PepsiCo–Taste the Success

By Douglas Shuit

May. 29, 2004

T he proxy list of public companies with the most highly compensated human resources executives confirms what some have known for years: PepsiCo and its subsidiaries are a great training ground for top people managers. Three executives who worked for Pepsi or its Frito-Lay subsidiary turned up among the 10 highest-paid human resources executives in a proxy analysis of more than 5,000 companies by Aon Consulting’s eComp Database.

    Leo Taylor, executive vice president for human resources at Pulte Homes, worked as group manager of corporate human resources for Frito-Lay. Bruce Johnson, senior vice president of human resources at The Timberland Co., also worked for Pepsi. Robert Foreman, vice president of human resources at SPX Corp., spent 14 years there.

    Pepsi is so well known for training hard-charging human resources executives that it even has something akin to a brand identity. “People will say, ‘Get me a Pepsi-type person,’ ” says Frank Allen, a New Jersey-based human resources recruiter. Hal Johnson, a managing partner with a division of Heidrick & Struggles International Inc., the executive search and leadership consulting firm, estimates that 30 to 35 of the chief human resources officers at the 200 largest employers in the United States got at least part of their training at PepsiCo or one of its divisions.

    Among the more prominent graduates of the Pepsi human resources program: Ken DiPietro, the top human resources executive at Microsoft Corp.; Eva Sage-Gavin, chief of human resources at Gap Inc.; John S. Bronson, a director at G & K Services and former vice president of human resources at Williams-Sonoma Inc.; and Della Wall, group vice president of human resources at Kroger Co.

    In defining “a Pepsi-type person,” Allen says that the executive would be performance oriented, with a bottom-line focus to go along with traditional responsibilities like training and development, compensation and benefits. From the first interview on, Pepsi hiring executives know what they are looking for, Allen says. “They are looking for human resources candidates that are coming from established companies, ones with a good reputation for the HR function. Then in the interview process they stress a partnership with business.”

    The company’s track record is also affirmed by Ed Lawler, director of the University of Southern California’s Center for Effective Organizations. “Pepsi has a long track record for producing strong HR executives,” he says. “It’s kind of an academy company for human resources.”

    Lawler says that the company recruits at top-ranked schools, often at the master’s degree level. “That said, it is not that they are known particularly for innovative practices in human resources,” he says. “Rather, they are known for hiring good, solid people who do their jobs well.”

    Taylor credits PepsiCo with being “a great training ground for top talent in the human resources arena. The folks who go through Pepsi or Frito-Lay are exposed to strong leaders,” he adds. “You cannot be a wallflower in that human resources organization and survive.”

    Not every former Pepsi executive has worked out. One, Gregory Horton, was fired by Internet giant AOL from his position as executive vice president of human resources and then sued by the Web service on a claim that he siphoned thousands of dollars from corporate accounts for personal use.

    Timberland’s Johnson says a stint with ITT Industries Inc. probably helped pave the way for his career more than his time at PepsiCo. But he learned powerful lessons in business practices, such as the value of a big investment in human resources. “It was a terrific experience for me,” he says. “There are an awful lot of PepsiCo alumni out there.”

Workforce Management, June 2004, p. 46Subscribe Now!

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