Turn Covid-19 Crisis Into An Opportunity, Says HUL CMD Sanjiv Mehta

The year 2020 has shown that it is urgent and necessary, not just desirable, to humanize leadership, says Sanjiv Mehta, chairman and managing director of Hindustan Unilever Limited (HUL), India’s largest fast-moving consumer goods (FMCG) company. For decades, leadership has been practised as a cocktail of vision, passion and skills. This makes leaders ill-prepared to recognize and alleviate human suffering, let alone address the systemic issues that cause and perpetuate it.

“It is time for those who care for good leadership to put compassion at the centre of leadership,” says Mehta at e-commerce firm Amazon’s flagship event Smbhav. "People need care, not the battle cry."

Mehta was sharing insights about leading the business through the global pandemic. There was no playbook for a global crisis that threatened the lives and wellbeing of a society with the potential to fundamentally reshape the world.

Mehta said that for any business to survive and thrive, the focus must be on a few critical areas. Hindustan Unilever has always believed that if ‘you take care of your people, your people will take care of your business.’ While this is a mantra that all businesses should live by, at all times- the pandemic put people safety, front and centre. HUL not only ensured that employees and workmen were safe and well but also took steps to ensure well-being of people who worked across extended operations. Based on global best practices, the firm set up tiered SOPs (standard operating procedures) for health and safety in operations. This was accompanied by training and readiness drills to ensure that it minimized the risk of transmission across the value chain, from suppliers to customers. Also, the company’s office-based employees transitioned to the work from home model even before the national lockdown.

The pandemic highlighted the need for a nimble supply chain that can be dynamically managed to cater to external changes. In fact, to stay agile and resilient, it brought home the point that businesses need collaboration, partnerships and alliances. For instance, HUL drove the fast recovery of operations through strategic partnerships. It even collaborated with manufacturers and other industries to meet the rising demand for some products.

There were several consumer trends emerging out of the pandemic such as home cocooning, need for health, hygiene and nutrition. Being close to consumers and understanding shifts in demand had never been as important.

HUL had to innovate not only in products but also in communication and route to market to stay relevant and cater to evolving consumer needs. The production of sanitisers had to be ramped by a factor of 100x. The firm launched over 50 new products and pack innovations to cater to the rapid changes and demand in hygiene and sanitization.

It crafted communication keeping in view the changing consumer sentiments. For example, Lifebuoy was the first brand to talk about the criticality of washing hands with soaps or sanitisers manufactured by any brand or company. The Brooke Bond Red Label (tea) campaign talked about being together, even while being physically distant. The Vim (dishwash) campaign talked of men helping out in the kitchen. The latest Surf Excel Holi campaign was about bringing people together in a physically distant world.

“So it’s very important to keep your finger on the pulse of the changing demand and to cater to it,” says Mehta.

Organisations need to be adaptive and resilient. Even with the best prediction models, one cannot predict a way to a no-risk world. The crisis has shown adaptable teams retool in a matter of days. On the other hand, seemingly successful organisations with vast prediction capabilities paralyzed as the virus spread. During the crisis, Mehta said many organisations driven by low cost, high efficiencies and capacity utilization were caught on the wrong foot.

Businesses also need to respond to crises with speed and agility. But this is easier said than done. Speed is not simply an attribute of an organization activity tied to clock time. Rather, speed is a complex, performance-enhancing organisational capability that requires a holistic approach to its development and execution. During a crisis, businesses must also demonstrate agility. This is a capability that allows the organization to pivot to adjacent or entirely new product domains.

The pandemic has also accelerated the country's digital journey. Enterprises that had adopted digital technologies in the core of the business, were less impacted than others. Many SMEs (small and medium enterprises) in India are at a low level of digitisation, and there is growing awareness of the handicap it creates. The RBI’s financial stability report of July 2020, stated that it will be critical for small and medium businesses to navigate to a digital-first business model for the whole business value chain to survive and recover. Mehta said leveraging technology in businesses will have a bigger impact on collective productivity gain that comes from widespread digitization.

The true strength of Hindustan Unilever’s prowess in technology and data-driven decision making came to the fore during the pandemic. This helped it to mitigate many of the challenges faced due to physical restrictions. For instance, Shikhar, which is a B2B (business-to-business) ordering app, enables hundreds of thousands of retailers to place contactless orders safely. It provided them visibility into the fulfilment of those orders through logistic tie-ups and intuitive interfaces.

The exigencies of crisis should not lead to compromising on an organisation’s purpose and values. In fact, they enable the leader to keep a cool head amid chaos. There is a striking parallel between great crisis leaders and parents who must stay firm on values and principles while still giving their children space to develop a very delicate balance.

“It is often said that smooth seas do not make skilful sailors. As we fight this crisis, we should look beyond just recovery,” says Mehta. “As Indians, we should embrace this crisis as an opportunity to craft a different and better future together.”

One must realise that the pandemic is not over anywhere until it is over everywhere. The major risk is that advanced economies and a few emerging markets may recover faster, but many of the developing countries could languish for years to come. However, history-altering events have very often brought about a chain that has pushed the world order in a new direction. For instance, the plague also dubbed as ‘Black Death’ that wiped out a significant proportion of the world’s population in the 14th century resulted in better standards of living for everyone. The cholera pandemic in the early 19th century brought modern sanitation to the centre stage. Mehta said the Spanish Flu in the early 20th century around the same time as World War One resulted in socialised healthcare systems being adopted by several nations. It also resulted in better disease surveillance and a more organized collection of health data.