Starbucks gets a new CEO in Pune boy Laxman Narsimhan
Starbucks has appointed Indian-origin Laxman Narsimhan as their new CEO. The interim CEO of the multi-million dollar American coffee brand, Howard Schultz, shall hand over the reins to Narsimhan in April 2023.
Mellody Hobson, former-chairperson of DreamWorks Animation and current chairperson of Starbucks, informed the Wall Street Journal that the company had found an exceptional individual to be its next CEO as Narasimhan is a tested leader.
What Laxman Narsimhan's appointment means to Starbucks: Born and raised in Pune, Maharashtra, Laxman Narsimhan is a graduate from the University of Pune and completed his master's degree in German and International Studies from the Lauder Institute at the University of Pennsylvania, following which, he pursued a master's degree in business administration from the University of Pennsylvania’s Wharton School.
Following his education, Narsimhan joined McKinsey & Company, later becoming a senior partner at the global consulting firm.
In 2012, Narsimhan joined PepsiCo (which is also a Starbucks partner for ready-to-drink products) and soon rose up the ranks to become chief commercial officer, looking after operations in Latin America, Europe and Sub-Saharan Africa.
He joined the Anglo-Dutch multinational consumer goods company, Reckitt, in September 2019 and boosted sales of its health and hygiene products during the pandemic and led the company through the baby formula crisis in the United States.
According to Reuters, with the announcement of Laxman Narasimhan's departure from the company, the Financial Times Stock Index (FTSE) - listed Reckitt's shares fell 4 per cent.
Narasimhan will be paid $1.3 million in annual base salary and will also receive a $1.6 million cash signing bonus and a replacement equity grant with a target value of $9.25 million to make up for incentives that he’s forfeiting by leaving Reckitt, according to Bloomberg reports.
The new CEO is faced with myriad challenges the company has been combating, including higher costs of labour and raw material, restructuring the business model as well as appealing to the increasing worker unionisations at over 200 Starbucks outlets across the US.
Howard Schultz, a longtime CEO who helped shape Starbucks after buying it in 1987, came out of retirement and assumed the position of interim CEO in March this year after the former CEO Kevin Johnson retired.
Though Narsimhan officially joins the company in October this year, Schultz shall remain interim CEO until April 2023, following which Narsimhan shall take over.