PGDM Batch 2020-22, Trimester-III

End Term Examination, June-July 2021

Subject Name: Strategic Management Subject Code: T3CGM03

Time: 2 hrs. Max. Marks: 40

Roll No…………………..

Note: There are two sections. Both are Compulsory.

SECTION A (20 Marks)

Case Study- All questions are compulsory.

Please go through the case and attempt the two (02) questions given at the end of the case. Make
and state suitable assumptions wherever necessary.

PepsiCo: Moving from Geographic to Combined Structure …..

PepsiCo has organized its businesses into North American Beverages (PNAB); that focuses on
carbonated soft drinks, juices, ready to drink coffee & tea and sports drinks, PepsiCo Americas
Foods (PAF) focuses on food and snacks in North and South America. PepsiCo International
(PI); includes its businesses in Europe, Asia, Africa, and Australia. Thus, PepsiCo is primarily
organized geographically – beverages in North America, food in North & South America and
food and beverages internationally by region. Accordingly, it has traditionally implemented the
multi-domestic strategy with regional focus, using the worldwide geographic area structure to
create a marketing approach that is adaptable to various languages, cultures and lifestyles.
However, it has diversified into a variety of beverages and snack foods. Consequently, it has
organized into product divisions as well to gain greater efficiencies in managing these products
worldwide. Although, it is still predominantly area focused through the management structure, it
has additional structures that allow the product divisions to be managed more efficiently. Thus,
PepsiCo is moving towards implementing transnational strategy through the combination
structure.
Interestingly, PepsiCo has the most diverse leadership teams, with Indra Nooyi, its CEO
originally from India and large number of board members possess significant international
experience. They have broad understanding of cultures and buying habits within geographic
regions outside the United States. The diversity on the board supports geographic focus has
added to the success of marketing of PepsiCo brands and products globally.

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Q1. Is the decision by PepsiCo to switch over to transnational strategy and a combination
structure correct? Justify your answer.

Q2. Should PepsiCo pursue a ‘Global’ strategy’ like its rival Coca Cola internationally? Why or
why not?

SECTION B (4×5=20 marks)

Attempt any 5 out of 7. Each question carries 4 marks

Q3. ‘Understanding how to exploit a competitive advantage is important for firms seeking to
earn above average returns’. Discuss the statement with the help of examples.

Q4. What is value chain analysis? What are the value creating potentials of primary activities in
a value chain?

Q5. Explain as to how profit potential of an industry is influenced by the five forces of
competition in that industry?

Q6. Discuss the value creating activities associated with the cost leadership strategy using the Michael
Porter’s value chain citing suitable examples.

Q7. Define corporate level strategy and its purpose. Describe various levels of diversification with different
corporate-level strategies.

Q8. What environment trends are affecting international strategy? Explain with the help of examples.

Q9. Explain ‘organization structure’ and ‘organizational controls’. Compare and contrast strategic controls
and financial controls giving suitable examples. What is the importance of differences between the two?

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