Carlos Enrique Piedrahita, president of Medellín, Colombia-based Grupo Nacional de Chocolates, S.A., mans the helm of this diversified food conglomerate with cunning and resolve during turbulent economic times. He attributes his success to countless years of industry experience and the know-how that comes courtesy of a strong crew.
While serving as Grupo Nacional de Chocolates’ proverbial master and commander for the past eight years, Piedrahita has upped the industrial ante by exploring countless strategic avenues for the company’s growth and development, going even further than Colombia’s own borders to gain a firm foothold in various commercial regions up and down the coastline of South America.
Driven by a competitive vision, investment savvy and a shrewd business sense, Piedrahita has enjoyed the fruits of his tactics, having led the company to build formidable alliances and gain notable acquisitions. In doing so, he’s penetrated new markets in an effort to raise the competitive bar - be it by expanding at an international level or generating additional growth and profits via rentable properties.
With six areas of the company’s core business categories currently in expansion, including confections, cookies, coffee, processed meat products, ice cream and pasta, along with the continued growth of established, well-known confectionery brands such as Jet, Chocolate Santander, MontBlanc, Frunas, Blue Mint and Roletto, Grupo Nacional de Chocolates maintains an imposing market presence in 66 countries around the world, with distribution in 12 countries and processing plants in Colombia, Costa Rica, Panama, Peru and Venezuela. Total sales for 2008 will approach $2 billion ($1.73 billion).
Well-grounded in businessAs an economics graduate of Keele University in England’s North Midlands region, Piedrahita turned his sights to Colombia in 1981 after obtaining a masters degree in finance from London’s School of Economics.
The eager economist kicked off his professional career at Suramericana de Seguros, one of Colombian company Grupo Empresarial Antioqueño’s largest subsidiaries. It was there that Piedrahita learned the ropes surrounding the company’s leasing business, acting as its manager for 19 years.
At the start of the new millennium, Piedrahita honed his financial skills at one of Grupo Empresarial Antioqueño’s other businesses – the then 15-year old Compañía Nacional de Chocolates – as part of its board of directors. The business was consolidated into Grupo Nacional de Chocolates three years later.
When it comes to describing his long-time food industry experience, Piedrahita simply says, “Food products are pleasant to work with.”
But in terms of Piedrahita’s typical workday, its inner workings are anything but simple since no two are ever alike.
As the company’s principal leader, Piedrahita doesn’t have a routine fixed in stone and prefers to divide up his day according to the time of the month.
“The last days of every month are dedicated to the board of directors more than anything else,” he says, “and the first days of the month go toward business trips to diverse countries and regions.”
Piedrahita notes that the best part of the job revolves around direct contact with employees and clients, especially since they can influence his decision-making process while also challenging him to derive new strategies for ongoing business growth.
Loyal to the idea of employee advancement, Piedrahita invests substantial company time and energy into his workforce, striving to give his staff both in the plant and on an administrative level an excellent work environment with a focus on health and wellness – complete with computer-equipped break rooms that feature chess games, a library and a full-service cafeteria where meals are served free of charge – and autonomy in regards to daily business functions and decisions.
Taking chargeThough the constant business trips and immense responsibility that comes with keeping a large international corporation successfully afloat are all just part and parcel of the high-level corporate world, Piedrahita also slows down long enough to enjoy the little things in life.
He admires perseverance, a strong personal work ethic, and a good sense of humor, leaving no room for pet peeves like hypocrisy and dishonesty. What’s more, Piedrahita is a firm believer in honesty and respect for humankind – personal points of conduct he considers important enough to ingrain into his own children as much as his employees.
“It’s a philosophy of life that I try to share with my family and with everyone that I work with,” he says.
Piedrahita has exceedingly high expectations when it comes to company and employee performance, and though not every business venture has resulted in ringing success, he feels satisfied and confident with what he has managed to accomplish in his life thus far.
If “do-overs” were an option, Piedrahita would certainly pass on the opportunity – even though making the leap from the financial sector to the food industry has been his greatest challenge to date – preferring instead to credit his clear objectives for his achievements, not only in his personal life, but in regards to business, too.
As a great believer in balance between the personal and the professional, Piedrahita manages to keep it even keel, perhaps due in part to monthly pleasure cruises throughout the Caribbean aboard a sailing ship he keeps anchored in the city of Cartagena. And, though Piedrahita fuels his fascination with seafaring voyages with literature on pirates and great world explorers, he also engages in golf and swimming and enjoys classical music.
Cut of his jibFrom his post at the top of the chain of command for one of the strongest, most prestigious companies in all of Colombia, Piedrahita has garnered a firm understanding of its challenges both on a social and economic level.
When asked what the major stumbling block is when it comes to Grupo Nacional de Chocolates’ social aspect, Piedrahita didn’t hesitate to point the finger at education.
“I think that if we advance the education levels of our countries, then we advance the quality of life while also furthering socioeconomic development,” he says. “I’m talking about education across all grades, from the primary level to the university level.”
As for the principle challenges facing the food industry at this point, Piedrahita notes that, “After what has happened with the financial crisis in various countries, I would have to say that the principle challenge for the years 2009 and 2010 will be growth. I think that demand is going to decline and the growth of businesses is going to be much more difficult. By the same token, the financing available to support expansion is going to be more limited.”
And, although Piedrahita does not dismiss the possibility that Grupo Nacional de Chocolates could suffer the ill effects of the current financial crisis coupled with declining demand, he prefers to keep his efforts fixed firmly on a positive future.
“We’ve already gone through periods of decline as well as increases in demand, and in the end, the food industry is always the last to falter and the first to bounce back,” he says.
Controlling the powers that be might be impossible, but if Piedrahita had the power to be the catalyst for change in the food industry, he would opt for making his competition more open on an international level.
“Unfortunately, the food industry has been affected by protectionism,” Piedrahita explains. “Agricultural sectors are protected or subsidized, while industrial sectors are unprotected.”
“As the mass producers of consumer goods, we are the industrial expression of the agricultural field, and many times, we are limited due to protectionism,” he adds. “There would plenty of room for competitive chains to be more productive if they were more open and less of them were subsidized.”
Piedrahita also believes that one of the major impacts of globalization has been a reduction in time and space.
“Globalization has integrated various countries and cultures, making what happens in one part of the world noticeable in other parts of the globe almost immediately,” he says.
Knowing the ropesWhen describing Grupo Nacional de Chocolates, Piedrahita is unable to hide the pride and satisfaction that comes as a direct result of all he and the company have accomplished over the past several years.
Grupo Nacional de Chocolates’ progression and ongoing evolution is even more clearly charted in its growing revenue, which totaled 650 billion Columbia pesos in 2000. In 2008, the company’s annual sales topped 4 trillion Columbian pesos ($1.7 billion), representing 24% growth for the entire year.
External sales (operations outside Columbia) have reflected an even larger uptick in growth with upwards of $45 million in 2000 and topping $500 million in 2008, a 35% gain from the previous year.
“Our six companies have been category leaders in the industry and have utilized a very high level of innovation, primarily through chains in Colombia as well as abroad,” Piedrahita notes. “Up until the 1990’s, these companies were very domestic, but once we put our strategic plan into play in 2000, we decided that international expansion by way of acquisitions or the establishment of new companies with complementary platforms in Colombia was a must.”
“To date, Grupo Nacional de Chocolates has acquired 11 companies in four countries and has created 10 new companies in nine countries,” he adds. “The first thing we do when arriving in a new country is to gain an understanding of the culture and its consumers, and then we take that knowledge and carry out our business platform in the most effective, productive way possible.”
Sound investments have also been a cornerstone in Grupo Nacional de Chocolates’ international expansion efforts.
“In the past year , investments rose to US $130 million,” Piedrahita says. “The profits from those investments went toward the modernization of our plants along with their expansion, and with it, launched our other businesses, particularly in the areas of processed meat products, cookies and chocolates, and a little bit less in the areas of coffee and ice cream.”
“For this start of this year, our forecasted budget is around US $120 million,” he adds.
As much as innovation is key, the company’s numbers say it all. In the first economic semester of 2008, new product sales reached more than US $120 million. Upon evaluating the results once the fiscal year closed, Piedrahita noted the year progressed positively without major obstacles, although the company did face some challenges, including the rising cost of commonly used commodities like wheat, fats, cacao, coffee, sugar and milk, whose prices rose at significant increments up until August.
“Now that the [financial] crisis has been calming down, prices have also gone down so we no longer face the added pressure of rising costs,” Piedrahita explains. “Now the challenge won’t be the rising cost of commodities as much as it will be the devaluation of money.”
A steady handWhen it comes to captaining a large company like Grupo Nacional de Chocolates, maintaining a sense of order and balance is key.
“Each of our six companies is the sole property of the Grupo but each company manages itself independently with its own president and board of directors,” Piedrahita sys. “It’s what we like to call ‘autonomy with strategic coherency,’ which exists on the premise of planning as a group, executing plans independently within each company and keeping consistency within the group.”
To keep business focused, Grupo Nacional de Chocolates incorporates what it calls “Servicios Nacional de Chocolates,” a company offshoot that is solely dedicated to centralizing administrative duties like accounts, payroll, treasury, buying, information technology, legal services and any other general social services for all the companies within Colombia and abroad, relieving each individual company from having to devote additional time and energy to employee support.
Another business in Grupo Nacional de Chocolates’ portfolio is NovaVenta, a company created in 2000 that supplies vending machines and has enabled 50,000 Colombian businesses to make door-to-door sales calls featuring a catalog filled with consumer food products.
Last July, Grupo Nacional de Chocolates added to its latest business ventures alongside well-known dairy company Alpina and formed a new company called “La Receta,” which means “the recipe” in Spanish. At its most basic, the newest operation is an alliance between the two companies that will handle distribution to the industrial sector.
“Between the two of us, we can meet almost half of the typical needs of a hotel, restaurant or cafeteria operation – with Alpina we cover the dairy side and with [Grupo Nacional de Chocolates] we cover the cold meats, cookies, chocolates, coffee, pasta and ice cream side of the business,” Piedrahita says.
He also plans for “La Receta” to complement the portfolios for both Alpina and Grupo Nacional de Chocolates with some fresh or processed products to present companies with a more integrated vending solution.
“We don’t plan on inviting new executives to come on board – only new suppliers so that the whole operation will continue to be exclusively inclusive of Alpina and Grupo Nacional de Chocolates,” he adds.
Success and leadership go hand in hand when it comes to Piedrahita’s accomplishments, due not only to his progressive vision for ongoing expansion into new markets along with modernization and diversification, but also thanks to his ethics and philosophies that have become a strong foundation for Grupo Nacional de Chocolates’ operating practices.
Along with new acquisitions and innovative projects on the horizon, Piedrahita plans on maintaining the company’s competitive edge sharp in the face of ongoing globalization. With a fast-growing Colombian market where imports are just as lucrative as exports he is confident that Grupo Nacional de Chocolates will be able to stay the course, keep on track and come out ahead regardless of how choppy the economy’s waters become.