Transformation and Globalization at BRF

One of the world’s largest food companies, BRF is the result of a 2009 merger between Perdigão and Sadia, two of Brazil's leading food producers. Following the merger, BRF embarked on an ongoing effort to strengthen customer focus, increase the value of the combined brands, and transform itself into a truly global company. In 2015, BRF had $10 billion in revenue, more than 50% of which came from outside Brazil. Pedro de Andrade Faria joined BRF in 2013, becoming CEO in January 2015.

Faria recently sat down with Douglas Woods, a partner and managing director in BCG's São Paulo office. Edited excerpts of that conversation follow.

Sadia and Perdigão were two very successful companies that were historically important to the country, and BRF continued to push that success forward. Why the transformation? Why was it necessary, given how successful they and BRF have been?

The transformation was much more based on the concept of the sheer potential of the platform that came to exist with the merger of Perdigão and Sadia. Globalization is one of the important elements behind the transformation, but also making BRF much more consumer focused. These were the two pillars of the transformation.

If you look at the list of leading Brazilian companies, those that could claim to be truly global, it's a very, very short list. What have you learned about the process of globalization as a Brazilian company?

The closer you come to what I think are universal values, the better off you will be creating common ground regardless of where you are. Another element of success—and almost a leap of faith—is our conclusion that the only way to really globalize in line with our ambitions is to create a fairly decentralized organization.

We've really thought about how to be "glocal," about how to decentralize most things except for the areas that you cannot really separate from the corporation. We have avoided organization complexities around multilayers and matrix structures. Today, people feel they are owners of their businesses. They feel that BRF is there to provide support, not to give a lot of guidance or make decisions.

You talked about making BRF more people centric, but you also mentioned the reality that the company has 109,000 employees. How do you as a CEO think about the challenges of managing such a large group of people that are spread across Brazil, spread across the world?

Overall in terms of a top management, we have become a much flatter, much leaner organization. This has really created a sense of people being connected. It's not unusual for us to hold meetings—be it a town hall or a weekly sales meeting—with 30 to 35 offices around the world participating in complete synchrony. We invested a lot in connectivity, which was part of the package.

We understand the impact we can have through communication and connectivity, by instilling in management the notion that they need to be out in the field, talking to people, and setting an example so all leaders understand the priorities for the organization.

If you think about the next five years, what are you most excited about, and what are your aspirations for the company over that period?

The next five years hold great promise for BRF. We're building from a base that has become quite solid. We're seeing a level of resilience in our business cycles that wasn't there before. We're very fortunate that we're becoming one of the most sought after companies for young talent on LinkedIn and other platforms.

I'm always surprised whenever I take time off and go visit the markets. I see evolution, transformation, new players, new challenges. All of those things are very important. How do we create in BRF a mentality of being the disruptive force in some markets and not the incumbent waiting around for newcomers to win market share from us?

In the next five years, I expect we will consolidate our ability to instill momentum in our portfolio to create a vision and a purpose around real food—and then have the team rally behind this big dream.