Indian Rakesh Kapoor to be global CEO of Reckitt Benckiser

Discussion in 'Economy & Infrastructure' started by sandeepdg, Apr 15, 2011.

  1. sandeepdg

    sandeepdg Senior Member Senior Member

    Sep 5, 2009
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    MUMBAI: It's an acclaim that had eluded Indian managers for decades. But now that they have made a mark on the global scale, recognition seems to be coming thick and fast. After the success stories of Indra Nooyi (PepsiCo), Vikram Pandit ( Citigroup) and Nitin Nohria (dean, Harvard Business School), it is now the turn of Rakesh Kapoor.

    The India-born Kapoor has been named global CEO by UK-based Reckitt Benckiser (RB). The GBP 8.5-billion ($13.7 billion) RB is a world leader in household, health and personal care goods with brands like Dettol, Lizol, Vanish, Durex, Airwick, Harpic, Mortein, Veet, Clearsil, Strepsils and others that are equally popular in India. Kapoor (52) is currently executive VP, global category development, and an executive committee member of RB.

    He will take charge as CEO effective September 1, 2011. A company announcement said the current CEO, Bart Becht, will retire after serving 16 years at the helm.

    "I am delighted to take on this role and very much look forward to leading the business to its next stage of growth and performance, supported by an excellent senior management team," Kapoor, who lives in Buckinghamshire with his wife and two children, said. Kapoor, an MBA from XLRI, Jamshedpur, did his chemical engineering from BITS, Pilani.

    His appointment to the CEO's post comes right after the Indian subsidiary of RB completed the acquisition of Paras Pharmaceuticals—its first in India—for over Rs 3,000 crore. What perhaps helped Kapoor's case was that in addition to driving organic growth through the power brand strategy, he has also been intimately involved in selective M&A activity of the household and personal care behemoth in recent years. Besides the acquisition of Paras, RB also acquired SSL, the maker of health and personal care brands Scholl and Durex, for $3.9 billion.

    The board was unanimous in its choice of Kapoor as the next CEO. Although Kapoor was largely expected to succeed Becht, what perhaps made him best suited for the role was his drive, strategic thinking and operational experience, coupled with a more than intimate understanding of the capability to improve RB's financial performance and earnings model. The challenge before Kapoor is to guide RB's offensive in a market where giants like Unilever and P&G hold sway. These are also competitors that are keen on acquiring a billion new consumers from emerging markets like India.

    RB chairman Adrian Bellamy said, "The board is delighted that someone of Rakesh Kapoor's calibre is able to step into the role of CEO. His close involvement in the drivers of success at RB and significant achievements to date are reassurance that the excellent performance for which RB has become renowned is set to continue."

    Becht said Kapoor had an outstanding track record of performance over many years, with broad experience across developing and developed markets, and all categories. "I have seen his considerable leadership and commercial skills in operation, and he will be a strong leader for RB in the future," Becht said in the statement. Becht will stay on as part time advisor to Kapoor and the board until September 2012 to ensure a smooth transition. Chander Mohan Sethi, CMD, Reckitt Benckiser India, said he was privileged to have worked with Kapoor. "He is a great professional and a fantastic individual. I wish him success in his new role to lead the company to greater heights." E Abraham, director XLRI, Jamshedpur, said, "It is a great achievement for Kapoor and we are proud of him in XLRI."

    With extensive experience of the household, health and personal care categories, Kapoor has an intimate knowledge of consumers and retailers in both developing and developed countries. Having led the pan-European and largest health care business in RB, while also leading northern Europe, he was one of the architects of the Boots Health care International acquisition in 2006, which transformed RB into a global consumer healthcare company. Kapoor began his career with Network, a part of India informational technology start-up Hindustan Computers Limited in 1982.

    Rakesh Kapoor's appointment as CEO-designate at UK-based Reckitt Benckiser adds to the growing list of Indians joining the elite club of global CEOs. The elevation of Indians may be because of the clout of the region ( Asia), which is being looked upon by MNCs as the biggest growth driver, or because desi managers have proven to be capable leaders, the fact remains that the Indian leadership quotient in Global Inc has gone up significantly.

    "Indian managers, especially those who have worked in India, are very versatile and capable leaders. They know how to compete with the international as well as local low-cost competitors," said M S 'Vindi' Banga, operating partner, Clayton, Dubillier & Rice LLP, a private equity fund. According to Banga, who was formerly president (foods, home and personal care), Unilever Plc, Indian managers mature in a very uncertain and volatile environment, where they face challenges of changing regulation, poor infrastructure and labor issues, and thus become versatile and nimble; compared to Western managers who only need to worry about the market and competition.

    According to Banga, Indian managers are good leaders as they understand the power of relationships with people. Banga, who knows Kapoor well, said that Rakesh is an outstanding professional and combines this with a very down-to-earth pragmatism and unassuming manner. Management gurus and HR head honchos, who are always on the hunt for this kind of leaders, also share Banga's views. "Today, the leadership aspect of an Indian origin is much respected unlike the days when the Americans, the Europeans and the Japanese more or less controlled senior roles in the company's management," said R Suresh, MD, Stanton Chase, a leading executive search firm. He added that for someone like Rakesh Kapoor to take the top most position at Reckitt is an indication of sectors like consumer goods seeing the Indian market as the biggest consumption story in the world. "This is the best place to launch new products and from where the big chunk of sales will come therefore, someone like him can drive the strategy around new growth markets," said Suresh.

    To be brought up in a multi-cultural environment helps, said Abraham Koshy, professor of marketing at IIM Ahmedabad. "The emerging markets will require somebody to understand the nuances and the backgrounds that Indians come from helps," said Koshy.

    Not only that. Global Indian CEOs also send out a clear message to young Indians that there is an opportunity for those who are competent. "For anybody to be selected as a global CEO, competence matters the most. Indian CEOs who have gone global have the advantage of having been through a filtration process, be it getting good education, working in a good multinational company or performing well there," said Koshy.

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