Ali Baig
BUS 550
May 19, 2014
Dr. Minder Chen
PepsiAmericas logo image, Aurora Regional Chamber of Commerce, Retrieved May 12, 2014, last updated Feburary 2009, http://www.aurorachamber.com/spirit/images/PepsiAmericas.jpg
Overview
•
•
•
•
•
•
•
•
•
•
Brief Background.
Historical Background.
Financials.
Technology.
Organization(Business Processes).
Management Decisions.
Business Challenges, Problems, Opportunities.
Future Strategies and Solutions.
Conclusion.
Questions for Class and for me.
Brief Background
• Was the 2nd largest bottler of Pepsi
products contracted to make Dr.
Pepper/Snapple/smaller regional
brands.
• Worldwide operations and HQ was
Minneapolis, Minnesota.
• Had about 41% stake in PepsiCo and
in 2007 generated 4.5 Billion at its
peak.
• CEO and Chairman was Robert C.
Pohland.
• President, Chief operating officer
Kenneth E Keiser
• Main competitor was Coca Cola
Enterprises.
Image of Pepsi Americas room, Siewart Cabinet, Retrieved May 13, 2014, last updated 2009, http://www.siewertcabinet.com/wp-content/uploads/2014/03/DSCN1281.gif
Brief Historical Timeline
• Founded in 2000 with merged with Whitman
Corp (a Pepsi Bottler, originally a railroad
company, 1962 went into bottling)
• 2000-2009*: Individually based dependent on
firms truck drivers. New Products, (net sales $5
billion, 20% of Pepsico Total Sales
• 2001(NextGen), 2003(PMO), 2005(Customer
Alignment), 2006(Ecommerce), 2007(CO3 and
BRM)
• 2009-2010: PepsiAmericas became a part of
PepsiCo, renamed Pepsi Beverages Company.
Financials
$86.54/share, P/E: 19.32, EPS: 4.48
PepsiCo Inc, http://www.marketwatch.com/investing/stock/pep/analystestimates, last updated May 16 2014, Retrieved May 16 2014
Technology
• Originally, truck drivers
were the salespeople
for the customers but
as their demand went
up-> new IT methods.
• NextGen handheld
device.
Image of Pepsi Truck, Retrieved May 14, 2014, Last updated May 2009, http://fleetnewsdaily.com/wp-content/uploads/2013/06/Screen-shot-2013-06-11-at-4.23.28-PM.png
NextGen
• “Handheld project”
• Redesigned sales by
replacing conventional
route sales process with
pre-sell before loading
the trucks.
• Divided into 3 areas: Sales
Rep, Driver, Merchandizer
• Implemented new
processes, redesigned
roles, build in customer
service with lots of
information
UPS next generation model is here, Handheld device image, Last updated March 2012, Retrieved May 16, 20-14 http://upsblog.files.wordpress.com/2012/03/diad_v.jpg?w=216
Organization(Business Processes)
• Too much data coming in and not updated
quickly enough.
• Customer Alignment: an initiative that
reorganized the firm around centralized
functions.
• 4 customer segments
– Needs of large customer shipments
– Needs of Direct Store Delivery (DSD)
– Smaller DSD
– Unique and Special needs (vending machines)
Management Decisions
• NextGen and Customer
Alignment success made
the executives realized a
need to drive value from
tech initiatives.
• Projects based on Internal
Rate of Return (IRR).
• Formed Project
Management
Organization (PMO),
which helped more
disciplined way.
Other Management Decisions.
• 8 critical future business
capabilities
• Competitive Edge initiative:
IT infrastructure to deal
with these 8 elements and
has 2 components.
• 1) Information Backbone :
made data more accessible
for decision making and
banalsis.
– CDR(Central Data Repository)
– DW(Data warehouse)
• 2) a mobile platform(CO3)
Mobile Platform: CO3
• Customer Optimization or
C03 was a series of
projects that focused on
business PepsiCo was
building
• Use data to improve
performance that linked
sales and supply chain.
• 3 areas
– Demand planning
– Power pre-sale
– Perfect pallet
Business Challenges, Problems,
Opportunities.
• NextGen: technology limitations, battery
issues, wiring, data wasn’t always updated,
too much demand.  PMO.
• Customer Alignment and PMO changed IT
structure and provided stronger pathways.
• Competitive Edge
Future Strategies and Solutions.
• Grow into Central and Eastern European
Countries. (CEE)
• European expansion would significantly
improve revenue.
• Constantly improve IT
Conclusion.
• Was the 2nd largest bottler of Pepsi products
and main competitor was Coca Cola
Enterprises.
• Originally truck drivers were the salespeople
for the customers but as their demand went
up, NextGen
• Customer Alignment->PMO->Customer
Optimization and Competitive Edge
• CEE
Quiz Time!!!!
1)
The purpose of NextGen was to
a) Engage younger consumers through celebrity ads to bring in more customers
b) Implement new processes, redesign roles, build in customer service with lots of information
c) Make the delivery task easier for the truck drivers as cheap as possible.
d) Limit the information coming in and the roles to improve efficiency
2) All are customer segments provided by Customer Alignment except
a) Needs of large customer shipments
b) Needs of Direct Store Delivery (DSD)
c) Unique and Special needs
d) Needs of Indirect Store Delivery (LSD)
3) CO3 stands for
a) Customer Optimization
b) Carbonation of the latest Pepsi product.
c) Carbon trioxide
d) None of the above
Works Cited
•
•
•
•
•
•
•
•
•
•
•
(2014). Retrieved May 16, 2014, from Pepsico: http://www.pepsico.com/
Aguirre-Mar, M. (2013). Global Structural Design and Results: PepsiCo Case. JOURNAL OF
STRATEGIC LEADERSHIP, 6-14.
Baig, J. (2014, May 17). Pepsico Manager of Sales. (A. Baig, Interviewer)
Beath, C. and Ross, J. PepsiAmericas: Building An Information Savvy Company, 378 (MIT Feb 2010).
Image of Pepsi Americas room, Siewart Cabinet, Retrieved May 13, 2014, last updated 2009,
http://www.siewertcabinet.com/wp-content/uploads/2014/03/DSCN1281.gif
Image of Pepsi Truck, Retrieved May 14, 2014, Last updated May 2009,
http://fleetnewsdaily.com/wp-content/uploads/2013/06/Screen-shot-2013-06-11-at-4.23.28PM.png
NNDB. (2012). PepsiAmericas. Retrieved May 15, 2014, from NNDB:
http://www.nndb.com/company/395/000124023/
PepsiCo Inc, http://www.marketwatch.com/investing/stock/pep/analystestimates, last updated
May 16 2014, Retrieved May 16 2014
Pepsico. (2014). Pepsico Corp Fact Sheet. 1-2.
Pepsico/PepsiAmericas, 5632 (Luxembourg October 26, 2009).
UPS next generation model is here, Handheld device image, Last updated March 2012, Retrieved
May 16, 20-14 http://upsblog.files.wordpress.com/2012/03/diad_v.jpg?w=216
Questions