Deepak Nath Navigates Smith & Nephew Through Turnaround Amid Market Pressures
Deepak Nath, CEO of medical supplies company Smith & Nephew since February 2022, has steered the 170-year-old firm through a major turnaround using a 12-point strategy and intensive quarterly oversight. The company faced significant headwinds including inflation, supply chain disruptions, and unexpected price controls in China that reduced that market from 7% to 2% of business. Nath's hands-on management approach and zero-based budgeting helped the company meet most of its three-year targets despite activist investor pressure and shareholder criticism over executive pay.
Deepak Nath, a former Siemens healthcare executive, became Smith & Nephew's fourth CEO in five years in February 2022, inheriting a company with a struggling share price and clear performance challenges. He implemented a 12-point turnaround strategy with ambitious three-year goals for growth, cashflows, and margins, but faced mounting pressure from shareholders, activist investor Cevian Capital (which took a 5% stake), and a protest vote over executive compensation in 2024. Rather than retreat from this pressure, Nath adopted an intensely hands-on management style, chairing four-hour biweekly meetings with his executive committee to monitor progress with granular detail. His strategy was tested by unexpected market disruptions: surging inflation, supply chain problems, and Beijing's price controls that dramatically reduced China's contribution to revenues from 7% to 2%. In response, Nath implemented zero-based budgeting to control costs, ultimately enabling Smith & Nephew to exceed profit, cash, and revenue growth targets, though it narrowly missed margin goals.
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Deepak Nath applies pressure at Smith and Nephew
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