Solving problems is manufacturing at its best, according to Gregg Roden, senior vice president of Supply Chain at Frito-Lay North America (FLNA). The brand is a subsidiary of PepsiCo.
“As we look to serve consumers whose tastes change quickly, we need to adapt both our manufacturing processes and supply chain to accommodate the market,” says Roden. “One of our current innovations is that we can season our chips in a variety of flavors that are all coming out of the same production line.”
The ‘on machine’ seasoning allows the line to produce greater varieties of spicy and sweet flavors and proprietary technology for new packaging formats and size flexibility, all part of changing customer demand.
This was an innovative solution to a current need and is but one example of how company employees are always on their toes seeking solutions.
“No matter how automated we become, we are still very much a people business,” explains Roden. “The world changes very quickly and we seek employees who have intellectual curiosity.”
Curiosity is often a hallmark of the Millennial generation and PepsiCo is very aware of that. As a company, their leadership program is structured around employees being trained in various disciplines. For example, in supply chain management employees can spend a year in packaging and then a year on the transport side to ensure a well-rounded education. Then they can choose which area they prefer. They can also look across the entire corporation for opportunities such as selling, R&D or becoming plant directors.
“Employees who are flexible with regard to career paths are ideal for our company,” Roden says.
Flexibility is, in fact, a large part of PepsiCo’s success. Over the past eight years, the company has been altering production in order to place greater emphasis on efficiency and customization to reflect current market demands. The new production system, created eight years ago, is called Geographic Enterprise Solution (GES) and Frito Lay North American has nine GES sites across the country. This system reduces the amount of manual handling throughout the supply chain to drive productivity. It also improves quality and offers a broader assortment of products being delivered to retail customers.
Technology is part of the upgrade at these facilities. The system leverages robotics and technology in new and different ways, in areas like packaging, case picking and forklift operations. Material handling automation is bringing fulfillment of orders closer to the point of production which allows for quicker movement to the stores. The advantage here, according to Roden, is providing fresher products to market faster. It also accommodates an increase in the number of SKUs.
Roden said that the benefits they expect to see from this system are to improve sales, increase cost efficiencies and improve customer experience. “This isn’t just a cost play or a volume play but also a quality play.”
A key component of this system is to incorporate sustainability goals as part of growing the business. The company has committed to reducing water, waste and energy use in its facilities. FLNA has invested in a combination of technologies across various facilities, including membrane bioreactors to treat and recycle water (e.g., Casa Grande, Ariz.); and biomass boilers that generate steam and cut fuel use (e.g., Topeka, KS; Casa Grande, Ariz.).
Last year PepsiCo introduced a sustainability program called Performance with a Purpose 2025 Agency. The three focus areas of the program are Products, Planet and People. In a report issued last month, the company reasserted its aspiration to deliver sustainable change across the company, its value chain, and the food and beverage industry, through this program.
“Last year, we doubled down on Performance with Purpose, our vision to deliver top-tier financial results over the long term in a way that’s responsive to the needs of the world around us,” said PepsiCo CEO Indra K. Nooyi when announcing financial results last month. “Since then, we’ve been working hard to advance our 2025 Agenda, from making more nutritious products to limiting our environmental footprint, to empowering people and the communities where we do business. As this year’s Report shows, we are making real, meaningful progress all over the world.”
Meaningful progress in the areas of automation, production, innovation and sustainability certainly appeals to the future manufacturing workforce. And Pepsi has a good handle on how it recruits, trains and provides career paths for workers. These methods have paid off. “We have very low turnover, and that represents a strong future.”