PepsiCo took a chance and gave iPhones to 4,500 hourly employees -- and it's paying off

PepsiCo merchandisers use a custom iPhone app to make sure products are displayed properly on store shelves. Credit: Apple

Last year, PepsiCo handed out more than 4,500 iPhones to its army of hourly employees who drive around to stores making sure products are placed correctly. 

Companies often give smartphones and tablets to managers and mobile salespeople. But the merchandisers who work for PepsiCo are not your typical information workers.

"These merchandisers are young, many work out of their home, and they're hourly employees," explained Mark Uppaluri, the Director of PepsiCo's go to market systems, who led the initiative. Their job is to follow closely behind Pepsi's delivery drivers, and arrange the products on shelves in a very specific order. They have to be fast -- if the product sits too long on a stockroom floor, retailers will call to complain.

But the old process was inefficient. Merchandisers would come in for a weekly meeting and get a stack of paperwork with their assigned route and instructions for arranging the products on shelves, and they had to place frequent calls to their managers to check in.

So Pepsi created an iPhone app that automated the process. 

"Everything they needed to know was loaded onto the iPhone in real time," says Uppaluri. "They didn’t have to make a phone call to say 'I'm starting my shift.' The timecard is on the iPhone itself. They didn’t have to tell their manager what store they were in -- ahead of this project, we put bar codes in every one of our 400,000 retail outlets. So when a merchandiser shows up at the store, he scans the barcode using the camera on the iPhone." 

At the same time, Pepsi rolled out 1,500 iPads for managers, with a custom app that lets them keep track of where their merchandisers are and what they're working on.  A second custom iPad app lets managers access SharePoint to view things like pricing and contracts. 

Building the apps only took full two full-time developers four months from concept to rollout, and Pepsi did the entire thing in house, despite having no iOS experience at the time.

"We're mostly a Windows shop, with some Java of late," said Uppaluri. "I have a background in computer science, so I downloaded the development kit and I was able to figure it out pretty quickly once I got Objective C. Apple did a fantastic job of documenting it, all the developer tools were seamless."

Once he decided the project was ready to go, it was critical to pick the right developers. They had to be able to build the apps, while also getting cooperation from PepsiCo's 400-person IT department, who needed to revamp some back end systems to present data to the apps.

"The one group we had to have on board was IT. When I'm done with this project, they're the ones who have to live with it. We had to get them to drink the Koolaid." 

Uppaluri went with a two-person team: a senior developer and a junior developer who was a couple years out of school.

"We kind of handpicked these people," he said. "They had institutional knowledge, an engineering background, plus the outside-the-box thinking of a young college graduate." 

They were successful in getting IT aboard. "Before we knew it, half people on the IT floor were asking managers why they couldn’t work on iphone project."

Why iOS?

So why did Uppaluri pick iPhones and iPads, rather than sticking with Windows or using Android, which would have been more familiar to developers who knew Java?

Consumerization was the first big factor.

Uppaluri says, "In my tour of the field, people would come into work with their iPod, they were texting, they had all these devices. Our strategy was to give them something so that they'd leave those other devices home. Sure enough, when our employees come to work, they come to work with the iPhone that we gave them. They use our device exclusively, even for personal tasks."

The portability of the iPad compared with a notebook computer was also attractive.

"Managers are required to do audits, to make sure all displays are done right," said Uppaluri. "Some managers have laptops with wireless. But one things we found, even though they had a laptop and a laptop bag, most of time it would sit in the car. They'd never even take it into the store." With the iPad, it was more like carrying a small notebook -- they could simply tuck it under their arms.

When Uppaluri first started considering the project in 2008, the iPhone was "not enterprise ready." But once Apple added the capability for over-the-air updates in iOS 5, which came out in late 2011, Uppaluri took another look. He says he was impressed with the stability of the iOS platform. 

"We'd seen several iterations, the accessories were the same, the upgrade path was very simple. With other technologies, every time there was a new release it seemed like lots of things had changed, and the accessories were different."

Uppaluri eventually signed an enterprise license, and got great treatment from Apple.

"Apple was absolutely available for us with a single phone call," he said. "We had access to this person we could call, he would then get anyone and everyone to help us." But Apple didn't try to push any particular methodology. "They let us run the thing on our own. For a lot of stuff we didn't know how to do, they had sample code, or would point to web sites."

Managing the devices and setting policies

Rolling out so many new devices on a platform Pepsi had never used before presented some challenges -- particularly to the IT department.

The security team insisted that the project use a mobile device management (MDM) solution to protect against data theft if phones were lost or stolen. Uppaluri tested several before deciding on AirWatch. 

Since these were COPE (company owned, personally enabled) devices, PepsiCo also had to lay out some clear policies about how employees could use them.

"Like anything we do, we sign a contract with our employees. We tell them 'here are our constraints.' They're free to use the device for certain things," he explained. "When we train them, we tell them we're not responsible for backing up your phone, we're not responsible for any personal stuff on there. If you lose your phone, your personal stuff is your responsibility."

Pepsi also bought insurance policies on the phones. "If it drops and shatters, no questions asked."  

He expected employees to lose or break "many many more" phones than they did. But because the workers use the iPhones like personal devices, they treat them like personal devices too.

"There's personal stuff on there, so they don't want to lose them."

The bottom line

To justify the project, Uppaluri had to show that the iPhones saved six hours of labor per week per employee. "We've been able to deliver that," he says.

Now, PepsiCo is starting to look at other projects where iOS or other platforms could play a role. "My goal was to build a developer capability for IT so they could work on Windows stuff, Apple stuff, Android stuff -- you never know what they'll need to work on next."

Uppaluri is also happy that the project moved PepsiCo's culture forward to give employees more control over the technology they use at work.

"Any time we have a frontline employee, everything is controlled. We had to cede some of this control, and that was a big change. It took a while for us to get people to relax a bit. The change is good. We don’t have to be in 100% control all the time."

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