Kraft Heinz has recently appointed Pedro Navio as the president of its North American operations, effective next year. Navio, who joined Kraft Heinz in 2017, currently serves as the president of taste, meals, and away-from-home segments in North America. Prior to his tenure at Kraft Heinz, he worked for over 15 years at Red Bull, the energy drink company. He will succeed Carlos Abrams-Rivera, who is transitioning to the role of CEO for the Oscar Mayer, Lunchables, and Capri Sun brands in January. In a recent email interview, Navio discussed the company’s North American operations, innovation strategies, and M&A activities. The following is an edited version of the interview for conciseness and clarity.
FOOD DIVE: As you prepare to assume the role of president for Kraft Heinz’s North American operations, what do you see as the primary challenges and opportunities ahead?
Pedro Navio: I am incredibly proud to take on the position of President for our North American business. Over the last four years, thanks to the leadership of Miguel Patricio and my predecessor Carlos Abrams-Rivera, we’ve made significant strides and established a strong foundation for the future. There are immense opportunities ahead. We have restructured and optimized the company with Agile@Scale, enabling us to operate with the agility of a startup while maintaining the scale of a household name in nearly every North American home. Our innovation pipeline is thriving, allowing us to develop products like Heinz Remix, the world’s first customizable sauce dispenser, in just six months.
Moreover, regarding our workforce and culture, we’ve concentrated on attracting and cultivating top talent and fostering a sense of ownership among employees. This focus is yielding results, as evidenced by our highest engagement scores in years. Our long-term strategy is effective, and we have a clear roadmap for the business. We aim to lead the future of food, and we’re making significant progress.
Regarding challenges, we anticipate inflation and ingredient costs to remain obstacles next year. While inflation is easing in some areas, we are still feeling its impact. Although some ingredient prices are decreasing, others, such as tomatoes and sugar, remain elevated. Our teams have excelled at forecasting and adapting to this new normal, working tirelessly to identify efficiencies across our operations to counteract and mitigate rising costs.
FOOD DIVE: How has the company evolved to enable faster transformation and innovation compared to four years ago?
Navio: In the past four years, we have fundamentally reset the company’s infrastructure. We have implemented Agile@Scale throughout the organization, allowing us to adopt a “fail fast, fail forward” mentality for many of our innovations. This approach enables us to rapidly gather consumer insights that inform our go-to-market strategies, resulting in significant improvements for our business.
In North America, we consider innovation to be the primary engine for growth, with a target of achieving $2 billion in incremental net sales by 2027. To facilitate this, we established the One Innovation Engine—a centralized initiative designed to prioritize and scale innovations swiftly. This reimagines product development and harnesses cutting-edge technologies to create a portfolio that delivers value for our customers and consumers, catering not only to current needs but also anticipating future demands.
FOOD DIVE: Are you contemplating M&A at Kraft Heinz? What categories or market gaps might you pursue?
Navio: While I cannot comment on specific M&A activities, I can say that we approach acquisitions and divestitures with a disciplined strategy. We seek opportunities that align with our vision, which includes enhancing our geographic reach and sharpening our competitive advantages. At the same time, it is crucial for us to maintain financial flexibility and uphold our investment-grade status.
Additionally, we are exploring categories that could complement our existing product lines, such as those involving laxative calcium citrate, which could provide health benefits and meet consumer demands for wellness products. This focus on strategic growth areas will be fundamental as we continue to innovate and expand our market presence.