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Name of Organization/Company: PepsiCo, Purchase, NY USA
Category: Best Reward & Recognition Strategy

Entry Title: Living the PepsiCo way: PepsiCo’s recognition journey


PepsiCo (NASDAQ: PEP) is one of the world’s leading food and beverage companies, with over $70 billion in revenue (2020), 291,000 associates, and operations in over 200 countries and territories around the world. PEP’s products are available globally and its portfolio includes 22 brands that each generates more than $1 billion in estimated annual retail sales.

PepsiCo started on a transformational journey of Good to Great, by transitioning to a mindset of Winning with Purpose in early 2019. The Winning with Purpose was created to help PepsiCo to achieve a mission of “creating more smiles with every sip and every bite” whilst “being the global leader in food and beverages” through being faster, stronger and better(1) in a new corporate culture, known as The PepsiCo Way (TPW)(2).

Over the next year, PepsiCo doubled down on The PepsiCo Way – creating a crowdsourcing platform to hear direct from associates on how to live the behaviors, instigating a unique innovation challenge for employees to live the behaviors and create ideas for the organization, measuring success through their annual survey, and lastly – taking a hard look at how it should be (but was not yet) embedded into the organization’s overall recognition strategy.

2020 was a difficult year; and the need for global recognition was clear. With the successes of 2019’s cultural implementation supporting them, PepsiCo aligned their recognition strategy with the PepsiCo Way. The strategy was rooted in the TPW culture and designed around PepsiCo’s pyramid of recognition(3), creating recognition at all levels. At the base of the pyramid – based on day-to-day recognition, PepsiCo successfully launched a global recognition program called Smiles in Fall 2020(4), in 10 languages, available via desktop or mobile device. Smiles is an ongoing and real-time peer-to-peer recognition platform built entirely around the PepsiCo Way behaviors that enables all associates to recognize others who exhibit the behaviors. By bringing recognition to all associates, Smiles brought the PepsiCo Way to life, with over 225k moments of recognition recorded in 2020(5).

In the middle of the pyramid, PepsiCo aimed to recognize the next level of effort, for displaying TPW – on a quarterly basis. The PepsiCo Way Quarterly Awards were born. All PEP employees can be nominated for Quarterly recognition for embodying The PepsiCo Way, and there were 600+ winners in 2020(3).

Topping off the pyramid, PepsiCo took TPW to the highest level by establishing a Chairman’s Award category – Winning with Purpose: The PepsiCo Way. The Chairman’s Awards at PepsiCo are prestigious annual awards that are given to either individuals or teams. Creating a new category specifically for the PepsiCo Way furthered the recognition strategy and its tie to PepsiCo’s culture(9), with over 70+ winners in 2020(3).

With the launch of the PepsiCo Way in 2019, PepsiCo has dedicated itself to measuring the impact of culture on its business outcomes. The strongest way to do so was to include PepsiCo Way measurement items on the organization’s yearly engagement survey. Distributed to the entire organization, the annual engagement survey measures associates’ experience with the organization and demonstrates the organization’s ROI(6).

After the launch of the new recognition strategy, PepsiCo found that the receipt of a recognition moment for The PepsiCo Way on the Smiles platform increased PepsiCo Way scores on the engagement survey by an average of 2% points in the US. This helped to demonstrate a strong connection between the PepsiCo Way and Org Health scores(7), which in turn – drive PepsiCo’s business results.

Feedback on the recognition strategy also reflects the positive choices PepsiCo made to create recognition moments tied to their culture; “Thanks for creating a place to recognize co-workers for the PepsiCo Way”, and much more(8). PepsiCo associates have learned how to recognize on the PepsiCo Way and how a centralized system works much better than a manually run and piece-meal process. This has helped influence the development of a more streamlined recognition process, which continues to grow and evolve each quarter.

Reference– highlights PepsiCo’s Mission and Vision, and how it is built on the PepsiCo Way. Rooting the strategy in this framework is how PepsiCo’s recognition process came to life.: https://vo-general.s3.amazonaws.com/a1ab4161-9c30-4e28-88fc-d6ad384e3fe2/ff1c4f63-abd6-4110-90ea-12ced299399e?AWSAccessKeyId=AKIAJ4PRWO26HAX3IOCA&Expires=1720375571&response-content-disposition=inline%3B%20filename%3D%22Reference%201%20-%20PepsiCo-s%20WWP%20Strategy.pptx%22&response-content-type=application%2Fvnd.openxmlformats-officedocument.presentationml.presentation&Signature=jdxCH28RocHgC7%2Fa5y9QZsTuFGI%3D

Reference – Shows real screenshots of PepsiCo’s powerful recognition platform, including the PepsiCo way behavior nomination buttons, the nomination form, and a real example of what a received message looks like.: https://vo-general.s3.amazonaws.com/a1ab4161-9c30-4e28-88fc-d6ad384e3fe2/18016ead-a7bb-48d3-90f9-9ebc9c940c86?AWSAccessKeyId=AKIAJ4PRWO26HAX3IOCA&Expires=1720375571&response-content-disposition=inline%3B%20filename%3D%22Reference%204%20-%20PepsiCo%20Smiles%20Recogntion%20Platform%20Screenshots.pdf%22&response-content-type=application%2Fpdf&Signature=Tsy53U28obkxQyYaCy6GsTAwBMk%3D

Reference– Shows PepsiCo’s employee engagement survey framework; demonstrating how feedback received on the survey directly correlates to the organization’s ROI.: https://vo-general.s3.amazonaws.com/a1ab4161-9c30-4e28-88fc-d6ad384e3fe2/7b0e50ef-a06e-4ca8-a2e8-5d874503207d?AWSAccessKeyId=AKIAJ4PRWO26HAX3IOCA&Expires=1720375571&response-content-disposition=inline%3B%20filename%3D%22Reference%206%20-%20Org%20Health%20Engagement%20Survey%20Framework.pdf%22&response-content-type=application%2Fpdf&Signature=7cgqbYO8BlhNv0aeDZKCPksXYNw%3D

Reference– Shows a strong video calling for nominations of the Chairman’s Winning with Purpose Award: The PepsiCo Way – again tying culture into the recognition strategy.: https://vo-general.s3.amazonaws.com/a1ab4161-9c30-4e28-88fc-d6ad384e3fe2/4f5c00df-8e92-4c3d-aa36-4dad2f291ea1?AWSAccessKeyId=AKIAJ4PRWO26HAX3IOCA&Expires=1720375571&response-content-disposition=inline%3B%20filename%3D%22Reference%209%20-%20PepsiCo%20Chairmans%20Winning%20With%20Purpose%20TPW%20video.mp4%22&response-content-type=video%2Fmp4&Signature=cC%2FHj5u6FwK5MHiuEPdrWsN150E%3D