OB Project Group 4 Section D

8/2/2019 OB Project Group 4 Section D

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Group - 4

Ankur Pandit (206)

Jayantwin Katia (224)

Meenakshi Shekhar(232)Mohnish Karjodkar(234)

Mradul Sharma(235)

Raminder Singh Sidhu(238)

PEPSICO


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About PepsiCo

PepsiCo is a world leader in convenience foods and

beverages. Its world renowned brands are available in

nearly 200 countries and territories

PepsiCo entered India in 1989 and has grown to become

the countrys largest selling food and beverage companies

PepsiCo India and its partners have invested more than

U.S.$700 million since the company was established in the

country in 1989


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Mission: To be the world's premier consumerproducts company focused on convenient foods andbeverages. To produce healthy financial rewards toinvestors & provide opportunities for growth andenrichment to our employees, business partners and thecommunities in which we operate & in everything we do,we strive for honesty, fairness and integrity

Vision: To inspire the moments of optimismthrough our brands and our actions. To continually

improve all aspects of the world in which we operate -environment, social, economic - creating a bettertomorrow than today.


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Brands and Products


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Organization Configuration

Large firm with global presence, having multiple products

Each of the sub-divisions acts like an independent entitythat works towards fulfilling the companys stated goals

Horizontal linkages between the divisions exist that aid in

information sharing across the divisions

Diversified Form


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Organization Structure

Pre-November 2007

PAB and PAF reported asPepsiCo North America

PepsiCo Europe and

AMEA reported asPepsiCo international

Post-November 2007

PAB and PAF report asindividual entities

Current Scenario

PepsiCo Europe andAMEA report as individualentities


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Organization Structure

Global Matrix Structure


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Business UnitCEO/MD

Market UnitGeneral Manager

MarketingExecutive Director

Human ResourcesExecutive Director

OperationsExecutiveDirector

LegalExecutiveDirector

FinanceExecutiveDirector

InnovationGeneralManager

PepsiCo India Structure

Business Units

Each Business Unit (BU) is headed by a Business Unit General

Manager (BUGM).

There are several Market Units under a Business Unit like NorthIndia Market Unit (NOMU), East India Market Unit (EAMU) etc.

Executive Directors (ED) for each functional unit report to the

BUGM.


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Reporting StructureUnit Manager

TerritoryDevelopment

Manager

Assistant Sales& Distribution

Manager

DevelopmentManager

CustomerExecutive

SalesExecutive

Sales Trainee

MarketingDevelopment

Manager

MarketingDevelopmentCo-ordination

Sales and Marketing

Department


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StrategyPorters Five ForcesAnalysis

MODERATELarge amount of volume bought by retailersGrowing discount stores , consolidation of grocery stores, buyer powerincreasing

Low bargaining power of end consumersHigh brand loyalty

Buyer

LOWBottler's are locked into contractsSugar , bottles and cans are homogenous products, can be obtainedfrom many sources

Pepsi sales account for a large percentage of the suppliers totalrevenues

Supplier

LOWEstablished BrandBarriers to entry are relatively highHigh advertsing and marketing cost

New Entrants

LOWPepsi Co products are uniqueHigh brand loyaltyOne category that threatens is that of new age health and energy drinks

Substitutes

HIGH Intense rivalry between Coke and PepsiLeads to a downward pressure on pricesHigh investments in advertising so as to maintain brand loyaltyFight over prices, suppliers, spokespeople, retailspace and most

importantly, the taste buds of consumers

Internal Rivalry


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Strategy

PepsiCo interacts with a highly dynamic and growingenvironment

Innovation is of key importance

Continuously improves its product line

Innovative products such as Propel zero calorieenhanced water beverage, Quaker oats

Creative marketing campaigns such as the chooseyour Lays flavor , acquisitions of bottlers andcompetitors

Miles and Snow : Prospector Strategy


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Mergers and AcquisitionsAcquisitions

1988- PepsiCo acquired Tropicana

2009- Completed acquisition of Pepsi Bottling Group andPepsiAmericas

2011- Acquisition of Wimm-Bill-Dann (WMD), Russias largestF&B company

Joint Ventures1993- PepsiCo and Unilever formed a Joint Venture resulting in

Pepsi Lipton

1994- PepsiCo and Starbucks formed the North American Coffeepartnership NACP

Mergers

1965- Pepsi merged with Frito Lays and formed PepsiCo inc.

2001- PepsiCo merged with The Quaker- Oats company.


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Environment Analysis

Task Environment

Raw Material

Subject to the harvest of the raw material

Market Sector

Highly competitive markets

Satisfy the requirements and needs of the customers

Human Resource Sector

The company is seeing an attrition rate of over 20 per cent

Launched an initiative under the name 'I Care' which is specially designed for itssales force

Launched a new Programme called 'Infinite Possibilities to retain employees

International Sector

PepsiCo has made significant investments in the emerging market

Vulnerable to any instability in these markets

More than 45 percent of its revenue in 2010 came from outside United States


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GeneralEnvironment

Demographic Influence

Target customers for PepsiCo is young adults Attractive site targeted at entertaining teens and young people

Government Sector

Subject to various laws such as food and drug laws, advertising and deceptive marketing practicesregulations

Subject to environmental laws, such as laws relating to the regulation of water rights and treatment

Economic Conditions

Subject to cost of procurement and availability of the raw material, labour

Vulnerable to variation in fuel prices

Socio-Cultural Sector

Contract farming, Solid waste management

Replenishing the water that it uses for its beverages is an important concern for PepsiCo

Technology Sector

Introduction of cans and plastic bottles in place of glass ones has given more importance totechnology

State of the Art Plants and advertisements


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Balanced Scorecard


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Net revenue grew by 33% Core division operating profit rose by 23% Core EPS which grew by 12%, Annual dividend up by 7% Share repurchases and dividends to the tune of $8 billion. 19 of PepsiCos brands generated more than $1 billion retail sales

FinancialMeasures

Independent bottlers - bottler funding, advertising support, new productsupport, and vending and cooler equipment placement

Independent distributors and retailers- volume based rebates, productplacement fees, promotions and displays

Retail consumer incentives- coupons, price discounts and promotionaloffers

CustomerMeasures

Employees can create their own Career Development Action plan for theyear

Internal job portal- transparency, maximum growth opportunities MQPI- Judge managers - feedback, recognize and reward achievements

Learning &Growth Measures

Formed the Global Nutrition group- provide Good-for-you products Use of blended rice bran oil in India, a 40 % decrease in saturated fat in

products Direct seeding of rice that saved 7.8 billion litres of water in 2010

Internal businessprocess measures


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Environment framework

Moderate

Uncertainty

UncertainPepsiCo

CertainModerate

Uncertainty

SIMPLE COMPLEX

STAB

LE

UNS

TABLE

Competitivestrategy

CustomerPreferences

Unstable

ComplexGovt

legislationEconomy ,Technology


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Culture

Guiding PrinciplesCare for our customers, ourconsumers and the world we live in

Sell only products we can be proud of

Speak with truth and candor

Balance short term and long term

Win with diversity and inclusion

Respect others and succeed together


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Insiders View

PepsiCos culture encourages initiative, risk taking and accessto decision makers

The casual and collegial environment is headed by seniormanagement eager to hear the questions and ideas of theirmore junior colleagues

PepsiCo is into diversity,

PepsiCo really wants one type of person, someone who will puttheir job before their family or personal life

The culture is deliberately geared to churn people - theworkload is extreme, your job is everything, and personalneeds are frowned upon

PepsiCo has instituted a number of work family programs toease the strain of corporate life including flex-time and work athome arrangements

Pepsi is a great place to make a name for yourself with a wideopen career track, but only if you are prepared to makepersonal sacrifices


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Supportingour planet...

is good for

business.

To protect Earths natural

resources through innovation andmore

efficient use of land, energy, waterand packaging in PepsiCos

operations.Achieve positive water balance in water distressed areasUse at least 10% rPET in its primary soft drink containers in the U.S.,

and increase its usage across the globe.

Reduced weight of its packaging, reduce landfill waste volume

Improve electricity utilization, fuel use intensity by 25 % by 2015.


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Providingpeople with

choices...

is good for

business.

Formed the Global Nutrition group- provide Good-for-you products

Reduce saturated fat by 15% & Sugar content by 25% by 2020

Reduce sodium content in food products by 25% by 2015

To develop affordable, nutritionally relevant products for underserved and

lower-income communities. Eg. Fortified snack in Andhra Pradesh

To provide people withhealthy and enjoyable food

and beverages.


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Investingin our people...

is good for

business.

To invest in its associates to helpthem succeed and develop theskills needed to drive companys

growth and create employmentopportunities.

Ensure safe working conditions, improve occupational health

and safety metrics through best practices

Provide training programs to improve the skills and knowledge

of its employees to help them achieve high performance

Eg. WorkSmart and MangeSmart series by PepsiCo India

OST- to improve work life balance; BOLT- Learning & Development

Best company for leadershipdevelopment in India by Great

Places to Work Institute


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Supply Chain Management

InboundLogistics

Operations

OutboundLogistics

Marketing &Sales

Service

Margin

C t R l ti hi


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Customer RelationshipManagement

Operational CRM approach

Analytical CRM approach

Collaborative CRM approach

E- Commerce

Refreshing the world campaign 2011 Path-Break from Traditional Marketing and CRM strategy.

PepsoCo Refreshing The W@RLD
http://www.refresheverything.com/http://www.refresheverything.com/


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Recommendations

Increased attention towards enhancing employee satisfaction

Persist with Human sustainability

Environmental sustainability

Projected as a 'youth only' brand

Increased attention on emerging markets

Reduce dependence on bottlers


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Thank You

OB Project Group 4 Section D

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