After taking over as chairman & CEO of PepsiCo India two months ago, D Shivkumar has restructured the company’s operations in line with its global operating model. From a business unit-based organisation, PepsiCo India has now become an integrated power-of-one functional organisation. With this move, the company has integrated its beverage and food business into one entity.
As the title sponsor for IPL-7, the company is drawing up fresh marketing and advertising plans to attract cricket lovers. It has floated a music channel, Pepsi MTV Indies, in association with MTV to target the youth segment. In an exclusive interview with Lalitha Srinivasan, Shivkumar talks about the company’s plans. Excerpts:
Tell us about the company’s restructuring plans to strengthen operations in India.
Our new organisational structure is aligned with our global operating model. The food and beverage categories are highly complementary. Our integrated structure drives speed, efficiency and effectiveness at all levels in the organisation, which will enable us to meet the needs of retailers and help us in brand building, innovation and points of sale.
How important is PepsiCo India in your global operations?
India is a key market for PepsiCo and one of the top markets worldwide. Today, we have one of the largest MNC food and beverage businesses in India with a significant manufacturing presence. Along with our partners, we have recently announced an investment of Rs 33,000 crore in India by 2020 for product innovation, increasing manufacturing capacity, ramping up market infrastructure, strengthening supply chain and expanding company’s agriculture programme. The decision reiterates our commitment to India and the long-term growth opportunities in the country.
How is your strategic alliance with Tata Global Beverages’ NourishCo doing?
We are proud of our joint venture with the Tata Group as it is the most trusted home-grown Indian brand with a significant global presence today.
As the title sponsor for the 7th edition of IPL, what are the company’s initiatives this year?
Our association with cricket is with the world cup, T-20 and IPL. We have exciting plans for IPL-7. We have started with a digital idea called the Pepsi Intern and will unveil our other plans soon. Our fresh initiative @ThatPepsiIntern will generate exclusive content from IPL 2014 and will be a link between fans and celebrities, bringing the Pepsi IPL experience alive.
As the new head of PepsiCo India, what will be your key focus areas?
The first priority for any new CEO must be to know his people and build mutual respect and trust in the company, and the broader ecosystem. Getting to know the people also helps the new CEO understand the culture. Understanding the culture is a great learning experience to judge the speed at which one moves forward. A business has a many assets, the two most important being brands and people.
As innovation is the name of the game in the packaged food and beverages industry, what are your new investments in R&D?
Innovation is important to stay ahead in terms of price, and to differentiate with others in the category. Our innovation is in the value chain from the potato farmer to the packaging and to the outlet programmes. Innovation can come from product space, services space and business models in general. Indra Nooyi, our chairperson, has announced a Rs 33,000-crore investment in India by 2020.