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Human Resource Management of PepsiCo

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Human Resource Management of PepsiCo
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Netra Shetty
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Human Resource Management of PepsiCo - January 27th, 2011

PepsiCo, Incorporated (NYSE: PEP) is a Fortune 500, American global corporation headquartered in Purchase, New York, with interests in the manufacturing, marketing and distribution of grain-based snack foods, beverages, and other products. PepsiCo was formed in 1965 with the merger of the Pepsi-Cola Company and Frito-Lay, Inc. PepsiCo has since expanded from its namesake product Pepsi to a broader range of food and beverage brands, the largest of which include an acquisition of Tropicana in 1998 and a merger with Quaker Oats in 2001 - which added the Gatorade brand to its portfolio as well.[5]

As of 2009, 19 of PepsiCo’s product lines generated retail sales of more than $1 billion each,[6] and the company’s products were distributed across more than 200 countries, resulting in annual net revenues of $43.3 billion. Based on net revenue, PepsiCo is the second largest food & beverage business in the world,[7] Within North America, PepsiCo is ranked (by net revenue) as the largest food and beverage business.[7]

Indra Krishnamurthy Nooyi has been the chief executive of PepsiCo since 2006, and the company employed approximately 285,000 people worldwide as of 2010.[4] The company’s beverage distribution and bottling is conducted by PepsiCo as well as by licensed bottlers in certain regions.[8] PepsiCo is a SIC 2080 (beverage) company.

HR Introduction:

HR department follows the policies by the HR department of PEPSICO. At PEPSICO, their belief is that "their people are their greatest asset. They take great pride in acknowledging the contribution each one of them makes". they focus on People Development and for that they ensure:
 Staff PEPSICO with world class Professionals and ensure that the right systems are in place to encourage them to develop to their full potential.
 Create a collaborative and mutually supportive work environment that encourages people to grow.
 Build a team of professionals who deliver expertise by participating in business decisions.
 Develop Performance Management and reward systems underlying our Business strategy.

HR Objectives:

• To look out for the well being of all employees of the company.
• Provide leadership and direction to employees of the company.
• Career Development planning for all employees of the company.
• Ensure thorough training of nationwide employees.
• To provide individual employees with orientation on the company at the time of joining.
• To provide employees with solutions to their problems.

• Maintaining data records of all employees of PEPSICO (Human Resources information System).
• To evaluate and retain those employees who are assets to the company.

HR Policies:

• Friendly, conversant, flexible and congruent with business environment.

Policies are legally compliant with clearly expressed processes for timely revisions and a framework in place to foster employee adherence.


• Development of interactive web-site aligned with all HR sub-functions to facilitate communication between employee and organization through dialogue boxes and speedy availability of information.
• Enhancing overall perception of HR, as with the help of HRIS the function of HR is changing direction and heading towards Relationship Building, in this all the links are being recreated and employees are given much more weight as compared to past.


HR planning’s purpose is to determine what HRM requirements exist for current & future supplies & demands of workers. The organization ensures that they have the right number and kinds of people at the right place; this task is accomplished by regular recruitment and selection, performance evaluation, Promotions, Regular Training and development programs.

HR Functions of PEPSICO:

1- The people in the HR department of PEPSICO are extremely qualified personnel so no flaws in decision making are prominent
2- They have sufficient resources of getting knowledge from outside sources.
3- They prefer new entrants of the market to increase their efficiency.

1- the ethical issues in the PEPSICO prevail the most
2- the employees in the PEPSICO don’t participate equally so there are chances of misspalnning.


Company Name: PEPSICO

Job Title: Assistant HR Manager Job Code:310-4

Salary: Rs.35000

Reporting Relationships:
Assistant HR manager reports to HR Manager, and then he reports to the HR Secretary. Then all other HR people get information from the HR secretary.

Job Summary:

Manage the HR activities of the department. plans and develops the systems and procedures for recruiting.
Supervises staff in accordance with company’s policies and procedures. Responsible for coaching and training.

Job Duties:

HR manager’s major duties include assisting the HR activities, for instance if any recruiting procedure needs to be implemented then the HR manager is responsible for it. HR manager in PEPSICO has to make some plans for a assigning duties to the employees


Working conditions are normal for an office environment. Work may require occasional weekend and/or evening work.

Performance Standards:

PEPSICO expects from its employee’s specific performance expectations for each major duty and also expects certain behaviors like friendliness, helpfulness, courtesy, and punctuality.

Job Specifications:

In PEPSICO the minimum job requirement for a HR Manager is Master degree in HRM with relevant work experience,

The company is giving more stress on employee empowerment by giving them right to participate in decision making speacially those decision which directly affect the employee themselves.
Also the company gives the subordinates the right to work on the behalf of its supervisor in absence of him.

The company is paying more attention to strengthen the relationship among employees by giving them equal opportunities to take advantage of the firm’s incentives, because no biasness among employees is practiced in the firm which affects the good relations among employees.

PEPSICO employs through both formal and informal ways of recruitment. Departments tell their need to HR department. And then recruitment is done on the requirement by the project. All candidates send their CV’s by post; they are then short listed and called. So those candidates then report at the PEPSICO from where they are sent to the Human Resource Department for further interviews. But recently PEPSICO has devised a new way of recruitment i.e. Online Applications. They give Ads in leading newspaper and use some other mass media communication channels and then receive applications and CV’s online. In this way huge paper work is reduced

and recruitment process is improved in terms of efficiency and convenience with the use of technology.

Sources of Recruitment
PEPSICO uses both Internal and External Recruitment. But the priority is given to the internal if the employee has the capabilities, required by the management for working on that post. In Internal recruitment they ask for employee referrals. Any employee can refer any competent and potential person and if the referred person comes up to their expectations and hired, then the one who referred is rewarded with a bonus. In External environment the company’s corporate Image matters a lot in a way that not only new candidates are attracted but also people who became a part of it in past.

Internal Methods
PEPSICO usually prefers “Job Posting” in which employees from with in the organization are preferred but if the organization feels that the employee is not competent enough then they go for external methods. Such announcements are made through bulletin boards, memos and other internal sources.

External Methods
PEPSICO usually prefers advertising through newspapers and their official website for their recruitment purposes. They give an open invitation to everyone to apply, so people who are interested come and if they are capable enough they are hired. They don’t prefer any specific universities or colleges to get the applicants, what matters are the potential talent and caliber of the person and his commitment to work. Last year a scheme is started in which a

team of HR professionals visit different colleges and universities to recruit fresh and passionate candidates.

Strategies for Recruitment

The recruitment process is likewise the same but minutely varies in the organization depending upon the ranks. In recruitment PEPSICO keeps certain things in front e.g.

 What the person was getting (in terms of salary) prior to PEPSICO’s Job.

 Whether the person is polished enough to adjust in their environment.

 Whether he or she has the required technical skills or the required qualification for that specific job.

In PEPSICO they surely see qualifications but they prefer a person with required skills, aptitudes, experience and capabilities.


1- The factor of succession planning is prevailing
2- They use the right techniques in recruiting.

1- At the time of the recruitment the most suitable and appropriate employee may not be available.


In PEPSICO, selection Criteria is based on numerous factors such as education, health, background and previous experience.

Selection process

1. The Application

The employment application is candidate’s first chance to present his qualifications to the Organization. As such, it is extremely critical for his/her continued participation in the examination process. Before beginning, one has to review thoroughly what the Job Announcement specifies as the requirements to qualify for the position. Candidate must meet these criteria to be considered for the position; ensure that, otherwise candidate will be wasting his effort in completing the application. Most entries on the form are self-explanatory, but a few pointers on filling it out may help
2. Written Exams:
Written exams are usually obtained from one of several test construction firms available to them. These tests are designed to determine level of technical and/or analytical abilities associated with the particular position for which candidate had applied. The test which is conducted in PEPSICO selection purpose is TEST OF COGNITIVE ABLITIES. This test is mostly taken from fresh graduates. Whereas, some people are selected on the basis of experience.

3. Performance Exams:
Performance exams test ability to accomplish specific job-related tasks by providing the opportunity to actually perform them. These tests are scheduled through the Human Resources Department office, with notification in writing of the date, time, location and duration of the test. Instructions will be given on the tasks to be completed and then asked to complete them. Individuals with considerable relevant experience will conduct the evaluations. Safety, quality of work, adaptability, performance under stress, etc. are evaluated.

4. Specialized Testing
Some positions will require specialized testing, such as technical skills, agility and communication skills etc. These tests are scheduled just as like other tests.
5. The Panel Interview
The results of this component of the exam process will be used to determine if candidate should be included on the List of Eligible Candidates forwarded to the hiring authority for consideration for a departmental Selection Interview.
This portion of the examination is normally weighted 100% (or as indicated on the Job Announcement). Typically, previous test results are used only to qualify you for participation in the Panel Interview.
The Panel is comprised of qualified individuals, which may or may not be employees of the City. Normally, the panel will consist of three evaluators. These individuals will evaluate responses to a variety of job-related questions over the scheduled time period.

6. The Selection Interview
Once the List of Eligible Candidates is established it is sent to the Department(s) that is hiring to fill a current vacancy. The Department Head is responsible for setting up Selection Interviews. He/she may interview anyone on the list, since all persons referred to the department are qualified. The Department Head will be looking for the candidate with the best qualifications for their particular position. The candidate selected to fill the vacancy will undergo a medical examination, drug screen, background investigation, and a probationary period before attaining permanent employment status.

1- They implement a crucial testing system which affects the selection process.
2- They have a separate selection criteria for each job.

1- They take group interview which causes many confusion.


PEPSICO has trained and developed many of its senior and fast track managers and supervisors. For lower and technical staff the organization have a complete training calendar for the year, if organization thinks and feel that an employee requires training to update his knowledge about the field, he just have to report the HR department and he will be listed for the next training program.
On-the-job Training:
As compared to other competitive organizations the training program of PEPSICO is quite different. It provides full opportunity to its employee to develop themselves and also train them according to the requirements of their job. In return they will be greatest asset for their organization. The employee is being trained in many ways while they are on job.
External sources
These are formal training opportunities that PEPSICO offers to employees either internally or externally. A trainer, facilitator and/or subject matter expert are brought into the organization to provide the training session or an employee are be sent to one of these learning opportunities during work time. These training opportunities are provided in the form of seminars, classroom training courses and workshops.


1- They hire foreign instructor for the training of the employees
2- The employees after getting trained perform well and become able to maximize their potential.


1- The factor of favoritism effect the performance of certain employees.


The jobs are evaluated on yearly basis under 360o method; the competent employees are rewarded in shape of promotions, bonus, increments and annual holidays and promotion. The results of an appraisal can be used to identify areas for further development of the employee.
The organization also uses different questionnaires, which consist of numerous questions about the behavior of the employee, and then on the basis of these answers personality of the employee is judged.
When evaluation is made the unsatisfactory performers are given warning. The employee after warning is put under observation, for some period of time and if the employees’ performance is still unsatisfied then are demoted or fired.


• Promotion
Promotion is direct shift only to the next level from the current grade, the employee’s performance is evaluated and if his performance is above average he is given promotion. PEPSICO promotes only those candidates who are experienced and eligible for that particular vacancy.

• Increments

The company decides at the end of the financial year, according to its financial condition, whether increments should be given or not.

• Free transport
PEPSICO provide free transport to local employee.

• Medical facility
PEPSICO provide free medical facility to workers depending upon the position/rank of the employee.

• House loans:
They give the facility of house loan only to deserving individual. The loan approval depends upon the post of the employee.

• Overtime payment:
Overtime payment is pay for only those workers who are working more than their working hours mostly overtime payment is given to low level staff.


1- They should develop such system in their HR department that no ethical issues can be raised.
2- The employees should participate in all the activities of the department.
3- They should choose plan in such a way that when there is a need of recruitment the proper candidate must be available.
4- The factor of favoritism must be eliminated from the department of HR.
5- They should hold meetings of the HR employees more frequently for eliminating any misunderstanding.

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Re: Human Resource Management of PepsiCo
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Krunal Dhabhi
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Post Re: Human Resource Management of PepsiCo - August 7th, 2014

Nice Project on Human Resource Management of PepsiCo
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Re: Human Resource Management of PepsiCo - May 21st, 2015

These information are very much useful for the reference of case study but , These posts have compiled a wide array of Human resource job description, salary,definition and so on,but, it is also very much important to find out about about importance of human resource management,and what are the functions of human resource management.which are the books to refer to get complete idea about the above topic.
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area of hrm, career development, career management, career path, career planning, company in us, fringe benefits, hrm of us company, hrm practices, human, human resource management, induction process, job evaluation, job rotation, management, orientation process, pepsico, performance appraisal, personnel management, recruitment process, resource, staffing process, strategic hrm, training development
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