Willem Uijen (Unilever): ‘We Pursue Procurement With Purpose’
Willem Uijen has worked for Unilever for a lifetime. He travelled all over the world for the food, personal care and detergent company. Last fall, he ‘returned’ from Mumbai to work at the company’s London headquarters as Chief Procurement Officer. His first assignment was to create a strategy for ‘procurement’. The crux here is close collaboration in the chain, especially to meet sustainability goals, Uijen tells Marc-Jan Reumers, partner at strategy consultant Kearney. ‘You cannot do this alone. You have to do it with a collaborative approach.’
With what expectations and ambitions did you begin your new role as Chief Procurement Officer of Unilever last September? What did you do first?
‘When I started as CPO, I mainly had a lot of conversations, both internally and externally with all the partners. I wanted to know what was going well and what would be needed in the coming years. In my first months I focused on shaping the new sourcing strategy, a strategic plan for the procurement organization. That is now in place. What we are striving for is procurement with purpose. And in doing so, we are looking for partners with purpose. We want to get more out of our partnerships, we want to work more closely together, we want to focus on joint innovations and cost reduction. This should ultimately lead to sustainable business performance, where the shareholder is satisfied on the one hand and the planet is the ultimate winner on the other. Revenue growth and profit alone are not enough for us. Fortunately, our partners also believe in this route. So we pull together as much as possible and formulate the goals together.’
How did you experience those first months as a CPO?
‘I must say that I had a very enjoyable and energizing period. Procurement at Unilever is very broad. We have a large number of partners in a very broad field: raw materials, packaging materials, IT, marketing and so on. I learned much from those conversations. If you look at Unilever’s sustainable targets specifically, we have to achieve at least half of those targets upstream in the chain. What helped me tremendously in the first few months was our new organizational structure. Last year we defined five business groups at Unilever. With procurement, we can now really focus on what is best for each of those business groups. I want to use procurement to generate value for them. Each group has a differentiated strategy, they all need something specific from us. One business unit deals with packaging, another unit works on regenerative agriculture.’
Has the role of procurement changed significantly in recent years?
‘The role has definitely evolved. A few years ago, procurement was mainly about price and savings. That was really all there was to it. Nowadays you are more strategically involved, more about agility and resilience. We do far more with collaborative programs. The question becomes how to bring innovation from your partners to Unilever and vice versa. It requires much closer collaboration with the partners, but also internally with R&D, marketing and the business groups. It goes even further: if you want to achieve your goals, if you really want to make an impact, you have to strive for an ecosystem of partners. And that includes, for example, universities and NGOs.’
Is it difficult to get people on board with the sustainable part of the ambitions?
‘Above all, there has to be a culture that encourages the sustainability course. At Unilever, that sustainable, caring course is in our DNA. It is part of the foundations of this company. The Lever brothers built Port Sunlight here in the UK, a model village for the workers at their factory. That was progressive at the time. That culture is still there: we want to take care of our people and the world. Look, of course sustainability must also make business sense. But we are convinced that it does. In India, we recently switched several factories to solar energy. Not only is that better for the planet, it also results in gigantic cost savings.’
What would you consider as key advice to build momentum for the sustainability agenda?
‘The challenge is mainly to make sustainability work across the ecosystem. If you can copy and replicate certain concepts. When I worked for Hindustan Unilever in India, we made great strides in ketchup production. For the Kissan ketchup popular in India, we used tomato paste that came from China. In India, tomato processing capacity was limited and, on top of that, the puree was not of the desired quality: the taste was not satisfactory, the color was not good. So it all came from China. I changed that. We started working closely with a cooperative in western India. We started training a group of Indian farmers to grow tomatoes the right way. We started setting up a tomato processing company. That became a huge success. There were really only winners. The farmers had high yields, we had a shorter chain and lower costs. The environmental benefit is also enormous, of course. And the farmers also get a higher price for their tomatoes. It ticks all the boxes. You can copy that whole process again to other places. You immediately notice that the whole process speeds up. So the very first step is complex, the replication is a lot simpler. Then suddenly you speed up.’
Speaking of speed: is it going fast enough as far as you are concerned?
‘It is never going fast enough. I would love to go faster, but we also face technological constraints, for example. Switching to solar energy in India, a few years ago, would not have been possible. Or only at very high cost. Now it can be done. And you see that in many areas. Some changes are not commercially viable at a given point. We then need to work with our partners to achieve some technological steps to make the changes commercially viable and then you can bring implementation forward.’
Looking ahead, are there any major hurdles that need to be overcome to achieve all these goals?
‘One hurdle is that only a part of consumers are willing to pay a higher price for sustainable products, especially in markets hit hardest by the rising cost of living. Nearly 20 percent of consumers are already making the sustainable choice, which means the vast majority do not yet. At the same time, 60 percent of people say it is companies’ biggest responsibility to take action on climate and nature protection. There is a gap there somewhere. A second hurdle is in the technological challenges. Sometimes it is not yet technologically possible to make sustainable choices, although I must say that developments in the technological field are fast-moving. For example, our R&D department is well advanced with the plastics program. We want to use no or fewer plastics, or better plastics that contribute to a circular economy. So that our plastic packaging does not become waste, but a raw material for new packaging. That all is on the horizon. Another challenge is that especially in Asia, Latin America and Africa we work with a lot of relatively small farms. This makes it difficult to implement major changes in one fell swoop. It requires a great deal of training, a great deal of guidance.’
What have been the most important lessons in the past period?
‘There are a number of things you have to consider when making the chain more sustainable. One important aspect, for example, is that you have to measure meticulously. The targets have to be accountable. The second lesson is that you have to measure and innovate together with the partners in the chain. Develop an ecosystem approach. When I look at our net zero efforts: in this we work with 300 partners, with the common goal of reducing greenhouse gas emissions. You cannot do this alone, or with three hundred separate, bilateral partnerships. You have to do this with a collaborative approach. The solution that applies to some often applies to others. And finally, I think commitment is key. Everyone has to feel a drive to move forward.’
With some partners you do probably still come from a classic ‘buy-sell’ relationship. How do you create that sense of shared commitment?
‘That soon comes naturally. The interesting thing is that everyone is working on the theme of sustainability. Our partners have to deal with their own targets. And so it quickly becomes a common interest. Cooperation pays off almost immediately. Everything should be aimed at making that cooperation as smooth and easy as possible, to integrate operations. Above all, leaders must be committed, name commonalities, remove barriers and see opportunities. When that happens, things start to flow naturally. It is amazing how fast things can move then.’
Are there any personal beliefs why you do what you do?
‘I grew up in Wijchen, close to Nijmegen, on a small farm. I was always outside, always in nature. When I joined Unilever 24 years ago, I really felt the company even then was trying to do good for the world. The beliefs I have personally, how I grew up in that village, are reflected in the way this company is trying to get something done. I would like to do my part in that.’
Have you yourself changed as a person or as a leader in recent years?
‘Yes, I certainly have. At Unilever I had the opportunity to live in many different places, work in different markets, with different people in different cultures. I to an extent started with a typical Dutch trainee mentality, thinking I could shape the world to my liking. During my career I learned that things do not always go the way you would like them to. Yet I found that wherever I lived and worked - whether that was in Mexico, in India or in the UK - that at Unilever the company culture was largely the same everywhere. To achieve things, I had to adjust my leadership style from time to time. I think it is that adaptive ability in particular that has helped me move forward. As a leader, I really try to get the best out of people. I believe in empowerment. As a leader, you can help remove barriers. When you let people work on things that they are really interested in and have a real passion for, you get amazing results. I prefer to let my people choose what they want to do. I have defined 25 themes - topics we want to work on in the coming years. When they get to choose, they take a topic they are genuinely passionate about. Next, they are given substantial freedom and also resources to work on it, with extensive room for experimentation. It is amazing what these teams can achieve in a short period of time. I do not believe in the traditional form of management, where people are told from the top what to do. In my view, that does not work. There has to be a strategy of course, but then leave it to your people to get it done in the best way. If you want to make speed, you have to use the knowledge and passion of your people.’
If I visit you again in four or five years - what would you like to have accomplished?
‘I hope to have been able to contribute to the winning strategy. I believe the role of procurement will be essential in that. All of our five business units depend on us. We can make a difference in sustainability, in innovation from our suppliers, in how robust and agile our network is, in how we have the best products for our consumers and, of course, in cost. And that is my main ambition in the coming years: to help Unilever’s business units meet their targets. We want to grow Unilever faster. Market share has to go up and sustainability has to go faster. If I can do my part in that, I will be satisfied.’
And will your world tour ever end in Wijchen?
‘I still love visiting Wijchen. My father still lives there, a lovely place. Now that I moved from Mumbai to London, it is much closer. The Netherlands is not far away anymore. I always like to come back.’
This interview was published in Management Scope 07 2023.
This article was last changed on 29-08-2023