BUSINESSWEEK ONLINE : APRIL 10, 2000 ISSUE
COVER STORY A Potent Ingredient in Pepsi's Formula Six years ago, Indra K. Nooyi found herself in the enviable position of weighing competing job offers from General Electric Co. chief Jack Welch and PepsiCo Inc. CEO Wayne Calloway, who also sat on Welch's board of directors. ''Jack Welch,'' she recalls Calloway saying, ''is the best CEO I know, and GE is probably the finest company. But I have a need for someone like you, and I would make PepsiCo a special place for you.'' The appeal worked. ''Behind my cool logic lies a very emotional person,'' says Nooyi, who decided to join PepsiCo (PEP) as its chief strategist. In early February this year, she was named chief financial officer, an appointment that makes Nooyi the highest-ranking Indian-born woman in Corporate America. The promotion is a testament to her ability to balance a high-powered career with a family and her Hindu heritage. ''Indra is off the charts,'' says PepsiCo CEO Roger Enrico. ''The energy and time she puts in are incredible.'' FIRST-CLASS. He should know. Nooyi has been directly involved in every major strategic decision that Enrico has made. She worked closely on his 1997 decision to spin off PepsiCo's fast-food chains. She helped spearhead the drive to acquire Tropicana in 1998. And she played a critical role in the decision to cast off PepsiCo's bottling operations. At 44, Nooyi has a resume packed with first-class credentials. When Nooyi first came to the U.S. in 1978 to attend Yale University's Graduate School of Management, she didn't own a single business suit. She interviewed for summer jobs with consulting firms wearing a sari. ''I was a poor student, working nights to make ends meet,'' she recalls. ''But by the end of the summer, I had made enough money to buy two suits.'' Her wardrobe, however, made little difference to her success. Impressed by her intelligence and analytical ability, Boston Consulting Group hired her out of Yale. Six years later, she joined Motorola Inc. in 1986, where she assisted CEO George Fisher and his successor, Christopher B. Galvin, as vice-president for corporate strategy and planning. She moved to Asea Brown Boveri in 1990 to work for celebrated CEO Percy Barnevik for four years in a similar role. Shortly after her arrival at PepsiCo, she began to assist Enrico, who had just returned from a sabbatical to run the company's fast-food operations. Together, they spent months taking apart the economics of the business, and sampling the food and service at dozens of outlets. Their conclusion: The industry was overbuilt, and success required a different culture than that of a packaged-goods company. PRAYER ROOM. She helped with a similar analysis of PepsiCo's bottling operations. Rival Coca-Cola Co. had spun off its bottling group in 1986, and she believed that Pepsi was left at a disadvantage. The reason: The capital-intensive business brought PepsiCo's overall profit margins down and hurt the company's stock market valuation. Just as important to Nooyi as her PepsiCo career are her family and her religious heritage. She shares her Greenwich (Conn.) home with her husband, a management consultant, and two daughters, aged 16 and 7. The family maintains a puja, or Hindu prayer room, where a light always burns and the air is perfumed with incense. Yet Nooyi also plays rock 'n' roll guitar and is among a coterie of PepsiCo executives who often gather at Enrico's home to belt out popular tunes until 2 a.m. A rabid sports fan, she studies videotapes of the final championship games Michael Jordan played for the Chicago Bulls for their lessons on teamwork. Like Enrico, she expresses frustration over the investment community's failure to reward PepsiCo's improvement. ''Don't group us with the dogs and cats of the food business. We have created a gold-standard food-and-beverage company,'' she says. Her biggest challenge as CFO will be to convince Wall Street that she's right. By John A. Byrne in Purchase, N.Y. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP					RELATED ITEMS PepsiCo's New Formula COVER IMAGE: PepsiCo's New Formula CHART: The New PepsiCo TABLE: A Life at PepsiCo TABLE: Pepsi Facts A Potent Ingredient in Pepsi's Formula Today, Mexico. Tomorrow... ONLINE ORIGINAL: "The Sweet Spot of Convenient Food and Beverages" ONLINE ORIGINAL: Is Pepsi's Stock Finally Ready to Pop? INTERACT E-Mail to Business Week Online

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