PepsiCo Corporation produces a strategic management report that analyzes the company's history, vision, mission, objectives, strategies, products, services, competition, and recommendations. The report is presented to a professor by a group of students and contains an executive summary and sections on SWOT analysis, financial forecasts, competitor profiles, and strategic recommendations and implementation plans.
intro of PepsiCo
Intro of CEO
Mission & Visions
History
Organization Chart
Philosophy
Policies
Current Strategies
Products Details
Competitor & its Analysis
Swot Analysis
We as a CEO
Conclusion
Pepsico Presentation
Pepsico's Analysis
intro of PepsiCo
Intro of CEO
Mission & Visions
History
Organization Chart
Philosophy
Policies
Current Strategies
Products Details
Competitor & its Analysis
Swot Analysis
We as a CEO
Conclusion
Pepsico Presentation
Pepsico's Analysis
Prepared by:
Abdul Hadi Anwar Siddiqui
I am luck that I share this Presentation with you because this is My best Presentation I prepared till now,
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A ppt on PepsiCo. It includes sales and distribution management, Inventory management, production, transportation and logistics, Material Handling, warehousing, Supply chain management, Organizational Structure, Processes and Supply flow of materials used for the production.
The project is about "the study of the acceptance of Brand Tropicana Slice Alphonso in Banglore market", the report includes the industry profile, PepsiCo world, PepsiCo India, business model, financial statements, problem centered study, customers of pepsico, business segments, distribution channel and so on........
Prepared by:
Abdul Hadi Anwar Siddiqui
I am luck that I share this Presentation with you because this is My best Presentation I prepared till now,
thanks........
For more information please follow me at,
Gmail: abdulhadianwar9998@gmail.com
facebook: https://www.facebook.com/innocent.hadi.733
A ppt on PepsiCo. It includes sales and distribution management, Inventory management, production, transportation and logistics, Material Handling, warehousing, Supply chain management, Organizational Structure, Processes and Supply flow of materials used for the production.
The project is about "the study of the acceptance of Brand Tropicana Slice Alphonso in Banglore market", the report includes the industry profile, PepsiCo world, PepsiCo India, business model, financial statements, problem centered study, customers of pepsico, business segments, distribution channel and so on........
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Cultivating and maintaining discipline within teams is a critical differentiator for successful organisations.
Forward-thinking leaders and business managers understand the impact that discipline has on organisational success. A disciplined workforce operates with clarity, focus, and a shared understanding of expectations, ultimately driving better results, optimising productivity, and facilitating seamless collaboration.
Although discipline is not a one-size-fits-all approach, it can help create a work environment that encourages personal growth and accountability rather than solely relying on punitive measures.
In this deck, you will learn the significance of workplace discipline for organisational success. You’ll also learn
• Four (4) workplace discipline methods you should consider
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RMD24 | Retail media: hoe zet je dit in als je geen AH of Unilever bent? Heid...BBPMedia1
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Personal Brand Statement:
As an Army veteran dedicated to lifelong learning, I bring a disciplined, strategic mindset to my pursuits. I am constantly expanding my knowledge to innovate and lead effectively. My journey is driven by a commitment to excellence, and to make a meaningful impact in the world.
1. 1
STRATEGIC MANAGEMENT
A REPORT
OF
PEPSI CORPORATION
Presented to:
Professor: Vahid Victor Keyhani
Presented by: group 3
Name Keuka ID
1. Nguyen Ngoc Tuyen 332907
2. Le Ngoc Hoang Nhat 332896
3. Dinh Cong Tai 332887
4. Nguyen Huu Tung 332944
5. Nguyen Cong Duy 295900
6. Ho Thi Da Thao 332891
7. Truong My Ngoc 332926
International Business Management
Keuka College
2. 2
STRATEGIC MANAGEMENT
TABLE OF CONTENTS
1- EXECUTIVE SUMMARY………………………………………………………………… 3
2- HISTORY OF PEPSI COLA INTERNATIONAL…………………………………… 3
3- ETHICAL AND UNETHICAL ISSUES OF PEPSICO…………………………….. 4
4- VISION STATEMENT……………………………………………………………………. 5
5- MISSION STATEMENT…………………………………………………………………. 5
6- OBJECTIVES…………………………………………………………………………………. 5
7- COMPANY STRATEGIES………………………………………………………………… 6
8- IMPROVED MISSION STATEMENT………………………………………………. 7
9- COMPANY’S PRODUCTS & SERVICES……………………………………………. 7
10- COMPETITION & MARKET CONDITION…………………………………………. 7
STAGE 1 (INPUT STAGE)
11- SWOT ANALYSIS………………………………………………………………………… 9
12- KEY EXTERNAL FACTOR ANALYSIS .…………………………………………… 10
13- KEY INTERNAL FACTOR ANALYSIS …….………………………………………. 11
14- STOCK PRICE and FINANCIAL FORECAST……………………………………. 11
15- ANALYSIS OF COMPETITORS PROFILE……………………................... 11
STAGE 2 (MATCHING STAGE)
16- SPACE MATRIX…………………………………………………………………………. 11
17- GRAND MATRIX……………………………………………………………………….. 12
18- QSPM OF PEPSICO…………………………………………………………………… 12
STAGE 3 (DECISION STAGE)
19- STRATEGY BUSINESS RECOMMENDATIONS……………………………….. 12
20- PROPOSED METHODS & TIMETABLE FOR THE IMPLEMENTATION
OF THE LONG TERM OBJECTIVES………………………………………………. 14
21- CONCLUSION…………………………………………………………………………….. 15
22- APPENDIX…………………………………………………………………………………. 16
3. 3
STRATEGIC MANAGEMENT
1- EXECUTIVE SUMMARY
The project will be discuss about the Pepsi Cola Corporation in term of strategic management in
order to understand how this firm is formulating, implementing, and evaluating their objectives
to reach their goal. This project will be also discussed about the analysis of competition, market
growth and trend, opportunity analysis and strategies for creating competitive advantage by
Pepsi Cola in its industry.
The purpose of doing this project is to study the strategic management which Pepsi is operating
their organization in the whole market for its products.
In order to analyze Pepsi Cola Corporation, we will divide the process into three stages:
The first stage will be analyzed PepsiCo’s SWOT, the internal and external factor evaluations that
are aggressive, responses as well as strong competitive position compared to its competitors,
Coca Cola and Gourmet Cola and also indicated that Pepsi Cola is the market leader.
The second stage will be figured out the TOWS Matrix, Space Matrix, and Grand Matrix that also
have an aggressive, responses which helps the firm identifies and alternates the strategies in
order to choose which one is the most benefit strategy to implement.
The third stage will be discussed about Quantitative Strategic Planning Matrix (QSPM) that
concludes the internal factor evaluation, external factor evaluation, and Space strategic Matrix
to carry out the best strategy that brings the most benefits for Pepsi Cola and represent how that
strategy works on.
2- HISTORY OF PEPSI COLA INTERNATIONAL:
Back in 1880’s, the recipe for Pepsi was developed by Caleb Bradham in New Bern, North
Carolina who had renamed it “Pepsi-Cola” in 1898. As the Cola industry developed in popularity,
Caleb created Pepsi-Cola Company in 1902 and registered a patent for his recipe in 1903.
As Pepsi-Cola Company went bankrupt in 1931, Charles Guft who owned a syrup manufacturing
in Baltimore Maryland acquires the trademark and recipe to Loft Inc. In the year 1941, Pepsi was
formally absorbed to Loft, and Loft Inc. rebrands its company name to Pepsi Cola Company.
Up until today, Pepsi Cola Company further will be mentioned as PepsiCo has successfully
expanded it area of products through mergers and acquisition of other companies, such as Frito-
Lay Company, Quaker Oat Company and other companies.
PepsiCo has developed its divisions into 5, PepsiCo Americas Foods (PAF), PepsiCo Americas
Beverages (PAB), PepsiCo Europe, and PepsiCo Asia, Middle East and Africa (AMEA).
4. 4
STRATEGIC MANAGEMENT
3- ETHICAL AND UNETHICAL ISSUES OF PEPSICO
Code of Conduct
Your Personal Responsibilities:
All of your work must comply with our Code, our policies, and the law. Each of us, especially
leaders and managers, must act with integrity and inspire trust.
Respect in Our Workplace:
You can contact Speak Up by phone or by web. You will not be retaliated against for raising
concerns. Each of us must respect the diversity, talents and abilities of others. Always be alert to
possible human rights violations. You should never discriminate or deny equal opportunity. You
must not harass others in our workplace.
Integrity in Our Marketplace:
You must never threaten anyone or display violent behavior in our workplace. If you are involved
in marketing, always market our products responsibly. We must treat our customers fairly. All
interactions with our suppliers must meet our high ethical standards.
Ethics in Our Business Activities:
You should avoid a conflict, or an appearance of a conflict, between your personal interests and
our company’s interests.
Your business decisions should never be influenced by corruption. If you suspect your customer
or supplier is engaged in an illegal activity, report it. You are prohibited from using company
resources for personal political activities.
Administering Our Code:
Always use our trademarks and other intellectual property properly. PepsiCo takes seriously all
reports of misconduct. If you violate our Code, the Company will take appropriate disciplinary
action.
Unethical Issue
Pepsi was involved with false advertising. Pepsi was selling its Aquafina brand of bottled water
under the assumption that Aquafina is sourced from mountain spring water. Although the bottle
itself did not have the words “spring water”, Pepsi used a great marketing gimmick to deceive
consumers. Aquafina brand was sold in a bottle with a clean, blue label showing images of snow-
capped mountains and the claim, "Pure water, perfect taste". That's the image created by
PepsiCo Aquafina brand of water, and many consumers leaped to the incorrect conclusion that
5. 5
STRATEGIC MANAGEMENT
Aquafina is sourced from mountain spring water. In reality, Aquafina comes from tap water, the
same water we get when we turn on our kitchen faucet. Of course, Aquafina is filtered, purified
and perhaps even enhanced with trace amounts of added minerals, but it's certainly not
mountain spring water, it's just processed tap water.
4-VISION STATEMENT
“PepsiCo’s responsibility is to continually improve all aspects of the world in which we operate -
environment, social, economic - creating a better tomorrow than today.”
Pepsi cola international vision is put into action through programs and a focus on environmental
stewardship, activities to benefit society, and a commitment to build shareholder value by
making PepsiCo a truly sustainable company.
5-MISSION STATEMENT
Our mission is to be the world’s premier consumer product company focused on convenient
foods and beverages. We seek to produce financial rewards to investors as we provide
opportunities for growth and enrichment to our employees, our business partners and the
communities in which we operate. And in everything we do, we strive for honesty, fairness and
integrity.
6- OBJECTIVES
Performance
Strive to deliver superior long-term financial performance and sustained shareholder value.
Human Sustainability
Continue to refine our food and beverage choices to meet changing consumer needs by reducing sodium,
added sugars and saturated fat, and developing a broader portfolio of product choices.
Continue to provide clear nutrition information on our products, and sell and market them appropriately
to our consumers, including children, in line with our global policies and accepted global standards.
Environmental Sustainability
Help protect and conserve global water supplies, especially in water-stressed areas, and provide access
to safe water. Innovate our packaging to make it increasingly sustainable, minimizing our impact on the
environment. Work to eliminate solid waste to landfills from our production facilities. Work to achieve an
absolute reduction in greenhouse gas (GHG) emissions across our global businesses. Continue to support
sustainable agriculture by expanding best practices with our growers and suppliers.
6. 6
STRATEGIC MANAGEMENT
Talent Sustainability
Create a safe, healthy, diverse and inclusive workplace that reflects the global communities in which we
operate. Respect human rights in the workplace and across the supply chain.
7- COMPANY STRATEGIES
PepsiCo uses Differentiations to gain a competitive advantage
Develop Brand Equity
Sell in Most Markets
Win Customers through Brand image
Developing Cooperation Strategy
In 1965 Pepsi-Cola merged with Frito-Lay to form PepsiCo
In 1968 PepsiCo purchased North American Van Lines
In 1970 PepsiCo bought Wilson Sporting Goods PepsiCo acquires Pizza Hut, Inc.
In 1977, Taco Bell in 1978 and Kentucky Fried Chicken in 1986
International Strategy
Four Sectors of Operation
PepsiCo Americas Beverages
PepsiCo Americas Foods
PepsiCo Europe
PepsiCo Asia, Middle East and Africa
Alliances & Cooperative Strategies
Tingyi- Beverage operations in China
Suntory- Beverage operations in Japan and Vietnam
Calbee - Snack food operations in Japan
Ocean Spray- Beverage operations in Latin America
Lipton- Beverage operations in India
7. 7
STRATEGIC MANAGEMENT
Mergers & Acquisitions
In 1998 PepsiCo purchased Tropicana Products. This brought in an expanded product line in the
form of juice.
In 2001 PepsiCo merged with Quaker Oats. This brought in the Quaker brands and Gatorade.
8-IMPROVED MISSION STATEMENT
Recommendation for PepsiCo mission statement:
“To be the world’s premier consumer products company focused on selling high quality food and
beverage products, to our customers all across the globe. We are triggered to use the most efficient
processes using the best of machinery. By doing so, we seek to produce healthy financial rewards to
investors as we provide opportunities for growth and enrichment to our employees, our business
partners, and the communities in which we operate. And everything we do, we strive for honesty,
fairness and integrity”
Recommendation for PepsiCo vision statement:
“To become the first choice of the consumers all over the world. Try to maximize our profit and
minimize our operating cost.”
9-COMPANY’S PRODUCTS & SERVICES
PepsiCo has 5 major brands offering. They have Pepsi products which include: Pepsi, Mountain
Dew, Energy Drinks and Aquafina water. They have Frito-Lay which include of Lay’s Chip, Totitos,
Sun Chip. They have Quaker Oats which includes Breakfast cereal, Oat meal and Syrup. They also
have Gatorade and Tropicana brand which include orange juice.
10-COMPETITION & MARKET CONDITIONS
The macro environment consists of the larger social forces that affect the micro environment.
The external factors are not under the control of the strategists, they can just observe them and
make strategies in light of these factors. Some of these factors are given below:
Demographic Factors:
Age: The requirements of different age groups are different. PepsiCo should target that group
that consumes it the most and make promotional strategies according to their behavior. So their
main target is the young generation.
Education: A company has to make promotional strategies keeping in view the customer level. If
the percentage of education is high in a country then through advertisements people can be
made well aware of their product and can convey their message easily. Promotion and education
has a direct relationship.
8. 8
STRATEGIC MANAGEMENT
Population Distribution: It means how much population lives in urban areas and rural areas.
PepsiCo is focusing on urban areas as people there are more inclined towards such beverage.
Economic Factors:
Income: If the income level of the people increases, it will have a positive effect on the
consumption of Pepsi
Inflation: If the country faces inflationary trend in the market, the price of the Pepsi will ultimately
increase which will lower its demand
Employment opportunities: As employment opportunities increase the living standard of the
people increase and the people consume more.
Economic Policies: Some of the economic policies which can affect the market of Pepsi are
discussed below:
Fiscal Policy: It is the policy of taxes. If heavy tax is levied on Pepsi then its price will rise having
negative affect on its consumption.
Monetary Policy: Monetary policy is made to restrict or increase the supply of money in the
market. If policies are made to restrict the flow of money in the market, inflation can be
controlled hence increasing the real income of the people which will ultimately affect the
consumption of Pepsi.
Price Policy: If price of Pepsi is increased its demand will decrease and vice versa.
Income Policy: If income of the people will increase their purchasing power will increase and
hence increasing the market share of Pepsi.
Physical Factors:
City size: The more city size, the more consumption of Pepsi
Climate: Pepsi is more suitable for humid or hot weathered countries
Infrastructures: Roads are the basic need for transportation of Pepsi from one place to another.
Pepsi cannot open factories in every city of each country so it has to transport it to other cities
where Pepsi is demanded.
Technological Factors:
Research and Development: Through research and development quality of the product can be
improved or better techniques or machinery can be developed which can increase the
production. When technology is advance the supply of the product increase hence the company
experiences growth in their business
Political and Legal Factors:
Political stability: Whenever the government is considered to be stable, the business will flourish.
If there is political stability in the country the policies and strategies made by Pepsi can be
consistent to be implemented. Foreign companies are also keen to invest in those countries
which are politically stable where they have no fear of decline in their market share or shut down
due to sudden change of government.
9. 9
STRATEGIC MANAGEMENT
Laws Formulation: Government has given copy rights to Pepsi so that another company cannot
sell their product by the name of Pepsi. The countries where laws are formulated, the strategies
and activities of the company are different.
Social Responsibility: Pepsi’s social responsibility is to provide its customers with clean and
hygienic product so to do this they have increased the use of disposable bottles.
Social and Cultural Factors:
Psychographic:
It is a combination of demographic and psychological factors. Psychological attributes mean how
you perceive things. The company will focus on the behavior of consumers and make different
changes in their product quantity or quality and in promoting their product so that they can
attract the customers. Keeping in view that the behavior of different consumers is not alike they
have to make their marketing strategies in accordance with their requirements so that they are
convinced to buy the product.
Media:
It is a very important factor for marketing. Media these days is a very effective way of inspiring
people to buy a specific product. A good promotion can boast up sales to a great extent.
11- SWOT ANALYSIS OF PEPSICO COLA
Strengths
Strong brand name is one of the greatest strengths for PepsiCo. It is one of the largest brands
that could be recognized be the people in the world. In all around the world the company use the
name “PepsiCo” in every country in the world. The strong brand presence makes it easier for the
company to market its products around the world. PepsiCo did not provide only the cola product
but also provide various numbers of products. All these brands have rode on the success of the
company brand and have found it easy to sell since the company brand in largely accepted in the
market. The popularity of PepsiCo corporate brand has also made it easier for the company to
introduce new products in the market. All PepsiCo has to do in order to make a new product
success is to attach it with the company’s corporate brand which has already attained a
significant level of brand loyalty in the beverage market.
PepsiCo is a large distribution network; this is the one of the core elements that define the
company success. The firm has managed to do this through creation of a massive distribution
system. The organization runs bottling units in diverse geographical region, which enables the
company to produce its products near the consumers. By doing this, it reduces the transportation
cost and storage cost of the company, which leads to the higher profit as it reduces the expense.
Moreover, the company also has established good connection with small and mega retailers who
sell PepsiCo products to the final customers. Forming partnership with large retailers such as
Wall- Mart has enabled the company to expand its reach to the market. Also, partnership with
10. 10
STRATEGIC MANAGEMENT
small retail business has helps the firm to take it products to even the remotest parts of the
world. Apart from retail chains, the company has also corporate with fast food restaurants
around the world such as KFC, which have also provided the company with a wide network of
outlets.
Weaknesses
The company’s reliant on franchised bottling company to distribute its products; this is one of
the internal weaknesses found in PepsiCo. This strategy has seen the company create very
powerful bottlers that it cannot exert control over. Occasionally, the franchises oppose
introduction of new products by PepsiCo while other refuse to produce some of the products.
Sometimes, the franchises also create their own product lines that are not part of the PepsiCo’s
brands. Moreover, this franchise system also limited the ability of the company to expand its
operations. On the other hand, the company main competitor like Coca Cola is being able to
invest in its bottling companies but the company cannot invest in its bottling companies since it
does not own them. This has hampered the growth and expansion of the firm since most of the
individual investors have limited capacity to make such investments.
Opportunities
Opportunities of PepsiCo are easy new products penetration in the market, it operates in fast
growing industry, changing social trends, and new media promotion opportunities. In addition, it has
the opportunity to make a partnership with well-known brand such as Starbucks, and more sport
tournaments that PepsiCo can support.
Threats
PepsiCo has to face with strong competition in every division it has, such as competition from
Coca-Cola and Kraft, it operates in the mature beverage/food industry, and aggressive top
management strategy by its competitors. There is also growth in the carbonated drink sector
which will bring new substitute products to entry. And also, some health issues are concerned
regarding the products of PepsiCo.
12- KEY EXTERNAL FACTOR ANALYSIS
According to the table 1’s calculations, it has been concluded that the company’s Total Weighted Score
is 3.2 which shows that the company is hugely successful in utilizing its opportunities and minimizing the
threats around it.
11. 11
STRATEGIC MANAGEMENT
13- KEY INTERNAL FACTOR ANALYSIS
According to the table 2’s calculations, it has been concluded that the company’s Total Weighted
Score is 3.55 which shows that the company is hugely successful in utilizing its strength and
minimizing the weakness around it.
14- STOCK PRICE and FINANCIAL FORECAST
According to the figure 1 in the appendix, the stock price would be increased significantly in the
year going on because of the trend line is positive and the slop is 6.4614.
The financial of PepsiCo is forecasted to increase since the sales can increase in 2016 and 2017.
The operating profit also increases in the following years according to the table 3 and 4 in the
appendix.
15- ANALYSIS OF COMPETITORS’ PROFILE
According to the table 3 in the appendix part that gives the general evaluation on some critical
success factors between PepsiCo, Coca Cola, and Gourmet. It showed the total weight score of
PepsiCo is the highest number by 3.29 points which means that PepsiCo has the most effective
internal strategies. It also means that PepsiCo has strongest strengths and less weaknesses than
their competitors, Coca Cola and Gourmet. In contrast, Gourmet has the lowest weight score by
1.49, which means that they have worst internal strategic information compare to PepsiCo and
Coca Cola. The Coca Cola Company has the total weight score at 2.5. It represents Coca Cola has
less effective internal strategic information than PepsiCo and more effective internal strategic
information than Gourmet. However, the total weight score of Coca Cola is still higher than the
average score which means they have very good internal strategic information as well.
Therefore, it can be said that PepsiCo has more potential opportunities in order to enlarge their
market share and take advantages implementing their business objective strategies. The
advertising really helps PepsiCo to capture consumer’s attention which is their target and makes
PepsiCo more valuable than its competitor
16- SPACE MATRIX
The SPACE Matrix tells us that PepsiCo should continue to pursue aggressive strategy. Our
company has a strong competitive position in the market with rapid growth. It needs to use its
internal strengths to develop market penetration and market development strategy. This can
include product development, integration with other companies, and acquisition of competitors.
12. 12
STRATEGIC MANAGEMENT
17- GRAND MATRIX
According to the figure 3 in Appendix PepsiCo comes in the first quadrant. The company must
focus on the current market and achieve growth by adopting product development and market
penetration strategies. The company has abundant resources and competitive advantage
through which it can achieve growth by adopting the backward and forward integration
strategies. PepsiCo can also adopt the related diversification strategy to reduce its risk with broad
portfolio or product line. PepsiCo can afford to take benefits of external opportunities in many
areas. It can take risk being aggressive when necessary.
18- QSPM OF PEPSICO
According to the QSPM, (shown in the Appendix), we have two alternative strategies for the
company and the after analyze the total attractiveness of two alternatives, we can conclude that
the strategy of introducing new product line is more attractive and suitable for the company.
19- STRATEGY BUSINESS RECOMMENDATIONS
Based on the analysis of space matrix that PepsiCo is on the first quadrant so they should still use
differentiations to gain a competitive advantage by developing brand equity, selling in most
markets, and winning customers through brand image. Especially, PepsiCo should develop
corporate strategic diversifications. In order to do market penetration, market development,
PepsiCo should corporate with:
Highland Coffee in Vietnam
Popeyes- fast-food restaurant in Vietnam
Campina- Beverage operations in Thailand
Calbee - Snack food operations in Japan
Popi- Beverage operations in France
Phuc Long- Beverage operations in Vietnam
In addition, according to the analysis of grand matrix that PepsiCo is also located on the first
quadrant so they should do mergers and acquisitions. Especially, PepsiCo should do international
strategies by direct exports, joint ventures, licensing or franchising, and acquisitions in the Middle
East, Asia, and Africa.
In 2016 PepsiCo should buy Rockstar Inc. This would bring in an expanded product line in the
form of energy drinks. Furthermore, PepsiCo could merge with Vinamilk Inc. This would bring in
the Vinamilk brands in Vietnamese market.
13. 13
STRATEGIC MANAGEMENT
In order to implement our strategy, here are our objectives for the project.
Research and development
Firstly, PepsiCo has to do the research on the consumer preferences in Middle East, Asia, and
Africa. The R&D department have to find out the consumers taste, price that they are willing to
pay and which category they prefer in energy drinks. The research can include both:
• Secondary research
• Primary research
After conducting the research, the company has to know which product should be produced that
adapts the changing of customers’ wants and needs. Firstly, it will be produced a sampling in
order to send to different markets for testation purpose. Then PepsiCo can send a team for
collecting customers’ feedbacks of this product. Finally, they can make decision whether or not
working on this project or they can make an adjustment to improve it and make mass production
for being ready to providing this product to their customers.
Matrix structure
Matrix structure is said to be the best structure as it has less disadvantages compare to the other
structures. Here PepsiCo can bring together the creative heads to work on this project. People
from different department such finance department, marketing department, and production
department can together to further proceed with this project.
After the team have put together, we will develop certain objectives which each department has
to follow to achieve long term goal.
Long term goal
To successfully launch the energy drinks into market and gain a market share 9% at the end of
financial year. Company will further divide this goal into small chunks for each department.
Finance department objectives
To generate finance to support this project and to carry on successfully
Production department
To produce to that limit where they can generate the revenues to gain share in the market
Marketing department
It is responsibility of the marketing department to sale those product which are produced by the
production department.
Resource allocation
Recourses are to be allocated according to priorities established by annual objective.
14. 14
STRATEGIC MANAGEMENT
There are four types of recourses
• Financial resources
• Physical resources
• Human resources
• Technology resources
Example
For production department, it is understood that for production department they will need new
technology in the form of new machinery as they are moving into new line of energy drinks.
20- PROPOSED METHODS & TIMETABLE FOR THE IMPLEMENTATION
OF THE LONG TERM OBJECTIVES
Activities 1st
Quarter 2nd
Quarter 3rd
Quarter
Month
1
Month
2
Month
3
Month
4
Month
5
Month
6
Month
7
Month
8
Month
9
Highland
Coffee in
Vietnam
Popeyes- fast-
food restaurant
in Vietnam
Campina-
Beverage
operations in
Thailand
Calbee - Snack
food
operations in
Japan
Popi- Beverage
operations in
France
Phuc Long-
Beverage
operations in
Vietnam
PepsiCo should
buy Rockstar
Inc.
PepsiCo could
merge with
Vinamilk Inc.
15. 15
STRATEGIC MANAGEMENT
21- CONCLUSION
The PepsiCo is a very effective company that maintains the loyalty to their customers, while
consecutive growth the ultimate goals to maximize their profits. PepsiCo could do a very good
business with the marketing techniques. Furthermore, it can easily improve its products to meet
the aggregate demands of more consumers, especially in the unexploited market where have
various tastes. The marketing strategy and strategic management group could work on
diversifying customer segmentations to satisfy more races, age groups, cultures, and people that
are in less developed areas. Every company always has to improve their business day by day to
keep up with the changes of customers’ expectations, but the Pepsi Cola Company is getting close
to perfection. This success of PepsiCo is continuing to be prosperous as they always put their
customers is on the top of their priorities list.
16. 16
STRATEGIC MANAGEMENT
22- APPENDIX
KEY EXTERNAL FACTOR ANALYSIS
Table 1
Opportunities Weight Rate
Total
Score
PepsiCo New Products Can Easily Penetrate In The
Market. 0.09 4 0.36
Noncarbonated Drinks Are The Fastest-Growing Industry 0.11 3 0.33
Demand Of Pepsi Is More Than Of Competitor 0.07 3 0.21
Changing Social Trends (Fast Foods) 0.09 3 0.27
Internet Promotion And Ordering Processes 0.06 1 0.06
May Tie Up or Liaison With Major Computer Centers
&Restaurant 0.07 2 0.14
Threats
Non-Carbonated Substitutes (The Mango Season) 0.14 3 0.42
Beverage Industry Is Mature 0.12 4 0.48
Fake Products (Imitators) 0.1 2 0.2
Competitor’s Schemes 0.05 2 0.1
Strong Competition With Coca-Cola Company 0.1 2 0.2
Total 1 2.77
Scoring Method:
List The Key External Factor
Assign Weight To Each (0 To 1.0)
Weight In Response To Importance Of A Factor For A Particular Industry
Sum Of All Weights = 1.0
Assign 1-4 Rating To Each Factor
Firm’s Current Strategies Response to The Factor: How Well Firms Response To
These Factors (Effectiveness Of The Firm).
Poor Response 1
Average Response 2
Above Average Response 3
Superior Response 4
Multiply Each Factor’s Weight By Its Rating
Produces A Weighted Score
Sum The Weighted Scores For Each
Determines The Total Weighted Score For The Organization
Result: Above Average Response 2.77 (Aggressive)
17. 17
STRATEGIC MANAGEMENT
KEY INTERNAL FACTOR ANALYSIS
Table 2
Strengths Weight Rate Total Score
Strong Multinational (Brand Equity) 0.11 3 0.33
Strong & Vast Distribution Channels 0.09 4 0.36
Lack Of Capital Constraints 0.07 3 0.21
Record Market Share 0.1 4 0.4
Strong Brand Portfolio 0.06 3 0.18
Aggressiveness In The Market (Market Leader) 0.07 3 0.21
Brand Promotion & Sponsorship 0.12 4 0.48
Weaknesses
Targeting Only Young Customers 0.09 2 0.18
Political Franchises 0.06 2 0.12
Centralized Decision Making 0.05 2 0.1
Decline In Taste 0.09 1 0.09
Motivational Factor 0.05 1 0.05
Not All Products Bear The Company Name 0.04 2 0.08
Total 1 2.79
Scoring Method:
List Key Internal Factors (Strengths & Weaknesses)
Assign Weight To Each (0 To 1.0)
Weight In Response To Importance Of A Factor For A Particular Industry
Sum Of All Weights = 1.0
Assign 1-4 Rating To Each Factor
Firm’s Current Strategies Response to The Factor: How Well Firms Response to
These Factors (Effectiveness of The Firm).
Major Weakness 1
Minor Weakness 2
Minor Strength 3
Major Strength 4
Multiply Each Factor’s Weight By Its Rating
Produces A Weighted Score
Sum The Weighted Scores For Each
Determines The Total Weighted Score For The Organization
Result: 2.79 (Aggressive)
Score ≥ 2.5 Aggressive
Score ≤ 2.5 Defensive
20. 20
STRATEGIC MANAGEMENT
ANALYSIS OF COMPETITIVE PROFILE MATRIX
Table 5
CRITICAL SUCCESS FACTORS Weight Rate
Total
Score Rate
Total
Score Rate
Total
Score
Plant Location 0.07 3 0.21 2 0.14 1 0.07
Strong Brand Image 0.11 4 0.44 4 0.44 3 0.33
Large Marketing Resource Budget 0.09 3 0.27 3 0.27 2 0.18
Market Share 0.12 4 0.48 2 0.24 1 0.12
Product Taste 0.09 3 0.27 4 0.36 3 0.27
Production Capacity 0.07 4 0.28 3 0.21 1 0.07
Innovation 0.11 3 0.33 3 0.33 2 0.22
Control over Supply Chain 0.06 3 0.18 3 0.18 2 0.12
Availability 0.11 4 0.44 3 0.33 1 0.11
Advertising 0.1 3 0.3 3 0.3 1 0.1
Bottling Investment & Empty Mgt 0.03 3 0.09 3 0.09 1 0.03
Personnel 0.04 3 0.12 3 0.12 2 0.08
Total 1 3.29 2.5 1.49
Scoring Method:
List Key Internal and External Critical Success Factors
Assign Weight to Each (0 To 1.0)
Weight in Response to Importance of a Factor for A Particular Industry
Sum of All Weights = 1.0
Assign 1-4 Rating To Each Factor
Firm’s Current Strategies Response to the Factor: How Well Firms Response to These
Factors (Effectiveness of The Firms).
Major Weakness 1
Minor Weakness 2
Minor Strength 3
Major Strength 4
Multiply Each Factor’s Weight by Its Rating
Produces a Weighted Score
Sum the Weighted Scores for Each
Determines the Total Weighted Score for the Organization
Result:
PepsiCo. Is More Aggressive Policy As Compare To Other Competitor
21. 21
STRATEGIC MANAGEMENT
SPACE MATRIX
Figure 2
Steps for the preparation of SPACE Matrix:
a. Select a set of variables to relating to financial strength, competitive advantage, environmental
Stability and industry strength.
b. Assign a numerical value ranging from +1 (worst) to +6 (best) to each of the variables that make
up the financial strength and industry strength dimensions. Assign a numerical value ranging from
- 1 (best) to -6 (worst) to each of the variables that make up the environmental stability and
Competitive advantage dimensions.
c. Compute an average score and dividing by the number of variables
d. Plot the average scores in the space matrix.
e. Add the two scores on the x-axis and plot the resultant point on x. Add the two scores on the
y-axis and plot the resultant point on y. Plot the intersection of the new (x;y) point.
22. 22
STRATEGIC MANAGEMENT
f. Draw a directional vector from the origin of the space matrix through the new intersection
point. This vector reveals the type of strategies recommended for the organization: aggressive,
Competitive, defensive, or conservative.
Competitive position:
Brand Recognition -3 Mean= -2.75
Large Market Share -2
Wide Distribution Channel -2
Customer Loyalty -4
Financial position:
Inventory Turnover +5 Mean= +4
Return on Asset +4
Net Income +3
Industrial position:
High Industry Growth Rate +5 Mean = +3.75
Profit Potential +3
Financial Stability +4
Resource Utilization +3
Stability position:
Economic Stability -2 Mean = -2.33
Barrier to Entry -2
Competitive Pressure -3
CP + IP = +1.0
FP+SP = +1.67
23. 23
STRATEGIC MANAGEMENT
GRAND MATRIX
Figure 3
QUANTITATIVE STRATEGIC PLANNING MATRIX
There are four main columns in QSPM, the left column list down the key internal and external
key factors which are same as in EFE and IFE matrix. Adjacent column to key factors is Weight
(relative importance of the factor) which holds the numeric value obtained from EFE and IFE
matrix weight column. The next to weight is AS stands for attractive score assign priority to key
factors using the numeric value 4 for most importance and 1 for least importance and the last
column TAS (Total attractive score) is the value calculated by multiplying weight by AS. One thing
important to note for each strategy separate AS and TAS value added in the table, weight remain
same for all set of strategies mentioned in QSPM.
Rapid Market Growth
Quadrant II Quadrant I
Strong
Competitive
Position
Slow Market Growth
Weak
Competitive
Position
Quadrant III Quadrant IV
24. 24
STRATEGIC MANAGEMENT
Key Internal Factors Weight
Increasing the
advertisement /
Marketing Budget
Introducing the
energy drinks
Strengths AS TAS AS TAS
1: Strong Brand 0.09 2 0.18 2 0.18
2: Strong marketing and advertising of
products around globe
0.07 2 0.14 4 0.28
3: Products availability 0.08 --- --- --- ---
4: Revenue and profits 0.08 1 0.08 --- ---
5: Market share 0.07 --- --- --- ---
6: Working Environment 0.05 --- --- --- ---
7: Wide variety of products 0.05 --- --- --- ---
8: Earning per share 0.02 --- --- --- ---
Weaknesses
1: High debts 0.07 --- --- --- ---
2: Health Issues 0.08 --- --- 2 0.16
3: Low sales in some products 0.09 --- --- --- ---
4: Negative impact on brand image due to
product recall
0.10 --- --- 1 0.10
5: Lack of product focus 0.05 --- --- --- ---
6: High operating expense 0.10 2 0.2 2 0.2
SUBTOTAL 1.00 0.6 0.92
Key External Factors Weight
Increasing the
advertisement /
Marketing Budget
Introducing the
energy drinks
Opportunities AS TAS AS TAS
1: Easy new products penetration in markets 0.09 --- --- 4 0.36
25. 25
STRATEGIC MANAGEMENT
2: Operate in the fastest growing industry
(noncarbonated drinks)
0.10 --- --- 2 0.3
3: Changing social trends (healthy foods) 0.10 --- --- 3 0.3
4: Media promotion and vending machines 0.10 4 0.4 2 0.2
5: Partnerships with well-known brands 0.07 --- --- --- ---
6:More sport tournaments are being held
worldwide
0.09 3 0.27 2 0.18
Threats
1: Strong competition in every division 0.10 --- --- --- ---
2: Growth of energy drinks in carbonated
drinks sector
0.08 --- --- 2 0.16
3: Mature industry 0.10 --- --- --- ---
4: A few Frito Lay products resulted in
abdominal cramps in consumers
0.07 --- --- --- ---
5:Aggresive top management strategy by
competitor
0.10 --- --- --- ---
SUB TOTAL 1.00 0.67 1.5
SUM TOTAL ATTRACTIVENESS SCORE 1.27 2.42
REFERENCES:
http://www.marketingteacher.com/pepsi-swot/
https://finance.yahoo.com/q/ae?s=PEP+Analyst+Estimates
http://www.reuters.com/article/2010/01/19/idUS116177+19-Jan-2010+BW20100119
http://www.authorstream.com/Presentation/crystalmcmahan-1865748-powerpoint-project-
pepsico/
http://www.pepsico.com/Investors/Stock-Information
http://www.strategicmanagementinsight.com/products/swot-analyses/coca-cola-swot-
analysis.html
http://balancedscorecard.org/Resources/Strategic-Planning-Basics