PepsiCo has a decentralized organizational structure with three main business units - PepsiCo Americas Foods, PepsiCo Americas Beverages, and PepsiCo International. This structure allows business units to make operational decisions while being governed by corporate policies. In 2007, PepsiCo reorganized from two business units to three units in order to better focus on emerging international markets, the health-conscious US market, and growing business outside of the US. PepsiCo's chairman said the new structure would help the company manage its robust global growth and customize its products for local markets like India.

1. ORGANIZATION STRUCTURE
An organizational structure consists of activities such as
task allocation, coordination and supervision, which are
directed towards the achievement of organizational aims.It
can also be considered as the viewing glass or perspective
through which individuals see their organization and its
environment.[

2. TYPES OF ORGANIZATION STRUCTURE

3. • LINE ORGANISATION
• Line organisation is the simplest form of organisation
structure. The line
• structure is based on the scalar principle, which states that
authority and
• responsibility should flow in a direct line vertically from the
highest level of the
• organisation to the lowest level. The primary emphasis in
the line organisation is
• upon the superior-subordinate relationship. Every person in
the organisation is in
• the direct chain of command.

5. • One of the
• advantages
• of the line organisation is that it facilitates decision
• making and execution because there is a definite
authority at each level of the
• hierarchy. However, the
• disadvantage
• is that if a wrong decision is made at
• the top level, the same is carried out simply without
anybody down the line
venturing to point out its deficiencies

6. • LINE AND STAFF ORGANISATION
• Most business organisations, except the very small, have this type of structure.
• As the organisations have grown complex, the problems of line executives have
• become sufficiently complicated. The line executives being generalists, need the
• advice of personnel with specialised knowledge and functions to tackle these
• problems. For this purpose, the staff positions are created in the organisation. In
• line and staff organisation, the line authority remains the same as it does in the
• line organisation i.e. the authority flows from top to bottom; and the line
• executives perform the major functions; the staff functionaries support and
• advise the line executives. For example, for sound management of human
• resources, the line managers are provided specialised assistance through
• personnel/Human Resource managers. As staff functionaries are employed to
• perform supportive role, they do not have any power of command in the
• organisation

8. • The main
• advantage
• of line and staff organisation is that the staff specialists
• relieve the line executives of the botheration of concentrating on
specialised
• functions like selection, training, development, wage and salary
administration,
• accounting, public relations etc. However, the
• disadvantage
• of this structure is
• that since functionaries are not accountable for the results, they
may not be
• performing their duties effectively.

9. • FUNCTIONAL ORGANISATION STRUCTURE
• This is the most widely used form of organisation structure because of its
• simple logic and commonsense appeal. Here the tasks are grouped
together on
• the basis of common functions. So, all production activities or all financial
• activities are grouped into a single function which undertakes all the tasks
• required of that function. A typical chart of a functional organisation is
• presented in Figure 3.
• The functional structure suits best to the small to medium organisations
• producing one or a few products, where the goals of the organisation
• emphasise functional specialisation, efficiency and quality.

11. IMPLICATIONS TO MCS

12. • PepsiCo is well known for its Pepsi beverage
products. This multinational corporation is also
responsible for the production of Frito-Lay,
Gatorade, Tropicana and Quaker products.
November 2007 marked a change in the
company's organizational structure from two
units to three.

13. What Type of Organizational Structure
Does Pepsico Have?
• PepsiCo is an adaptive organization, as they are
continuously seeking constant improvement and
keeping new ideas in the marketplace while its
products progress along their life cycles. PepsiCo
has a decentralized organizational structure, with
operational decisions made within the separate
business units while being governed by policies at
the corporate level.

14. CURRENT STRUCTURE
• PepsiCo consists of three units: PepsiCo Americas Foods,
PepsiCo Americas Beverages and PepsiCo International.
PepsiCo Americas Foods encompasses Frito-Lay North
America, Quaker and all Latin American food and snack
businesses. PepsiCo Americas Beverages oversees Pepsi-
Cola North America, Gatorade, Tropicana, and all Latin
American beverage businesses. PepsiCo International is
responsible for PepsiCo business in Europe, Asia, and
Africa.

15. OVERALL ORGANISATION STRUCTURE
OF PEPSICO

16. IMPLICATIONS
• According to Chairman Nooyi, "PepsiCo's robust growth has enabled the
company to manage three units instead of two.“
• The realignment enables PepsiCo to focus more resources on emerging
international markets, especially in Asia.
• Decreasing its dependence on domestic revenues.
• PepsiCo will be able to better focus marketing efforts of lower calorie and
less sugary products on the increasingly health-mindful United States
market.
• Pepsico recognised and added new senoir level workforce to take
advantage of an opportunities wordwide.
• As the doller rate is depriciating, the more buisness the company does
outside the USA,will benefit the company revenue.
• The structure will help to manage the firms robust growth.
• Will help them to reach to the sky.

17. STRATEGIES
• PepsiCo’s Indra K. Nooyi is on a new realisation about the land of her birth as she leads the board of
her global food and beverage empire at a meeting in Mumbai this week.
• “We feel that solutions which have been devised by us around the world, cannot be imposed here.
The company needs to find unique solutions for India,” Nooyi, chairman and CEO of PepsiCo told a
news conference in Delhi.
• PepsiCo’s brands such as Lays are already being complemented by local tags like Kurkure and lemon
drink Nimbooz in a market in which its mainstay business, soft drinks, has faced a tough battle with
traditional rival Coca Cola, which made waves in the rural hinterland with its Rs. 5-rupee bottle that
attracted attention.
• For Coca-Cola, which entered India in 1993, four years after its rival, sales volumes have grown for
more than three years.
• Nooyi said PepsiCo plans to customise its food and beverage products to suit the requirements of
the Indian market.
• Atul Singh, president and CEO of Coca Cola India said he would not discuss strategy. Coke has
introduced local products such as Aam Panna as it eyes an investment plan of $250 million for
India.
• “We do not devise our marketing strategies according to any company’s plans. We continuously
evaluate our options and our products are a result of continuous research initiatives,” said Singh.
• PepsiCo’s three-day board meeting, scheduled to begin on Wednesday, is also aimed at creating
awareness about India’sculture and product needs.