PepsiCo Corporation

A Successful Company

Table of ContentsPrimary Business Practices..........................................................................................................................3

Strategy...................................................................................................................................................3

Execution.................................................................................................................................................4

Culture.....................................................................................................................................................4

Structure..................................................................................................................................................4

Secondary Business Practices......................................................................................................................4

Talent.......................................................................................................................................................4

Innovation...............................................................................................................................................5

Leadership...............................................................................................................................................5

Mergers & Partnerships...........................................................................................................................5

Conclusion...................................................................................................................................................5

References...................................................................................................................................................5

PepsiCo Corporation – A Successful Company

To: Ray Smith, Chief Executive Officer

From:

Date: June 1, 2013

Subject: PepsiCo; “A Successful Company”

Through research, I have found PepsiCo Corporation to be a successful company. PepsiCo has excelled in the four primary practices in business; Strategy, Execution, Culture, and Structure. They have also met three of the four secondary practices; Talent, Innovation and Mergers & Partnerships. Joining a partnership with this organization will not only assist in meeting the needs of our customers, it will strengthen us as an organization.

Table 1: Business Practices Review

Primary Business Practices Secondary Business PracticesStrategy Met or Exceeded Talent Met or Exceeded

Execution Met or Exceeded Innovation Met or ExceededCulture Met or Exceeded Management Not Met

Structure Met or Exceeded Mergers & Partnerships Met or Exceeded

Primary Business Practices

StrategyPepsiCo has a strategy of delivering sustained growth by placing importance on empowering their employees and building trust from within the organization as well as the community. There are six guiding principles that are reviewed on a regular basis. Frequent review ensures management the overall strategies are met during the day to day business decisions.

Below is a list of the six guiding principles:

1. Care for customers, consumers and the world. 2. Sell only products we can be proud of. 3. Speak with truth and candor. 4. Balance short term and long term. 5. Win with diversity and inclusion. 6. Respect others and succeed together.

ExecutionPepsiCo consistently review corporate performance indicators used to assist in the evaluation of progress from the previous year. Those indicators are also used to mark progress from their competitors. PepsiCo realizes execution is not necessarily the work performed. It is how well that work is performed.

Below is a list of an example of their benchmarks:

Performance: Total net revenue; Core total operating profit; Common share repurchases; Dividends paid.

Human Sustainability: Compliance with advertising-to-children pledge. Environmental Sustainability: Greenhouse gas emissions; Fuel use reduction;

Waste percentage to landfill; Water Conservation, etc. Talent Sustainability: Demographics regarding race and gender, Lost time

injuries, etc. Responsible & Sustainable Sourcing: Suppliers in Carbon Disclosure Project;

Supplier diversity. Community & Philanthropy: PepsiCo Foundation contributions.

CultureThe culture at PepsiCo advocates employee involvement, empowerment and engagement to encourage employees and managers to do their best. To assist with ensuring employees are involved; programs were implemented to seek employee input regarding current and future processes. In 2004, new performance based compensation program was implemented to reward employees and managers for their performance. Diversity is a main focus in the PepsiCo culture. The inclusion of diversity awareness and celebration events allows employees to feel part of the team even if they are from different culture. In 2010, PepsiCo was listed in the World’s Most Ethical Companies by Ethisphere and came in first in the 50 Most Powerful Woman in Business by Fortune.

StructurePepsiCo Corporation’s structure is setup in a way to simplify the work. On March 12, 2012, PepsiCo announced a new global structure. The purpose of this change was to strengthen the management team and continue to produce sustainable growth.

Secondary Business Practices

TalentPepsiCo has embraced training and involvement in the decision making process to empower and encourage the advancement of the talent hired. They have investigated and implemented programs related to training and education, personal and professional development, associate engagement, and award programs. Employee involvement is supported and encouraged in management discussions regarding changes and enhancements in the workforce. These programs increase employee engagement which enables PepsiCo to retain their talented employees.

InnovationPepsiCo embraces technology and process enhancements to improve efficiency to remain ahead of their competitors. In 2012, PepsiCo was announced as one of the most innovative suppliers by Progressive Grocery. The Toolbox Advantage program, configured to meet PepsiCo’s needs, has offered a platform for management to track professionals, sales managers, shipment, ad tracking data, etc. The data compiled from this program assist PepsiCo with new attractive products and delivery methods for their customers.

PepsiCo was also recognized for their partnership with a national retailer where they gained a better understanding of the shopper. They investigated price, promotion, placement, and product. The result of this partnership, PepsiCo reworked their product placement to allow retailers to showcase new products. This change allowed PepsiCo to outpace their market with double digit growth.

LeadershipPepsiCo Corporation didn’t excel in the Leadership business practice. Data was not readily available to effectively measure the leadership outcome since the management reorganization in 2010.

Mergers & PartnershipsPepsiCo Corporation has a long history of successfully acquiring organizations and entering into partnerships to enhance their business portfolio and diversify their product line. PepsiCo acquired Mabel in 2011. Mabel was a producer of cookies, crackers and snacks. They were located in Brazil. In 2008, the acquisition of V Water occurred. They were a producer of vitamin water located in the U.K.

ConclusionAs you can see from the above data, PepsiCo Corporation is a successful company. A partnership with them will assist us in meeting our customer needs and help strengthen us as an organization.

References

PepsiCo Values & Philosophy. Retrieved May 22, 2013, from PepsiCo Corporation website: http://www.pepsico.com/Company.html

PEPSICO PROVIDES YEAR-END ASSESSMENT AND 2004 OUTLOOK, Retrieved May 23, 2013, U.S. Securities and Exchange Commission http://www.sec.gov/Archives/edgar/data/77476/000007747603000054/exhibit99-1.htm

PepsiCo Announces New Global Structure and Leadership to Drive Continued Growth, Retrieved May 23, 2013. PR Newswire. http://www.prnewswire.com/news-releases/pepsico-

announces-new- global-structure-and-leadership-to-drive-continued-growth-142287945.html

PepsiCo Opts for Customized ToolBox CatMan Solution, Retrieved May 27, 2013. Progressive Grocer. http://www.progressivegrocer.com/top-stories/headlines/technology/id36169/pepsico-opts- for-customized-toolbox-catman-solution/

PepsiCo Inc., Retreived May 26, 2013. From Mergent Online. http://www.mergentonline.com.libproxy.uncg.edu/companyownership.php?compnumber=6581