WMU FOOD MARKETING CONFERENCE

MARK HAMSTRA

KALAMAZOO, Mich. - Recruiting, training and retaining good employees is becoming increasingly critical to the success of large corporations, especially as baby boomers age and retire, according to several speakers at the Western Michigan University Food Marketing Conference here last week.

"Probably the biggest challenge we face as we grow is people," said Jon Flora, senior vice president, Cincinnati-based Kroger, in a presentation at the conference's closing session. "Where will we find the people to staff our stores? And it's not just at the low end, it is throughout the organization."

In the conference's opening keynote speech, Al Carey, president of sales, PepsiCo, Purchase, N.Y., said that in the next five years, 21% of PepsiCo's top 300 executives will be eligible to retire, and the company may need to hire as many as 60,000 new workers ¡- a challenge it is seeking to meet by making the workplace more accommodating to today's young job seekers.

"By 2008, 40% of the workforce will be 45 and older," he said. "This is something we are really going to have to deal with."

In addition, as the demographics of the country evolve to encompass a larger proportion of minorities and immigrants, companies need to establish systems that attract and retain those individuals, Carey said. Within about 10 years, he said, only 30% of the new entrants to the workforce will be white males, and the remaining 70% will be women and minorities.

"We will need to build organizations that are attractive to diverse candidates," he said, stressing the importance of including minorities in the top executive ranks. "It's very important for young people to be able to look up to those people and say, 'Yes, I can do that some day.'"

Carey also said the current generation of entrants to the workforce - influenced by the recent wave of corporate scandals and the impact of the 9/11 terror attacks - have become disillusioned with large companies and want more balance between their careers and their personal lives.

He cited exit interviews at PepsiCo in which 86% of those people leaving the company in 2003 cited work-life balance as a reason for leaving, vs. 44% who cited balance in 2000.

To accommodate this new mind-set, Carey said the company introduced some new policies, including mandatory use of vacation time - internal polls had found that 50% of vacation time was going unused at the company - and a "Just go, don't even ask for permission" policy for employees seeking to attend their children's activities.

Flora said that as retailers increasingly offer similar products, level of service becomes more of a competitive advantage.

"The major point of differentiation between companies is people," he said. "We may have the best-looking store in the area, but if a customer gets bad service, they won't come back to that store."

He cited one example of front-line service in which a customer came into a Kroger and asked a deli manager for a brand of mayonnaise that the store did not carry.

"What brand?" the deli manager asked.

"Albertsons," the customer replied.

The deli manager - presumably choking back the urge to burst out laughing - went across the street to an Albertsons store, purchased several jars of mayonnaise, and gave two of them to the customer. The deli manager saved the remaining jars for the customer to pick up on future shopping trips.

"Don't underestimate what your people can do," he said.