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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/8/2/2019 OB Project Group 4 Section D
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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
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