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Going Behind the Curtain: Integrated Talent Management at PepsiCo
Allan H. Church, Ph.D.PepsiCo Inc.SVP Global Talent Assessment & Development
Association for Talent DevelopmentSouthern Connecticut ChapterOctober 17th, 2016
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Agenda
• Context Setting
Talent Management and High-Potential Identification
Key Research Insights & Trends
• PepsiCo Application
Talent Management Strategy
LeAD Program Architecture
Sample Feedback & Usage
• Building and Sustaining an Integrated Process
Enhancing the Effectiveness of the Process
Understanding the Impact of Transparency
• Final Thoughts
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Focus on the “Few”(e.g., Identifying HiPos, Session C, BoD)
Focus on the “Many”(e.g., Culture, Structure, Performance)
Talent Management & Succession Planning
Organization Development & Change
Leadership Development as the Integrator
Leadership Development
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Setting the Context: War for Talent & Resources
Talent has been a scarce resource for
over a decade and it’s getting worse
Organizations have limited
resources for development
Differentiation and talent
identification is key for
successful TM
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Research on Assessment Practices
ASSESSMENT IS HOT!
Research on 100 Top Development Companies Reports that 70% Use Assessments
Church & Rotolo (2013)
Church, Rotolo, Ginther & Levine (2015)
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Research on Assessment Tools & Methods
High Potentials (75%)
Senior Executives (90%) Church & Rotolo (2013)
Assessment Tools Currently In Use (Average of 4 Together)
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Research on Maturity of High-Potential Programs
53% are Level 3 “standardized” today. Many in early stages are considering assessments, while 87% of those in later stages already use them
What is the Maturity Level of Your High-Potential Program/Process?
(5) Business Integrated: Strategy and processes fully integrated w/ strong Exec engagement; Long-term planning standard; Business impact
measured; HP talent visible and shared; high development
(4) Transparent: HP development implemented consistently; Higher Exec engagement and longer-term planning; Full disclosure regarding
status; HP transition support moderate
(3) Standardized: Consistently implemented and integrated w/ some processes; Moderate Exec engagement but mostly short-term;
transparency status inconsistent
(2) Inconsistent: Criteria exists but varies/determined largely by mgrs. Limited exec engagement, planning & integration w/ strategy
(1) Reactive: Ad-hoc processes w/out clear criteria; No targeted development
43% currently use assessments
57% are “in development”
87% currently use assessments
7% are “in development”
Church, Rotolo, Ginther & Levine (2015)
Majority of “top companies” are far from fully integrated, and those who are more advanced are more likely to use assessments
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Fundamental Question
Better Question:Potential for What?
Good Question:What is a high-potential?
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Agenda
• Context Setting
Talent Management and High-Potential Identification
Key Research Insights and Frameworks
• PepsiCo Application
Talent Management Strategy
LeAD Program Architecture
Sample Feedback & Usage
• Building and Sustaining an Integrated Process
Enhancing the Effectiveness of the Process
Understanding the Impact of Transparency
• Final Thoughts
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Applications
Global Beverages
Global Snacks
Global Nutrition
Brands
22billion-dollar
brands
Performance
More than $63 billion
revenue
Scale
>200 countries
& territories
People
More than 250,000
employees
PepsiCo is a global food and beverage powerhouse.
Our broad range of more than 3,000 delicious products offers consumers
convenient, nutritious and affordable options in nearly every country around the world.
Business Overview
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Performance: Mix of Net Revenue (2015 Data)
Food
Beverage
Outside
US US
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Integrated Talent Management Architecture
Learn & Develop
Perform & Reward
Attract, Select, Onboard
Growth & Succession
Business Strategy
Talent Strategy
Right People in the Right Place at the
Right Time doing the Right Work the
Right Way
1
2
4
3
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Standard Paradigm
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One Size (Leader) Does Not Fit All
C-
Suite
Senior
Level
Mid-
Level
Entry
Level
1
2
3
4 7
6
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Segmentation by Levels, Roles & Functions
Types of Roles• Developmental• Critical• Transition• Pivotal• Crucible
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One Size (Hipo) Is Unrealistic
Based on Silzer & Church (2009)
Industrial-Organizational Psychology
Segmentation by Leadership Potential and Destination
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Building an Integrated Talent System
Linking role segmentation with the Leadership Potential BluePrint…
(a) targeted assessments
(b) customized development plans
(c) actionable talent decisions
(d) accelerated and enhanced bench strength
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The PepsiCo Approach
Designed to facilitate the identification, assessment, and development of global high-potential talent to build leadership bench
• Multi-level design
• Multi-trait multi-method
• Theoretically grounded
• Empirically validated
• Integrated w/ TM systems
• C-suite engagement
• Internally designed & led
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General Approach
Assessment & Development Pyramid
One-on-One : Behavioral interview, Executive
360, Hogan assessment, Custom strategy simulation
Assessment Center:In-person simulations, behavioral interview, psychometrics (Hogan, Ravens), and career aspirations
Web-Based:Virtual simulation, psychometric assessments (Hogan, Ravens),
and career aspirations
Web-Based:Psychometric assessments (OPQ, Ravens), biodata, P-O fit, career aspirations, performance criteria
Consistent Framework with Increasing Levels of Focus
Confirm and
Develop
Shape and
Refine
Verify and
Stretch
Identify and
Differentiate
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Provide
feedback to
individuals
Identify
specific
development
actions
Implement
specific
development
actions
Monitor
progress
indicators
Assess
individuals
against
criteria
The SLDC and LeAD programs add consistency and rigor to the assessment, development, and tracking of key global talent using a basic consulting model
Assessment & Development Process
CoachingStretch
AssignmentOnline
Learning
Executive MBA
Programs
PepsiCo University Programs
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Assessment & Development Roadmap
Orientation
Raven’s
Online
Critical
Thinking
Business Case
Simulation
360/ Hogan Feedback
Session
Individual LeAD
Feedback Session
Development
Phase
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Sample BluePrintDimension
Cognitive Skills
PersonalityDispositions
Leadership Behaviors
Experiences & Learnings
Functional Capability
Summary of Capability
Assessment Method Test Self-Report 360 Feedback Interview SimulationWeightedAverage
Strategic Thinking
Problem Solving
Emotional Intelligence
Growth Mindset
Learning Agility
Ambition & Drive
Inspiring Followers
Developing Talent
Financial Savviness
Customer Focus
Sample Report
Significant Strength
At Standard Levels
Significant Opportunity
Not Measured via this Method
Foundational
Growth
Career
Sample data only
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Key Integration Points with Talent Management
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Talent Call Prior to
Program
LeAD Results:
Some Potential
LeAD Results:
Moderate Potential
LeAD Results:
High Potential
High-Potential 3 14 8
Key Contributor 5 7 3
Talent Review and Sample Insights
Insights and Implications:• 8 high-potentials “confirmed” – ensure talent / career plans are robust• 3 high-potentials “failed” the assessment – need to understand why• 5 key-contributors scored some thus are “confirmed” – remain in core programs• 3 key-contributors “blew the doors off” – need to review/reconsider why not HPs
Example: • 40 People are Assessed through LeAD• 25 HPs and 15 KCs• Results show 20% Some, 53% Moderate and 27% High Potential
73%67%38%
62% 33% 27%
Sample data only
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• Context Setting
Talent Management and High-Potential Identification
Key Research Insights and Frameworks
• PepsiCo Application
Talent Management Strategy
LeAD Program Architecture
Sample Feedback & Usage
• Building and Sustaining an Integrated Process
Enhancing the Effectiveness of the Process
Understanding the Impact of Transparency
• Final Thoughts
Agenda
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No noticeable impact (2%)
Minor (9%)
Moderate (37%)
Significant (28%)
Dramatic (5%)
Too soon to tell (19%)
Enhancing the Effectiveness of the Process
Impact Do Assessment & Development Programs Matter?
What Has Been the Impact of the Assessment and
Development Process on the Business Performance
of Participants Within 12-18 Months of Assessment? Senior Leader Development Center
• SLDC Launched in 2013
‐ Over 120 senior leaders have started the process in successive waves
‐ 50 have completed the 18 month process
• All participants received:
‐ Custom MTMM report
‐ Individual feedback sessions with I-O Psychologists
‐ Development plan support and coaching
‐ Follow-up feedback survey (DCI)
‐ Follow-up participant program survey
Church & Rotolo (2013)
Church, Rotolo, Ginther & Levine (2015)
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Enhancing the Effectiveness of the Process (cont.)
Impact What Types of Results Have We Seen?
Higher Potential & Higher Performance
Ratings(3 Yrs Average)
Exiting the Organization
(Lower Ratings on 11/19)
Outcomes Over TimeProgram Feedback
I put in significant effort toward
completing the assessments 77%(92%)
My reaction following the feedback
session was positive
(negative/neutral/positive)
74%(96%)
Feedback I received gave me
insights into my leadership
capabilities
52%(96%)
Working sessions with COE to
create my development plan were
effective
44%(88%)
I have taken action toward closing
my development gaps63% (100%)
My involvement in the program
shows that the organization is
invested in my growth as a leader
67%(92%) Strongly Agree (“5”) Only XX%
Agree & Strongly Agree (top Box “4” & “5”) xx%
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Understanding the Impact of Transparency
Transparency Should We Tell People if They’re a HP or Not?
What is Your Formal Policy About
Sharing HiPo Status with Employees?
Church & Rotolo (2013)
Church, Rotolo, Ginther & Levine (2015)
LeAD Potential Leader
• Potential Leader launched to ~3,900 associates in 11 languages in 2014
– Approximately 85% of those invited accepted
– 97% completed the assessments (n=3,335)
• All participants received a feedback report with 2 strengths/ 2 opportunities & their individual level of LIFT
– 4 levels of LIFT: some, moderate, great and very great
– extent to which associates are similar to more senior leaders in experiences and capabilities as indicated by assessments.
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Understanding the Impact of Transparency (cont.)
Transparency What Happened When We Did Tell People?
Program Satisfaction
65% 69% 72% 79%
62% 63%
71% 68%
Some Moderate Great Very Great
0%
20%
40%
60%
80%
100%
Some Moderate Great Very Great
Will improve my overall effectiveness
Shows org is invested in my growthand development
Program Satisfaction by LIFT
(% Satisfied/ Very Satisfied)
Perceived Impact of Program
Employee Attitudes
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Understanding the Impact of Transparency (cont.)
Transparency What Happened When We Did Tell People?
Overall Satisfaction by
Reports Feeling “Like Me”
33%31%
61%
84%87%
0%
20%
40%
60%
80%
100%
Not at all likeme
Not like me Neutral Like me Just like me
49% 44%59% 64%
Some Moderate Great Very Great
% Who Felt the Report was “Like Me” by LIFT
53%
average
Report Was “Like Me”
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Understanding the Impact of Transparency (cont.)
Transparency What Happened When We Did Tell People?
Some Moderate Great Very Great
Long-Term Rating
Short-Term Ratings
Performance
1 Year Later
Met Key
Objectives
Exceeded
Objectives
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Agenda
• Context Setting
Talent Management and High-Potential Identification
Key Research Insights and Frameworks
• PepsiCo Application
Talent Management Strategy
LeAD Program Architecture
Sample Feedback & Usage
• Building and Sustaining an Integrated Process
Enhancing the Effectiveness of the Process
Understanding the Impact of Transparency
• Final Thoughts
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• Final Thoughts
HR Strategy linked to the Business Strategy
Aligned set of frameworks (Hipo, Leadership, Functional)
Assessment, differentiation, and feedback creates energy
Data can be used for used and misused (content and validly matter)
Decision making systems have consequences (purpose, tools, targets)
Talent Management is About Making Decisions on People