Evolving the Strategic
Workforce Planning
Strategy at PepsiCo
By Beverly Tarulli and Damien DeLuca
T
he purpose of strategic workforce planning (SWP)
has always been to get the right people with the right
skills in the right place at the right time. While that
sounds straightforward on the surface, determining what
all of those “rights” are, obtaining buy-in, and achieving
that future state in the right way has been anything but
simple in practice.
As a case in point, several years ago one of our business
units identified an opportunity for a new product launch. The
financial plans and sales goals were complete and the leader-
ship team was committed and excited about the opportunity.
The local HR team was poised to hire a few new leaders and
create a longer-term workforce plan to support this new prod-
uct and the business’s future growth.
We set out to understand the business strategy, conducted
leadership interviews to identify critical roles, and produced
models and forecasts of staffing plans. The SWP work came to
a stop because we ran into a common problem: the local busi-
ness and HR team found it difficult to articulate and agree
on what the right workforce looked like a year or more in the
36 PEOPLE + STRATEGY
future. We had all the tools and techniques we needed to hit
a target—if only we knew what that target should be.
While we eventually agreed on and implemented a
successful strategic workforce plan for the business unit, we
recognized that this difficulty in target-setting was a recur-
ring problem that had hindered many of our earlier projects
as well. Business leaders had a clear line of sight of their
strategic business goals, but often lacked clarity regarding the
talent implications of those goals. Likewise, HR leaders had a
deep understanding of the talent issues of the moment, but
were conscious of sacrificing near-term results in the name of
long-term needs.
We as strategic workforce planners were caught in the mid-
dle—trying to navigate between these two worlds, defining what
right meant for the business and translating what we heard from
our partners into actionable steps to achieve their talent goals.
We needed a better approach—one that would help us
establish what right looked like quickly and correctly, gain
consensus and commitment from leaders and HR business
partners, and create an actionable plan.

Warning Signs That Strategic
Workforce Planning May Stall
Business leaders are not dedicating time
to the effort.
Business leaders have a hard time explaining
(or agreeing on) key facts about their talent needs
(e.g., what is the total talent budget in the future).
HR business partners are focused on current
talent needs and have little perspective on what
comes next.
Stakeholders have divergent or conflicting
opinions of what the future will bring.
The future described by stakeholders is too high-level
or mainly a summary of recent topics in the press
(e.g., we want to be digitally enabled, use AI, etc.).
Enhancements to the traditional strategic workforce plan-
ning process have helped PepsiCo accomplish these goals more
effectively and efficiently today than in years past. Instead of ask-
ing our business partners what they want, we’re better equipped
to tell them what they need to deliver for the business.
SWP Is More Critical Than Ever
Strategic workforce planning, especially for global compa-
nies, has never been more important. The traditional reasons
to plan are still relevant, but they have been magnified by
the increasing complexity of our operating environments.
This complexity is driven by several factors, including talent
diversity and scarcity, new digital technologies and ways of
working, and a broadening set of stakeholders to satisfy.
Talent Diversity and Scarcity
The demographics of the employee base as well as the talent
PepsiCo at a Glance
Our Business
•• 260,000 employees worldwide
•• Operates in 200+ countries and territories
•• $64B in net revenue in 2018
•• 22 billion-dollar brands
•• Products consumed more than 1 billion times each day
pools we draw from can be very different in developed and
developing markets, and even across units in the same loca-
tion. For example, data from the Organization for Economic
Cooperation and Development (OECD) shows that older
workers in developed markets are staying in the workforce
longer, making them a talent pool that organizations can tap
for their experience and deep skills. This trend also sug-
gests that reskilling or upskilling as a talent strategy may be
important in those markets, rather than looking for scarcer
millennial and Gen-Z talent.
Economic factors also drive our talent planning. Unemploy-
ment rates vary country to country, but in the U.S. they are at a
50-year low, requiring thoughtful hiring and retention strategies.
Companies are also striving to build more diverse and inclusive
workplaces that reflect their consumer base and communities.
New Digital Technologies and Ways of Working
Digital transformation is driving changes in the work we do,
how we work, where work gets done, and who (or what) does
the work. In 2016, The World Economic Forum published
their report on the Fourth Industrial Revolution. Since
then, there has been much speculation about the number
of jobs that will be impacted, the number of entirely new
jobs that will be created, and how jobs that remain will be
fundamentally changed. These ideas have huge implications
for strategic workforce planning experts, as we will need to
project which, if any, jobs will be eliminated, what new skills
and capabilities will be needed when new technologies are
introduced, or how skills will recombine to become new jobs.
While the exact magnitude of these changes is unclear, a
recent study by Deloitte showed that 86 percent of executives
believe reskilling is important and 40 percent of the work-
force will need to be trained in the next 12 months.1
Broadening Set of Stakeholders
External stakeholders such as institutional investors are
demanding greater transparency about how we manage
our talent. For example, BlackRock and State Street Global
Investors have made clear that they will use information
about how companies manage human capital factors in their
investment decisions.2 Gartner showed that talent topics
are more likely to be discussed on quarterly earnings calls,
increasing 16 percent between 2010 and 2017.3 Investors are
driving the C-Suite to pay closer attention to talent issues
and to shift their thinking about human capital as an asset
to be leveraged, not simply a cost to be minimized. Strategic
Our Strategic Workforce Planning
•• Begun in 2013
•• Started in one country and expanded to other key markets
•• Refreshed annually or as needed
•• Localized plans developed
•• Skill gap commonalities addressed globally
•• Results used in hiring and reskilling efforts
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 Differences Between Traditional and Evolving SWP
Traditional SWP
Talent Diversity and Scarcity •• Primary focus internally on talent gaps
•• Traditional build/buy/borrow strategies
New Digital Technologies and Ways of Working •• Gap solutions = people
•• Jobs to be filled
Broadening Set of Stakeholders •• Audiences are primarily HR and business leaders
workforce planners are ideally positioned to help corporate
leaders make this shift.
Enhancements to the Traditional Approach
Given the increasing demands on business leaders, it’s no
wonder they have difficulty projecting future talent needs.
To address these complexities, we’ve made several changes
to our strategic workforce planning process: we adapted our
methodology to provide a closer connection to the business
strategy process, added new external data sources to assess
talent market opportunities, completed a country-by-country
analysis on what really makes a business impact, and linked
local needs with global solutions.
Process Alignment and New Data Sources
The first two changes were relatively easy. We realigned our
strategic workforce planning methodology and language to
be consistent with the strategic business planning process that
was used by each of our businesses. This allowed us to better
communicate with business partners and they could readily
see how talent planning aligned with business planning.
Additionally, as more sophisticated and global external
data sources became available, we incorporated those into
our process, which allowed us to assess talent availability
market by market, proactively and more dynamically than
in the past. Even just five years ago, it was difficult to get a
sense of how many people with the right skill profile existed
in a specific location, and how many of them were seeking
employment or persuadable to your employee value propo-
sition. Today, one can get answers to these questions in a few
clicks and keep track of how the dynamics are changing on a
daily basis. These new data streams provide powerful insights
we can use to set realistic talent targets and know whether it
makes more sense to build, buy, borrow, rent, or automate
our way to those targets.
Quantifying How Talent Drives Financial Performance
There is a sizeable body of academic literature that demon-
strates a relationship between human capital and company
financial performance.4 However, most HR professionals
cannot articulate which human capital actions drive financial
performance in their own organizations. This lack of clarity
was one reason it was difficult for business and HR partners
to define talent targets for their strategic workforce plans.
To tackle this issue, we approached it from a different di-
38 PEOPLE + STRATEGY
Evolving SWP
•• Greater use of external data sources to assess
market availability
•• Using skill adjacencies to address gaps
•• Gap solutions = people plus new technologies
•• Jobs eliminated and jobs to be filled
•• Audiences are C-suite and investors
rection. We set out to explicitly test which HR-related activities
and decisions have the greatest and most direct impact on
whether a business unit makes money in the future. In this
process, we tested hundreds of hypotheses.
The results were surprising in their simplicity. We found
that a few key things that HR does in conjunction with busi-
ness leaders matter a lot, while many other things they spend
time on are not making a significant difference to business
performance. We now have the facts to tell a business where
they stand today on these critical talent metrics and what they
need to do to improve their financial performance. It pro-
vides an evidence-based approach to setting the right targets
quickly and correctly.
Coupling this knowledge with the new data streams men-
tioned above allows us to provide clearer direction to our busi-
ness and HR partners. We can now articulate the talent factors
they should focus on to achieve business results and what the
labor/skills supply looks like in their markets.
Linking Local Needs with Global Solutions
The final enhancement to our strategic planning process
emerged out of our involvement in country-level planning. At
PepsiCo, our approach of working with country-level business
and HR leaders allowed us to understand the local dynamics
and plan appropriately. However, it also provided a global
perspective on common talent and skill gaps. For very spe-
cific gaps, solutions are generated and implemented locally.
For common skill gaps that have a “build” solution, it makes
sense to develop solutions on a global scale.
Strategic workforce planning approaches can vary from
company to company, depending on talent needs, the nature
of the business, and the sophistication of data analytics. Our
experience after six years of conducting these projects showed
us that guiding business and HR partners, using as much data
from as many sources as makes sense, and speaking in a lan-
guage they recognize helps them see the future of their talent
needs much more readily.
General SWP Best Practices
Our recommendations below can help you if you are just
getting started or if you have been conducting strategic work-
force planning for several years and need a refresh.
1. Ensure you have business and HR leadership buy-in
before you start. Trying to push a workforce planning pro-
cess on your own never gets the sustained buy-in you need
 from your partners to execute the plan into the future.
You need to have the team that will execute aligned right
from the start.
2. Plan talent the same way you plan the business. Adopt
your business planning process (steps, terminology, and
timing) for your workforce plan. This makes it easy for
your partners to see the connection between planning
talent and their everyday roles, to speed up their under-
standing and adoption.
3. Plan at a level with the authority to decide and act. The
level at which you should plan varies from company to
company. You need to find the spot where your leaders
have the authority and resources to help you design, com-
mit to, and execute the plan you create. Aiming too high
or low will lessen the buy-in and follow-through.
4. Tell them what needs to happen vs. asking what they
want. You need to have a fact-based point of view to guide
the work and set the targets. Know what the key drivers of
performance really are and where your business should
focus their priorities.
5. Deploy new data streams to reduce ambiguity. Infuse
real-time facts into your initial planning effort and the on-
going monitoring to help proactively steer your partners’
efforts. There are many new data streams available that
bring blind spots of the past into focus (e.g., what training
programs are most in-demand today).
6. Have a “right-to-win” vs. your talent competitors.
Defining a strategy is all about setting priorities and
choices. Just as your business won’t launch a product
that is destined to fail, you should not launch a talent
plan that is either. Design your talent strategies in areas
where you can beat the competition by offering recruits
and existing employees something better than others
can. If you can’t make the claim that you are better, start
over or choose not to play.
7. Verify your talent investments have a competitive ROI to
other business investments. Value your talent investments
the same way other parts of the business value their invest-
ments. Will that training program generate an ROI bigger
than a new machine or digital tool? If you don’t know, you
need to find out.
8. Test-and-learn before deploying at scale. HR still loves
to deploy big programs everywhere. A better, more agile
approach is to test and learn first. If your short-term pilot
works, scale it up.
9. Link your plan goals and targets to senior and HR lead-
ers’ personal objectives. Strategic workforce planning is
a long-term play with incremental steps along the away.
Ensure your leaders have an ongoing incentive to see the
vision come to life and will be held accountable for com-
mitting and driving the resources to make it happen.
10. Constantly track your plan’s progress and update it as
necessary. As is often said, what gets measured gets man-
aged. Have a method to track progress on at least a quar-
terly basis and refine your targets with new updated in-
formation as necessary. In the dynamic environment that
organizations operate in today, plans can and do change
and your workforce plan should change with them.
Signs Your Strategic Workforce
Planning Process Is Successful
Leaders who have not previously been
involved are asking to be a part of
the process.
The plans you put in place are executed
and deliver the results you envisioned.
The plans are stable over time
and they stay in place even after
a leadership change.
SWP Success Story
Unlike the 90 percent of companies cited by Deloitte that are
unsure how to reskill their workforce in the Fourth Industrial
Revolution, each of our regional businesses can articulate
their plan with precision and confidence. They know what
capabilities and roles they will need, which jobs will remain
stable, which will be created, which will be eliminated, which
roles employees can realistically be reskilled for, and how the
reskilling approach is connected to market and organizational
needs. They have achieved this level of clarity because they
were early adopters of strategic workforce planning. They
realized its value by executing evidence-based plans, tracked
results and adjusted when needed, and incorporated it into
their ongoing business planning process. This is an example of
how to do it the right way and is the ultimate promise of strate-
gic workforce planning for both HR and business leaders.
Beverly Tarulli, Ph.D., is Vice President, Human Capital Strategy
and Advanced Workforce Analytics, PepsiCo. She can be reached at
beverly.tarulli@pepsico.com.
Damien DeLuca is Senior Director, Advanced Workforce Analytics,
PepsiCo. He can be reached at Damien.Deluca@pepsico.com.
References
1 86 percent and 10 percent statistics from “2019 Global Human
Capital Trends report, Learning in the Flow of Life,” Deloitte In-
sights, 2019; 40 percent figure from “Future of Jobs Survey 2018,”
World Economic Forum.
2 BlackRock Investment Stewardship Commentary, January 2019;
State Street Global Investors, 2019 Proxy Letter—Aligning Cor-
porate Culture with Long-Term Strategy, January 15, 2019.
3 Gartner, Discussing Corporate Culture with the Street, 2018.
4 For example, see Crook, T.R., Todd, S.Y., Combs, J.G., Woehr, D.J.,
& Ketchen, D.J., Does Human Capital Matter? A Meta-Analysis
of the Relationship Between Human Capital and Firm Perfor-
mance. Journal of Applied Psychology, 2011.
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