CHp 9

Former PepsiCo VP Shares Strategies for

Successful Labor/Employee Relations
by Maggie JacksonFriday, May 5, 2017
Bill Brennan, Principal Officer of WH Brennan Consulting and former Vice President-Global
Labor/Employee Relations with PepsiCo, was the final speaker of the 2017 HR Summit. His session
focused on global and domestic labor relations from an HR generalist perspective. He started his talk
with the challenges companies face in the global and domestic labor market, followed by stories and
strategies learned during his career, and finally his advice for all HR generalists.
To start, he delivered an overview of changes in global and domestic labor relations, focusing on
unions. This area has evolved significantly since 1989, notably with Eastern Europes switch to the
west and the rise of China. These changes also corresponded with the increasing emphasis on human
rights, particularly the right of freedom of association and collective bargaining. When creating a
strategy for global labor relations, Mr. Brennan emphasized the need to have a good understanding of
both Global Union Federations and the complex climates of each involved country.
Regardless of company size or location, Mr. Brennan outlined essential roles HR generalists should
adopt to have a seat at the table in their companies and to make a difference. HR generalists should
be technical experts, business partners, and change agents. His session concluded with the question,
When someone says, do they have it?, how do you define it? From over 30 years of professional
experience, Mr. Brennan defines it as a combination of intuition, courage, and wisdom. As students,
we will take Mr. Brennans advice with us as we go into our summer internships and full time positions.

Are well being and performance compatible ?

Delphine Dupuis
Rather start with this point before going further. Its always difficult to establish causal relationships
and its often a chicken and egg situation. But, in 2011, Pepsico had a 10% growth, outperforming its
industry average by a factor 3.
For Delphine Dupuis, things are clear and convictions firmly stated :
We have the conviction that a virtuous circle exists : motivation and enthusiasm lead to economical
performance. Making human capital bloom leads to a sustainable economical performance .
So, at this point, its important to guess how deeply the approach is rooted in the corporate DNA.
Local, brilliant but fragile initiative or carved-in-stone principles that lead strategic and operational
decisions ?
A long-term project where luck has nothing to do.
There are lots of discussions on how hard it is to lead local initatives on ones own and the fragility of
such initiatives considering the economic situation, changes in the leadership team and strategic
turnabouts. At the same time, the changing role of HR needing to become business partners and the
need for HR to move from a culture of process to a culture of service [fr] is also much debated. Being
about these two concerns, the Pepsico case is in some ways exemplary.
No surprise here. It all starts with a global strategic project purposely named Performance with
purpose. The french subsidiary decided to make the most of such a lever and turned it into three
streams of actions :
Improve the quality of management
Consider employees as people (with the specificities of each) and not as tools
All this gives the HR project a strong rooting and a legitimacy that allow long-term planning and
prevents from tactical and short-term thinking. As a matter of fact, if Pepsico France has been
recognized as the french Best Place to Work for the third time in a row, theyve been competiting for 9
years. Nine years of continuous improvement to finally get the award. Such a thing would not be
possible with a short term and merely opportunistic approach. I forgot to ask the question but I think
thant the benefits of entering such a context for a company is not the final reward but continuous
assessment and benchmark that comes with and force the organization to move forward and never
step back.
Interpersonal relationships : In Real Life contact above all !
I purposely decided to chose a precise angle when we entered the detail of the Pepsico HR project. At
a time when so many organization start enterprise 2.0 or social business projects to address social
link, engagement and performance issues, I started with the place of communications tools in the
system to understand how Pepsico was dealing with their dual nature : at the same time performance
lever and factors of psychosocial risks.
Pepsico admits they need modern communication tools. The company has intranets, is thinking about
new collaboration tools. As Delphine Dupuis says : were living with our age. But she wont enlarge
on the topic, what is very meaningful. As I often say, technology is only the ball that makes it possible
to play the game. And its clear that Pepsico decided to focus on the game, the players, and the style
of the game play. Nothing happens online that would not happen in real life : thats obviously an
assumption shared at Pepsico. First build an organization that works IRL with its employees rather
than expecting technology to trigger dynamics that makes no sense and have no cultural,
organizational and management rooting. Moreover, talking about tools, she adds : were trying to
make them more simple. Just a way to remind us that in the love/hate relationship between people
and technology we should always remind which one is supposed to serve the other.
Conviviality between people matters more than anythingmost of all in times of crisis [] the
enterprise is a social link space states Delphine Dupuis. Understand : conviviality starts in real life with
people who talk to each other, discover each other. I some ways I find a lot of similarities with the
idea of human rubbing which is key at Danone.
So Pepsico tries to prevent technology from distorting human relationships. Pepsico established a no
email day. The goal was to reinforce oral communication. Instead of sending an email to the HQ,
sales people take their phone and talk to an human being. Hear his voice. Something no technology
can do. They organized workshops to help employees write better emailsand they even hired a
professional writer to teach them how to write clear and concise messages, keeping in mind that the
receiver of any message is an human being with his own personality and emotions.
And what about socializing employees. Many would answer social networking and communities of
course. Once again Pepsico puts the real first. Sport, cultural workshops, anything is done to make
employees meet, discover each other and foster relationships outside of the context of work, without
hierarchical barriers.
And since bringing people together matters, so lets celebrate successes ! Albeit not being very
common in the french culture, such celebrations seems to be appreciated by french employees who
gather twice a year (summer and christmas party) to celebrate the corporate successes. There again
rubbing and conviction that the best encounters happen in real life.
And what about work relationships then ? Still a strong conviction : [work relationships] are not
mechanical relationships with people sitting behing tools . In fact tools are a wider concern that is all
about relationships between individuals. Whos in my team, what are their passions. At Pepsico its
important to talk to each other. The personality of an employee is more important than the emails he
sends. So Pepsico implemented a concept that many people are talking of but dont know how to
make it work : work is relational.
To end, I mentioned leaders who decided to launch their own internal media to directly engage with
employees (blogs etc..). The answer was not a surprise : at Pepsico we will always try to favor in
person meeting to deliver important messages.
What about relationships between employees and the company ?
The doors of board members are always open. Employees are encouraged so submit ideas, provide
feedbacks on the company, on their work. And ideas coming from the field are the most relevant .
Even more : theyre being implemented. They often have a 8 people think tank, kind of itching powder
or troublemakers that speaks in front of the leadership board every month and challenges received
ideas. 90% of their suggestions are implemented.
Pepsico France is a startup inside a large company. Managers are here to make sense of things and
unleash energies. Ideas are provided by staff members working in the face of the customer because
theyre the more relevant.
And what about sharing ideas ? Each department has his own internal bulletin. Something simple that
gathers initiatives and successful tricks. Departmental bulletins are shared across the organization.
Maybe a rudimentary way to break down silos but its working while avoiding unnecessary complexity.
In the other hand, the recognition system is more formal since awards are given twice a year for
exemplary ideas that delivered great results or fruitful initiatives in a field that was not the one the
employee who took it was assigned to. But note that the company does not rewards ideas but the
results of the idea. Awards are given in public, with all employees attending.
So Pepsico is managing to do the old way what many organizations try to do with lots of technology
and ambitious programs. Yes, it works without tools provided the manager/employee relationship is
good. Thats why Pepsico is investing that much on the quality of human relationships and
management quality. An exemple ? Objectives setting.
At Pepsico, individual objectives are 50% business related, 50% personal. So delivery and behavioral
skills are equally valuated. Each employee can define with his manager a personal objective which, if
met, would make the coming year a sucessful year for him. It could be starting playing tennis again,
pick up my kids at school on Thursday. It helps manager to understand employees expectations and
priorities, what makes sense, and play an active part in helping the employee to reach the objective.
For example by not scheduling any meeting on Thursdays after 4.00 pm for the one who wants to
pick-up his kids All these things contribute to bring trust and well-being into relationships .
What about tomorrow ?
What are the future projects ? What will help Pepsico to be Frances great place to work next year, for
the 4th time in a row. A couple of examples, following the main lines of the global HR project :
management quality : improve trainings, most of all on the intergenerational issues. Lots of
managers have to manage both Yers and seniors. All the more that the fast internal promotion system
makes that Yers are starting to manage seniors.
 work-life balance : going further whats already done. Work is intense so people need breaks. So the
take a break program will help to make breaks in their workday with purposeful activities (improving
cardiac health, nutrition advices, massages).
conviviality : the summer and Christmas parties wont be open to all employees and not only those
from the HQ as it used to be.

Elements of conclusion
Only elements because this post is already too long but the case was so interesting that removing a
part of it would have been a pity. But theres food for though for many posts in the future.
Talking with an enterprise 2.0 standpoint, it seems that Pepsico clearly gets what the its about
people thats endlessly repeated elsewhere means. If everything is about people so lets start with
people and dont expect to build any technology-enabled organization that would rely on nothing
tangible in real life. They worked on sense and meaning instead of exhorting people to engage, found
the levers to increase trust in the management relationship by helping people to discover one another.
So of course, there are a lot of what if that can come after such a post.and Ill deal with them
later.
That said, at a time when nearly everyone is complaining about HR feebleness, this interview made me
end my day with a big smile and lots of hope. What does not happen that often on such matters.
Meanwhile, I leave you with three quotes to ponder :

References:duperinn.com wisc.edu