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PEPSI UNVEILS ORGANIZATION OF THE FUTURE; ROLES, RESOURCES TURNED 'RIGHT SIDE UP'

 PEPSI UNVEILS ORGANIZATION OF THE FUTURE;
 ROLES, RESOURCES TURNED 'RIGHT SIDE UP'
 SOMERS, N.Y., Sept. 21 /PRNewswire/ -- Pepsi-Cola Company announced today an innovative restructuring of its U.S. operations to improve customer service capability, and to position the company for future growth opportunities. The move, which takes effect immediately, simplifies communication and decision-making, and focuses major additional resources on the front line of the business, the point of customer contact.
 The change is the culmination of an intensive two-year study of customer service and in-market systems, company and industry-wide, plus benchmarks from companies in non-related businesses.
 The new organization eliminates Pepsi's previous four geographic Divisions and consolidates 24 Operating Areas into 16 Business Units, 12 dedicated to company-owned operations and 4 focusing on the franchised bottler business. Its new core is approximately 100 Market Units charged with all front-line sales, marketing and local marketplace customer service activity. Market Units report into 16 Business Units responsible for planning, business development and providing resource support.
 The Business Units will report into a single National Business Unit. The role of this newly-created National Business Unit ends a 20-year era of functional specialization in favor of new strategic and business development assignments geared for future growth opportunities.
 Each Market Unit will be run by a Market Manager who reports to a General Manager at one of the 16 Business Units. Business units report to one of two Chief Operating Officers at the National Business Unit, who in turn report to the President and Chief Executive Officer.
 From an organizational perspective, the new structure literally turns the traditional hierarchical management pyramid upside down. Those closest to the customer -- Pepsi's 20,000 front-line performers and operations staff -- are placed at the top of the organization, essentially turning Pepsi-Cola "Right Side Up."
 Additionally, the traditional, rigid function-oriented organization has been replaced with cross-functional work teams. "Until today, Pepsi-Cola was organized in a traditional functional system. Departments like finance, marketing, operations, and sales each operated independently," said Craig Weatherup, President and Chief Executive Officer of Pepsi-Cola North America. "In listening to our employees and other companies, we discovered that the system wasn't as effective as it could be. The new integrated organization eliminates layers of supervision, focuses on 'teams' designed to create fluid, efficient work processes, removes barriers to serving customers, and better links headquarters to the front line."
 Consequently, all job assignments -- from plant supervisor to the CEO -- have been fundamentally redesigned to simplify customer communication, work processes, and decision making, with resources moved closer to the front line. There are now two fewer layers in the management. The new management team is now focused on planning, coaching and providing resources. Their goal is to deliver field-ready tools and programs to exceed customers' expectations year in, year out.
 The structure also simplifies and streamlines the process of bringing new products to market, a strategic priority for the company. "With customer service a linchpin of our organization, we'll have the operational capability for introducing new beverage products and concepts more quickly," Weatherup said.
 "Our customers are making sweeping changes in their operations. This is not a downsizing effort to cut costs and improve the bottom line but rather an enlightened organizational move designed to adapt to customers' needs and to grow the top line," Weatherup said. "We've designed an organization and a team positioned for growth and new business development."
 Along with unveiling Pepsi's new organization, Weatherup also announced the appointment of two Chief Operating Officers, Brenda Barnes and David Novak, who will direct all operating unit activities. Barnes, a 16-year PepsiCo veteran, has held leadership positions in every aspect of the business -- marketing, sales, bottling and division operations. She most recently served as President of Pepsi South. Novak has been a champion of Pepsi's drive to become a total beverage company through joint ventures with Lipton and Ocean Spray and the launch of new products like Crystal Pepsi. Novak has been Executive Vice President of Marketing and Sales for the past two ears.
 Pepsi-Cola Company is based in Somers, N.Y. and is a division of PepsiCo, Inc. (NYSE: PEP).
 -0- 9/21/92
 /NOTE TO EDITOR: A chart which explains the Pepsi-Cola restructuring is available; for fax of chart call Lisa Kovitz, Hill and Knowlton at 212-210-8889./
 /CONTACT: Rebecca Madeira of Pepsi-Cola , 914-767-7214/
 (PEP) CO: Pepsi-Cola Company ST: New York IN: FOD SU: RCN


SH -- NY066 -- 1754 09/21/92 14:13 EDT
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Publication:PR Newswire
Date:Sep 21, 1992
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