In its wake, Covid left behind a business environment dominated by what’s become known as VUCA — volatility, uncertainty, complexity, and ambiguity. At the League of Leaders conference last month, held at SAS’s Executive Briefing Center in Cary, N.C., John Phillips, PepsiCo senior VP, customer supply chain and go-to-market, presented ways to turn VUCA into opportunities and success in this radically shifted post-pandemic CPG environment.
The League of Leaders is a cross-functional gathering of senior business and IT leaders in retail and consumer goods who meet quarterly to exchange ideas on a range of trends. Phillips' overarching advice for those navigating VUCA’s challenges: Don't resist or merely embrace change. “You have to be willing to drive change,” he insisted.
Phillips broke down the challenges facing CPG businesses into three categories:
- Satisfying the omnichannel consumer
- New work life-balance employee expectations
- Building resiliency & automation into operations
While Phillips noted that e-commerce growth is slowing a bit, consumers taking advantage of omnichannel access to goods no longer fits a stereotype. “Virtually everyone across every demographic, every geographic area, whether it’s urban versus suburban, city, non-city, are purchasing things online,” he noted. “You’re really seeing people split their shopping trips across three or four channels and also multiple modes.”
Another emerging trend is the desire of consumers to have more information about the products that they purchase. Phillips shared PepsiCo’s SMART Packaging strategy that leverages a single QR code to tailor a product specific experience at the package level. Current QR codes will soon evolve to the GS1 Digital Link, which will replace the current UPC barcode.
“A single QR code can curate a tailored consumer experience at the product level,” Phillips explained. “You’re able to provide information that would never fit on the physical package.” GS1 and the industry has ratified the Digital Link standard that will replace the current UPC barcode over the next five to seven years, according to Phillips.
Flexibility Key to Hiring, Retention
Now that employees have gotten a taste of working from home and creating an improved work-life balance, there's no going back. The pandemic, Phillips commented, “held up the mirror for many of us highlighting the lack of balance we had in our personal lives. The pandemic forced people to reflect on what really matters to them, and it is no longer just about work.”
Twenty-somethings, he noted, don't “live to work, they work to live. They define the experiences they want, the lifestyle they want, and that drives which job they take, how long they work, how aggressively they go after promotions.”
Phillips enumerated a new list of demands of today’s workers:
- Flexibility and hybrid work, which, Phillips explains, often trumps compensation
- Better wages and benefits
- Internal mobility opportunities
- Team culture
- Health – reduced anxiety and stress
The challenge for employees, Phillips believes, is to be flexible and enable flexibility while still enhancing corporate culture. But, he warned, “if you’re providing flexibility to check a box or you do it with an eye roll — don’t do it, because that’s actually worse. If you do it, do it with sincere intent.”
Complicating the employee equation is that there are a lot of roles that workers are no longer willing to do, presenting the challenge to look at new areas of automation to change or eliminate many of the less desirable jobs.
Phillips showed a series of videos laying out the “warehouse of the future” — available right now — in which all movements are steered by machines and computers, with employees managing the automation instead of lifting boxes.
“There’s incredible automation coming to market,” he stressed. “You can get overwhelmed thinking you’ve got to do it all at once. You really don’t. You can take little pieces. You just want to have a mindful blueprint to make sure your end state is compatible with whatever building blocks you put into the network to start with.”