Packaged to excel

Forming in the early 1950s, Tetra Pak was one of the first companies to successfully package liquid milk. Since then, it has become one of the world’s largest suppliers of packaging systems for milk, fruit juices, drinks and many other products. Today, there are 41 Tetra Pak companies and 74 sales offices across the world. They host 43 plants and 10 assembly factories. In all, the company has 21,640 employees, bringing in net sales of €8.825 billion (US$11.21 billion) in 2008.

Yves Zerbib, HR cluster leader, South and Southeast Asia, says Tetra Pak operates in 150 markets, making it a global leader in its field. But none of that success would be possible without the company’s focus on HR and talent management. “We recruit the right people, make them comfortable, develop them and make them stay for the right reasons,” he tells HRM.

So just what is the secret of Tetra Pak’s internal packaging that makes it so attractive and motivating to employees?

Developing the right talent

Zerbib says Tetra Pak’s HR leaders boast an extremely organised talent management programme and people development infrastructure to balance its escalating success in business. To begin with, the company regularly assesses the potential of everybody within the organisation based on their performance, demonstrated leadership, and their willingness to change and develop themselves. “For each and every employee at the management level, there is a yearly assessment of their potential,” Zerbib says. “This assessment is then used to build the development plans and also pipelines of talent for given positions.”

The company has no qualms about having high potential staff lie in wait until appropriate development opportunities come around.

Zerbib says these bench-strength talent, or “Benches”, are people that have been recognised with potential for higher positions or more responsibility. Every time the company has a new position at some level, the HR team goes into this bench and these people automatically become part of the gross (selection) list, he says. “We believe in strength-based development of our people more than trying to fill the gaps.”

But this is just one part of a talent management system that works in several stages. Zerbib says it starts with competency development, identifying people’s strengths, nursing them and then developing them. The succession planning in Tetra Pak is slightly different, says Zerbib. “We don’t simply identify one person and see if we have two people that can take that job,” he says. “We want to fill the whole pipelines for talent for various functions.”

Does the company always have enough internal talent to fill these vacancies? “Usually, yes,” Zerbib says. If there is ever a shortfall, Tetra Pak has a system for also bringing in some strong outside talents. “That’s something we have been doing pretty well and it is very-well organised,” he adds. That’s been particularly true for the top end of the Tetra Pak team, but the organisation is now working to improve what it calls its “young talent development” strategies, focusing on early career development for the lower levels of the organisation. “We have done a lot for the top 20% but maybe not for the 80% below,” Zerbib admits.

“We have some very good initiatives but we are still not where we should be with the whole organisation. We are not really very good at early development programmes and that’s what we plan for the next couple of years – to develop the lower end of the pyramid.”

He says Tetra Pak is looking to get more organised throughout the whole range of talent management practices.

“Tetra Pak is starting programmes that will try to identify the leaders for tomorrow, people who are ready in the organisation, in a much more organised way than it is being done now. We need to identify these people and we need to prepare them and develop them.”

Another way to do it is to make sure HR employs people with this desired potential from the outset. For this, Tetra Pak has a programme that recruits young people who have excelled in school and university. “We have graduate students from engineering schools who topped their class, who are interested to come and work for us,” Zerbib says. “We have a Graduate Engineering Training programme that is meant to fill our pipeline with young potentials for tomorrow. These are people we then move from one process to another before they take up permanent positions somewhere in the organisation.”

Talent retention

Zerbib says Tetra Pak’s turnover rate is the envy of the entire packaging manufacturing industry in Asia. Backing up its retention efforts is a significant focus on open communication and employee feedback. “The way we retain our people is through a high level of engagement,” he shares. “We do one employee engagement survey every year and normally we have ‘employee engagement’ at the top of our findings.”

Engagement is not just about keeping workers energetic and enthusiastic. It’s a long-term process that looks to ensure every employee has something both interesting and challenging to do. Tetra Pak makes sure that every worker feels that it is worthwhile to wake up in the morning and come to work because they know that they would do something interesting, Zerbib says.

Beyond that, the company looks closely at rewards. This is not just about decent monetary compensation but also providing active recognition when they do well. “We have quite a lot of programmes,” Zerbib says. “We are also working to make sure there is a career for people, so that they can see that if they perform well, they will have a chance to get more, and have more interesting things to do at every level in the organisation.”

In a nutshell, Zerbib believes in retaining the employees through empowerment, by giving them the right amount of responsibility, by developing them throughout their careers, by giving them the right recognition for what they do, and by making sure that they see there is a career for them in the company. “We respect our people, every one of us. We consider every employee in this company valuable to us.”