By Brian Blackstone and Saabira Chaudhuri
Nestlé SA's Mark Schneider likes to describe his corporate strategy as a movie. Reviews so far have been positive, but he does have one prominent critic.
In his nearly two years as chief executive, the former health-care executive has put greater emphasis on nutrition, petcare, coffee and water while shedding ancillary business. Analysts have welcomed his deals and initiatives, with Nestlé's stock outperforming the sector, but he's also had to fend off the demands of an increasingly vocal activist investor.
Last week, Nestlé sold its Gerber life-insurance business and launched a review of its skin-health unit. Those moves followed acquisitions in coffee and vitamins and the sale of Nestlé's flagging U.S. confectionery arm.
In an interview with The Wall Street Journal, Mr. Schneider described his strategy as "being a movie not a snapshot," saying various elements of a previously outlined plan are now taking shape.
"No one puts everything out on one slide day one with all details and all bells and whistles," he said.
Mr. Schneider's efforts to boost returns from Nestlé's portfolio -- which includes brands like Nescafe coffee, Poland Spring water and DiGiorno pizza -- come at a tricky time for the industry, which has struggled with changing consumer tastes and low inflation.
He also faces added pressure from billionaire activist investor Daniel Loeb, who wants more decisive action to jump-start growthand for Nestlé to sell its 23% stake in French cosmetics company L'Oréal.
Mr. Schneider declined to comment on L'Oréal and didn't directly address his relationship with Mr. Loeb.
"Every shareholder has his or her own style. Some are more silent, some are more outspoken. Some use the media, some don't. Some reach out to others, some don't. That is strictly speaking none of our business," Mr. Schneider said.
Nestlé's approach is to be "very approachable, to listen very readily, be very constructive about dialogue but also be deeply realistic about what can be done and where we should go with this company," he said.
To cope with the demands on his time he has given up external board seats and moved his family to Nestlé's hometown of Vevey in Switzerland, an ideal setting to pursue his main hobbies: jogging, cycling and skiing when he has time. "The job comes first," he said.
He spends half the year on the road, sometimes at short notice, in some of the 190 countries where Nestlé sells its products. Completing Nestlé's $7 billion Starbucks deal in May -- which allows Nestlé to sell Starbucks coffee and tea products in retail and grocery stores -- had him shuttling between Switzerland and Seattle.
"The quip is when you have the CEO talk about his or her own work-life balance it may be time to sell the stock," he said, adding that programs to balance personal and professional parts of life are central to attracting talent.
Mr. Schneider, who said Sweet Earth Foods pizzas and S. Pellegrino sparkling water are among his favorite Nestlé products, wasted little time after becoming the first outsider to lead the company in almost 100 years. He quickly ditched longstanding growth targets and not long after unveiled plans for an overhaul of its product portfolio.
After a string of deals, he says his main focus now is on cutting costs, partly by eliminating duplication and redirecting research and development to more quickly launch new products to respond to ever-changing consumer tastes.
He says Nestlé has taken a "soft touch" toward integrating some of its new acquisitions, partly to allow for flexibility and quick decisions. But he rejects any idea that Nestlé might evolve into more of a holding company of assets that now include California-based Sweet Earth, a stake in coffee retailer Blue Bottle and an investment in subscription-meals startup Freshly.
The results of those efforts have so far been mixed. After languishing the year before Mr. Schneider arrived, Nestlé shares are up 7% under his stewardship. That is slightly better than the overall European consumer goods sector, but its overall performance has been far from stellar.
Nestlé's organic sales growth -- which strips out currency changes, acquisitions and divestments -- was at its slowest pace since at least the mid-1990s last year, though it picked up a little during the first half of 2018, to 2.8%.
Mr. Schneider admits sales in the U.S., Nestlé's biggest market, have remained sluggish. But he says the hard work has been done and that Nestlé can now shift gears to focus on innovating to stem market share losses. He says readying products from the Starbucks deal is going "significantly ahead of schedule" and they will be on the shelves early next year.
"I think the heavy lifting has been done" in the U.S., he said.
Write to Brian Blackstone at firstname.lastname@example.org and Saabira Chaudhuri at email@example.com