«There is no action, enough with the proclamations. We are a large multinational company, we have broad shoulders and we never stopped during the lockdown, many companies, however, have stopped producing and put workers into layoffs, now they need facts, because they have a huge liquidity problem »Says Silvia Bagliani, 51, just promoted to CEO of Mondelez Italia, the subsidiary of the American multinational that controls the Oro Saiwa, Oreo, Toblerone, Fattoria Osella, Yocca and Philadelphia brands. Born in 2012 from the spinoff of the Kraft snack division, the Mondelez International group, listed on the Nasdaq, invoices around 26 billion dollars globally, of which approximately 900 million euros in our country.
From 2015 he was in charge of the snack division in Italy and Greece. With the reorganization, she was appointed CEO of the entire group in our country, bringing the fresh sector under her control, hitherto led by Giuseppe Banchini. Does the Covid pandemic have anything to do with it?
“Just an unfortunate coincidence. We found ourselves managing an ongoing change, the decision had already been made. Having completed the turnarounds of the two business branches, the fresco (which includes the Fattoria Osella, Yocca, Philadephia and Sottilette brands) and the snacks (including Oro Saiwa, Oreo, Toblerone, Fonzies and Milka), we decided to bring back the two activities under one roof, while previously they were two separate areas, which reported to two different teams in Europe. But we will continue to have two separate sales forces. ”
Does a woman manage change better?
«I hope they have chosen the most competent person. Within Mondelez we carry out a series of initiatives focused on gender diversity, to encourage and encourage women’s careers. So, in theory, with the same skills, different candidates should always be present. From mine I had a good track record, I was in charge of the snack sector since 2015 and I brought great results to Italy, also making the turnaround in Greece. My guidelines? Focus on the venue. We have brought the Oro Saiwa brand to a new life, working on the Italian supply chain and wheat. In a couple of years, between 2016 and 2017, we brought home 10% growth, while 2019 closed with sales increasing by 1% at sell-out. At the group level, I can anticipate that Mondelez Italia had a turnover of around 900 million last year, because the balance sheet came out in July, about half from snacks and half from meals. In an increasingly competitive market, also for Ferrero’s landing in the biscuits sector ».
Food is among the few sectors that never stopped during the lockdown. How did it go?
«The organizational change started in early March, in full emergency, and we managed it by working from home. We immediately set up a crisis committee. We have two factories in Piedmont, in the province of Alessandria and in Cuneo. The aim was to ensure continuity of production, taking care of worker safety. We are a company with already high safety standards, but we have implemented them even more for Covid, in some cases beyond the recommendations of the government, for example by creating a changing room. ”
Have you rewarded workers?
«We pay overtime to those who stay longer and we have recognized economic rewards. We never made use of layoffs even in the case of workers who dealt with the “out of home channel” and represent around 25% of the workforce employed in the snack division and 10-12% of the meals division. We have chosen to keep all direct employees in strength, thanks to a mix of holidays and training. I am very proud of this, because looking at the country and the difficulties of many companies, it did not seem ethical to me. Even if a significant part of our staff and business has stopped, because we have an important part in vending, with automatic distribution in airports, schools, stations, but also in bars and sports centers. All employees of the office, including the sales force, worked in smart working. Fortunately, having already introduced smart working in the company, 4 days a month for a maximum of one day a week, there is a habit of working remotely, we had the tools. But from 4 days a month, moving to an absolute experience is another thing. As a woman and mother of two children aged 10 and 13, I truly admire female colleagues: I believe that not having help at home, without the support of your grandparents and with the schools closed, being able to keep work going involves a great organizational effort . Personally I have never worked as much as in March and April: we started at 8 in the morning, with the local crisis committees, but also the European crisis committees, because Europe wanted to understand what was happening in Italy, the first country to being hit by Covid. The problem is that, working from home, we tend to go on and on. I was very lucky, because we had a nanny who lives with us, she had to leave in early March and she got stuck, so she stayed with us. My husband, who like me is a manager of the food sector, instead continued to go to the office every day, because in his company there was a different organization.
Surveys indicate that the majority of employees would like to continue working from home, even after the emergency, to better reconcile family and career. Some companies are moving in this direction, to allow more flexibility. What do you think?
«To me, and I also believe to many colleagues, there is no work in the presence. We have proven to work this way too, but teamwork, the exchange of ideas works best when we meet and talk to each other in person. Of course, we will have to take advantage of this lesson that has taught us that, with the right supports, we are able to adapt. But going back to looking us in the eyes will be another matter. We will return to the office in September. In the first phase, we will probably not work 100% in the office, but with some groups, to begin testing the return. We have conducted an internal survey to collect employee information and opinions, but we do not yet have the results available. Personally, I found it somewhat alienated to work for 12 hours in a closed call in my room. Although every week I communicated with all the teams and once a month we gathered virtually all the employees, an appointment called “townhall”: it was very important for people, because they felt part of a community. Not only that, in recent months, we have made calls by department, with a hit and answer for each individual function. But this was smart working in a crisis, now we are going back to a rather normal situation ».
Let’s talk about business challenges.
«We had to rethink the brand plans, because the world was changing, also with respect to the value of solidarity. We have tried to do our part, with the doubling of solidarity hours, which we have donated to the hospitals of Alessandria and Cuneo and to the Sacco of Milan. Mondelez, at a global corporate level, said it wanted to reach 15 million dollars in donations between products and economic aid, in Italy we contributed 700 thousand euros, thanks to Fattoria Osella to the Cuneo hospital and Oro Saiwa to the Red Cross Italian. Another initiative is linked to the Chiara Ferragni collection for Oreo: Ferragni donated his fee to the Bergamo hospital, which we doubled. The crisis forced us to review marketing and communication plans, also on a creative level. An example? We launched a challenge with the Fonzies, always accompanied by the slogan “If you don’t lick your fingers, enjoy only half”. The challenge was to eat the Fonzies without licking their fingers. Thanks to this initiative, we donated 10,000 meals to the food counter. Security, communication and solidarity were the first three pillars on which we moved. In between is business. ”
Istat reports the collapse of consumption and industrial production, as a consequence of the Covid crisis. What about food?
“It is a more isolated sector, because it never stopped even during the lockdown. But food is not just the shops, consumption outside the home weighs about 30% on turnover. We have seen an increase in meals eaten at home, because nobody ate at the bar, in the canteen or in the restaurant. Therefore all the food bought in supermarkets has increased significantly, but with different speeds. People have stockpiled and increased consumption of basic necessities. So we have seen more primary goods bought, fewer secondary goods. For example, the sales of candy and gum (Mondelez controls the Halls and Trident brands), have collapsed, because they are usually located near the supermarket checkouts, where people stopped for what is necessary to pay, without delay. On the other hand, the away world has gone to zero. We have very strong brands, in which trust has been winning, brands such as Philadelphia, Sottilette, Oro Saiwa, Milka, have recorded very strong results, because home cooking has grown. Let’s think about breakfast: suddenly a high percentage of Italians stayed at home instead of consuming cappuccino and croissant at the bar, here we saw a surge in Oro Saiwa. of consumption. Virtual aperitifs, on the other hand, favored the consumption of Fonzies and savory snacks. But the world of snacks has marked -8%, because the benefit of portioned packaging has waned ».
“According to Nielsen data, Fonzies has grown by 28% from late February to May, while the increase is 19% from January to today. In Phase 1, Classic Gold rose 25% and Saiwa Gold 18%; Philadpephia and Sottilette recorded + 25% and Milka by 18%. Cote d’Or, which we launched in Italy in September, is also doing well, with very solid growth rates, because chocolate is a comfort food, even though strong growth has rewarded basic consumption such as tablets. As I said, packaged snacks, on the other hand, fell by 8% “.
How did 2019 end and what are the prospects for this year?
“We closed 2019 with growth of around 1% in a stable market. We had started 2020 well with the first 2 months up 1.5%. From February onwards we observed a disruptive dynamic in supermarkets and then the collapse of the away from home. Now? The growth in supermarkets in our market categories is diminishing, even if they remain positive, but we no longer register growth rates of 25, let’s say that we are around 10%. On the other hand, the away world has started to move. During the lockdown we developed a proposal plan that would support the re-start in our categories, with commercial packages that would help our customers. In the away from home, for example, to agents who earn commission, we anticipated the payments of the 2 months in which they did not work, it is not a gift but only an advance ».
«We are already starting to see a rebalancing of some trends. For example, e-commerce growth dropped around 130% compared to 300% peaks during the lockdown. Ditto for sales in supermarkets, always growing but with different trends. I expect a change in habits will remain. Away from home will take some time to return to pre-Covid, perhaps a year, a year and a half. We have a very large portfolio of leading brands, they are historical brands, loved by consumers, I believe they will continue to react well. Some dominant themes? Comfort food and Italian spirit, in the sense of Italian food, which is already ours with Fattoria Osella and Oro Saiwa, but we try to strengthen with the extension of Italian wheat to a greater number of products and references. Another trend is that of home entertainment and not only intended as home cooking. Then the whole world of sustainability, which has not stopped during the crisis and will not stop ».
The government has concluded 9 days of General States of the Economy to revive the country. What do companies really need to restart?
«There is no action, we are stuck in the proclamations. We are a large multinational company, we have broad shoulders and we have never stopped producing. But many companies had to stop and lay off workers. These companies need concrete facts, because there is a big liquidity problem. We have used these two months to prepare a plan to help thousands of wholesalers, bar owners, vending machine operators, restaurateurs, small supermarkets. We know they have liquidity and expired goods problems, so we have prepared a package that has put in place immediate solutions since the first day of reopening. Here, today there is a separation between the desired, the proclamation and the true action. But there is another priority. We were inundated with decrees that sometimes we couldn’t even understand. We need a simplification and a sburocratization. As a company we tried to reimburse medical supplies and disinfectants, but in the first second of entering the applications, the resources were already exhausted. These are real costs suffered by businesses that no one will get relief from. Steps if we do not receive it as Mondelez, but for many other companies it is a problem. I repeat: prompt actions are needed, which follow the announcements, simplification and sburocratization. Then as a mother I wonder when schools will reopen. If children don’t go back to school, people don’t go back to work. The school has created tremendous anguish. It is also very important for the functioning of the economy that schools reopen. And they should reopen on 1st September, instead we still don’t know when and how they will reopen ».
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