giving has gone beyond the schools in the United States. I just read it all signs labs and my high school and read it all this. Hence labs in my undergraduate college, in India and in the process of rebuilding the women's lounge. Which was not in very good shape. So I think the The day we ve been privileged to have enough resources, but you know you don't take your resources with you when you pass on I think the best thing you not do not yet a waste, not, I think the best thing you
Do as do I paid forward, and so There you are putting the money to work for the next generations is critically important work you. I think this was in association with your your gift to Yale. You are quoted as saying that business issues are never just business issues, and my most ardent hope is that this endowment will teach future generations of leaders at the most successful companies of tomorrow will do more than make money, I'd love to hear what you mean by that business issues are never just business issues, especially when you're in a business of making food and beverage.
Is that not all of the world, especially the public health people, nutrition people love. You know our companies business was developed and grown different time, as society became more sedentary for whatever reason you know the offering of foods and beverages to that society to the seven Terry Society has to change its, not a or game. It's an angle. There is a time and place for the fun products, but now increasingly, we have to develop good for you, products that are suitable for an increasingly sedentary population. So, from our perspective
You know purely you'd make a lot of money just focusing on the products of the past, but we'd be growth constrained. What I wanted our company to do is think about societies, think about communities, think about how we can evolve a business model that takes into account changing societal, and whether it be a product portfolio, whether it be environmental issues, whether it be issues related to diversity and inclusion. I wanted to make sure that we looked at all of these issues holistically and made sure we did the right things as a company so that we would remain successful. Into the future, because at the end of the day Stephen, you know, companies like ours are little republics bear because market capitalization makes is bigger than many countries around the world, and we have access to lots of technology. We have access to big distribution systems. We have access to
capabilities that many countries don't have and we haven't on a global basis. So we get the actually movement across the world seamlessly. So I think companies like I have not really gotta run the company for the benefit of shareholders gotta. Do it in a way that very sensitive to societies and communities around the world. That's my sincere hope, Every company views their place in society that way and modifies the business model to be more sensitive to these countries. Societies in communities in which they are read. So if you were not ingenuity, but maybe a marketing executive, working for ingenuity, or maybe a food scientists that Pepsico or maybe even an intern. What would you say bout ingenuity as a boss. Somebody who has very high standards who holds us to high standards but helps us get to these higher standards,
somebody's very demanding, but also very carrying somebody. Who works as hard as we do doesn't is dead. The gate and go off to play golf for. You now have a relaxing live, but is there alongside us, helping us get to a better place, but also pushing us and herself to be a better person and a better executive having thus what they say about me that was ingenuity to seal Pepsico who be stepping down in October after twelve years on the job. If like to hear more of our ceo series, including conversations with Facebook founder Mark Zuckerberg, Richard Branson, a virgin Microsoft. Such an Adela, many others check out our full archive. Would you can find on the stitches podcast at or at for economics dot com
for economics radios produced by stature in Dublin productions. This episode was produced by MAX Miller, withheld from Zack Levinsky our staff, it includes Allison Craig Little Gregory's ASCII rigged, Ribbon Alvin Meloth Harry hugging. And Andy mice and hammer for this series of on design was by David Herman with help from Dan dissolve the music you hear throughout our episodes was composed by Luis scare up. You can subscribe different. Radio on Sticker Apple, podcast we're we're ever you get your pot gas. You should also check out our archive economics, dot, com, rican stream or download every episode with ever made and more than three hundred you can also find the transcripts, links to the underlying research we can be found on Twitter, Facebook or the email, radio economics that come thanks to listen. Teacher.
Transcript generated on 2021-01-20.