Eight years ago, PepsiCo thought design mostly applied to highly engineered products, not consumer packaged goods.
But then the food and beverage giant hired Mauro Porcini, the company’s first chief design officer. “It was an educational experience for us to have somebody like Mauro explain what design can do,” says PepsiCo global chief commercial officer Ram Krishnan, speaking Tuesday at Fortune’s “Resilience by Design: Driving Business Transformation” virtual event.
Porcini’s rise at PepsiCo is part of a broader recognition in corporate America of the value of design and the elevation of chief design officers to c-suite roles.
Poricini says that it’s the role of designers to behave almost like anthropologists and look at what’s going on the world in order to identify opportunities out of frustrations, desires, and dreams.
When the pandemic hit, he says, “We needed to be out there really understanding what was happening.” The problem, he adds, was the level of uncertainty about the short, medium, and long term.
The company used typical methodologies of design thinking by trying to understand people’s response to the pandemic, thinking about how the the company should react within the context of its portfolio and industry, and then prototype solutions.
In the last year, PepsiCo has developed a new corporate structure that integrates all of its commercial functions—design as well as marketing, sales, e-commerce, and research and development—under one team that reports to Krishnan in a newly created role.
“That has accelerated the role of design within PepsiCo, moving from just looking at aesthetics to looking at genuine consumer experience,” he says. The new structure has also reduced the speed to market for new products by 30%, he says.
The way PepsiCo has come to embrace design throughout the company is exemplified in how it now thinks about budgeting, which Krishnan says is one of the biggest fundamental shifts. Rather than Porcini having to ask for funding, “it’s now every function wanting to fund design because they see the impact designer side, and also the business unit,” Krishnan says.
Porcini says that since 2014 the company has been measuring the return on investment of design: “It has been a major enabler to show that we should create a design function in-house because it can move with higher agility, better quality at a lower cost.”
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