Indra Nooyi the Current CEO of PepsiCo - Research Paper Example

Indra Nooyi – the Current CEO of PepsiCo Indra Nooyi, the current CEO of PepsiCo, began her corporate career in 1994 after the CEO of GE Jack Welch and the CEO of PepsiCo Wayne Calloway made offers for her services. Turning down Jack Welch’s offer at GE, Indra Nooyi accepted the position at PepsiCo as Senior VP for Corporate Strategy and Development. In the years after her appointment, she transformed the company’s portfolio significantly, resulting in her promotion as CFO and subsequent appointment in 2001 as a director of the board (Annapoorna, 2011). After Steve Reinemund’s early retirement as CEO in 2006, Nooyi took his place, becoming the first woman CEO at PepsiCo. She launched her vision for the company with the motto “Performance with Purpose”, using her vast experience to promote a culture of change within the company. This has proved an integral strategy that will define her legacy, while her vision has significantly narrowed the company’s path for the foreseeable future (Annapoorna, 2011). Indra Nooyi has positively mastered various emotional intelligence competencies, including trustworthiness, adaptability, initiative, empathy, service orientation, and organizational awareness to succeed, which will be the focus of this paper. Indra Nooyi has proven to be a trustworthy leader with a real purpose and vision that her employees can believe in. While she is accountable ultimately to the shareholders at PepsiCo, it has been evident that she does not pander to Wall Street and is very clear about her goal to transform PepsiCo to a provider of healthy food and away from being a snack food firm (Cook & Glass, 2014). She has made this known through the prioritization of the environment, consumers, and her employees, considering a profit later, which has not been lost on her employees and management. The “Performance with Purpose” mission has formed the foundation for trust with her employees through its human sustainability, talent sustainability, and environmental sustainability aspects. By generating and balancing profits without loss of focus on her vision, the employees feel that the company has a secure future. This has also ensured that the employees focus on the company’s future and balance it with accountabilities and performance. Nooyi has given the employees a sense of purpose in knowing that they are making a difference, while putting their future in the CEO’s hands for the future (Cook & Glass, 2014). By being consistent and having a credible presence, Nooyi has developed trust with the company’s employees, shareholders, and partners. Nooyi has also shown adaptability as part of her EQ by developing a model of adaptability, stating that all businesses today are in the business of adaptability and failure to do so will be fatal. The culture of adaptability initiated by Nooyi at PepsiCo has kept the company transforming and performing in a dynamic business environment. For example, she has always ensured that the company is always scanning the environment for future trends, as well as defining the company’s ability to lead these trends (Alison & Christy, 2014). To do this, she considers it important to see the environment always through the eyes of the consumers and employees. For example, understanding that social responsibility, sustainability, and healthy eating were major concerns for consumers, the creation of healthier products enabled PepsiCo to adapt to consumer needs. She also insists on listening to consumers and customer partners through social media and acting on their preferences, which is evidenced by the “Do Us a Flavor” campaign in the UK that sought ideas from consumers on new flavors and received over 1 million entries (Cook & Glass, 2014). Finally, she also believes that companies should disrupt industry trends before the trends disrupt the company, making changes and re-thinking strategy to adapt to future trends today. The PepsiCo CEO also possesses the EQ aspect of initiative, which has seen her revolutionize and maneuver the company’s portfolio and increase its market value. By being a change agent and a smart risk-taker, Nooyi took the initiative to restructure PepsiCo through bold decisions such as selling the company’s bottling division and restaurant business (Gifford, 2013). After identifying changes in consumer habits, she took initiative to take advantage of these trends by acquiring healthy brands like Naked Juice and Tropicana in order to increase PepsiCo’s market share. Moreover, she made an asset out of her strategic skill to capitalize on the global economic downturn of 2007/2008 by re-investing in its bottling divisions. This saw the company gain approximately $60 million, while improving the company’s corporate position. Nooyi has been able to combine her style of leadership with strong business acumen to take initiative in translating the company’s vision to reality. Undeniably, she has been a corporate shape-shifter, striving constantly to effect changes and take initiative for leading this change at PepsiCo (Gifford, 2013). By applying strategic experience to drive PepsiCo towards a healthy food company, she has been able to steer PepsiCo through the financial crisis. Although Nooyi may not seem like a strong personality, she has been variously described as a humble, charismatic, and empathetic leader. Indeed, she seems to view her position at PepsiCo as a privilege and one with a lot of responsibility. Nooyi’s ability to rise to the position of CEO has been put down to her innate ability to care for and understand her employees and co-workers (Gifford, 2013). From the employees to management, she has been known to go out of her way to remain visible to everyone at the company, including the lower-ranking employees. For instance, when she was chosen as the CEO of PepsiCo, she immediately contacted her competitor for the position Mr. Mike White to ensure he was alright with the decision, while also pushing the board to give him a salary that matched her salary. By humbling herself and showing empathy towards Mr. White, Nooyi showed that she was passionate about her workers and inspired similar passion in her employees. She proves that even CEOs of top companies can be strategic, sensitive, and humane simultaneously. This is evidence of how important it is for leaders to ensure that their IQ measures up to their EQ, encouraging experiential learning and leading with empathy (Gifford, 2013). Organizational awareness is another critical aspect of emotional intelligence that Indra Nooyi has espoused since she became CEO of PepsiCo and, indeed, even prior to her appointment as CEO. Identifying the increasingly global nature of PepsiCo’s business, she began to champion of corporate diversity and integrating inclusion training for her employees, management, and executives. By taking ownership of the company’s HR strategy and coupling 50% of her bonus to the goal of enhancing diversity, she has shown an appreciation for the unique contributions that are brought to the workplace by individuals (Colvin, 2012). She has also been reported to watch Michael Jordan’s NBA championship games to gain insights into how American teams work, which she then applies to the organizational setting. This shows that she is always willing to learn new things that can help her solve issues plaguing the organization. Her strategic thinking and global perspective have also improved her organizational awareness, enabling her to learn about how to improve PepsiCo’s corporate strategies. In addition, by attempting to combine emerging and traditional leadership standards, as well as advocating for consensus in group decision-making and the promotion of workplace equity, Nooyi has elevated PepsiCo standards to current organizational business practices (Colvin, 2012). Finally, Nooyi shows service orientation as part of her emotional intelligence, which involves acting with the stakeholder’s needs in mind through establishment of a rapport with them. Indra Nooyi has a clear vision that seems to be in congruence with that of the company’s stakeholders (Burnison, 2011). Service orientation involves facilitation of solution delivery to meet the stakeholder’s unexpressed and underlying needs. In this case, she has framed her vision under the “Performance with Purpose” statement that has been based round improving PepsiCo product’s healthy status and ensuring that the company pursues sustainability. By rallying her employees and management around this vision, she was able to orient the company’s services around the needs of the consumer for healthy foods. These efforts were undertaken while balancing the key strategic and business priorities of PepsiCo, which was to increase market share and profits (Burnison, 2011). By genuinely attempting to help its consumers in the midst of an obesity epidemic, PepsiCo with Nooyi as CEO has taken short-term risks with a long-term vision of benefits for both consumers and the company. References Cook, A., & Glass, C. (2014, January 01). Analyzing promotions of racial/ethnic minority CEOs. Journal of Managerial Psychology, 29(4), 440-454. Annapoorna, K. (2011). Indra Nooyi: A biography. Delhi: Rajpal & Sons. Burnison, G. (2011). No fear of failure: Real stories of how leaders deal with risk and change. San Francisco, CA: Jossey-Bass. Colvin, G. (2012, June 11). Indra Nooyi's challenge. Fortune, 165(8), 74-79. Gifford, J. (2013). 100 great business leaders. Singapore: Marshall Cavendis. Read More