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The Pepsi Bottling Group: “Pour It On!” HOW THE WORLD’S LARGEST PEPSI BOTTLER ENGAGES EMPLOYEES IN WHOLE LIFE SUCCESS
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hether you’re driving up profits or driving down blood pressure, The Pepsi Bottling Group (PBG), the world’s largest manufacturer, seller, and distributor of Pepsi-Cola beverages, is ready to recognize you for it. Based in Somers, NY, this driven, high-energy company is focused on creating a complete culture of celebration for its 70,000 employees. “People leave because they feel underappreciated,” CEO Eric Foss recently told USA Today. “A culture of recognition needs to be a part of the company DNA.” The company’s “whole life” approach to appreciation acknowledges the connection between personal and professional success. Counted among the top 200 U.S. corporations, PBG is integrating appreciation into every aspect of employee life. Appreciation efforts recognize employee achievement in areas as diverse as length of service, safety, health and financial wellness. “Our goal is to create a culture of health, wellness and appreciation,” says John Berisford, chief personnel officer of PBG. “It’s important to hold up the heroes and role models and recognize not only the outcomes but also the effort that people put forth every day.” // continued inside
MEGAN BRODERICK, PBG DIRECTOR OF FIELD C O M P E N S AT I O N A N D H R I S
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Top Priority: Talent Management SOURCE: MCKINSEY QUARTERLY, NOV. 2007 WWW.MCKINSEYQUARTERLY.COM
Demand for executives will increase by one third in 15 years while supply of 35- to 44-year-olds will decline by 15%
any big U.S. companies are fighting – and losing – the war to attract and retain top-flight employees. A 2 percent economic growth rate for 15 years will increase the demand for executives by about a third. Meanwhile, supply is shrinking: By 2015 the number of 35- to 44-year-olds in the U.S. will have declined by 15 percent. The result? Companies must make talent management a top priority by creating and perpetually refining their employee value proposition.
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C O R P O R AT E S P O T L I G H T
HR Leadership and Better Performance SALES BLAZERS STUDY OF SUCCESSFUL REVENUE LEADERS REVEALS COMPANYCHANGING PRINCIPLES.
GARY CALL, VICE PRESIDENT SALES AND EDUCATION, BEAUTOPIA
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he business of beauty can get ugly. Just ask Gary Call. As a manufacturer of high-end beauty products like Brocato, Call is always looking for ways to help his distributors move more product. So when he heard about a new leadership philosophy based on the practices of the world’s top revenue leaders, he figured it was worth finding out more. Call’s visit to growth expert Mark Cook’s presentation on the new book, Sales Blazers, proved to be just the inspiration he needed to change his business. Cook’s book, just released by number-one sales publisher McGrawHill to number one status in its category, details common best practices among 200 top sales leaders that produce extraordinary results for their organizations. Such leaders outperform trends with 31 percent growth compared to 5 percent growth for those maintaining the status quo. Call was most interested by Cook’s approach to sharing the practices. Instead of exhaustive, industry-specific techniques for improving growth, Sales Blazers offered eight practical strategies common to all hyper-successful leaders. By teaching the reader how to lead diverse teams through revenue growth, Cook breaks away from the typical approach to business tactics. Instead, turning Call and others like him from simply mechanics to leaders for their clients and teams.
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How did Call put Cook’s strategies to work for him? First, Cook’s observation that true Sales Blazers, “Start with a Clean Bill of Health,” resonated with Call. A close examination of his business practices highlighted an unnecessary cause of backorder issues. Acting on it, Call pulled his 12 distributors together to discuss the problem. The meeting crystallized the depth of the backorder issue for management who discovered it was creating serious consequences for those trying to sell his products. Committed to removing all obstacles to growth, Call went to work to eliminate the backorder issue with his management team. Says Call, “It’s really amazing if you think about how a $20 book made our company tens of thousands before I even got out of the first chapter.” Call moved forward implementing other Sales Blazers techniques. Soon Call was training his distributors and even their client salons on the eight Sales Blazers strategies. The result? Call sparked a change of actions and results that infiltrated his entire channel. And that’s resulting in greater growth opportunities. “Realizations and results like Gary Call’s are not unusual for leaders who are willing to put a few simple principles to the test,” says Cook. “The seeming crescendo of market pressures facing business leaders today makes Sales Blazers important to those involved in any part of management—especially human resource leaders. After a decade of cost cutting, CEOs are asking entire leadership teams and work-forces to double the rate of revenue growth. This has put tremendous pressure on leaders in all departments and at all levels to figure out how to contribute to the revenue effort. I felt it was time to offer real solutions and examples of leaders who have discovered a way to excel in today’s environment.” Cook writes from experience leading and researching sales teams. He says his book is as much for executives outside of sales as front line salespeople. “The Sales Blazers study wasn’t about selling technique, there are endless numbers of experts out there that address that topic,” says Cook. “We were looking toward how these people lead others in a high-performance setting. Likewise,
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our topic was not on the mechanics of management either. Our goal was to identify leadership actions across a diverse set of titles and company sizes to find leadership strategies that create high performance that really can be applied in any performance setting.” Cook’s resulting eight strategies have the potential to lead organizations like Call’s to breakthroughs at every point, in every department. What’s even better? Cook says it all boils down to improving leadership and nothing does that faster than showing appreciation for those who do things right in your organization. “Holding up role models and appreciating people for sharing ideas is extremely important,” says Cook. “The principles of extreme sales success—sparking performance, setting expectations, delivering feedback, coaching, heightening reward potency— all center on noticing the greatness in others. And our study revealed that those who excel as business leaders notice and recognize people. It is a consistent characteristic of those who are able to accelerate revenue results.” For more information on Sales Blazers by Mark Cook, visit salesblazers.com
SENI OR LEADERSHI P
M AT T H I R S H E I M E R , N AT I O N A L S A F E T Y M A N AG E R
SERVICE
PA U L K U N K E L , PBG FLEET MECHANIC
J O H N B E R I S F O R D, CHIEF PERSONNEL OFFICER, PBG
“New ideas and fresh thinking are critical, but it is a mistake to equate long tenure with stale thinking. Some of the most innovative minds happen to be the most tenured minds…[We] retain talent, but never lose sight of developing talent.” — E R I C F O SS , C E O, P B G
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While PBG has cultivated a comprehensive approach to recognizing tenure that includes personalized messages of congratulations, a choice of awards, and presentation coaching for managers, much of the ownership for creating truly personal day-to-day recognition experiences for PBG employees lies with local managers. PBG encourages a creative, practical and local approach to recognition. They emphasize that public appreciation of great work should not be reserved for a particular function or level because every job is important to the
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t its core, PBG puts a high value on honoring tenure—a practice many organizations worry might send the wrong message of promoting seniority over performance. At PBG, however, the company sees tenure as a competitive advantage. “We have more than 200 years of service on our executive team and thousands of employees with 20- plus years of experience. Few companies can claim that kind of continuity, institutional knowledge and employee satisfaction,” says Berisford. “So when a colleague earns a service award, we celebrate the individual and the company for providing a compelling place to work.” Foss says recognizing long tenure is an important pillar of success at PBG. “We definitely do not offer a job for life,” said Foss. “New ideas and fresh thinking are critical, but it is a mistake to equate long tenure with stale thinking. Some of the most innovative minds happen to be the most tenured minds…[We] retain talent, but never lose sight of developing talent.” Living up to its commitment to honor tenure, PBG leaders recently invited all employees with 45-plus years of service to an exclusive weekend of celebration where the organization’s most senior leaders personally thanked PBG employees for their lifetime of commitment to the company. “The standing ovations, the tears, the cheers that came from the leaders in the audience were simply unbelievable,” says Megan Broderick, director of field compensation and HRIS. “The impact reached far beyond the people being honored. In addition to making them feel special, we communicated the value of tenure to the entire organization.”
V I C E P R E S I D E N T,
PBG WELLNESS PROGRAM PA R T I C I PA N T S A R E RECOGNIZED WITH C U S T O M AWA R D S T H AT HONOR PROGRESS T O WA R D K E Y G O A L S
PBG FLEET MECHANIC
taying safe tops PBG’s list as one of the company’s most critical goals. With one of the largest fleets in the U.S., the company’s 10,000 drivers spend their days driving large vehicles, lifting and delivering hundreds of cases of Pepsi products, and serving as the face of the company to retailers. Keeping this group of key employees engaged and equipped to work is central to executing company service strategy at the ground level. “We have adopted the concept of safety at home, work and play,” says Matt Hirsheimer, national safety manager. “We have broadened our focus to not only safety at work, but the same things that keep you safe at work, like wearing the proper equipment, following the proper procedures, are important at home, work, and play. If we can keep our drivers safe wherever they are, they will be healthy on the job and that makes a huge difference in their lives and on our productivity.” PBG’s innovative whole life approach to safety has delivered impressive results. Hirsheimer reports the company has been able to sustain a 3 percent reduction in vehicle accidents for the past two years, which is less than half the accidents of the typical fleet. “Those type of results are significant,” says Hirsheimer. “By paying attention to preventing accidents and appreciating employees who stay safe with PBG’s Professional Driver Program, we offer meaningful recognition every year a driver remains safe building to more significant recognition at five years of safety and beyond. Our front-line employees are consistently reminded of their importance and they respond to that.”
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longside safety, PBG is placing increased emphasis on commitment to personal health and financial wellness goals as well. Despite the organization’s size, company leaders have made a point to take a personal approach to encouraging excellence. From proactively reaching out to employees at key milestones to remind them of the company’s savings plans, financial planning programs or free health screenings, to personal messages on employees’ children’s birthdays reminding them of free immunizations available through the company, PBG believes a work force that feels financially secure and healthy also feels more satisfied. And they believe it’s that satisfaction and peace of mind that leads to better productivity, ideas, and results. A recent survey of about 450 major U.S. employers—conducted by Hewitt Associates,
a global human resources consulting firm— confirms that incentive-based health programs are on the rise. Released in April 2007, the results indicate that 48 percent of surveyed companies either already offer incentives, or plan to offer them to employees who take part in company-sponsored health programs. This represents a 10 percent increase from 2006. PBG has taken a lead position among progressive companies, and has offered its Healthy Living Program since 2003. The program offers incentives for participating in company-sponsored walking programs, weight management, health screenings and more. PBG recently received the C. Everett Koop award for “Best Employers for Healthy Lifestyles” for its efforts. “Some of the greatest returns are in improved energy, morale, retention and
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overall success of the business. They also explain that employees often derive more satisfaction from the praise and appreciation they receive from their local managers than from senior executives at headquarters. This grass roots approach to program implementation has proved extremely successful for PBG. Corporate headquarters is constantly impressed with the stories of personalized recognition experiences that come from its field locations. PBG’s internal newsletters share stories of recognition best practices that include framed work shirts for retirees, rental of a community billboard to honor years of service, onsite electronic tickers that share recognition information with all employees, and family members invited to the workplace to share the recipient’s moment of appreciation. Such personalized events coupled with customized, Pepsi-logo awards provide employees with lasting mementos of significant experiences at PBG. “We’ve gotten far more strategic as far as thinking through the impact of the awards we’re offering employees,” says Broderick. “In the past, we relied heavily on gift cards. But they presented real “gotchas” for our employees—they were limited to a number of stores, they expired, and they frustrated a great number of employees who selected them. Not to mention they posed big tax issues for us as an organization. By thinking through those issues, doing away with the gift cards, and having our awards complement other initiatives in the company, we’ve created a far more cohesive approach.” Broderick is careful to point out that carefully chosen awards, although important, are just part of the impact of a sincere appreciation experience. “Moments of appreciation help you feel connected back to the company,” says Steve Grinstead, food service sales manager for PBG’s Connecticut region. “In the field, you can feel at times like you’re on an island. But when recognition happens everyone is reminded that we are working toward something bigger and you recommit to those goals.”
“We start at the top by being mindful of appreciation because that is how it becomes woven into the fabric of who we are.”
recruitment,” Brad Cooper, founder and chief wellness officer of US Corporate Wellness Inc. recently told Incentive Magazine. “When employees are taking better care of themselves, he estimates that performance increases by 20 to 30 percent. “Multiply that by 1,000 (or 10,000) employees, and wow!” says Cooper.
ST E V E G R I N ST E A D, FOOD SERVICE SA L E S M A N AG E R , CONNECTICUT REGION
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o what’s the key to creating a holistic approach to recognition in your organization? “Senior leadership support is critical,” says Paulette Alviti, vice president of leadership development. “We recently gathered the top 150 leaders of PBG worldwide for a conference focused on who we want to be as an organization. A central theme emerged from that meeting on branding a culture of appreciation.” With the same laser focus and 100 percent commitment to execution PBG’s leadership gives other business initiatives, the group turned their attention to appreciating great work and the differences it can bring about in the organization. Despite all that’s already happening with recognition at PBG, it was agreed that a renewed focus on the power of appreciation in the organization would begin this fall with “Employee Appreciation Week.” “The event will involve PBG’s 70,000 employees and focus on demonstrating our appreciation to all of our employees. We’ll focus on listening and caring about what our employees have to say by doing global round-tables to get feedback from our employees. We’re going to focus on what’s important to our employees by including their families and communities in our activities. We will demonstrate that we care about our employees well being by doing health and wellness activities including some health screenings and a food drive for charity. This is really an opportunity for us to get excited about our employees, and just say thank you, we appreciate your hard work.” Along with planning major appreciation events, this elite group of company leaders invited recognition expert and best-selling author of The Carrot Principle, Chester Elton to discuss the relevance of recognition as a business practice. In addition to devoting resources to this type of senior training and planning, PBG has named appreciation as a core leadership competency—one of the top 15 required leadership attributes. “We start at the top by being mindful of appreciation because that is how it becomes woven into the fabric of who we are,” says Alviti.
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hile PBG makes it clear their motivation to create a holistic approach to recognition for employees begins with the idea that it is the right thing to do, it also recognizes the benefits of a strong culture of appreciation to the company. “We are ready as an organization to find out what we have not known in the past,” says Broderick. “Historically we had not broken down the results of our quarterly survey for the service award program by market unit or location. Now we’re breaking it down into 35 different subsets so we have results we can share, coach, and improve.” Broderick says she expects the more detailed analysis and concentrated action that will occur as a result of better information to improve satisfaction scores, productivity, and absenteeism. “We have put a stake in the ground and said as a group we will deliver significant improvements on our Employee Insight survey results that deal with treating employees fairly and providing praise and recognition,” says Alviti. “Measurable goals are an important part of us remaining a great place to work.” Aside from the metrics, PBG says appreciation practices are doing the right thing to generate the right outcomes.
“It takes more than money to make people passionate or loyal,” says CEO Foss. “You have to think holistically.” “To be a strong, healthy and admired company, we look at the issues that matter most to our employees – work/life balance, healthcare and financial wellness are at the top of the list,” adds Berisford. “By focusing on our employees’ professional and personal success, we demonstrate to our people that we care about their wellbeing and recognize the importance of their families. Inevitably, this approach attracts top talent and increases employee satisfaction and productivity. Rewarding employees for their service and showing gratitude and concern are components of wellbeing and determinants of job satisfaction. If we want to build a better place to work – and we do – these are the habits we have to develop. . .and we are.”
AWA R D S P O T L I G H T
The Rosenblatt Prize O
.C. Tanner passionately supports appreciation of the arts and academic excellence. Most recently the company celebrated its 25th anniversary of involvement with the Rosenblatt Prize for Excellence, the University of Utah’s most prestigious award. This year’s recipient, Robert A. Goldberg, professor of history and director of the Obert C. and Grace A. Tanner Humanities Center at the University of Utah, was honored as one of most creative and productive scholars of modern American history working today. Along with a $40,000 gift from the Rosenblatt endowment, the professor received an impressive crystal trophy provided by O.C. Tanner. The Rosenblatt endowment was established in 1983 by the Joseph and Evelyn Rosenblatt family to honor the civic leadership and generosity of Joseph’s parents, Nathan and Tillie Rosenblatt, who immigrated from Russia to Utah in the late 19th century.
ROBERT A. GOLDBERG, RECIPIENT OF THE 2008 ROSENBLATT AWARD
ku•dos
1. honor; glory; acclaim. 2. a statement of praise or approval; accolade; compliment.
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In this issue… The World’s Largest Pepsi Bottler Engages Employees in Whole Life Success
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Publisher O.C. Tanner Managing Editor Mindi Cox Design Brandon Jameson / Axis41
Graphic Supervisor Shauna Raso
Photographer Shauna Raso
Award Photographer Rick Hayward
Sales Blazers: How HR Can Lead Revenue Growth Rosenblatt Prize Celebrates 25 Years
KUDOS is published by O.C. Tanner, 1930 South State Street, Salt Lake City, UT 84115. Copyright 2008 by O.C. Tanner. All rights reserved. Reproduction in part or whole without written permission is prohibited. Not responsible for unsolicited materials. Second-class US postage paid at Salt Lake City, UT 84101 and additional offices. Postmaster send address changes to above address.
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