Roger Enrico, 51, won't formally become the third CEO in PepsiCo history until April 1, but he moved quickly last week to promote three executives to help him lead the company forward.
The promotions give PepsiCo a youthful (average age: 48) core management team but one with lots of experience (average years with PepsiCo: 18). The restructuring also gives the company a more global operating view, creating three worldwide operating units: beverages, snacks and restaurants.
In naming Christopher Sinclair, 45, chairman-CEO, Pepsi-Cola Co.; Steven Reinemund, 47, chairman-CEO, Frito-Lay Co.; and Craig Weatherup, 50, president of PepsiCo, Mr. Enrico eliminated PepsiCo's traditional separation of North America from the rest of the world. That's a step the company had taken earlier with its restaurants division, reporting directly to Mr. Enrico.
PepsiCo's management moves aren't expected to cause major marketing or ad changes. The joining of North American and international divisions will probably lead to campaigns more readily crossing geographic boundaries. And PepsiCo has recently done some account consolidating with agencies in Europe and Asia; more such moves were expected even before the executive changes.
COKE'S OVERSEAS ADVANTAGE
Shifting to a global management structure highlights Mr. Enrico's key challenge as he assumes the helm-international growth. While PepsiCo beverages outsell Coca-Cola Co.'s rival ones in the U.S., and PepsiCo snacks and restaurants have scored some big domestic wins lately, the company's growth overseas pales in comparison with Coca-Cola's.
The latter grew non-U.S. sales 15% in 1995 and now gulps 70% of total sales on foreign turf. In contrast, 70% of PepsiCo's sales come from the U.S., and international sales grew more slowly than domestic sales last year, 6% vs. 7%, respectively.
Mr. Enrico has had notable success overseas as head of PepsiCo's restaurant businesses since 1994. International restaurants led all PepsiCo sectors in sales growth last year, up 16%.
Mr. Sinclair's leadership on international beverages produced similar results last year, with sales up 14%. And the company is optimistic about international snack sales, hurt last year by the peso devaluation in Mexico.
MORE SHARING EXPECTED
The new management structure should lead to more sharing of ideas and successes between Pepsi operations at home and abroad, said Bill Katz, president of BBDO Worldwide, New York, Pepsi's longtime lead ad agency.
Mr. Katz described Mr. Enrico as a hands-on innovator and competitor. "He's not into competition for competition's sake. He's into competition to make his organization better," Mr. Katz said.
Added Phil Dusenberry, chairman of BBDO's New York office, and vice chairman, BBDO Worldwide, "He's always out searching for the big idea."
Mr. Enrico started his PepsiCo career in 1971 in the marketing department of Frito-Lay.