Evgeny Lyubimov: “Who owns the information, he owns the world’. And there is a serious challenge for us because you can analyze information to the state of “Analysis Paralysis”

Transformation Manager PepsiCo UA Evgeny Lyubimov about the experience of standards management processes automating in the company and what does it give them.

Please tell us about the industry and the brand, about the competitive environment.

Everyone knows PepsiCo, we work in the FMCG industry. These are food products: carbonated soft drinks, snacks (Lay's, KhrusTeam), Sandora and Sadochok juices, dairy products and baby food (CHUDO, Slavyanochka, Agusha). Considering the range of our products, we have to work in very aggressive segments, almost in each of them the competitors are international companies with whom we should seriously fight for the market share.

Why did the company decide to automate the management of standards and selling on to the national retailers? What was the reason?

The reasons are obvious: many national retail companies are switching to supply management through their own distribution centers (DC) and as a result, we, manufacturers, have lost the threads of supply management to retail outlets. It became difficult to control the fulfillment of agreements through shipments. In addition, even the management of agreements through shipments is somewhat inertial and does not provide a day-to-day understanding of what is happening on store shelves. Therefore, we were thinking about getting a tool or process that will allow us to do this promptly. To understand what is happening in stores and, as a result, react faster than before.

Answering your question, there are two key reasons: the switching of key players on supply via DC’s and our desire to respond promptly to the real situation on the store shelves.

How did you choose the service?

We are a large company, so on our request the procurement department has monitored the market and offered a list of companies with similar solutions. Fortunately, at the same time IPLAND company came up with its offer to us. At the right time in the right place, the company properly presented its product. The stars were aligned, and IPLAND was chosen at the end.

What had influenced the decision?

One of the main reasons, of course, was the price. However, there were even more interesting reasons, as for me it was the user-friendly interface of the service. The solution impressed our team with its simplicity, intuitiveness, nice visualization. The technical nuance is also important – there is no need to integrate this service with our ERP system, which for us, large multinational companies, often becomes a serious project, and sometimes a blocking factor for the implementation of IT solutions. There was no such factor for effie> and this also played sizable part to decision.

What tasks did you have at the start of the project with effie>?

At the beginning of the project, we set a very simple task, at first glance, to get away from motivating sales teams for sales volume performance in the VIP channel and switch to motivation for fulfilling various conditions. It could be the terms reached by the network, the standards of performance, contracts, or the motivation of the team for extra tasks performance which are inevitably arising. We tested whether we can get away from motivation for volumes without lost in sales and go to motivation for the so-called “visual” indicators. We also wanted to simplify the communication processes, speed up and simplify the processes of setting tasks by Key Account Managers and performance checkup. Heretofore these processes used to live in other solutions like Viber, Excel, email, etc., which created chaos in communications. We consider the service effie> as a way to organize these communications.

What functionality is the most demanding today? What opportunities does it give you?

Due to effie> we promptly collect a lot of information from the fields: photo reports (which is important, since they are very conveniently realized in effie> including the impossibility of fakes), easy management of the tasks and questionnaires. In one word, this is the prompt collection of a huge amount of information.

Ones who own the information, owns the world. And there is a serious challenge for us because you can analyze information to the state of “Analysis Paralysis”. We will create inside by ourselves some rules on how to work with this mass of data. And the possibilities, by and large, are endless: quick response to the market demand, market situation, on competitors' or our own mistakes done. This is the essence of business. There is no way without information and effie> gives it.

How has the process of managing brands in retail networks changed today?

We have many brands, and by many of them we are market leaders. Of course, management processes have moved to a practical level. Our brand teams are now involved in regular processing of information received from fields, and naturally, they are forced to adjust their trade marketing plans taking into account the realities of the market.

You have launched an innovative process to control the information received from the fields (incidents). Tell us please what this process gave to you.

It was our feature, IPLAND has developed the functionality at our suggestion. The goal was very simple: we wanted to eliminate the costs of verifying the correctness of the information submitted by the fields. We didn't want to have teams or agencies going around and checking the correctness of the information given by the trade teams. We were also against putting this work on our supervisors, it is not worth their time. All this information can be verified by comparison with photos, as the photo cannot be fabricated. We decided why not. And now we can make online verification of the data received.

Incidents have appeared consequently. Naturally, we find mistakes and deliberate fraud, and we think what to do with it. Thus, supervisors receive a message that their team members are submitting incorrect information. And we have a process on how to work with these incidents to correct the situation.

We talked to other companies and in other categories. It turned out that our experience was unique at some stage, since everyone practiced the physical control of the credibility of the data provided.

Please, share the results that the company has achieved today with the help of automation.

After the pilot project we proceeded to the industrial deployment of effie> throughout Ukraine. This indicates that the pilot was successful. We were able to move away from motivating teams for sales volume to visual indicators performing without sacrificing sales. This is a good result in itself.

In addition, we received a tool that makes it possible to work with any type of merchandisers team - both with our employees and from agencies. If a merchandising agency provides us with a resource, the work with it is absolutely transparent for us now. It is possible to start tasks realization by a third party in a week. This is a very strong result that gave us flexibility. We have got a good choice now.

Please, share with us your plans. How do you want to use the possibility products recognition on the shelves?

This is the area in which we will move very strongly forward together with IPLAND. When we put a team of online auditors to check the photos and compare them with the merchandiser’s answers, we have realized very quickly that this is a low-skilled work that does not require special education, and it can be easily transferred to artificial intelligence.

A machine can count the number of SKUs not worse than a human. I see great potential here. This will allow using effie> quickly transform the large amount of information obtained into reporting based on which we can already take certain actions. This is the first and main project that we are implementing now.

effie> is currently being tested at PepsiCo in other countries, particularly in Kazakhstan, Belarus, Azerbaijan. This experience has already given positive results and I think effie> expansion to other countries will be very successful. I am feeling proud of both PepsiCo Ukraine and effie>.

We are always thinking about how to simplify, automate and secure many processes from the human factor affecting. Especially now, this is the first point of my Job Description as the Head of the transformation department. There is the other side of the coin, PepsiCo is a huge company and there are many limiting factors to consider. Not all our dreams come true quickly, but we do everything we need to do for that.

Company information:

PepsiCo is one of the world's largest food and beverage manufacturers with annual sales of over $ 64 billion. The company has a wide range of products, including 22 brands with more than $ 1 billion in annual retail sales for each.