Saturday, October 11, 2014

WOMAN SPECIAL .....................What's unique to PepsiCo's rigorous leadership selection process?

 What's unique to PepsiCo's rigorous leadership selection process?



Armed with an MBA from INSEAD and stints at InBev and Godrej, when Shalini Puchalapalli signed up with PepsiCo as a lateral hire a few years back, little did she know that her career would be put on leadership overdrive at the beverages-to-foods major. Identified as a high potential (approx. 15% of the employees), Puchalapalli was responsible for PepsiCo being the first company to use online reverse auctions in India.
At the company's Gurgaon head office, Puchalapalli, also among ET's top 40 leaders under the age of 40, is now shadowing PepsiCo India CEO D Shivakumar  or a two-week stretch to gain insights into the top job. As CEO and Senior Director of PepsiCo subsidiary Lehar Foods, her bird's eye view exposure will be invaluable. And Puchalapalli is not alone. The company has identified 15 such next-level leaders who could benefit from shadowing Shivakumar and his direct reports. Grooming leaders and fast-tracking them across functions and geographies is a way of life at Pepsi. Shivakumar claims that leaders need to have a global mindset with Indianness thrown in to run India. "So if you sent people out (to other geographies) early, their ability to learn and your ability to invest is much more," he says.

In Puchalapalli's case, she excelled through functional mobility. She joined PepsiCo India as head of supply chain, and then looked after a unit, sold beverages for a while before heading Lehar Foods. Others move across geographies and portfolios for a more holistic experience within the group. For instance, this year, VP-Foods and Beverages Deepika Warrier moved to the Middle East and Vipul Prakash has taken on her position after having served as a brand manager in India and then moving to the US in a global flavors role until landing up in Dubai to head innovation for Asia, Middle East and Africa. "One of our supply chain resources moved to Cork in Ireland and got into SAP and then returned to India as our bulk water sales head until becoming our business development manager," explains Puchalapalli.
The top 15% percentile identified as leaders go through about 100 programs which the company rolls out through its 'My Learning' portal. "These are a mix of internal and external training," says Samik Basu, Chief Human Resources Officer, PepsiCo India. Apart from tieups with XLRI and IIM-A, PepsiCo conducts three stages of advanced leadership programs (ALP 1, ALP 2 and ALP 3) for its high performers. These are often multi-country where the participants get cross-cultural exposure and multi-cultural faculty.

Emphasizing on the internal aspect of training, Basu underlines that many of the programs IIM-A onward are leader-led, wherein for the whole week, the leader lives and participates in that program. Puchalapalli too underwent a similar program, the predecessor to ALP or Region's President Leadership Academy, or RPLA. "The deal is that it is a whole week with the region's president spending time with a very small group of people," she says, recalling how her region president Sanjeev Chadha, who was heading PepsiCo back then, "invested five days from 6 am to 12 midnight". Alongside, she had international faculty from IMD Lausanne, INSEAD and Stanford to make leadership both a classroom and practical experience.

Arguably, the whole construct of leadership deals with self-awareness at every level using psychometric tools and a 360-degree feedback. Of course, not all survive the 100-odd programs meant for high performers as the dropout rate hovers around 10% of the identified population. But the ones who do, remains loyal to the company for long. "Over the years, our retention of high potentials is significantly higher than our overall retention at about 95%," says Basu.

Apart from the development piece of leaders, assessments of managers too are systematic. The company has established a Management Performance Quality Index, or MPQI, for instance. It ensures that any manager who has three or more direct reports, gets an anonymous feedback once a year from them indicating how they are faring as managers. "They are expected to do some action planning around that and share it with their direct reports ...it's a way of improving manager quality as well as the relations between employees and managers," elaborates Basu.

D Shivakumar, who has been helming the beverage maker since December last, has even introduced something called a 'responsiveness survey' for the top leadership. Simply put, in the survey, each of the leaders get feedback from the rest of the organization as to how responsive they are. Our first ranking in the survey stood at 60 and we climbed to 62 in the next one....I'll be happy if we get to 70," says the top boss. To his credit, Shivakumar simultaneously started a 720-degree feedback, "where we are now getting feedback from external partners as to how they see us and the areas of improvement," says Basu.

At PepsiCo, it is the identification of leaders early on and then honing their skills as leaders that separates the wheat from the chaff. Typically, high potentials who survive the 100-odd program drill are retained as leaders. As Shivkumar puts it: "You cannot make leaders out of managers...great managers are very good at detailing and the efficiency part of the equation but leaders have a more holistic view for it is they who can see the big picture and make the people connect and have this innate ability to see around the corners."


By Moinak Mitra, ET141009

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