Saturday, February 8, 2014

New Hiring Strategy - The CEO who writes her employees' parents

Indra Nooyi has been CEO of PepsiCo since 2006 and during her tenure has seen a remarkable amount of change. A big part of her strategy is intense focus on the employees. A favorite technique is to pen letters to employees' parents and she says it really works for her.   Nooyi recently sat down with Fortune managing editor Andy Serwer at the World Economic Forum in Davos for an interview. Here are the excerpted highlights on the hiring strategy 

I thought about my kids and I said, "You know what?  If I ever got a report card on them, after they're 18, I would love it, because in the U.S., once they turn 18, we don't get report cards.  We pay their tuition, but we don't get their report card, right?"

And I am just dying to get the report card. I would kill to get to the report card, okay?  We don't get it.  But this is good news because they're only going to get a good report card, right?  I'm not going to write anything bad because these guys are all C Suite candidates. So the first thing I did was, I wrote to the parents of all my direct reports and said --

You wrote to the parents of all your direct reports?

All my direct reports. I wrote to them and I told them the story of my going to India and what happened with my mother, and I said, "therefore I'm writing to thank you for the gift of your son, who is doing this at PepsiCo, and what a wonderful job this person is doing."  I gave a -- it was a personal letter for each family member.

And it opened up emotions of the kind I have never seen.  Parents wrote back to me, and all of a sudden, parents of my direct reports, who are all quite grown-up, and myself, we had our own communication.

And one executive, I remember, he went home and he said to his mom, "you know, my boss is really giving me a tough time." And his mom told him, "Nuh-uh, not about her.  She's my friend!"  (laughter)

You were working it!  (laughter)

So this is one thing.  And then I expanded it, and I said, okay, let's identify the 200 people in PepsiCo, age 35 to the senior most people, who could be the future and the soul of the company. I break them into groups of 15 and then I take away for a couple of days, or 2-1/2 days.  And it's just them and me, and we talk about who they are, their story, and I get to know each of them personally.

And then after they're through, I write to their parents also.

We had an employee who we were trying to hire.  Absolute high-potential chap.  He had an offer from another company down the road from us, and I wanted him real bad….He was a tough guy to hire. So I said, okay, I'm going to call his mom.  (laughter)  So I call his mom, and she didn't know who I was.  I introduced myself and I said, "Let me describe the situation," and I said, "Let me tell you why coming to PepsiCo is going to be the right career decision for your son."

So the son goes home -- he has no clue I called his mom -- and he says, "I'm looking at these two offers,  Mom, and I'm close to accepting the other one."  And she goes, "No.  You're accepting PepsiCo."  He goes, "Since when did you know anything about PepsiCo?" And the mom said, "She called me, your CEO called me."  And this boy goes, "I had no choice!"  (laughter)  Can you imagine going home every day after that and a mom goes, "but you should have accepted that offer!"

The full interview transcript can be read here :