There is nothing unhealthy about beverages

There is nothing unhealthy about beverages
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First Published: Fri, Nov 06 2009. 10 56 PM IST

All clear: Coca-Cola India CEO Atul Singh believes in leading with transparency. Rajkumar/Mint
All clear: Coca-Cola India CEO Atul Singh believes in leading with transparency. Rajkumar/Mint
Updated: Fri, Nov 06 2009. 10 56 PM IST
New Delhi: Atul Singhis considered a turnaround specialist. US soft drinks maker Coca-Cola Co. posted him in India four years ago after he succeeded in driving up volumes in China. Under him, Coca-Cola India Inc., too, has turned profitable, the first time after it re-entered the country in 1993. Ironically, though, even after 16 years in India, the local Thums-Up drink remains its top-selling brand.
Singh, 49, president and chief executive officer of Coca-Cola India, is secretive about new launches and advertising campaigns but shares his strategy and the leadership mantras he uses to fight it out in the competitive Rs7,500 crore soft drinks market in India. Edited excerpts:
How would you rate Cola-Cola India’s performance?
In the last quarter, Coca-Cola India grew by 37%, its highest growth in the last 13 quarters. In fact, in the last four quarters, our growth has been in excess of 30%. China is doing very well, too, in terms of volume.
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How have you managed to turn around Coca-Cola in India?
I came here in September 2005. We did an assessment of our business, capability and portfolio and set a vision for ourselves. There were changes in the management team. We focused on what we call the manifesto for growth and we clearly aligned our system to the manifesto and the six P’s—people, portfolio, partners, profit, planet and productivity.
All clear: Coca-Cola India CEO Atul Singh believes in leading with transparency. Rajkumar/Mint
For a business to do well, we focus on the six P’s, which is a global framework. But what we do in each of the six P’s depends on local insights and needs. So the portfolio of products in India is different from the portfolio in China or the US.
In the planet area, we work in rain-water harvesting and have committed to be water neutral in a given period of time. The other focus area is energy efficiency and reducing the carbon footprint.
We created the right partnerships with the kirana and the large format stores. We have trained 30,000 small shop keepers on merchandising skills and we taught them how to manage their finances. This is about managing their business and nothing to do with selling our products.
The attrition rate in the company, which was very high earlier, dropped below the industry average (of around 18%). When we measure our performance across the six P’s, we have made significant progress.
You announced an investment of $250 million (Rs1,170 crore now) in 2006. Where is the money being used?
Since our re-entry, we have made investments of around $1.2 billion already. The $250 million investment is being used to increase our capacity in manufacturing, transportation, logistics, cold drink equipment such as refrigerators, and consumer marketing.
Does the money come from the parent company?
We have franchise bottlers who generate their own funds within India. The company also generates funds locally. But the $250 million has come from the parent company.
Are you launching new brands in India?
We have added Minute Maid, Fanta Apple and Fanta Orangy Blast. We have added different pack sizes also.
Globally, we have over 400 brands and will bring to India what we believe the consumer wants. It’s difficult to say what. We will expand both the sparkling (carbonated drinks) and still (non-fizzy drinks such as Maaza) beverages range.
Any acquisitions in the pipeline?
We do not speculate. But we continue to evaluate options both on the sparkling side and still side.
Aren’t the soft drinks companies facing a challenge from the health and nutrition point of view?
There is nothing unhealthy about beverages. All our products are safe. Yes, there is a debate on obesity but that is a separate debate. Obesity is caused because of our habits. We promote an active lifestyle through sponsorship of sports; we sponsor the Olympics, the FIFA Cup.
Globally, we have announced that all our products in 206 countries will have front and back labels by Q1 (first quarter) of 2011. We will have calorie content and nutrition details on the labels. The initiative is voluntary.
We want to be ahead of the curve in telling people what they are eating and drinking and let them make a choice.
How was your China experience different from India?
Both countries have over a billion people but the per capita consumption of soft drinks in both India and China is still very low. The physical infrastructure is a challenge in India, unlike in China.
Interestingly, (the) ready-to-drink industry is large in China with a surfeit of global, regional and local brands. In India, there are not that many players.
An independent study shows that of the 120-billion-litre non-alcoholic beverage consumed in India, only 4% is ready-to-drink. So the opportunity is huge.
With increased urbanization and growth in the middle class, more people will go for packaged drinks.
Which is your favourite drink?
Diet Coke. I drink six to eight cans a day.
Which country did you most enjoy working in?
In the last 30 years, I have lived only six years in India. I have worked in the US, Africa, Eastern Europe, China and now India. The opportunities and challenges have been unique so I have enjoyed working in all the countries. But the Romania experience was truly memorable because it was just after the revolution and the Berlin Wall had just fallen. It was a unique time in history when I was there.
Do you have a favourite city?
Kolkata and New York are my favourite cities. I grew up in Kolkata and my first jobs (PricewaterhouseCoopers and Colgate-Palmolive Co.) were in New York. I just enjoy the people of Kolkata and love the hustle and the bustle, the cosmopolitan nature and energy of New York.
How would you describe your leadership style?
I believe in leading with transparency. I believe in open communication, collaborative style and I am a good listener. I like to do the right thing the first time and every time.
For me, sustainability is very important and sending the right and consistent message. I don’t like layers either, so I pick up the phone and talk to the most junior person. I have worked all over the world and I don’t believe in bureaucracy.
Are you always so focused?
I wanted to join the corporate world and work abroad. So I studied management. I knew I won’t make it as an engineer or a doctor. I wasn’t just smart enough. I knew I wouldn’t get into an IIT, so why bother. If you are a batsman, then don’t try and become a bowler. I keep telling people focus on your strengths and make sure you don’t have any de-railers. Lot of people try to fix their problems without capitalizing on their strengths.
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First Published: Fri, Nov 06 2009. 10 56 PM IST