CEO Indra Nooyi believes that each PepsiCo product must engage customers so directly and personally that they fall in love with it. So in 2012 she hired renowned designer Mauro Porcini as PepsiCo’s first chief design officer. Nooyi says that design thinking now informs nearly everything the company does, from product creation, to the look on the shelf, to how consumers interact with a product after they buy it.
Design thinking is apparent, for instance, in Pepsi Spire, the company’s touchscreen fountain machine that gives consumers the visual experience of watching flavors get added to a beverage before the finished product is dispensed. And design thinking is an integral part of what Nooyi says makes women embrace Mountain Dew Kickstart—with its slim can, higher juice content, and lower calorie burden—as a product they can “walk around with.”
But design is not all about the way a product looks, according to Nooyi. She says that PepsiCo has delivered “great shareholder value” on her watch because the company also offers consumers true choices, as evident in its “good for you” and “fun for you” categories of products—and because she has led her workforce to adapt strategically to consumers’ constantly evolving aspirations.
HBR Reprint R1509F
Just a few years ago, it wasn’t clear whether Indra Nooyi would survive as PepsiCo’s CEO. Many investors saw Pepsi as a bloated giant whose top brands were losing market share. And they were critical of Nooyi’s shift toward a more health-oriented overall product line. Prominent activist investor Nelson Peltz fought hard to split the company in two.
HBR Learning
