MasterCard CEO Ajay Banga on Taking Risks in Your Life and Career (Full Transcript)

Full Text — MasterCard CEO Ajay Banga on Taking Risks in Your Life and Career View From The Top talk at Stanford GSB


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Interviewer: Thank you so much for being here today. It’s a real pleasure to have you. And before we dive in, I want to have a brief roadmap of where we’re going to go with today’s conversation. Want to begin with your career and its trajectory to date, 30 years, Nestle, Pepsi-Co.

Ajay Banga –CEO, MasterCard: You’re giving away my age very quickly.

Interviewer: So Nestle, Pepsi Co, Citi, and now MasterCard.

Ajay Banga –CEO, MasterCard: Yeah.

Interviewer: Then I want to move on to, in the last 10 years at Citi and now MasterCard, you’ve had a chance to develop a global perspective, and I want to explore that a little bit.

Ajay Banga –CEO, MasterCard: Okay.

Interviewer: And finally I want to pivot some more personal things like work life balance, family, diversity et cetera.

Now before we begin, I also have a deal for you. If you can forgive half my MasterCard debt, I’ll stick to the easy questions.

Ajay Banga –CEO, MasterCard: Now, what if I double your debt?

Interviewer: Okay, hard questions it is you guys.

Ajay Banga –CEO, MasterCard: Sucker punch.

Interviewer: So let’s start 30 years ago. You graduated. You went to Nestle as your first job. And you spent 13 years there. At the time when you were choosing your first job, how did you choose Nestle as the first place you wanted to work?

Ajay Banga –CEO, MasterCard: And so my wife and I were classmates at business school. She’s sitting right there. We were both, you know when we were in business school. This was a long time ago 1979 to 81. In India, India had just began to open up to the advent of multinationals coming in to build a lot of businesses there. Some had stayed on over the years and had changed their ownership model. Nestle was one of those, Unilever was another one. Others had left when the Indian government wasn’t as conducive to foreign investment as it is in the period in between. And so when we were graduating, multi-national corporations like Nestle, like Unilever, were places to work in of great attraction. They were terrific for learning the business. They were great for understanding the culture of a company that operated across the world. They were great for comprehending the concept of high quality products, of high ethics in how you worked. And all of us looked up to those companies as where you wanted to be. Because you would learn the things that you needed to learn in your early years of working life. And we guys, unlike you all who work and then come to business school, we didn’t risk to go, those days, straight from undergrad to business school. We were very young. I was 21 years old when I finished my business school career. And so, when you think about that, you think about the people in that frame of mind, Nestle was a very attractive learning place, with lots of strengths and attributes that I still think the company has. That’s how I ended up there. Getting in was not easy because everybody in the class would apply for these few jobs that were available, and they were very competitive, but —

Interviewer: And then, you chose to spend 13 years there?

Ajay Banga –CEO, MasterCard: Yeah, so clearly it takes me a long time to learn. But the really attractive part about Nestle was that you were able to move in different parts of the company very quickly. It was part of why I went there. It’s part of what I’ve tried to build with all the recruitment programs we run here as well as in Citigroup where I had a chance to influence the kind of program is I tried and built the chance for people to go across the company in different places, geographically, functionally, opportunity wise, so that they don’t get stuck and where they joined is where they’re going to be. And I think that’s a big part of what Nestle did for me. They took me into sales. They took me into marketing. They took me into factories. 7They took me into product management. Took me into running a region and gave me the chance to work on changing the entire inventory system of the Indian company and to manage inventory and working capital better. Things that I don’t know, but a lot of our company would have given me that breadth and depth of knowledge, and I’ve lived in all parts of India, as I said, this is the one time you got paid to travel. Not the most attractive places, but you’re paid to travel.

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Interviewer: And, so now, 30 years later and you reflect back on that time at Nestle, what are one or two things that you really learned over that, over the course of those 13 years that set you up for so much success later on in your career?

Ajay Banga –CEO, MasterCard: I’d say that Nestle taught me a lot of things. The guy, I still say that the guy was the managing director of Nestle when I joined, many levels above me, a guy called Barry Ryan. He’s still one of the people I’ve learned the most from. And I think people make the difference, not just companies. And you’ll see that’ll keep coming up in a conversation with me. That one individual can make a difference and Barry Ryan made a difference to Nestle. It was there when I joined. And his view, aside from the company’s commitment to quality and ethics and standards, his view was, never take no for an answer. There is always a way to get to the right solution. If you apply your mind, don’t take the hurdles that come in your way as the reason why you’d move around them or give up or as in India they say, jugar. Jugar means you adjust for everything. He said don’t do that, that’s the wrong way to do business. Go for it. Never take no for an answer.

And the second thing that he taught me, which I think was tremendous, was that you’re one added — you’re one person, but you’re one person you can make the difference. If you have the energy and the passion to drive it in to action, and if you know how to communicate well, which by the way is the most underrated attribute when you’re young, but the most important attribute as you grow, is your communication. And if you can do those two things well, then there’s a whole new world out there. And I think Nestle taught me that really, really, well thanks to him.

And the last thing I think I picked up was that I was a young MBA entering a company which traditionally had been run by people who had grown up there from being a sales rep all the way to being the boss. And I was among the first few groups of young MBAs to come in. And therefore there was always the resentment about this young kid who would learn from me and then come back in six months time, green behind the ears, if you could find my ears, and then you would sort of, you know, have to be listening to this kid tell me how to do my business. And I learned that that’s the worst way to start your relationship with this company. And instead, if you take the approach that you can learn from everybody, because we’ve all got something to teach you. And then you can bring the value you bring. But you got to learn from everybody. It changes everything. And so, I guess that’s the two or three things in Nestle.

Interviewer: And then, you chose to leave Nestle for Pepsi Co. So 13 years at Nestle, two years at Pepsi Co, 13 years at Citi, now four to five years at MasterCard. That’s quite a few career transitions that you’ve had. I think many of us expect to also have a lot of career transitions. As you’ve gone about your career and made these big jobs, have you thought about timing and reasoning for when you leave one place and go to the next?

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Ajay Banga –CEO, MasterCard: Timing, very poor. I just take the jump but I think I’m ready to make it. I, in truth, in my, my generation you stay in careers for a long time. 30 years in one company. You guys are different. And I think you’ve got the right approach to it, because if you don’t try out new things, if you’re not willing to take a risk, you will achieve very little reward out of the system the way it’s constructed today. And so, I have a big encouragement saying if you want to move jobs, or you want to move roles within the company, or you want to move companies or industries, think about it but go for it. Don’t, don’t, don’t procrastinate forever, and don’t hesitate forever. So, timing in my case was more about when I felt that I had learned what I could, and I wanted to do something different. And my mind felt that I was reaching a point where I was stagnating. So, the Pepsi thing is a different one, that is only two years because Pepsi decided to spin off its restaurant business, KFC, Pizza Hut and Taco Bell. That’s what I had joined to start in India. I didn’t want to work for a franchisee, I wanted to work for a large global organization, not for a local Indian franchisee. And so that was a decision that kind of came my way because the nature of what Pepsi was going through. But both of Nestle and Citi kind of stuck it through, but I did many different things in each of the companies. From, I told you about the Nestle, at Citi, I did everything from joining in marketing in India to running the region, Central Europe, Middle East, Africa, to coming to the U.S. to run the lending businesses, then the consumer business. Then I became the chair of the Global Consumer Business. Then I moved to Asia, as the dean was doing in his introduction, where I ran every one of the businesses in Asia through the financial crisis actually, and then left and came here. And each time it’s been something to do with my mind feeling that I had more to give and more to do, but maybe not where I was.

Interviewer: I find the transition from Citi to MasterCard to be particularly interesting. It was on the heels of the financial crisis. A bit later in your career. I imagine there was a lot of stability and kind of community that you had with the Citigroup.

Ajay Banga –CEO, MasterCard: Oh yeah, I knew everybody there. I was in there. That’s true.

Interviewer: And still you made the choice to pick up and try something completely different.

Ajay Banga –CEO, MasterCard: You know, at Citi, if I stayed there, I was clearly being prepared to be the next CEO of the company. That was what the board had told me. That’s what the CEO, Vikram, who came here to speak at one of these events, actually was the CEO that time. And that’s what he told me as well. And everybody told me that. And I didn’t know that I wanted to be the CEO of a bank over the next 10 years because I think banking is going to be an industry where, you’re actually contracting and shrinking and dealing with an increasing regulatory environment rather than innovating and expanding and doing fun new things. And MasterCard had technology and data and even though I didn’t do technology when I was a young kid, I did in school but not in college I just love the space. I think I’m half a geek somewhere deep inside and I enjoy the stuff and I enjoy data and I enjoy making connections and I, I love globality and it’s got all that in it, and it’s got this interesting mix of B2B, and B2B2C, which I found really fascinating. So a lot of work for me in my head at that time, which allowed me to think about this company.