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Indra Nooyi, Ceo of Pepsico Essay

INDRA K. NOOYI, CEO of PEPSICO
Indra K. Nooyi, CEO and Chairman for PepsiCo, is one of the most powerful women in the business world. She has been consistently ranked among the top 50 most powerful positions in the business world in magazines such as Forbes and Fortune. She currently holds the #12 spot in Forbes overall rankings of “World’s 100 Most Powerful Women,” being first in the “female” business category. (Howard, Forbes, 2012). Largely due to her leadership, PepsiCo enjoys the #41 spot in Fortune 500’s 2012 annual rankings. (Fortune, 2012).

Nooyi earned a Bachelor’s degree in her native country of India at Madras Christian College and, from Calcutta’s Indian Institute of Management, she received her first Masters of Business Administration. Thereafter she was admitted to Yale University in the United States where she earned her second M.B.A in Public and Private Management (PepsiCo, n.d., para. 8).

Prior to beginning her employment with PepsiCo in 1994 as its “chief strategist” (Useem, 2008, para. 2), she worked for companies such as Motorola, Zurich-based Asea Brown Boveri, and the Boston Consulting Group, where she was heavily involved in and often leading the organizations strategic planning departments. Since beginning her employment with PepsiCo, Nooyi has steadily moved up the ranks of the company having served as Senior Vice-President of Corporate Strategy and Development and Senior Vice-President and Chief Financial Officer until she was chosen in 2006 to be the company’s President and Chief Executive Officer (PepsiCo, n.d.).

In addition to her stellar business portfolio, Nooyi also has fulfilled the roles as a wife and mother to two children and obtained her American citizenship.

Organizational Structure
Nooyi leads PepsiCo’s multifaceted matrix-like global organizational structure where she has taken it from a “beverage” company to an organization with twenty-two different brand names which, in addition to Pepsi-Cola, include Quaker, Tropicana, Gatorade and Frito-Lay (PepsiCo, n.d.). Under Nooyi’s tutelage, PepsiCo changed its organizational structure to a matrix style to facilitate organizational growth and ease the path into a more in depth global market. This transition enabled PepsiCo to manage several different product lines around the globe while increasing the company’s efficiency and reducing potential losses (Souperbiet, u.d., slide 11). PepsiCo now boasts three different distinct units: PepsiCo Americas Foods, PepsiCo Americas Beverages and PepsiCo International. Each of these units has its own hierarchy of management led by its own CEO all of whom fall under the leadership of Indra Nooyi and her global vision (Caggeso, 2007).

Leadership Style
Nooyi has been described as “A caring CEO,” (Useem, 2008, para. 5) and nearly every photo of her on the internet reveals a beautiful woman with an award winning smile and eyes that appear warm and compassionate. Indeed when she joins in the fun singing karaoke at company get-togethers it is probably not too hard to think of her as just another employee of PepsiCo not too far removed from those who work the production line at one of its factories. But yet, she is a woman who, either from experience, education or intuitively, knows what motivates people as can be seen by her actions directly after she was chosen to head the company. She went directly to the person with whom she competed for the top spot and convinced him to stay with the company and become her right-hand man, offering him whatever it took to motivate him to stay with PepsiCo and aid her in leading the company into a prosperous future (Useem, 2008.) Nooyi once stated, “I am a global thinker in everything I do,” (Saporito, 2007, para.3), and her vision of “Performance with Purpose” has indeed led the company in an upwards trajectory, with PepsiCo seeing steady net profits ever since Nooyi took over the reins. She defines that vision as not so much about corporate accountability or social responsibility but more about “sustainability on multiple levels: human, talent and environment.” (Saporito, 2007, para.4).

Her vision of shiftingthe company to produce more healthy snacks and beverages is very basic in its design – a company cannot continue if there are no customers to buy its products. Therefore her vision of transitioning towards a more health focused production is one that her subordinates can easily support. Summary

Indra Nooyi appears to be a woman whose leadership skills and employment portfolio should be set as a template for those entering the business world. However even the best of plans can have their setbacks and bumps as can be seen with the recent numbers out on PepsiCo. Although PepsiCo’s ended its year with definitive profits and shareholder returns, it lost some market share to its top rival, Coca-Cola. Additionally some investors are pushing for the beverage portion of PepsiCo to become its own separate company. To counter, Nooyi’s strategy appeared to be based on textbook BCG Matrix analysis. She reduced costs by cutting a small percentage of the workforce, increased marketing budget for some of the core brands launched a new product, Pepsi Next, and reorganized her top management positions (Howard, 2012).

Whether these moves launch PepsiCo in another upward climb or whether they prove to be the moves which set someone else up to take over Nooyi’s top position remains to be seen. Regardless, being the strategist that she is trained to be, Nooyi has a plan. “After PepsiCo, I do want to go to Washington,” (Useem, 2008).

References
Caggeso, M. (2007, November 7). Dividing to Conquer: Pepsi Shifts Organizational Structure to Focus on Emerging Markets. In Money Morning. Retrieved January 21, 2013. http://moneymorning.com/2007/11/07/dividing-to-conquer-pepsi-shifts-organizational-structure-and-management-to-focus-on-emerging-markets/ FORTUNE 500: Our annual ranking of America’s largest corporation. (May 21, 2012). In CNN Money. Retrieved January 20, 2013, from http://money.cnn.com/magazines/fortune/fortune500/2012/snapshots/321.html Howard, C., ed. (2012, August 22). World’s 100 Most Powerful Women/The 100 Women Who Run the World. In Forbes. Retrieved January 20,2013.
http://www.forbes.com/profile/ indra-nooyi/ Indra Nooyi ‘80. (n.d.). In Yale School of Management. Retrieved January 19, 2013, from http://mba.yale.edu/alumni/alumni_profiles/nooyii.shtml Mayles, J. (2012, November 25). PepsiCo Organizational Chart. At Cogmap. Retrieved January 21, 2013. http://www.cogmap.com/chart/pepsico-organizational-chart PepsiCo Our Leadership: Indra K. Nooyi. (n.d.). In PepsiCo. Retrieved January 18, 2013, from http://www.pepsico.com/Download/Indra_Nooyi_bio.pdf Rosenbaum, C. (unknown date). What Type of Organizational Structure Does Pepsico Have? In eHow Money. Retrieved January 21, 2013. http://www.ehow.com/facts_5547544_type-organizational-structure-pepsico.html Saporito, B. (2007, May 3). The Time 100: Indra Nooyi. In TIME. Retrieved January 20, 2013, from http://www.time.com/time/specials/2007/time100/article/0,28804,1595326 1615737_1615996,00.html

Sellers, Patricia (2006-10-02). It’s good to be the boss. In CNN Money. Retrieved January 20, 2013, from http://money.cnn.com/2006/09/29/magazines/fortune/mpw.femaleCEOs. intro.fortune/index.htm Souperbiet, D. (unknown date). Networking in matrix organization. PepsiCo. Retrieved January 21, 2013. http://cs6218.userapi.com/u1443649/docs/42c398d28b00/Networking_ in_matrix_organizations.pdf Useem, M. (2008, November 19). America’s Best Leaders: Indra Nooyi, PepsiCo CEO. In US News. Retrieved January 19, 2013, from http://www.usnews.com/news/best-leaders/articles/2008/11/19/americas-best-leaders-indra-nooyi-pepsico-ceo


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