Principal Of Management Final Project : Pepsi Prepared By: Study Zoomers (RamzanIdrees, Naqeeb Ur Rehman, ZeeshanRafiq, UzmaNaseem) University

of Central Punjab,Gujar Khan Campus Submitted To: Prof.UmerNiaz Dated: 18-01-2013

History:
Pepsi is a carbonated soft drink produced and manufactured by PepsiCo. The drink was first made in the 1890s by pharmacist Caleb Bradham in New Bern, North Carolina. The brand was trademarked on June 16, 1903. There have been many Pepsi variants produced over the years since 1898. It was first introduced as "Brad's Drink" in New Bern, North Carolina in 1898 by Caleb Bradham, who made it at his pharmacy where the drink was sold. It was later named Pepsi Cola, possibly due to the digestive enzyme pepsin and kola nuts used in the recipe. Bradham sought to create a fountain drink that was delicious and would aid in digestion and boost energy.

Mission Statement:
Mission is to produce Pepsi Co. quality beverages, maintain market leadership by growing our sales volumes, strengthen our market share, deliver ROI to all of its stakeholders and fulfill

its responsibilities in the community.

Vision Statement:
We aspire to be, and be recognized as, the largest beverage manufacturing and selling company in Pakistan with the most diverse portfolio of branded beverages and cutting edge superior customer service.

Our Values
Integrity Leadership Honesty Passion Ownership Trust

Our 7 Guiding Principles

Practice and show respect for all individuals Innovation with speed to market is the cornerstone of our success Focus on strategic work Both the company and the individual have undividable interests Externally Focused Mutual interdependency is our way of life No Procrastination

Pepsi manager do.

Coordinating an over seeing the work activity of others so that their activities are completed Efficiently & Effectively.

function do Pepsi Co. Managers:

Interpersonal Roles Informational Roles Decisional Roles

Management view of Managers:

Symbolic view

How is Pepsi Co. Managers Job is changing?

Changing Technology Changing Security Threats (War on Terror) Increased emphasis on organizational and Managerial Ethics Increase Competitiveness (Amrat Cola, Makah Cola)

Hierarchy:

Managing Director Chief Operating Officer

General Manager

Production Manager
Senior Manager Finance

Finance & Sales Manager

Senior Manager Admin

Senior Manger Accounts

Senior Manager MIS

Senior Manager Production & Quality

Senior Manager Mechanical Workshop

Senior Manager Store

Senior Manager Purchase

Middle Manager

Admin Manager

Deputy Manager

Assistant

Non-Managerial Staff

Pepsi Co. as organization

Pepsi Co. is well known for its Pepsi beverages products . This is a multinational corporation also responsible for the production of Frito-Lay, Gatorade, Tropicana & Quaker Products but only in international Markets. Common Characteristic of Pepsi Co. as Organization * Distinct purpose (Mission) Organizational Structure of Pepsi Co. * Adaptive Organization.

Organizational Culture :A system of shared meanings and common beliefs held by organizational members that determines, in a large degree, how they act towards each other.

Dimensions of Organizational Culture :* Attention To Detail * People Oriented * Outcome Oriented * Aggressiveness

Sources of Organizational Culture :* Past Practice * Behavior Of Top Management

 Managerial Decisions Effected by Culture :* Planning * Leading * Motivating * Organizing * Controlling

Pepsi Co. Facing Cultural Issues :* Creating an Ethical Culture * Creating an Innovative Culture * Creating a Customer-Responsive Culture

Workplace Spirituality in Pepsi Co. :* No Work place spirituality

Pepsi Co. External Environment :Coca-Cola, Government, Bottle Suppliers, etc

Components of the External Environment :* Specific Environment * General Environment

External Environment :Specific Environment :* Coca-Cola, Amrit Cola, Makah Cola etc. * Bottle Supplier, Water Supplier, Other Material Suppliers. * Customers (You, Me and Our families) * Public Pressure Groups(JamatulDawa)

General Environment :* Economic Recession * Political Instability * Social Culture of Pakistan

How the Environment Affects Managers ? * Environmental Uncertainty :

Pepsi Co. managers have knowledge of and are able to predict change their organizations external environment is affected by, they keep two things on their mind while making any prediction :-

* Complexity of the environment. * Degree of change in environmental components. The social sustainability:

 The company has the charity, community activities such as "Friendship Charity Golf Tournament Pepsi", and to support the "Day singer". Sponsored competitions for young talents such as Dynamic, Road to Success, the scholarship program for talented students, overcoming difficulties, etc. PepsiCo Vietnam has concerned community support, support poor families, families encounter unexpected difficulties due to storms and floods, especially in poor communities living in the Truong Son mountains, through program of the SGGP Newspaper.

Decision Making
Identify the problem or opportunity 2) Develop alternative 3) Evaluate alternative 4) Choose and implement the best alternative 5) Evaluate the decision

ORGANIZATION STRUCTURE
At Pepsico, the managers and leaders have identified the relationship that exists between themselves and the employees. In this company, the leaders and managers usually use information elements in supporting the employees' decision making for improvement of the working condition. Employee's involvement in decision making especially in regard to their working conditions and environment is a key to ensuring that a healthy culture is developed in an organization Managers and leaders involve all levels of management as well as the employees on the decision making process and they always encourage open and participatory decision making process.
Leaders and managers jointly perform the management function which includes planning, budgeting, evaluating and facilitating of organizational resources While formulating the plans, employees are consulted and their views incorporated in the overall plans of the company and they also aid the managers and leaders in coming up with fore-casted budgets for a particular period of operations. Managers of Pepsico are efficient and carry out their leadership functions effectively. This in turn motivates the employees and they willingly follow the leaders. Good leadership at Pepsico has been a major tool that has created a culture of hard work and innovation The company has also facilitated a good and safe working environment for its employees and this has in turn improved the workers productivity and commitment to the organization. The relationship between the workers and leaders is interactive and workers grievances relating to their working environment and other labor related issues are well addressed Trust has been developed between the management and the workers as leaders are committed to their tasks just as workers are. This maintains the culture of hard work and commitment to goals and objectives Organization Stakeholder:

Human Resource Management of Pepsi Co.

For Pepsi Co. human resources Management can be a significant source of competitive advantage.

Importance of Human Resource Management for Pepsi Co.

* Skilled People * Production Quality Control

Current Issues Pepsi Co. Facing in H.R.M:

* Standard of Education * People Demand

How do Pepsi Co. Measure the performance of Staff ?

* Overall Task Oriented * Staff Administration

Different Trainings provided by Pepsi Co.totheir Staff ?

* International Visits & Seminars * Local Discussion Programs

How do Pepsi Co. Setup H.R Strategy ?

* Aim Goals * Planning * Forecasting

 Challenges Pepsi Co. Facing of H.R in Pakistan ?

* Political Instability * standard of Education * Economic Crises

The Most Important Management Function In Pepsi Co. ?

* Planning

Job analysis Regarding Pepsi Co. ?

* Job Description * Job Specification

Recruitment & Selection process of Pepsi Co. ?

* News Paper * Company Website * Job Portals (Rozee.pk) Strategic Management &Planning :

What is Strategic Management for Pepsi Co. ?

* Developing Organizations Strategies * Basic Management Functions

Management Functions Pepsi Co. Perform ?

* Planning * Organizing * Leading * Controlling

The Strategic Management Process Pepsi Co. Follows ?

* Mission, Goals & Strategies * Doing External & Internal Analysis * Formulating, Implementing Strategies * Evaluating Results What is planning * Setting Goals * Establishing Strategies * Developing Plans

for Pepsi Co. ?

Why do Managers of Pepsi Co. Plan ?

* Provides direction * Reduces uncertainty * Minimizes waste and redundancy * Sets the standards for controlling

Traditional Goal Setting ?

* Broad goals are set at the top of the organization. * Goals are then broken into sub-goals for each department

* Assumes that top management knows best because they can see the big picture.

S.W.O.T Analysis of Pepsi Co

Strengths :* Competitive Oriented Mentality * Quality Control (PCI Check n Balance) * Location & Place (Geographical Location) * Sponsorships (PCB, Brand Ambassadors) * Market Share (65% In 2010, falls form 80% in 1990)

Weaknesses :* High Rates (in terms of major Competitor) * Weak Supply Chain * Decline in Taste * Formal Hierarchy Slow Decision making Opportunities :* Increased Population * Technology Development * Fountain Fresh\Vending Machines * Diversification (Snack food)

Threats:* Political Instability

* Economic Recession * Competitor Intentions * Threats of Labor Strikes * Material Shortage Problem

Porters 5 forces model

Threat of new entrant

The main barriers are.

Economies of scale Patents Product differentiation Capital requirements (financial & specialist equipment) Skills Reaction/strategic decisions of incumbents (ex-all undercut new entrant) Government policy (ex-de-regulation) The bargaining power of supplier exert power in the industry by threatening to raise prices or reduce quality. Powerful suppliers can squeeze industry profitability if firms are unable to recover cost increases. The bargaining power of suppliers.Suppliers are likely to be powerful if Supplier industry is dominated by a new firms. Suppliers products have few substitutes. Buyer is not an important input to buyers product. Suppliers products have high switching cost. The bargaining power of buyers

Buyers compete with the supplying industry by:

Bargaining down prices Forcing higher quality Playing firms off of one another

PEST analysis
Political factors. These refer to government policy such as the degree of
intervention in the economy. What goods and services does a government want to provide? To what extent does it believe in subsidizing firms? What are its priorities in terms of business support? Political decisions can impact on many vital areas for business such as the education of the workforce, the health of the nation and the quality of the infrastructure of the economy such as the road and rail system Economic factors.These include interest rates, taxation changes, economic growth, inflation and exchange rates. As you will see throughout the "Foundations of Economics" book economic change can have a major impact on a firm's behavior. For example: - higher interest rates may deter investment because it costs more to borrow

- a strong currency may make exporting more difficult because it may raise the price in terms of foreign currency - inflation may provoke higher wage demands from employees and raise costs - higher national income growth may boost demand for a firm's products Social factors.Changes in social trends can impact on the demand for a firm's products and the availability and willingness of individuals to work. In the UK, for example, the population has been ageing. This has increased the costs for firms who are committed to pension payments for their employees because their staff is living longer. It also means some firms such as Asda have started to recruit older employees to tap into this growing labor pool. The ageing population also has impact on demand: for example, demand for sheltered accommodation and medicines have increased whereas demand for toys is falling. Technological factors:new technologies create new products and new processes. MP3 players, computer games, online gambling and high definition TVs are all new markets created by technological advances. Online shopping, bar coding and computer aided design are all improvements to the way we do business as a result of better technology. Technology can reduce costs, improve quality and lead to innovation. These developments can benefit consumers as well as the organizations providing the products.

The threat of substitute products

Products with similar function limit the prices firms can charge

Keys to evaluate substitute products:

Products with improving price/performance tradeoffs relative to present industry products

Conclusion
In the end we conclude that Pepsi Co. is almost covering all essential parts of being a strong Organization by having a strong Management System but still its not Completely Decentralized MNC in Pakistan as final Decision power is with Pepsi Cola International and they are still facing some serious problems\Issues regarding H.R.M and market share.