India has gone from ‘must invest in’ to being ‘must deal with’

Chennai-born Indra Krishnamurthy Nooyi is considered among the most powerful business women in the world. As Chairperson and CEO of the world’s second largest food and beverages brand, Nooyi has embarked on a transformational path in a bid to make PepsiCo a health and wellness company. Business Line met Nooyi to talk about PepsiCo’s India strategy. Edited excerpts:

Are you concerned about the economic slowdown in India and the political uncertainty?

Basically, India, like any other emerging market, is going through ups and downs. This is inevitable. We are investing in India based on fundamentals, not just on temporary sentiment. Our belief is that the Indian market is fundamentally a good market to invest in. We want to grow in India, with India, for India.

Where do you see more growth — food or beverages?

There are some years when beverages grow faster than foods, and other years when food grows faster. The good news is that both are growing. When there’s an incredible monsoon, consumption of beverages slows down. But, on an average, both food and beverage have the potential to grow at double digit rates in India.

You have announced the appointment of a Chief Design Officer in addition to increasing your R&D spends. Are we seeing the beginning of a new PepsiCo?

It’s a progression of the journey. What we are trying to do is to transform the company. We want to be more balanced between fun products and ‘good for you’ products. But we haven’t taken our eyes off our product portfolio even as we invest in fruits, vegetables and nutrition. We want to give the consumers a choice.

We have stepped up investment in R&D and design because we want to create platforms from where new products can come out. Design is a way to drive innovation into products. We are not using design to decide how labels look on a bottle. We use design to know how the consumers consume products and then decide the shape, form, function and packaging of the product.

Some of your ‘good for you’ products have not done well in India. Are you concerned?

There’s a huge potential for growth because per capita consumption is still low. I wouldn’t write off anything and it’s not that we should not be doing ‘good for you’ products. I would go back and see what we can do differently to make that proposition a major factor in India. Our goal is to balance our range of products in India, make them more affordable.

Will you stick with IPL given the controversies around it?

Cricket is big in India. But we are also a highly ethical and principled organisation, so we want to associate with such organisations. We hope the current problems of IPL are addressed. But if they are not, we will have to go back and rethink.

Your India CEO recently quit. What are you planning to do on that front?

We have great guys running the business in India. I believe we are in a good situation. I wanted to come to India and dig deep into what I want to do about this, and that’s why I am here.

India is increasingly being considered as a country where doing business is becoming difficult. What’s your view?

India went from an absolutely ‘must invest’ in country to ‘must deal’ with country. I don’t think that’s good for India. India needs to address these issues. We all want India to grow. There is only so much we can do, we can make the investments and do our part to contribute to the country’s growth. Politicians and government have to decide on how to provide the right framework and environment to attract investments. So, let’s put it this way. We have got a whole bunch of willing investors, and the push is there from us, somebody has to create the pull.

What will be your message to a young Indian manager or business student?

First, dream and dream big, because today there are no constraints to what you can do… the world has changed, and if you set your mind to anything, you can do it. Second, there is no substitute for hard work. Don’t think it will fall into your lap. Dream, but back it up with enormous amount of hard work. You do the two, there is music to be made.

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