PepsiCo Bottles Technology Collaboration Effort In New Digital Hubs

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PepsiCo Inc.

is recruiting a mix of tech and business workers for two new business units tasked with adapting its digital tools to better tackle a range of issues, from solving supply chain constraints to developing new ones. -case.

The units, located in Dallas and Barcelona, ​​will serve as key sources of corporate technology development across the company’s global operations, independent of its existing information technology team, the company said.

PepsiCo, which calls the units digital hubs, plans to equip them with hundreds of software engineers, data scientists and analytics experts, as well as sales and marketing staff, designers and product managers, the company said. It plans to hire more than 500 workers over the next three years. The cost of the initiative was not disclosed.

“We’re not a tech company,” said Athina Kanioura, PepsiCo’s director of strategy and transformation. But by relying solely on enterprise applications in the marketplace and struggling to keep up with short technology cycles, non-tech companies end up spending most of their time updating existing applications rather than updating existing applications. develop new ones, she said.

Beyond that, she added, most software from third-party technology vendors only meets about half of the business’s needs. Either they lack company-specific data in the development process, or they’re just not aligned with its problem-solving goals, she said.

Instead, the company – which in addition to its namesake soft drink owns Cheetos, Doritos, Lay’s, and other snack brands – wants to take apps from external software vendors and customize them to better fit. to her distinct way of doing business, Ms. Kanioura mentioned.

To do this, PepsiCo needs to bring together tech and business experts under one roof, she said, “You can have an amazing technologist, but it can be difficult for them to understand business issues. ”

Ms Kanioura, who oversees the development of the new units, said she wanted to mix and match people with technological background and business experience who “understand how processes work and how the business works.”

For example, she said, digital hubs can solve business-wide issues, such as unifying separate and often incompatible planning systems across business divisions, as well as end-of-life processes. that extend from the supply chain to factories and grocery stores. shelves. It can also include product development, personalized customer services and targeted advertising campaigns, she said.

Based in the company’s Frito-Lay office building, the Dallas unit will be responsible for global software development with a particular focus on the company’s North American operations, including PepsiCo Foods North America and PepsiCo Beverages North America. .

The Barcelona unit, which started hiring workers earlier this year, will act as a corporate “center of excellence”, setting company-wide priorities and standards for implementation. of digital technology, while leading its vast digitization efforts, the company said.

Ms. Kanioura said Dallas and Barcelona were chosen for their proximity to the company’s regional operations, but also to emerging technology centers, research institutes and other nearby resources. The Dallas area in particular has started attracting tech workers from Silicon Valley who have switched to remote work during the pandemic.

Companies with similar stand-alone digital units – outside of traditional enterprise information technology stores – include Morgan Stanley, which operates what it calls a “data center of excellence,” which aims to give a sense of the complex business data needed to develop artificial data. intelligence applications.

Fiona Mark, Senior Analyst at IT research firm Forrester Research Inc.,

said that bringing together business and tech workers allows companies to leverage deep technology know-how coupled with business expertise. This combination can lead to specific software customizations targeting real business issues, she said.

During the pandemic, she said, many retail organizations had to quickly adapt to changes in operations such as curbside pickup. “They found that these customer-centric partnerships with technology, and these shared teams focused on targeted customer-centric problems, were able to deliver solutions quickly,” said Ms. Mark.

The number of digital hubs and centers of excellence outside of traditional IT units is increasing “because companies realized they were working,” said Enno de Boer, partner and global head of operations technology at McKinsey & Co .

He said early adopters of the digital hub model in manufacturing saw improvement rates of up to 90% in standard productivity metrics, lead time reduction of up to 80%, and energy improvements. up to 50%.

Write to Angus Loten at [email protected]

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