Photo by Alex Gagne

Niren Chaudhary (AMP 191, 2016) has spent most of his career in restaurants, working in leadership positions at Yum! Brands and Krispy Kreme Doughnuts before becoming the CEO of Panera Bread in May 2019.

In this episode of Skydeck, he speaks to Ranjay Gulati—his former college classmate and his eventual HBS Executive Education professor—about how Panera has faced the myriad challenges of the pandemic, the leadership values that guide him, and how a deep, personal loss became a pivotal part of his life and career.

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Gulati: Well, I have known you for many, many years. We met in college, actually in New Delhi. And then of course we lost touch for many, many years until you showed up in my class, in the Advanced Management Program at Harvard Business School, where I teach.

Chaudhary: Yeah.

Gulati: Now, I want to just share with everybody that at the end of the eight-week marathon, I would typically ask a couple of students to tell their story about their company or about themselves. And in my class, I remember your sharing that journey of yours. By the end of your story, the entire class was in tears. I mean, everyone was just stunned. So before we get to the story of Panera and the pandemic and all that stuff, tell us a little bit about your personal journey. Where you come from and how you got to where you are today—and all the ups and downs along the way?

Chaudhary: So my journey, if I look back, I think the first thing that has really shaped me is me falling in love with my wife who was 14 years old when I saw her. I was 16. The minute I saw her, I knew this is the woman I want to marry. And I keep joking with her that she has really been an inspiration, because many of the things that I do, I do basically to impress her. So I learned how to sing. I learned how to play music and martial arts and many of those things basically just to make sure that she was attracted to me and she found me to be a worthy match. She's a very important pillar of my journey.

And then the two of us together, very early in our marriage, we lost our first daughter. She was just eight months old. Her name was Tanya. She was born with an immune disease that had no cure. And that was a very hard thing to comprehend and cope with. And then we had Ishaan, my son, who's now 28. And then after Ishaan, we had Aisha. And Aisha unfortunately had the same condition that Tanya did. And then we had to battle like crazy to save her. We had to fly her to the UK. I had only $2,000 in my pocket. Enough to just buy an air ticket, one-way air ticket. I didn't know where I would stay, how I would pay for what I had to do. I didn't even think that far. I just wanted to take her to London, hoping that her diagnosis was incorrect and that I would find a way to come back.

But unfortunately, the diagnosis was confirmed at the Great Ormond Street hospital. And not only that, they told us that you need 150,000 pounds to do the bone marrow transplant. So I'm in a new country that's not my own. I don't have money and I have to raise 150,000 pounds from a standing start, otherwise my daughter would die.

And that feeling of desperation, that feeling of, “Who do I turn to for help?” I think [that] was very difficult. But even within that difficulty, I saw such a compassionate side of humanity that I was truly inspired. So I put out this radio appeal in a country that's not my own, and just said, "We've come from India. We have a daughter and can you please help?" And I was staggered that the response was so overwhelming. In five days, we had more than 250,000 pounds. We had to go back on the radio and appeal to people to stop sending checks because we had no way to even process it. And it was a moment of a deep connection with humanity for me, and a huge sense of gratitude. We had a bone marrow transplant in London. We managed to cure her underlying condition on immunity. But many years later, 14 years later, she developed a complication with her lungs. We discovered, unfortunately, that what had saved her life ended up taking her life and she passed away in 2015.

Gulati: I want to explore your conversations with Aisha a little bit. Maybe walk us through that period and how Aisha then inspires you because she in her own right has some deep insights that shape you as a person.

Chaudhary: I think Aisha is easily the most inspirational person I have come across.

Aisha Chaudhary: My name is Aisha Chaudhary and I'm 17 years old. And today I’d like to talk about what really matters most to me in life.

Chaudhary: In the 18 years that she lived, she achieved more than many of us achieve in a lifetime. She's a bestselling author of a book called My Little Epiphanies.

Aisha Chaudhary: What's the point—of anything?

Chaudhary: She has two TED talks on YouTube with over 2 million hits. So she achieved a lot.

Aisha Chaudhary: Is it not true? That not just me, but all of us are going to die one day. Yes, all of us are going to die. I’d like you all to just think about that for a moment. In the next hundred years, all of us sitting in this room today will be gone. Just at different times, some sooner than the others. So then if death is the ultimate truth, what should really matter most in life? I feel the only thing that truly matters to me is being happy and happiness is a choice one makes. It's simply an attitude.

Chaudhary: Like they say, "As parents, we think we are teaching our children. But children actually end up teaching us a lot more." And I think in this case, it is absolutely true. One is courage. And to me, courage is about focusing on what you have control over and not on what is happening to you. So that was a very important lesson from her that I remind myself of frequently, courage.

Aisha Chaudhary: As Anderson once said, "Enjoy life. There's plenty of time to be dead." Thank you for listening.

Chaudhary: The day that she passed away, the 24th of January, my wife just didn't have the courage to be there in the same room with her, but it was my son and I, we were holding her, intertwined. We didn't know where one body began and the other one ended. We were just holding each other and very tightly and closely the three of us. So I slipped my thumb into her fist and she was sweating and she could barely breathe. Her eyes were almost closing. Her forehead was filled with sweat. And I said, "Aisha. Can you tell me whose thumb this is, is it mine? Or is it your brother Ishaan’s?" And then I leaned close to her and she whispered. She said, "I can feel your wrinkles, you old man. Why don't you use one of mom's anti-aging creams?" And this is about five hours before she died. I mean, I'm just completely in awe with her attitude, her energy and love for life, and just her spontaneity. And she was truly a character. One that I miss very dearly.

So I think interestingly, the loss of my daughters always led to a pivotal change in my career. So when I lost Tanya, I had this deep sense of feeling very inadequate that I didn't have the financial means to do whatever it took to save my daughters. I just did not have money. I was starting out. It was early on in my career. And in those moments I resolved that I will never again fail my family. I decided to reset my life. And when I lost Aisha, I had just moved to the US with this role as the global president for KFC based out of Dallas. And I was really struggling. So, that's when the thought first came into my mind that I wanted to actually learn new skills. And I think with that, I've always been very drawn to coffee as a category and a product.

And, I was therefore thinking of Caribou Coffee, Peet's Coffee, and so on and Pret a Manger. And it turned out that the owner was JAB. And JAB Holding is a $140 billion investment fund. And they have roughly about 25 to 27 different assets. So the chairman and founder of JAB, his name is Peter Harf. Peter Harf and I met when I was interviewing to join the fund. And our interview was two hours where he and I just almost broke down and shared the pain of our respective losses. So turns out that Peter lost the love of his life, his wife, to a blood disorder. She also needed a bone marrow transplant. He couldn't get her a bone marrow transplant.

When he shared that with me, I was so inspired and I of course shared Aisha's story at that time. And we both sort of felt deeply and we just said, "We have to work with each other." And after that, I joined JAB Holding, which is an investment fund that owns a bunch of food retail concepts like Krispy Kreme and Panera Bread, Pret a Manger, et cetera. And I've been with them for the last three years.

Gulati: So now you come to Panera in 2019. What is your mandate? You arrive at Panera and what do you discover that you're coming into?

Chaudhary: So Panera, for those of you listeners who may not know, just a quick sort of a fact check. A two and a half thousand cafes, $6 billion of revenue. I think it is the nation's largest catering business, which is not very often known. And also the nation's largest fast-casual delivery player. So it's a very strong brand. Now the background was that Panera has had a track record of success over a very long period of time. If you look at the last 10 years, eight years were positive, everything that needed to go up was going up. Everything that needed to go down was going down.

And it was a rock star brand ‘til about … 2017 is when JAB purchased Panera. Soon thereafter, I think the founder moved on, Ron Shaich (MBA 1978) was incredibly talented, did a fantastic job with the brand. And now the brand was in transition from being founder-led. We need to now create an empowered, team-led organization, which meant that I had to recruit and onboard a world-class leadership team. And I had to do that almost from scratch. So when I came in, my mandate was very simple, transform and help unlock the massive potential that Panera has as a brand. That was the mandate.

Gulati: You're an outsider parachuting into an organization that is deeply entrenched, has looked up to a founder. How do you kind of establish your place over there as somebody they want to even listen to?

Chaudhary: That's right. So here was this guy, this Asian guy walking in with credentials in fast food. Just dropped in there and said, "Go figure it out. This is a transformation you have to lead." It's a very daunting thing. Right? So I'll tell you a funny story.

So I'm going to St. Louis, which is a large support center. We have 2,000 people. And this is the first time addressing them. So 2000 people, the room is overflowing. Everybody's curious to see who's this guy and what does he have to say? And I'm feeling a bit nervous and I'm walking up to the stage and my CFO taps me on the shoulder and he says, "Are you feeling nervous?" I said, "Yeah." He said, "Don't worry. They're in a good mood because the Blues won last night."

So I had no idea who the Blues were, but it stuck in my head. So I went to the stage and I said, "I'm sure you're wondering who I am. And you're probably as anxious as I am, but I hear you're all in a good mood because the Blues won last night." So the room exploded and people started cheering and said, "Go Blues." And it kind of broke the ice. So I thought, "Wow! That's pretty good." So I tried the same number in Boston and I walked in and I said ... And now I was feeling a little bit confident. And I said, "Hey, listen, I'm sure you guys are anxious as I am, but I know that the Blues won." And there was like deathly silence and one person walked up to me and whispered in my ear, "It's the Bruins, man. Not the Blues.”

So I had my moments of cultural snafus. But no, I really believe that we are more similar than dissimilar as human beings. So with that mindset, I slowly started chipping away and engaging with all the stakeholders across the organization and shared with them the following: Who I am. Where I come from. What's important to me as a leader. What are my core values. And what's my business philosophy. So that they could have a greater sense of how I would behave and how I would lead.

Gulati: Can you give us a short version of that? What were those elements.

Chaudhary: Sure. Yeah. So for example, in business, I think I have a very simple philosophy. My philosophy is, listen, we all come to work to do three things: shareholder value, help unlock the dreams of people that we work with, and serve the community in which we operate. Those are the three things that bring us to work, right? So then I shared with the team the following three core values that they can expect from me and hold me accountable to.

The first value that I have is one of congruence—that what I think, feel, say, and do will always be congruent. The second one, which is a very important one to me is about curiosity. That always have a learner's mindset and learn, unlearn, and relearn. And the third one is about courage. Of course, the courage to articulate what you believe in. But I would say even more importantly, it's the courage to have the humility to listen to other people with the intent to truly understand. That's also courage for me.

So those are my three values and I've talked about that. So this is how I introduce myself to the organization. And I said, "This is what you can expect. Please hold me accountable. I'm human, I'm not always able to live by these values. But I promise you, every night before I go to bed and before my head hits that pillow. I ask myself, "Okay, how do I wake up the next morning and be a better version of who I am?"

Gulati: Let me fast forward, you are in the midst of a transformation of Panera and along comes the pandemic.

Chaudhary: Oh yeah.

Gulati: And just when you thought things were getting better—and I remember having this conversation with you where you felt that you were turning a corner and things were looking good. And suddenly the bottom falls out of your business. Describe to everybody what the bottom falling out of a business means in terms of sales collapse and what that situation was like?

Chaudhary: Well, I think you're being very generous to me. I still remember vividly me coming to your house, end of 2019 and saying, "Man, I'm really struggling." And it was overwhelming, the transformation piece. I just want the listeners to know that this was not an easy journey, but you're right. Soon thereafter, I felt okay. I knew what needed to be done. And we were powering ahead. And then you're hit by the pandemic, Bang! March comes and within three days, our sales completely collapsed—50 percent down, in three days. And you wonder, "Okay, how long is this? How deep is this going to be? And how disruptive will this be?" There is no playbook for the pandemic.

But I'll tell you what. I, in some ways, felt inspired. And maybe it is the experiences that I had with my daughters and dealing with that adversity. I mean, I'm the leader, it's my responsibility to lead the team out of this. So how do I do that? I'm a big believer [that] when you have to make tough decisions, it really helps to clarify your objectives and goals, but also anchor yourself and the team in values that you will use as filters to make decisions. Otherwise, you can go horribly wrong. That gave us a lot of clarity. And even as we did some very tough things. So we had to furlough close to 37,000 people. We had to suspend all non-essential expenditure. We had to cut salaries 50 percent, 25 percent, all the way down. So [we] took a bunch of actions very quickly, early on in the pandemic. But always with compassion, always with care. So, that's how we initially started it.

Gulati: So describe to us how can you furlough with compassion? And then what you might have had to do to kind of soften the blow for people who in the midst of this crisis were being let go?

Chaudhary: Yeah. And that's such an important question because it's easy to say that, but how do you do it? Because those who can afford it the least get impacted the most. Unfortunately that's how life works. So some examples of how we did that with compassion. We told all of our furloughed employees that, "You will get a free meal for your family every week at a Panera that's closest to you. And as soon as we can get you back, we will get you back." It's the least we could do. We opened up an emergency fund where we were giving grants to people for anything that people applied for. I think we helped maybe 10,000, 15,000 people. And a third example, I think is ... And I have to tell you this, this kind of really impacted me. I felt terrible and responsible for the 37,000 people.

And I was asking myself, "So how do we do it in a way that softens the blow?" I reached out to the CEO of Walmart and CVS because I read that they were hiring 80 or 100,000 people. And I said to them, "Hey, listen, you are hiring people. I'm having to furlough people. Why don't you pick up my people? And then give them back to me once I'm ready." And CVS, in fact, made a dedicated homepage for Panera. The Panera employees could just go there and apply and get a temporary job at a CVS or a Walmart. And then we would get them back. So, that's an example of doing it with heart.

Gulati: Now, one of the emotions, really primary emotions that hijacks people sometimes in these moments of crisis and adversity is fear, right? The whole feeling of uncertainty and loss of control activates this kind of primal emotion in us. And then we try to hunker down. But in some of my own research, I found that usually through most of these recessions we've had, there are 9, 10 percent of companies which actually use adversity for advantage. They turn these moments into moments where they are going to really reimagine their business. They're going to move it forward. What are some things that you did that may have helped the company?

Chaudhary: Sure. So I have this metaphor that I use that when times are tough, one must build windmills. When a storm is raging, wouldn't it be cool if you step back and say, "I'm going to build a windmill that harnesses the storm. And I'm going to convert that into something that is positive, a positive force for good." And I think we used that metaphor multiple times and said, "Okay guys, where's the windmill?"

Gulati: Tell us about some windmills that you built through this crisis that you believe are going to be in good stead going forward.

Chaudhary: I'll share with you, on the customer side, a windmill that we built very quickly was when our sales sort of tanked by 50 percent. We were seeing a massive write-off—$30 odd million of ingredients because nobody's buying anything. And at the same time, one night, my wife and I are trying to order online grocery. And the online grocery is saying, "I'm going to deliver it to you after five weeks because I'm backed up." So we said, "What the hell? This is a consumer need out there." So I go to the team on Monday and I say, "Listen, why don't we launch a new business called Panera Grocery. We can serve customers, serve our associates and also serve the shareholder. So let's go." Within 10 days, we launched a new line of business called Panera Grocery.

Normally a business like this would be launched, if you're lucky, in about 18 months to two years. Within 10 days, we put it up. And so that's one example of a windmill that we set up. Another one is we recognized that we were really losing our sales because we didn't have enough drive-throughs. Only half of our cafes have drive-throughs. So we said, "We need curbside pickup, so customers don't have to get out of their cars." We launched curbside pickup with geo-fencing technology.

Basically when you crack the fence, it alerts the associates inside that you arrived. And we set it up like that. And it's become actually now 14 percent of our revenue comes from curbside. But I want to share with you that ... I shared that when the story began, we were 50 percent down and we are now down about say 15, one, five. So we have actually captured a lot of that ground back. And it's been an extraordinary story—both in terms of culture, but also in terms of business results that I feel incredibly proud of and makes me even more optimistic for the future that lies ahead.

Gulati: Do you see Panera coming out as a different organization through all this? Are you going to be different than what you were even six months ago?

Chaudhary: I think the pandemic has been in some ways the best thing that happened to us. It was a shock and a catalyst to the organization. And we are emerging as a stronger Panera. We had to take a lot of actions to make ourselves leaner, more productive, more efficient. So we are a leaner Panera. We've become less bureaucratic. We're faster, we're nimble, we're more agile. We are more affordable. We are more craveable. We are simpler. We are flatter. We are more sort of energetic and more agile. So we had a stronger Panera coming out of this. And as I look back to look forward, I recognize that I have in some ways taken inspiration from the pain and the difficulties that I've gone through. And always tried to approach that with a mindset of how can I create or leverage pain into purpose.

How can I deepen my sense of empathy and compassion for other people who might be going through their own rollercoaster journey in their life and be compassionate, be empathetic? And how can I with that empathy and compassion, leverage the privilege and the opportunity that I have as I lead organizations to make a difference in the lives of the people that I work with? And also the communities that I serve. And I constantly challenge myself. How can I be a force multiplier for good?

Skydeck is produced by the External Relations department at Harvard Business School and edited by Craig McDonald. It is available at iTunes and wherever you get your favorite podcasts. For more information or to find archived episodes, visit alumni.hbs.edu/skydeck.

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