Strategic Leadership Lecture 11

Re:  Indra Nooyi-Pepsico

From the PEPSICO case study, I learnt the important for an effective strategic leadership to make profit.  In business, the rule for profit is to continually make as much profit for the shareholders. Therefore, Shareholders can gauge the success of the leadership based on increasing or decreasing profits. This can determine if the leader, or other top executives, should be replaced. That is why in PepsiCo, shareholders are unhappy with the way Indra Nooy is running the company. As the result, Nooy`s job is on the line and from the shareholders standpoint she is not effective at all.

Furthermore, being profitable and responsible are equally important because it is indispensable for the continuity of any business.  It is generally held that corporate social responsibility (CSR) could increase company profits and thus most large companies are actively engaged in it. When a company chooses to be socially responsible they are not only helping out the community, environment etc. They are also helping themselves in the long run. Companies are effectively learning how to attract customers through being socially responsible. Customers tend to avoid selfish companies whose only goal is to maximise profit and economic power. Most leaders believe that CSR can improve profits. They understand that CSR can promote respect for their company in the marketplace which can result in higher sales, enhance employee loyalty and attract better personnel to the firm.

PepsiCo strategic leadership approach is different to other case studies.  First, the firm`s leadership (PepsiCo) has created multiple brands business strategy. For example, they have many successful brands such as Tropicana, Quaker Oats and so on. Second, they are the only one from the other case studies, who incorporated CSR to their business strategy. Finally, they understood the culture difference between nations and as a result they are able to target different countries with specific product (effectively).

DJ......