(BRK.A), (BRK.B)
The Kraft Heinz Company (which is 26.6%-owned by Berkshire Hathaway) will combine its U.S. and Canada businesses to create the North America Zone, which is expected to be effective in the second fiscal quarter of 2022.
The move is meant to advance the global food and beverage leader’s long-term, sustainable growth plans—which were first outlined at its Investor Day event in September 2020—by bringing increased agility to its innovation agenda, operations, and go-to-market approach.
The Company’s U.S. and Canada businesses accounted for approximately 80% of its 2020 consolidated net sales.
In the last 12 months, Kraft Heinz has taken multiple steps to transform its overall growth profile, strategic focus, and financial flexibility, including divesting certain assets in its global cheese and nuts businesses. The Company has also centered its business around a consumer-first approach, significantly investing in its portfolio, digital solutions, customer relationships, and people.
The Company believes the creation of the North America Zone will further fuel Kraft Heinz’s vision to leverage its scale through improved agility for competitive advantage. Structural changes to support the strategic plan are aimed at streamlining and synergizing the U.S. and Canada businesses. This evolved model is expected to help the North America Zone pilot high-value products, processes, and service innovations, backed by the resources of the two countries, while also increasing speed to market.
“As consumer, customer, and employee needs change, we must be in a position to anticipate, adjust, and respond with speed,” said Miguel Patricio, Chief Executive Officer of Kraft Heinz. “Combining our U.S. and Canada businesses—two dynamic Zones—gives us a distinct advantage and will produce faster, more effective results so we can continue investing in our strategic plan and driving sustainable growth. While this is an evolution to our structure, it is part of a broader revolution in how we will work at Kraft Heinz going forward.”
As a result, the following leadership changes are being made:
• Kraft Heinz’s new North America Zone will be led by Carlos Abrams-Rivera, currently U.S. Zone President. Since joining Kraft Heinz in February 2020, Abrams-Rivera has been instrumental in reigniting growth in the U.S. business, the Company’s largest Zone. Abrams-Rivera will assume the title of North America Zone President.
The North America Zone structure will include three commercial business units that will be organized around the Company’s consumer-driven product platforms and geographic needs, including:
• Taste, Meals, and Away From Home will be led by Pedro Navio, currently President of Latin America, and includes the Taste Elevation and Easy Meals Made Better consumer platforms as well as the U.S. foodservice and ingredient businesses
• Fresh, Beverages, and Desserts will be led by Steve Cornell, currently President – Enhancers, Specialty, and Away From Home, and includes the Fast Fresh Meals, Easy Indulgent Desserts, Real Food Snacking, and Flavorful Hydration consumer platforms
• Canada and North America Coffee will be led by Adam Butler, currently President – Kids, Snacks, and Beverages
The Company is also pleased to announce the appointment of Robert Scott as President of Research & Development – North America.
Scott joins Kraft Heinz from Abbott Nutrition where he most recently served as Divisional Vice President of Global Product Development. In this role, he successfully delivered a wide range of product solutions that met the diverse needs of consumers and retailers, as well as led the development of products to support Abbott Nutrition’s medical, institutional, and clinical businesses globally. Prior to Abbott Nutrition, Scott was Vice President of Research & Development- Latin America for The Coca- Cola Company where he delivered consumer-centric product innovations, as well as packaging solutions to support environmental and sustainability goals.
In his new role at Kraft Heinz, Scott will be tasked with leading Research and Development for the Company’s core business, renovation and innovation agendas, and commercialization strategy. His proven success in building Research & Development teams around agile ways of working coupled with his deep understanding of next generation ingredients, packaging innovations, and nutrition makes him uniquely positioned to advance Kraft Heinz’s North America portfolio strategy which is centered around creating more sustainable solutions.
Long-time Company executive Bruno Keller, currently Canada Zone President, will assume the position of President of Latin America, part of the Company’s International Zone.
Navio, Cornell, Butler, and Scott will report directly to Abrams-Rivera under the new structure.
The North America Zone will begin structural transitions in early 2022 with full organizational and financial reporting changes expected to take effect at the start of its second fiscal quarter next year.
© 2021 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.