INTRODUCTION

Indian Beverages industrys size is Rs. 8000 Crores and it is dominated by two
players viz PEPSI & Coke only. This high profile industry has lot of potential for growth
as per capita consumption in India is 9 bottles a year as compared to 20 bottles in Sri
Lanka, 14 in Pakistan, while 12 bottles a person in Nepal.
The RKJ group is India's leading supplier of retailer brand Carbonated and NonCarbonated soft drinks, with beverage manufacturing facilities in India and Nepal. Its
experience in the beverage industry dates back to the sixties when it had the first
franchise at Noida .
The family manufactures and markets Carbonated and Non-Carbonated Soft
Drinks and Mineral Water under PEPSI brand. The various flavors and sub-brands are
PEPSI, Mirinda Orange, Mirinda Lemon, Mountain Dew, 7UP, Slice Mango, Slice
Orange, and Aquafina. It has the license to supply beverages in the territories of
Western U.P., part of M.P., half of Haryana, whole of Rajasthan, Goa, 3 districts of
Maharashtra, 13 districts of Karnataka and whole of Nepal. The group has in total 18
bottling plants in India & Nepal and is responsible for producing and marketing 44% of
PEPSI requirement in India.

VARUN BEVERAGE TRADERS

With the urbanization in 1991, about 13 years after the exit of Coca-cola from Indian
scene an MNC (Multinational Company) globally known as PCI (Pepsi Cola
International) entered the Indian market with its name PFL (Pepsi Food Ltd.). It stated
bottling its product in UP, Delhi on 24th March 1991. Late D N Kamani installed this
very bottling unit in 1969. the company entered the soft drink with the introduction of
Coca-Cola and used to cater for the market of Bihar, Parts of Bengal, Orissa and Nepal.
The company was the pioneer of soft- d rinks in UP.
Due to urbanization and Behavioural changes the no. of soft drink consumers increase.
The Steel City Beverages Ltd. Delhi was unable to meet the dead of supply as per the
disability graph in Delhi due to this increase in the no. of consumers. To fulfill the
demand in that very region PFL established a plant in industrial area, .
It is one of those bottling unit of PFL, which comes under FOBO (Franchise Owned
Bottling Operation)
S.M.V. Beverage Pvt. Ltd, DAYALBAGH, (UP) a medium sector enterprise, located
amidst beautiful surroundings, on the DAYAL BAGH Area, and producing PEPSI range
of bottled soft drinks, word in the DEHLI.viz. Pepsi, 7 Up, Mirinda, Teem, Mirinda
Lemon, Mirinda Apple and Lehar Slice become a household and had
DEHLI was established in 1967 and production commenced in March 1969. At the very
outset the company installed state the art machines and technology, for the production
and bottling of soft drinks. The bottling plat with a capacity of produce bottle 220 per
minute is totally automatic and also had a modern state of the art inter mix machine for

binging forth the right blend of flavors. The company continuous to adopt and innovate
technology in keeping with its policy of constant quality improvements. With the advent
Pepsi Food Limited for the production and sales of Pepsi range of soft drinks for Dehli.
The company symbolizes self reliant in technology and ranked as the Best bottling
company in the country in terms of Quality, Efficiency, Sale, Productivity and KRD. Till
1998, it was under the guidance of its Chairperson, Smt. Kusum Kamani and the able
stewardship of its Managing Director, Shri. Nakul Kamani, the Co. has consistently
bagged on numerous occasions, awards for Quality Assurance and Productivity, in 1993 it
bagged top honors for being the best Quality conscious Plat amongst all Pepsi Bottling
companies in India. In March 1999, Steel City Beverages Ltd. was taken over by Mr. S.
K. Jaipuria from Mr. N.D. Kamani, along with Rushabh Marketing Ltd., a marketing unit.
Mr. S.K. Jaipuria started running this plant very successfully. He was very much
enthusiastic to increase the production and sale and to capture the whole market of
Dehli.He established another plant in the name of SMV Beverages (Jsr) and increased the
production from this new plant. The capacity of this new plant is 600 bottles per minute.
The Companys highly sophisticated plant and quality control laboratory along with the
dedication and enterprise of its employees is more than evenly matched by the
managements sense of understanding and compassion that states consumer soft drinks
market with an estimated growth annual turnover of over Rs. 10 corers. The company is
currently in pursuit of the coveted ISO9002, which it is confident of achieving and would
hence become the first food product factory in India to do so.has insured the companys
progress with every passing day.

PEPSICO COMPANY
PEPSICO is world leader in convenient foods & beverages, with high annually
turnover. The company consist of the snacks business of Frito-Lay North America &
the beverages & the foods business of PEPSICO beverages &

foods , which

includes PEPSICO Beverages North America & Quaker Foods North America.
PEPSICO brands are available in nearly 200 countries & territories many of
PEPSICO brands names are over 100 year old, but the corporation is relatively
young. PEPSICO was founded in 1965 with the merger
of

PEPSI-COLA &

FRITO-LAY. Tropicana was

acquired in 1998 & PEPSICO

merged

with

QUAKER OATS, including Gatorade in 2001.

the

PEPSICO IN INDIA
Pepsico gained to India in 1988 by creating a joint venture with the Punjab government
owned Punjab Agro Industrial Corporation (PAIC) AND Voltas India Limited .This joint
venture marketed and sold LEHAR Pepsi until1991,when the use of foreign brands was
allowed ; PepsiCo bought out its partners and ended the joint venture in 1994.Others
claim that firstly Pepsi was banned from import in India, in 1970 ,for having refused to
release the list of its ingredients and in 1993,the ban was lifted ,with Pepsi arriving on the
market shortly after wards .These controversies are a remainder of Indias some times
acrimonious relationship with huge multinational companies. Indeed some argue that
PepsiCo and The Pepsi Co and Coca-Cola company have been major in part because
they are well-known foreign companies that draw plenty of attention.
In 2003, the Center for Science and Environment (CSE ) ,a non governmental
organization in New Delhi ,said aerated waters produced by soft drink manufacturers in
India ,including multinational giants PepsiCo and Coca Cola Company ,contained
toxins ,including DDT , malathion and chlorpyrifos pesticides that can contribute to
cancer.
The Coca Cola Company and PepsiCo angrily denied allegation that their products
manufactured in India contained toxin level a far above the norms permitted in the
developed world .But an Indian parliamentary committee , in 2004 ,backed up CSEs
findings and a government- appointed committee, is now trying to develop the worlds
first pesticides standards for soft drinks. On December 7,2004 ,Indias Supreme Court
ruled that both Pepsi Co and competitor the Coca-cola company must label all and bottles

of the respective soft drinks with a consumer warning after tests showed unacceptable
levels of residual pesticides.
The Coca cola Company and Pepsi Co together hold 95% market share of soft drink
sales in India.
In 2006,the CSE again found that soda drinks, including both Pepsi and Coca-Cola, had
high levels of pesticides in their drinks .PepsiCo and The Coca Cola Company maintain
that their drinks are safe for consumption and have published newspaper advertisements
that say pesticide level in their products are less than those in other foods such as tea
,fruits and dairy products .In the Indian state of Kerala, sale and production of Pepsicola ,along with other soft drinks, was banned by the state government in 2006,but this
waqs revised by the Kerala High Court merely a month later. Five other Indian states
have announced partial bans on the drinks in schools, colleges and hospitals

CUSTOMERS OF PEPSICO
As we all know that PEPSI sell more than 1 billion drinks per day globally which shows
its huge customer base throughout the globe. In India, Pepsi have big market share where
it caters customer base of over 1 billion. Apart of end-consumer, Pepsi Company divides
its customer on the basis of different criteria which are as follows:

Distributors & Sub-Distributors

Channels
Volume
Income

Distributors & Sub-Distributors:

These are responsible for the distribution of drinks from bottling plant to different
channel or outlets through itself or sub-distributor.

Channels:
Company divides the channels in three segments according to the need of end-user which
are as follows:
Grocery outlets.
Convenience outlets.
E & D (Eating and Drinking) outlets.

Volume:

These outlets categories according to VPO (Volume per outlet) of these outlets which are
as

Diamond (VPO greater than 800 case annually)

Gold (VPO between 500 to 799 case annually)
Silver (VPO between 200 to 499 case annually)
Bronze (VPO less than 200 case annually)

Income:
Consumer market clustered according to the income level of the locality which are as:

Higher Income Locality

Medium Income Locality
Lowest Income Locality
Professional (VISHWA)

PEPSICos success is the result of superior products , high standards of

performance , distinctive competitive strategies & high integrity of our people.
ENTRY OF PEPSICO IN INDIA
In 1977, a change in the govt. at the center lead to the exit of COCA COLA
which is preferred to quit rather to dilute its equity to 40% in Compliance with the
Foreign Exchange Regulation Act( FERA).
The beginning of 80s saw a birth of another cola drinks Thums Up in 1978 PEPSI
leads the Indian markets (share33%) with its Goldspot & Limca brands . In 1987 pure
drinks share came down to 21% a result of growing popularity of Limca & Thums
Up. At the same time the threat to the Indian soft drinks market was that of fruit drinks.

In 1988, fruit drinks market was valued at Rs.40crores & was growing at the
rate of2% . In year 1985, the government rejected a proposal with R.P.Goenka group.
This involved the export of fruit juice concentrates from Punjab in return for the import
of the cola concentrates .The deal offered was3:1 export - import ratio in return for being
allowed to market PEPSI in India.The Rs.22 crore PEPSICO project was the second bid
by the U.S. headquarter MNC to enter India. PEPSICO would have an equity holding of
39%, Punjab Agro Industries Ltd.(PAIC) 20% & Voltas24%.
PEPSIs share which have been originally just under 40% was whittled to
about 35% & PAICs share was hiked to 40% these were mainly the in which COKE
had left India in1977.Thus PEPSI not only accepted the conditions but also went
much further . Finally their was a victory for PEPSI who after more than 5 years of
acrimonious battle was launched in June 1990 selectively in Rajasthan, Punjab, Uttar
Pradesh & South as a LAHAR-PEPSI.
In 1991, saw a major launch of 7UP & Mirinda in India, which was warmly received by
the

Indian customers& consumers. 1993 was a new beginning for fountain

PEPSI(PMX) .In 1994 PEPSI achieved the No.1 position in cola brands in India .In
1996 the Mirinda attained the No.1 position in orange beverages categorys Mr.Ramesh
Vengal was the first Managing Director who was there till a April1992; Mr. Suman
Sinha the current president took over from him after a long inning with Hindustan Lever
Ltd (HUL).
COMPETITORS

Coca-Cola FLAVOUR

COLA FLAVORS

Cola is a most popular flavor in any group of age. This is the most saleable flavor
in the world. Both PEPSICO has its own cola flavor. PEPSICO has a cola flavor named
PEPSI. PEPSI COLA is a cash cow brand for the company in terms of sales revenue.
PEPSI has two competitive brands in the cola flavor.

PEPSI:
LIME & LEMON FLAVORS
This segment of flavor is very likely in the children and aged person. PEPSICO
has one brands. The PEPSIs brands are MOUNTAIN DEW, MIRINDA LEMON and
7UP.
MIRINDA LEMON is considered to be lemon in taste, comes under the category
of cloudy lemon because of its colour which is similar to that of clouds. It has to yield
good revenue.
MOUNTAIN DEW is sweet lemon soft drink in India and in a few countries. It is
mostly demands by the children.

10

7UP is lemon-lime soft drink. Sale of 7UP is third largest carbonated soft drink
brand in the U.S. most consumers prefer 7UP as a their favourite brand than any other
non-cola.
PEPSI:ORANGE FLAVORS

This is another type of flavor in the soft drink industry. The taste is like orange. In this
segment PEPSI has a brand named MIRINDA whether COCACOLA has its FANTA in
orange. This flavour is mostly preferred by children and women.PEPSI:

MANGO FLAVORS
In this categorys of flavor is like a Mango. This flavor is now becoming more
popular in India. In Mango flavor PEPSI has a well known name SLICE whether
COCACOLA has a MAZAA in this segment.
PEPSI:
NEW BRANDS LAUNCHED BY

11

PEPSICO
7UP ICE:PEPSICO India recently launched a new flavour named 7UP ICE in Indian
market. It is hard than 7UP. The taste of 7UP ICE is mint.
MIRINDA BAT BERRY: PEPSICO is recently launched MIRINDA BAT BERRY. The taste of MIRINDA BAT
BERRY is like Glicodin
COMPOSITION OF AD ON VARIOUS ASPECTS
Soft drinks is perhaps the most hard fought product categories in India in every
respect - media, events, distribution, pricing, communication, endorsements and so on
Every year it consistently emerges as one of the top 10 categories on television. We, at
AdEx India, have looked at year 2003 to understand the year that was for this
exceptionally competitive segment!
One clear and predictable pattern in 2003 was the two clear peaks of ad spend one during the world cup and the other during the festive time. Interestingly, while Pepsi
dominated media budgets during World Cup, Coca-Cola seems to have been the
dominant spender in the month of September.
However, this time we at AdEx thought of dwelling on aspects of advertising in
terms of strategy adopted by the different players in this category and the duration of
advertising across genres on TV and press.
This paper tries to throw some light on the following aspects: 12

channel wise advertising on TV

Advertising strategy adopted by the aerated soft drink players on TV and press

Zone wise and advertising on press

It is evident from the findings that feature film attract the customers most in term

of advertisement composition, the next important events are cricket matches , music
shows and dramas soaps.
Action thrillers, film trailers, from some other ten important composition from of
advertisement.

Mountain Dew
Mountain Dew, currently stylized predominantly as Mtn Dew, is a soft drink distributed
by PepsiCo, but remains its own brand. The formula was made and first marketed in
Marion, VA, Knoxville and Johnson City, Tennessee, USA through the 1940s, then in
Fayetteville, North Carolina by Barney and Ally Hartman. By 1964, it was being
distributed across United States. The formula still used today was created by Bill
(William) Jones.
As of 2007, Mountain Dew was the 4th best selling carbonated soft drink in the United
States, behind Coca-Cola Classic, Pepsi-Cola, and Diet Coke. Mountain Dew's Diet
version ranked 9th in sales.
On October 15, 2008, Mountain Dew's official logo was redesigned to "Mtn Dew", as a
result of a PepsiCo rebranding of its core products.

13

Currently in the UK, a new drink called 'Mountain Dew Energy' has been introduced into
the energy drink market. Mountain Dew was previously marketed in the UK in 1995, with
a TV spot having the strapline "Wild colour, smooth taste." It was unsuccessful, and the
sale of Mountain Dew in the UK was discontinued (except for imports) by 1997.

Nutrition facts
Serving size 8 fl oz (240 mL)
Servings per container 1
Amount per serving
Calories 110

Calories from fat 0

% Daily value*
Total fat 0 g

0%

Saturated fat 0 g

0%

Trans fat 0 g
Cholesterol 0 mg

0%

Sodium 40 mg

2%

Potassium 0 mg

0%

Total carbohydrate 31 g

10%

Dietary fiber 0 g

0%

Sugars 31 g
Protein 0 g
Vitamin A

0%

Vitamin C

0%
14

Calcium

0%

Iron

0%

*Percent daily values are based on a 2,000calorie diet. Your daily values may be higher or
lower depending on your calorie needs.

HISTORY

15

7 Up was created by Charles Leiper Grigg who launched his St. Louis-based company
The Howdy Corporation in 1920. Grigg came up with the formula for a lemon-lime soft
drink in 1929. The product, originally named "Bib-Label Lithiated Lemon-Lime Soda",
was launched two weeks before the Wall Street Crash of 1929. It contained lithium
citrate, a mood-stabilizing drug. It was one of a number of patent medicine products
popular in the late-19th and early-20th centuries. Specifically it was marketed as a
hangover cure.
Philip Morris bought 7 Up in 1978, and sold it in 1986, to a group led by the investment
firm Hicks & Haas. 7 Up merged with Dr Pepper in 1988; Cadbury Schweppes bought
the combined company in 1995. The Dr Pepper Snapple Group was spun off from
Cadbury Schweppes in 2008.
Formula
7 Up has been reformulated several times since its launch in 1929. In 2006, the version of
the product sold in the U.S. was re-formulated so that it could be marketed as being
"100% Natural". This was achieved by eliminating the preservative calcium disodium
EDTA, and replacing sodium citrate with potassium citrate in order to reduce the
beverage's sodium content. This re-formulation contains no fruit juice and is still
sweetened with high-fructose corn syrup (HFCS). The manufacturing process used in the
production of HFCS has led some public health and advocacy groups to challenge the ad
campaign's "natural" claims. In 2007, after the Center for Science in the Public Interest
threatened to sue 7 Up, it was announced that 7 Up would stop being marketed as "100%
natural". Instead, It is now promoted as having "100% Natural Flavors". The controversy
16

does not extend to other countries, such as the United Kingdom, where the high fructose
corn syrup is not generally used in foods, including 7 Up. 7 Up is a common folk remedy,
for example relieving stomach aches.
There exists a myth that the 7 Up name comes from the "fact" of the drink having a pH
over 7. That would make it neutral or alkaline on the scale; however, this is not the case,
as the 7 Up ph is close to 3.79, similar to other drinks of the type.
Variations
Diet 7 Up
Originally introduced in 1963 as Like[ (not to be confused with 7 Up's Like Cola from
the 1980s), it was discontinued in 1969 due to the U.S. government ban of cyclamate
sweetener. After reformulation, it was reintroduced as Diet 7 Up in 1970. It was renamed
Sugar Free 7 Up in 1973 then back to Diet 7 Up in 1979. Diet 7 Up has also been
reformulated recently where it was packaged and advertised as now made with Splenda
sweetener (sucralose) but now the formula has been re-tooled and lists the following
ingredients: filtered carbonated water, natural flavors, citric acid, potassium citrate,
potassium benzoate, aspartame, acesulfame potassium, calcium disodium EDTA. The
ingredients for Diet 7 Up with Splenda are listed: filtered carbonated water, natural
flavors, citric acid, potassium citrate, potassium benzoate, calcium disodium EDTA,
acesulfame potassium, sucralose.[11] The 7 Up company claims they switched back to
aspartame because they conducted a nation-wide study showing that people preferred the

17

'aspartame taste' over the taste of Splenda-brand Sweetener. 7 Up Plus is still sweetened
with Splenda, and they announce no intention of switching it to aspartame.
Cherry 7 Up
Cherry 7 Up flavor, with these ingredients listed: Carbonated water, high fructose corn
syrup, citric acid, natural and artificial flavors, potassium benzoate, red 40. One known
ingredient that falls under "natural and artificial flavors" is apple juice.
Raspberry 7 Up
This flavor was available for a short time in Norway, Denmark (and possibly other
European countries) during the late 80s. It was released at the same time as Orange 7 Up.
It was a clear colored lemon, lime and raspberry flavoured soft-drink. It was pulled off
the market after 23 years.

18

7 Up briefly sponsored the Jordan Formula One team in their first year during the
1991 season.

You Like It, It Likes You (1936)

The Fresh Up Family Drink (1952)

Fresh up with 7 Up (1957)

Nothing does it like 7 Up! (1958)

Get real action, 7 Up your thirst away (19631964)

Wet 'n' Wild (1965, 1966)

The (Diet) Uncola. (1967-1990s) (some with charismatic actor Geoffrey Holder)

Crisp refreshing 7 Up (1960s-1970s)

It's 7 Up, it's Uncola (1975)

UNdo it with 7 Up (197778)

America is turning 7 Up (197879)

Feelin' 7 Up (1980)

Canada's turning 7 Up (1980) Canada

7 Up, The Difference is Clear (1982)

Never Had It, Never Will (1980s, reference to 7 Up not containing caffeine)

The feeling of Christmas. (December 1980s)

Put some Un in your life (diet). (early 1990s)

When you want the taste of UN, there's only one (early 1990s, used concurrently
with previous slogan)

On the spot. (late 1980s - early 1990s)

19

Now that's refreshing. (1990s)

It's cool to be clear - 7 Up (early 1990s)

6 Up was not enough. We went one louder. (1994)

It's an up thing. (1995)

Make 7 Up Yours. (1999)

Are you an Un? (Late 1990s-Early 2000s)

Seven flavors in one drink. (2008)

"Bheja fry .. 7 Up try" (2008)

"It's way more better than cola, it's 7 Up (Secondary Slogan used with Richard
Karn to promote summer 7 Up commercials)

Ridiculously Bubbly. (2010, in spots with Brad Garrett) Fresh-Up Freddie in

person.

In conjunction with the 1999 marketing slogan "Make 7 Up Yours," 7 Up distributed

shirts that said "Make Seven" on the front and "Up Yours" on the back. Television and
radio ads featured Orlando Jones walking down a street talking about 7 Up with people
seemingly angry or shocked by the risqu phrase "up yours". The ads and slogan quickly
became popular, and the campaign lasted until 2005.[citation needed]
The television cartoon character Fido Dido was used as a mascot from the late 1980s
through the early 1990s, and was re-introduced in international markets in the early
2000s.
Fresh-Up Freddie was the rooster mascot for 7 Up in 1950s. He gave viewers lessons
about how to plan successful parties and picnics by having a plenty of 7 Up on hand. The
20

commercials were produced by Disney, giving the character that specific Disney look of
the time. Freddie was a crossover between Panchito rooster from The Three Caballeros
and zany Aracuan Bird from the same film. Fresh-Up Freddie often was dressed in
human clothes. Freddie also appeared in Zorro 1957 series commercial intermissions.
Here, he was put against Pete the Cat. Fresh-Up Freddie also had a minor merchandise of
his own. He was voiced by Paul Frees.
just two years. The new design, which features yet another new revision of the main
Sprite logo, bears much resemblance to the 1994 revamp. Sprite Zero bottles from this
era feature grey packaging, a first for the brand.
In the UK, it is recognized by its slogan "Get the Right Sprite," based on ads containing
an alternate sprite, a green sickly goblin that causes irritation and trouble to those who
acquire it accidentally.

21

Brand Portfolio
Name Launched Discontinued

Notes
This sugar-free version was originally produced in
the United States as "Sugar Free Sprite" in 1974,
then was renamed to "Diet Sprite" in 1983. In
other countries, it was known as "Sprite Light." In
September 2004, it was rebranded as "Diet Sprite
Zero." Since then, it has become "Sprite Zero
(Sprite Z)" in Argentina, Australia, Bolivia, Brazil,

Sprite
1974

Chile, mainland China, Europe, Paraguay, Peru,

Zero
Uruguay, and New Zealand. "Diet" was dropped
from the product's name, to become simply "Sprite
Zero," when new logos debuted in June 2006. The
"Zero" designation for low-calorie sodas from the
Coca-Cola Company was first used on Diet Sprite
Zero before being used on the flagship Zero
product, Coca-Cola Zero.
A mint-flavored Sprite that made its debut in
Korea in 2002 as "Sprite Blue," "Sprite Ice" in
Canada, and '"Sprite Ice Cube" in Belgium in
Sprite
2002

2003. "Sprite Ice Blue" was introduced in Italy,

Ice
Taiwan, and mainland China in 2004, and in Chile
in the summer of 2005. There is also "Sprite
Lemon Lime Mint."
22

Sprite
Super 2003

Introduced in Hong Kong in 2003

Lemon

Pepsi

23

This article is about the beverage. For its manufacturer, see PepsiCo. For the singer, see
Pepsi Demacque.
Pepsi is a carbonated soft drink produced and manufactured by PepsiCo. The drink was
first made in the 1890s by pharmacist Caleb Davis Bradham in New Bern, North
Carolina. The brand was trademarked on June 16, 1903. There have been many Pepsi
variants produced over the years since 1898.
Origins

The pharmacy of Caleb Bradham, with a Pepsi dispenser, as portrayed in a New Bern
exhibition in the Historical Museum of Bern.
It was first introduced as "Brad's Drink" in New Bern, North Carolina in 1898 by Caleb
Bradham, who made it at his pharmacy where the drink was sold. It was later named
Pepsi Cola, possibly due to the digestive enzyme pepsin and kola nuts used in the recipe.
[1]

Bradham sought to create a fountain drink that was delicious and would aid in

digestion and boost energy.

24

In 1903, Bradham moved the bottling of Pepsi-Cola from his drugstore to a rented
warehouse. That year, Bradham sold 7,968 gallons of syrup. The next year, Pepsi was
sold in six-ounce bottles, and sales increased to 19,848 gallons. In 1909, automobile race
pioneer Barney Oldfield was the first celebrity to endorse Pepsi-Cola, describing it as "A
bully drink...refreshing, invigorating, a fine bracer before a race". The advertising theme
"Delicious and Healthful" was then used over the next two decades. In 1926, Pepsi
received its first logo redesign since the original design of 1905. In 1929, the logo was
changed again.
In 1931, at the depth of the Great Depression, the Pepsi-Cola Company entered
bankruptcy - in large part due to financial losses incurred by speculating on wildly
fluctuating sugar prices as a result of World War I. Assets were sold and Roy C. Megargel
bought the Pepsi trademark. Eight years later, the company went bankrupt again. Pepsi's
assets were then purchased by Charles Guth, the President of Loft Inc. Loft was a candy
manufacturer with retail stores that contained soda fountains. He sought to replace CocaCola at his stores' fountains after Coke refused to give him a discount on syrup. Guth then
had Loft's chemists reformulate the Pepsi-Cola syrup formula. I love Pepsi so much that I
wish I could have sex with it.
On three separate occasions between 1922 and 1933, the Coca-Cola Company was
offered the opportunity to purchase the Pepsi-Cola company and it declined on each
occasion.
Pepsi-Cola trademark

25

The original stylized Pepsi-Cola logo

The second stylized Pepsi-Colalogo

The original trademark application for Pepsi-Cola was filed on September 23, 1902 with
registration approved on June 16, 1903. In the application's statement, Caleb Bradham
describes the trademark as an, "arbitrary hyphenated word "PEPSI-COLA," and indicated
that the mark was in continuous use for his business since August 1, 1901. The PepsiCola's description is a flavoring-syrup for soda water. The trademark expired on April 15,
1994.
A second Pepsi-Cola trademark is on record with the USPTO. The application date
submitted by Caleb Bradham for the second trademark is Saturday, April 15, 1905 with
the successful registration date of April 15, 1906, over three years after the original date.
Curiously, in this application, Caleb Bradham states that the trademark had been
continuously used in his business "and those from whom title is derived since February
15, 1896." While Pepsi-Cola was filed in the same category of personal and legal and
social services in both applications, in the 1905 application the description submitted to
the USPTO was for a tonic beverage. The federal status for the 1905 trademark is
registered and renewed and is owned by Pepsico, Inc. of Purchase, New York.
26

Rise
During the Great Depression, Pepsi gained popularity following the introduction in 1936
of a 12-ounce bottle. Initially priced at 10 cents, sales were slow, but when the price was
slashed to five cents, sales increased substantially. With a radio advertising campaign
featuring the jingle "Pepsi-Cola hits the spot / Twelve full ounces, that's a lot / Twice as
much for a nickel, too / Pepsi-Cola is the drink for you," arranged in such a way that the
jingle never ends. Pepsi encouraged price-watching consumers to switch, obliquely
referring to the Coca-Cola standard of six ounces per bottle for the price of five cents (a
nickel), instead of the 12 ounces Pepsi sold at the same price. Coming at a time of
economic crisis, the campaign succeeded in boosting Pepsi's status. From 1936 to 1938,
Pepsi-Cola's profits doubled.
Pepsi's success under Guth came while the Loft Candy business was faltering. Since he
had initially used Loft's finances and facilities to establish the new Pepsi success, the
near-bankrupt Loft Company sued Guth for possession of the Pepsi-Cola company. A
long legal battle, Guth v. Loft, then ensued, with the case reaching the Delaware Supreme
Court and ultimately ending in a loss for Guth.

RESEARCH METHODOLOGY

27

Methodology, for a study like this is the most important part. The method of study
adopted by me is totally is to increase & to gather the more information regarding this
project.
The major emphasis in such studies is on the discovery of the ideas & fruitful
relevant information. As such the research design appropriate for such studies must be
flexible enough to provide opportunity for considering different aspects of a problem
under study.
METHODS OF DATA COLLECTION:
PRIMARY DATA:
Survey method -- This method was adopted because it helped in securing detail
information from a sample of respondents. The information received from the
respondents is recorded on a form called the questionnaire. This is only method to
measure attitude & motivation directly. Open framed discussion with managers.
SECONDARY DATA:
I have also used the secondary data, which included the written document of the
organization & other places.

HEAD OFFICE (VBL)

28

INTERNET
PAPERS & RECORDS
The data collected from the above mentioned sources helped me in getting
information about the brief history of PEPSICo
SAMPLING PLAN:
Target population

Or Universe

Retailers of the area of

khandari,
Agra

Sampling Size

100

Sampling Method

Simple Random Sampling

Area of Survey

Agra region

29

SIGNIFICANCE OF THE TOPIC

To determine the sales of DEW, 7UP, SPRITE brands in total soft drink sales at
Agra.

To ensure optimum use of existing sales efforts.

Find out that point in which company should improve itself rather than coke.

To link the comparative analysis with organizational planning.

To provide a basis for the sales improvement programme.

It is widely accepted that theory broadens ones thinking & helps in idea generation. But
practical & practices indicates the feasibility of their ideas & how far theory can be
applied in a situation successfully.

30

OBJECTIVE OF THE STUDY

To know the consumption rate of green glasses.
TO know that which green glass product is mostly liked.
To know the costumer demand in green glasses dew, 7up, sprite.
To know the comparison between tow companies pepsi & cocacola
To know the sale of green glasses.

31

EMPLOYEE RETENTION

The picture states the latest statement

that corporate believes in Love them or Lose them
Employee Retention involves taking measures to encourage employees to remain
in the organization for the maximum period of time. Corporate is facing a lot of problems
in employee retention these days. Hiring knowledgeable people for the job is essential for
an employer. But retention is even more important than hiring. There is no dearth of
opportunities for a talented person. There are many organizations which are looking for
such employees. If a person is not satisfied by the job hes doing, he may switch over to
some other more suitable job.
In todays environment it becomes very important for organizations to retain their
employees. The top organizations are on the top because they value their employees and
they know how to keep them glued to the organization. Employees stay and leave
organizations for some reasons. The reason may be personal or professional. These
reasons should be understood by the employer and should be taken care of. The
organizations are becoming aware of these reasons and adopting many strategies for
employee retention.

32

Employees today are different. They are not the ones who dont have good
opportunities in hand. As soon as they feel dissatisfied with the current employer or the
job, they switch over to the next job. It is the responsibility of the employer to retain their
best employees. If they dont, they would be left with no good employees. A good
employer should know how to attract and retain its employees. Retention involves five
major things:

<<Compensation>>

<<Environment>>

33

<<Growth>>

<<Relationship>>

<<Support>>

Employee retention would require a lot of efforts, energy, and resources but the results
are worth it.
Compensation
Compensation constitutes the largest part of the retention process. The employees always
have high expectations regarding their compensation packages. Compensation packages
vary from industry to industry. So an attractive compensation package plays a critical role
in retaining the employees.
Compensation includes salary and wages, bonuses, benefits, prerequisites, stock options,
bonuses, vacations, etc. While setting up the packages, the following components should
be kept in mind:

Salary and monthly wage: It is the biggest component of the compensation package. It
is also the most common factor of comparison among employees. It includes

34

Basic wage

House rent allowance

Dearness allowance

City compensatory allowance

Salary and wages represent the level of skill and experience an individual has. Time to
time increase in the salaries and wages of employees should be done. And this increase
should be based on the employees performance and his contribution to the organization.

Bonus: Bonuses are usually given to the employees at the end of the year or on a festival.

Economic benefits: It includes paid holidays, leave travel concession, etc.

Long-term incentives: Long term incentives include stock options or stock grants. These
incentives

help

retain

employees

in

the

organization's

startup

stage.

Health insurance: Health insurance is a great benefit to the employees. It saves

35

employees money as well as gives them a peace of mind that they have somebody to take
care of them in bad times. It also shows the employee that the organization cares about
the employee and its family.

After retirement: It includes payments that an Employee gets after he retires like EPF
(Employee Provident Fund) etc.

Miscellaneous compensation: It may include employee assistance programs (like

psychological counseling, legal assistance etc), discounts on company products, use of a
company cars, etc.

Growth and Career

Growth and development are the integral part of every individuals career. If an employee
can not foresee his path of career development in his current organization, there are
chances that hell leave the organization as soon as he gets an opportunity.

The important factors in employee growth that an employee looks for himself are:

Work profile: The work profile on which the employee is working should be in sync
with his capabilities. The profile should not be too low or too high.

Personal growth and dreams: Employees responsibilities in the organization should

help him achieve his personal goals also. Organizations can not keep aside the individual
36

goals of employees and foster organizations goals. Employees priority is to work for
themselves and later on comes the organization. If hes not satisfied with his growth, hell
not be able to contribute in organization growth.
Training and development: Employees should be trained and given chance to improve
and enhance their skills. Many employers fear that if the employees are well rained,
theyll leave the organization for better jobs. Organization should not limit the resources
on which organizations success depends. These trainings can be given to improve many
skills like:

Communications skills

Technical skills

In-house processes and procedures improvement related skills

C or customer satisfaction related skills

Special project related skills

Need for such trainings can be recognized from individual performance reviews,
individual meetings, employee satisfaction surveys and by being in constant touch with
the employees.

Support
Lack of support from management can sometimes serve as a reason for employee
retention. Supervisor should support his subordinates in a way so that each one of them is
a success. Management should try to focus on its employees and support them not only in
37

their difficult times at work but also through the times of personal crisis. Management
can

support

employees

by

providing

them

recognition

and

appreciation.

Employers can also provide valuable feedback to employees and make them feel valued
to the organization.

The feedback from supervisor helps the employee to feel more responsible, confident and
empowered. Top management can also support its employees in their personal crisis by
providing personal loans during emergencies, childcare services, employee assistance
programs, counseling services.
Employers can also support their employees by creating an environment of trust and
inculcating the organizational values into employees. Thus employers can support their
employees in a number of ways as follows:
By providing feedback
By giving recognition and rewards
By counseling them
By providing emotional support
Importance of Relationship in Employee Retention Program
Sometimes the relationship with the management and the peers becomes the reason for an
employee to leave the organization. The management is sometimes not able to provide an
employee a supportive work culture and environment in terms of personal or professional
38

relationships. There are times when an employee starts feeling bitterness towards the
management or peers. This bitterness could be due to many reasons. This decreases
employees interest and he becomes de-motivated. It leads to less satisfaction and
eventually attrition.

A supportive work culture helps grow employee professionally and boosts employee
satisfaction. To enhance good professional relationships at work, the management should
keep the following points in mind.

Respect for the individual: Respect for the individual is the must in the organization.

Relationship with the immediate manager: A manger plays the role of a mentor and a
coach. He designs ands plans work for each employee. It is his duty to involve the
employee in the processes of the organization. So an organization should hire managers
who can make and maintain good relations with their subordinates.

Relationship with colleagues: Promote team work, not only among teams but in
different departments as well. This will induce competition as well as improve the
relationships among colleagues.

Recruit whole heartedly: An employee should be recruited if there is a proper place and
duties for him to perform. Otherwise hell feel useless and will be dissatisfied.

39

Employees should know what the organization expects from them and what their
expectation from the organization is. Deliver what is promised.

Promote an employee based culture: The employee should know that the organization
is there to support him at the time of need. Show them that the organization cares and
hell show the same for the organization. An employee based culture may include
decision making authority, availability of resources, open door policy, etc.

Individual development: Taking proper care of employees includes acknowledgement to

the employees dreams and personal goals. Create opportunities for their career growth
by providing mentorship programs, certifications, educational courses, etc.

Induce loyalty: Organizations should be loyal as well as they should promote loyalty in
the employees too. Try to make the current employees stay instead of recruiting new
ones.
Organization Environment
It is not about managing retention. It is about managing people. If an organization
manages people well, retention will take care of itself. Organizations should focus on
managing the work environment to make better use of the available human assets.

People want to work for an organization which provides

Appreciation for the work done
Ample opportunities to grow
40

 A friendly and cooperative environment

feeling

that

the

organization

is

second

home

to

the

employee

Organization environment includes

Culture

Values

Company reputation

Quality of people in the organization

Employee development and career growth

Risk taking

Leading technologies

Trust

Types of environment the employee needs in an organization

Learning environment: It includes continuous learning and improvement of the

individual, certifications and provision for higher studies, etc.

Support environment: Organization can provide support in the form of work-life

balance. Work life balance includes:
o

Flexible hours

Telecommuting

Dependent care

41

Alternate work schedules

Vacations

Wellness

Work environment: It includes efficient managers, supportive co-workers,

challenging work, involvement in decision-making, clarity of work and
responsibilities, and recognition.

Lack or absence of such environment pushes employees to look for new opportunities.
The environment should be such that the employee feels connected to the organization in
every respect.
Importance Of Employee Retention
The process of retention will benefit an organization in the following ways:
1. The Cost of Turnover: The cost of employee turnover adds hundreds of thousands of
money to a company's expenses. While it is difficult to fully calculate the cost of turnover
(including hiring costs, training costs and productivity loss), industry experts often quote
25% of the average employee salary as a conservative estimate.
2. Loss of Company Knowledge: When an employee leaves, he takes with him
valuable knowledge about the company, customers, current projects and past
history (sometimes to competitors). Often much time and money has been spent
on the employee in expectation of a future return. When the employee leaves, the
investment is not realized.
3. Interruption of Customer Service: Customers and clients do business with a
company in part because of the people. Relationships are developed that
42

encourage continued sponsorship of the business. When an employee leaves, the

relationships that employee built for the company are severed, which could lead
to potential customer loss.
4. Turnover leads to more turnovers: When an employee terminates, the effect is
felt throughout the organization. Co-workers are often required to pick up the
slack. The unspoken negativity often intensifies for the remaining staff.
5. Goodwill of the company: The goodwill of a company is maintained when the
attrition rates are low. Higher retention rates motivate potential employees to join
the organization.
6. Regaining efficiency: If an employee resigns, then good amount of time is lost in
hiring a new employee and then training him/her and this goes to the loss of the
company directly which many a times goes unnoticed. And even after this you
cannot assure us of the same efficiency from the new employee.
Employee Retention Strategies
The basic practices which should be kept in mind in the employee retention strategies are:
1. Hire the right people in the first place.
2. Empower the employees: Give the employees the authority to get things done.
3. Make employees realize that they are the most valuable asset of the organization.
4. Have faith in them, trust them and respect them.
5. Provide them information and knowledge.
6. Keep providing them feedback on their performance.
7. Recognize and appreciate their achievements.
8. Keep their morale high.
43

9. Create an environment where the employees want to work and have fun.
These practices can be categorized in 3 levels: Low, medium and high level.

<Low>
<Medium >
What Makes Employee Leave?

<High>

Employees do not leave an organization without any significant reason. There are certain
circumstances that lead to their leaving the organization. The most common reasons can
be:
Job is not what the employee expected to be: Sometimes the job responsibilities
dont come out to be same as expected by the candidates. Unexpected job responsibilities
lead to job dissatisfaction.
Job and person mismatch: A candidate may be fit to do a certain type of job which
matches his personality. If he is given a job
44

which mismatches his personality, then he wont be able to perform it well and will try to
find out reasons to leave the job.

No growth opportunities: No or less learning and growth opportunities in the

current job will make candidates job and career stagnant.

Lack of appreciation: If the work is not appreciated by the supervisor, the

employee feels de-motivated and loses interest in job.

Lack of trust and support in coworkers, seniors and management: Trust is the
most important factor that is required for an individual to stay in the job. Nonsupportive coworkers, seniors and management can make office environment
unfriendly and difficult to work in.

Stress from overwork and work life imbalance: Job stress can lead to work life
imbalance which ultimately many times lead to employee leaving the
organization.

Compensation: Better compensation packages being offered by other companies

may attract employees towards themselves.

New job offer: An attractive job offer which an employee thinks is good for him
with respect to job responsibility, compensation, growth and learning etc. can lead
an employee to leave the organization.

45

PERFORMANCE APPRAISAL
People differ in their abilities and their aptitudes. There is always some difference
between the quality and quantity of the same work on the same job being done by two
different people. Therefore, performance management and performance appraisal is
necessary to understand each employees abilities, competencies and relative merit and
worth for the organization. Performance appraisal rates the employees in terms of their
performance.

46

Performance appraisals are widely used in the society. The history of performance
appraisal can be dated back to the 20th century and then to the second world war when
the merit rating was used for the first time. An employer evaluating their employees is a
very old concept. Performance appraisals are an indispensable part of performance
measurement.
Performance appraisal is necessary to measure the performance of the employees
and the organization to check the progress towards the desired goals and aims.
Performance appraisal takes into account the past performance of the employees
and focuses on the improvement of the future performance of the employees.
CONTENTS OF PERFORMANCE APPRAISAL FORM:
1. Quality of work
Consider accuracy, thoroughness, effectiveness.
Pressure, ability to meet standards of quality.
Use of time and volume of work accomplished.
Work output matches the expectations established.
2. Quantity of work
Competence, thoroughness, and efficiency of work regardless of volume.
Neatness and accuracy.

47

3. Teamwork:
Establish and maintain effective working relationship with others.
Shares information and resources with others
Follows instructions of supervisor and respond to requests from others in the team in a
helpful manner.
Contributing work and effort to group performance to meet agreed upon objectives and
achieve team success
4. Job knowledge
Application of appropriate level of technical and procedural knowledge in specific field
Degree of technical competence
Understanding of job procedures, methods, facts and information related to
assignments.
Perform duties with minimal supervision but seek guidance where and when
appropriate to the job, consults the appropriate staff
5. Initiative
Consider the extent to which the employees sets own constructive work practice and
recommends and creates own procedures.
Self-starter, develop and implement new methods, procedures, solutions, concepts,
designs and/or applications of existing designs or procedures.
Accepts additional challenges and responsibilities and willingly assist others, self-

48

reliant.
Completes assignment on time.
6. Interpersonal relations
Consider the extent to which the employee is cooperative, considerate, and tactful in
dealing with supervisors, subordinates, peers, faculty, students and others.
7. Health and safety compliance
The degree to which he or she complies with or over sees the compliance with
university safety rules.
The following are also to be completed for supervisory personnel and members of the
administrative staff.
8. Communications abilities
Performance appraisal of communications includes elements as:
Ability to listen and understand information;
Presents information in a clear and concise manner.
Knows appropriate way of communicating with immediate superiors and the
management
Demonstrates respect for all individuals in all forms of communication
Regardless of their background or culture;

49

9. Planning and organizing:

Adapting to changes and using resources effectively;
Maintains confidentiality as appropriate.
Setting objectives, establishing priorities, developing plans;
Arranging work schedules and prioritizing work to meet deadlines.
Know when to ask for clarification before proceeding on a work project.
10. Problem analysis and decision making
Anticipating problems and facilitate problem resolution.
Willingness to make necessary and immediate decisions given incomplete information.
Understanding practical and workable solutions.
Recognizing when a decision is necessary, asking for input, making decisions and
providing information and feedback in a timely manner.
11. Staff development
The extent to which the individual provides guidance and opportunities to his or her
staff for their development and advancement in the university.
12. Dependability
Performance appraisal of dependability includes elements as:
Consider the extent to which the employee completes assignments on time and carries
out instructions.

50

 Starts work at appropriate time;

Respects time allowed for breaks and lunch;
Follows policies for requesting and reporting time off;
Helps ensure work duties are covered when absent;
Employees presence can be relied upon for planning purposes.
Attendance and punctuality meets supervisors requirements.

Process of Performance Appraisal

51

ESTABLISHING PERFORMANCE STANDARDS

The first step in the process of performance appraisal is the setting up of the
standards which will be used to as the base to compare the actual performance of the
employees. This step requires setting the criteria to judge the performance of the
employees as successful or unsuccessful and the degrees of their contribution to the
organizational goals and objectives. The standards set should be clear, easily
understandable and in measurable terms. In case the performance of the employee cannot
be measured, great care should be taken to describe the standards.
COMMUNICATING THE STANDARDS
Once set, it is the responsibility of the management to communicate the standards
to all the employees of the organization. The employees should be informed and the
standards should be clearly explained to the. This will help them to understand their roles
and to know what exactly is expected from them. The standards should also be
communicated to the appraisers or the evaluators and if required, the standards can also
be modified at this stage itself according to the relevant feedback from the employees or
the evaluators.
MEASURING THE ACTUAL PERFORMANCE
The most difficult part of the performance appraisal process is measuring the actual
performance of the employees that is the work done by the employees during the
specified period of time. It is a continuous process which involves monitoring the
performance throughout the year. This stage requires the careful selection of the

52

appropriate techniques of measurement, taking care that personal bias does not affect the
outcome of the process and providing assistance rather than interfering in an employees
work.

COMPARING THE ACTUAL WITH THE DESIRED PERFORMANCE

The actual performance is compared with the desired or the standard performance.
The comparison tells the deviations in the performance of the employees from the
standards set. The result can show the actual performance being more than the desired
performance or, the actual performance being less than the desired performance depicting
a negative deviation in the organizational performance. It includes recalling, evaluating
and analysis of data related to the employees performance.

DISCUSSING RESULTS
The result of the appraisal is communicated and discussed with the employees on
one-to-one basis. The focus of this discussion is on communication and listening. The
results, the problems and the possible solutions are discussed with the aim of problem
solving and reaching consensus. The feedback should be given with a positive attitude as
this can have an effect on the employees future performance. The purpose of the meeting
should be to solve the problems faced and motivate the employees to perform better.
DECISION MAKING
53

The last step of the process is to take decisions which can be taken either to
improve the performance of the employees, take the required corrective actions, or the
related HR decisions like rewards, promotions, demotions, transfers etc.

Purpose of Performance Appraisal

To review the performance of the employees over a given period of time.
To judge the gap between the actual and the desired performance.
To help the management in exercising organizational control.
To diagnose the training and development needs of the future.

Provide information to assist in the HR decisions like promotions, transfers etc.

Provide clarity of the expectations and responsibilities of the functions to be
performed by the employees.
To judge the effectiveness of the other human resource functions of the
organization such as recruitment, selection, training and development.
To reduce the grievances of the employees.
Helps to strengthen the relationship and communication between superior
subordinates and management employees.
According to a recent survey, the percentage of organizations (out of the total
organizations surveyed i.e. 50) using performance appraisal for the various purposes are
as shown in the diagram:

54

The most significant reasons of using Performance Appraisal are:

Making payroll and compensation decisions 80%

Training and development needs 71%

Identifying the gaps in desired and actual performance and its cause 76

OBJECTIVES OF PERFORMANCE APPRAISAL:

To review the performance of the employees over a given period of time.

To judge the gap between the actual and the desired performance.
To help the management in exercising organizational control.

Helps to strengthen the relationship and communication between superior

subordinates and management employees.

To diagnose the strengths and weaknesses of the individuals so as to identify the

training and development needs of the future.

To provide feedback to the employees regarding their past performance.

Provide information to assist in the other personal decisions in the organization.

Provide clarity of the expectations and responsibilities of the functions to be

performed by the employees.

To judge the effectiveness of the other human resource functions of the

organization such as recruitment, selection, training and development.
55

Approaches to Performance Development

Performance appraisal - Traditional approach

Traditionally, performance appraisal has been used as just a method for
determining and justifying the salaries of the employees. Then it began to be used a
tool for determining rewards (a rise in the pay) and punishments (a cut in the pay)
for the past performance of the employees.
This approach was a past oriented approach which focused only on the past
performance of the employees i.e. during a past specified period of time. This
approach did not consider the developmental aspects of the employee performance
i.e. his training and development needs or career developmental possibilities. The
primary concern of the traditional approach is to judge the performance of the
organization as a whole by the past performances of its employees. Therefore, this
approach is also called as the overall approach. In 1950s the performance appraisal
was recognized as a complete system in itself and the Modern Approach to
performance appraisal was developed.
Performance appraisal - Modern approach
The modern approach to performance development has made the
performance appraisal process more formal and structured. Now, the performance
appraisal is taken as a tool to identify better performing employees from others,
employees training needs, career development paths, rewards and bonuses and their
promotions to the next levels.
56

Appraisals have become a continuous and periodic activity in the organizations. The
results of performance appraisals are used to take various other HR decisions like
promotions, demotions, transfers, training and development, reward outcomes. The
modern approach to performance appraisals includes a feedback process that helps
to strengthen the relationships between superiors and subordinates and improve
communication throughout the organization.
The modern approach to performance appraisal is a future oriented approach
and is developmental in nature. This recognizes employees as individuals and
focuses on their development.

Techniques Of Performance Appraisal

The various methods and techniques used for performance appraisal can be
categorized as the following traditional and modern methods:

57

A) Traditional Methods of Performance Appraisal

1. ESSAY APPRAISAL METHOD
This traditional form of appraisal, also known as Free Form method
involves a description of the performance of an employee by his superior. The
description is an evaluation of the performance of any individual based on the facts
and often includes examples and evidences to support the information. A major
drawback of the method is the inseparability of the bias of the evaluator.

2. STRAIGHT RANKING METHOD

58

This is one of the oldest and simplest techniques of performance appraisal.

In this method, the appraiser ranks the employees from the best to the poorest on the
basis of their overall performance. It is quite useful for a comparative evaluation.
3. PAIRED COMPARISON
A better technique of comparison than the straight ranking method, this
method compares each employee with all others in the group, one at a time. After all
the comparisons on the basis of the overall comparisons, the employees are given the
final rankings.
4. CRITICAL INCIDENTS METHODS
In this method of performance appraisal, the evaluator rates the employee on
the basis of critical events and how the employee behaved during those incidents. It
includes both negative and positive points. The drawback of this method is that the
supervisor has to note down the critical incidents and the employee behavior as and
when they occur.
5. FIELD REVIEW
In this method, a senior member of the HR department or a training officer
discusses and interviews the supervisors to evaluate and rate their respective
subordinates. A major drawback of this method is that it is a very time consuming
method. But this method helps to reduce the superiors personal bias.
6. CHECKLIST METHOD

59

The rater is given a checklist of the descriptions of the behavior of the

employees on job. The checklist contains a list of statements on the basis of which the
rater describes the on the job performance of the employees.
7. GRAPHIC RATING SCALE
In this method, an employees quality and quantity of work is assessed in a
graphic scale indicating different degrees of a particular trait. The factors taken into
consideration include both the personal characteristics and characteristics related to
the on-the-job performance of the employees. For example a trait like Job Knowledge
may be judged on the range of average, above average, outstanding or unsatisfactory.
8. FORCED DISTRIBUTION
To eliminate the element of bias from the raters ratings, the evaluator is
asked to distribute the employees in some fixed categories of ratings like on a normal
distribution curve. The rater chooses the appropriate fit for the categories on his own
discretion.
B) Modern-Method
1. MANAGEMENT BY OBJECTIVES
The concept of Management by Objectives (MBO) was first given by
Peter Drucker in 1954. It can be defined as a process whereby the employees and the
superiors come together to identify common goals, the employees set their goals to be
achieved, the standards to be taken as the criteria for measurement of their performance
and contribution and deciding the course of action to be followed.
60

The essence of MBO is participative goal setting, choosing course of actions and
decision making. An important part of the MBO is the measurement and the comparison
of the employees actual performance with the standards set. Ideally, when employees
themselves have been involved with the goal setting and the choosing the course of action
to be followed by them, they are more likely to fulfill their responsibilities.
UNIQUE FEATURES AND ADVANTAGES OF MBO
The principle behind Management by Objectives (MBO) is to create empowered
employees who have clarity of the roles and responsibilities expected from them,
understand their objectives to be achieved and thus help in the achievement of
organizational as well as personal goals.
Some of the important features and advantages of MBO are:

Clarity of goals With MBO, came the concept of SMART goals i.e. goals
that are:

Specific
Measurable
Achievable
Realistic,
Time bound.
The goals thus set are clear, motivating and there is a linkage between
organizational goals and performance targets of the employees.

61

The focus is on future rather than on past. Goals and standards are set for the
performance for the future with periodic reviews and feedback.

Motivation Involving employees in the whole process of goal setting and

increasing employee empowerment increases employee job satisfaction and
commitment.

Better communication and Coordination Frequent reviews and interactions

between superiors and subordinates helps to maintain harmonious
relationships within the enterprise and also solve many problems faced during
the period.

2. 360-DEGREE-PERFORMANCE-APPRAISAL METHOD
360 degree feedback, also known as 'multi-rater feedback', is the most
comprehensive appraisal where the feedback about the employees performance comes
from all the sources that come in contact with the employee on his job.
360 degree respondents for an employee can be his/her peers, managers (i.e.
superior), subordinates, team members, customers, suppliers/ vendors - anyone who
comes into contact with the employee and can provide valuable insights and information
or feedback regarding the on-the-job performance of the employee.
360 degree appraisal has four integral components:
1. Self appraisal
2. Superiors appraisal
3. Subordinates appraisal

62

4. Peer appraisal.
Self appraisal gives a chance to the employee to look at his/her strengths and
weaknesses, his achievements, and judge his own performance. Superiors appraisal
forms the traditional part of the 360 degree appraisal where the employees
responsibilities and actual performance is rated by the superior.
Subordinates appraisal gives a chance to judge the employee on the parameters
like communication and motivating abilities, superiors ability to delegate the work,
leadership qualities etc. Also known as internal customers, the correct feedback given by
peers can help to find employees abilities to work in a team, co-operation and sensitivity
towards others.

Self assessment is an indispensable part of 360 degree appraisals and therefore

360 degree appraisals have high employee involvement and also have the strongest
impact on behavior and performance. It provides a "360-degree review" of the
employees performance and is considered to be one of the most credible performance
appraisal methods.

63

360 degree appraisal is also a powerful developmental tool because when

conducted at regular intervals (say yearly) it helps to keep a track of the changes others
perceptions about the employees. A 360 degree appraisal is generally found more suitable
for the managers as it helps to assess their leadership and managing styles. This technique
is being effectively used across the globe for performance appraisals. Some of the
organizations following it are Wipro, Infosys, and Reliance Industries etc.
Arguments Against 360 Degree Performance Appraisal
Despite the fact that 360 degree appraisals are being widely used throughout the
world for appraising the performance of the employees at all levels, many HR experts
and professionals argument against using the technique of 360 degree appraisals. The
main arguments are:

360 performance rating system is not a validated or corroborated technique for

performance appraisal.

With the increase in the number of raters from one to five (commonly), it become
difficult to separate, calculate and eliminate personal biasness and differences.

It is often time consuming and difficult to analyze the information gathered.

The results can be manipulated by the employees towards their desired ratings
with the help of the raters.

The 360 degree appraisal mechanism can have an adversely effect the motivation
and the performance of the employees.

64

360 degree feedback as a process- requires commitment of top management and

the HR, resources (time, financial resources etc), planned implementation and
follow-up.

360 degree feedback can be adversely affected by the customers perception of the
organization and their incomplete knowledge about the process and the clarity of
the process.

Often, the process suffers because of the lack of knowledge on the part of the participants
or the raters.

3. ASSESSMENT CENTRES
An assessment centre typically involves the use of methods like social/informal
events, tests and exercises, assignments being given to a group of employees to assess
their competencies to take higher responsibilities in the future. Generally, employees are
given an assignment similar to the job they would be expected to perform if promoted.
The trained evaluators observe and evaluate employees as they perform the assigned jobs
and are evaluated on job related characteristics.
The major competencies that are judged in assessment centre are interpersonal
skills, intellectual capability, planning and organizing capabilities, motivation, career
orientation etc. assessment centre are also an effective way to determine the training and
development needs of the targeted employees.
4. BEHAVIORALLY ANCHORED RATING SCALES
Behaviorally Anchored Rating Scales (BARS) is a relatively new technique which
combines the graphic rating scale and critical incidents method. It consists of
65

predetermined critical areas of job performance or sets of behavioral statements

describing important job performance qualities as good or bad (for e.g. the qualities like
inter-personal relationships, adaptability and reliability, job knowledge etc). These
statements are developed from critical incidents.
In this method, an employees actual job behavior is judged against the desired
behavior by recording and comparing the behavior with BARS. Developing and
practicing BARS requires expert knowledge.

5. HUMAN RESOURCE ACCOUNTING METHOD

Human resources are valuable assets for every organization. Human resource
accounting method tries to find the relative worth of these assets in the terms of money.
In this method the performance of the employees is judged in terms of cost and
contribution of the employees. The cost of employees include all the expenses incurred
on them like their compensation, recruitment and selection costs, induction and training
costs etc whereas their contribution includes the total value added (in monetary terms).
The difference between the cost and the contribution will be the performance of the
employees. Ideally, the contribution of the employees should be greater than the cost
incurred on them.

Challenges Of Performance Appraisal

In order to make a performance appraisal system effective and
successful, an organization comes across various challenges and problems. The
main challenges involved in the performance appraisal process are:

66

Determining the evaluation criteria

Identification of the appraisal criteria is one of the biggest problems faced
by the top management. The performance data to be considered for evaluation
should be carefully selected. For the purpose of evaluation, the criteria selected
should be in quantifiable or measurable terms

Create a rating instrument

The purpose of the performance appraisal process is to judge the
performance of the employees rather than the employee. The focus of the system
should be on the development of the employees of the organization.

Lack of competence
Top management should choose the raters or the evaluators carefully.
They should have the required expertise and the knowledge to decide the criteria
accurately. They should have the experience and the necessary training to carry
out the appraisal process objectively.

Errors in rating and evaluation

Many errors based on the personal bias like stereotyping, halo effect
(i.e. one trait influencing the evaluators rating for all other traits) etc. may creep
in the appraisal process. Therefore the rater should exercise objectivity and
fairness in evaluating and rating the performance of the employees

67

Resistance
The appraisal process may face resistance from the employees and the
trade unions for the fear of negative ratings. Therefore, the employees should be
communicated and clearly explained the purpose as well the process of appraisal.
The standards should be clearly communicated and every employee should be
made aware that what exactly is expected from him/her.

Performance Appraisal Software

The growing size of the organisations, the competition in the labour market and
the importance of the performance management and appraisals have given way to the use
of performance appraisal softwares. Many companies providing the HR services and the
software companies provide the performance appraisal softwares.

The performance appraisals softwares automate the appraisal processes and assist
the HR by adding online capacities to the processes. The performance appraisal software
can be customized according to the needs of the organisation. The various forms and
other processes can be designed in accordance to the practices being followed in the
organisation.

The software standardizes the appraisal process. The software applications also
have guidelines for the users to guide them throughout the process, alerting the users
about the errors and mistakes (if any), suggesting the appropriate language to be used,
provides a systematic records of the necessary documents to the rater and the HR
Department.

68

Several software packages are available which also provide the 360-degree review
program so that employees can get a multi-rater feedback about their performance.

Benefits of using performance appraisal softwares

By using the performance appraisal softwares, an organisation can reap the following
benefits:

The performance appraisal software can be implemented organisation wide,

covering all the employees at the levels (from lowest rank to top management)
and across all the branches of the organisation throughout the world.

Designed with the latest technologies, they are easy to understand and make
things structured, organized and standardized throughout the organisation.

Performance Measures, KPI and KRAs, goals and objectives for each employee,
team and department can be weighted and listed according to their importance and
priority.

Use of the standard performance appraisal softwares can help to reduce the
subjectivity and the bias in the ratings of the appraisers.

It facilitates the calculations and adjustments of the performance related pay and
other related HR decisions.

Automatic reminders can be sent to the employees and the concerned authorities
for the due appraisals.

69

It helps the HR department in appraising the performance and to manage the

performance of the employees efficiently and effectively.

Helps to improve the productivity of the employees and employee retention in the
organisation.

Keeps a detailed record of the past performances and the reviews of the

employees.
Performance Appraisal Process - Key to Change organizational Culture

The performance appraisal process provides an opportunity for introducing organizational

change. It facilitates the process of change in the organizational culture. The interactive
sessions between the management and the employees, the mutual goal setting and the
efforts towards the career development of the employees help the organization to become
a learning organization. Conducting performance appraisals on a regular basis helps it to
become an ongoing part of everyday practice and helps employees to take the
responsibility

of

their

work

and

boosts

their

professional

development.

Various studies in the field of human resources have already proved that performance
appraisal process can affect the individual performance (in a negative or positive way),
thus having an impact on the collective performance.

Performance appraisal: An opportunity for an organisational culture shift

Performance appraisal process focuses on the goal setting approach throughout

the organisation.
70

Performance appraisal helps the clarity and understanding of the roles and
responsibilities of the employees.

The performance appraisal processes have the potential positive effects on

recruitment

It increases organisational effectiveness i.e. what to do and how to do through a

formal and structured approach.

Some evidence of the beneficial effects of team rewards

Therefore, performance appraisal is also an important link in the process of change in

organization culture.
LINKING COMPENSATION TO PERFORMANCE

One of the latest strategies being followed in all sectors through out the world for
retention and talent management is linking compensation to performance. Commonly
known as Performance pay or Performance based pay, it links the compensation of
the employees to their performance and their contribution to the organizational goals.
Therefore, periodic performance reviews play a vital role and provide the basis of
performance related pay.

Commissions, incentives and bonuses, piece rate pay help the employer to pay the
employee according to their productivity and hard work.
The process of performance based pay involves:

71

Deciding and clearly defining the performance goals and the performance
measures

Setting the target bonus for different levels of performances

Measuring the performance of the employee

Giving rewards and bonus according to performance

Organizations are also designing variable compensation plans for various roles and
positions in the organization.
Types of Performance Pay

Merit pay The first step to performance pay, merit pay means setting some
basic salary according to the position and the rank of the employee and the
variable part of the salary is based on the periodic performance reviews.

Profit Sharing Sharing the profits of the enterprise with the employees as
bonus.

Incentives and Performance Bonus Rewards for special accomplishments or

fulfillment of the targets set such as sales commission.

Gain sharing - Sharing of gains as a result of the increased performance of the

employees with them.

Although performance related pay has always been a topic of discussions and
controversies with many arguments against it, but it has also been proved that
performance based pay motivates employees to perform better and earn, and encourages

72

learning, innovation, creativity, problem solving and empowerment which can be

facilitated through proper performance measurement and reviews.
Relationship Between Performance Appraisal and Organizational Performance

Performance appraisal processes are one of the central pillars of the performance
management which is directly related to the organizational performance and have a direct
impact on it. Employee performance ultimately effects the organizational performance
and objectives.

According to a few HR professionals, the appraisals have no value for the

organisation as there is no direct relationship in performance appraisals and the
organizational performance. Also, there is no strong evidence to prove that appraisals
positively impact the performance of the employees. But the HR professionals who see
the organizational performance as a result or sum of the employees performance, argue
that apart from the direct benefits to the organisation, appraisals contribute to employee
satisfaction, which in turn leads to improved performance.

For an organisation to be effective, the goals, the standards and the action plans
need to be planned well in advance. Thus, performance appraisal facilitates the
achievement of organizational goals. It also facilitates the optimal use of the
organizational resources.
Performance appraisals a double-edged sword

73

Performance appraisal is like a double edged sword for an organisation. Although

it has many benefits for the organisation, various studies have also revealed that
performance appraisals have the equal probability of having a bad impact on the
organizational as well as the employee performance.
Where the performance appraisal improves the work performance and employee
satisfaction, it can also demotivate employees and leaving a bad impression on the good
employees. Most of the employees do not approve of continuous performance monitoring
and performance appraisals, and also consider it as a burdensome activity. According to
Professor Kuvaas Performance appraisals and other tools which involve feedback
and target management should be adapted to the employees individual needs and
characteristics. Otherwise, there is a risk of harming the good employees without
being able to help the less good.
Performance appraisal processes can create a sense of insecurity in the working
environment and can become an obstacle in achieving the required changes in the
attitudes and the performance of the employees. The element of bias in the appraisals can
also worsen the situation.
Therefore, performance appraisals can effect the organizational performance both
positively and negatively, and should be dealt with care and expert knowledge and
experience.

Performance Appraisal For Employees at Different Levels

74

Performance appraisal is important for employees at all levels throughout the

organization. The parameters, the characteristics and the standards for evaluation may be
different, but the fundamentals of performance appraisal are the same. But as the level of
the employees increases, performance appraisal is more effectively used as the tools of
managing performance.

Performance appraisals of Managers:

Appraising the performance of managers is very important, but at the same time,
it is one of the most difficult tasks in the organization. It is difficult because most of the
managerial work cannot be quantified i.e. it is qualitative in nature like leading his/her
team, guiding, motivating, planning etc.
Therefore, the two things to be noted and evaluated for the purpose of appraisals are:

Performance in accomplishing goals, and

Performance as managers

Performance in accomplishing goals

Managers are responsible for the performance of their teams as a whole.
Performance in accomplishing goals would mean to look at the completion or
achievement of the goals set for a team of employees which is being assigned to or
working under a particular manager. The best measuring criteria for a manager are hi
goals, his plans of course of action to achieve them and the extent of achievement of the
goals.
Performance as managers
75

The responsibilities of managers include a series of activities which are concerned

with planning, organizing, directing, leading, motivating and controlling. Managers can
be rated on the above parameters or characteristics
Criteria for measuring performance at different levels:
The criteria for measuring performance changes as the levels of the employees and
their roles and responsibilities change.
A few examples for each level are described below:
For top level management

Degree of organizational growth and expansion

Extent of achievement of organizational goals

Contribution towards the society

Profitability and return on capital employed

For middle level managers

Performance of the departments or teams

Co-ordination with other departments

Optimal use of resources

Costs Vs. revenues for a given period of time

The communication with superiors and subordinates

For front line supervisors

Quantity of actual output against the targets

76

Quality of output against the targets

Number of accidents in a given period

Rate of employee absenteeism

Pre-requisites for Effective & Successful Performance Appraisal

The essentials of an effective performance system are as follows:

Documentation Means continuous noting and documenting the performance. It

also helps the evaluators to give a proof and the basis of their ratings.

Standards / Goals The standards set should be clear, easy to understand,

achievable, motivating, time bound and measurable.

Practical and simple format - The appraisal format should be simple, clear, fair
and objective. Long and complicated formats are time consuming, difficult to
understand, and do not elicit much useful information.

Evaluation technique An appropriate evaluation technique should be selected;

the appraisal system should be performance based and uniform. The criteria for
evaluation should be based on observable and measurable characteristics of the
behavior of the employee.

Communication Communication is an indispensable part of the performance

appraisal process. The desired behavior or the expected results should be
communicated to the employees as well as the evaluators. Communication also

77

plays an important role in the review or feedback meeting. Open communication

system motivates the employees to actively participate in the appraisal process.

Feedback The purpose of the feedback should be developmental rather than

judgmental. To maintain its utility, timely feedback should be provided to the
employees and the manner of giving feedback should be such that it should have
a motivating effect on the employees future performance.

Personal Bias Interpersonal relationships can influence the evaluation and the
decisions in the performance appraisal process. Therefore, the evaluators should
be trained to carry out the processes of appraisals without personal bias and
effectively.

PERFORMANCE RELATED PAY

Performance Related Pay

Performance Related Pay (PRP) or Variable Pay is the reward paid to individuals
based on performance against the predetermined objectives aligned to the
business.

PRP is essentially a method of linking the pay of an individual to his/her

performance achieved at work (usually) against agreed objectives.
78

It is a method to remove or bridge the gap between pay and performance.

It is based on premise in general that top performers are funded at the cost of
lower/non-performer.

Ways of linking Pay to Performance

Varieties of ways such as cash bonuses, additional salary/increments, faster

incremental progression, all of which have their strong and weak points.

Different plans each uniquely suited to different employee groups/departments.

Separate from profit related pay, group incentive schemes or profit sharing
scheme.
Not to be confused with base pay adjustments.
Benefits:

Motivating people and creating performance oriented culture

To attract, retain and utilize most talented or right people in the organization

To catch top performers attention and sends a signal to a poor performing

employee

Sends vital signals about the organization priorities and values

Transforming reward from entitlement to achievement

Close to 78% companies view that this has positive impact on business results

Shifting compensation cost from fixed to variable expenses

20% people contributing 80% of the results should be suitably rewarded

Best way to increase productivity to secure dominance in the market

Paying for performance works much better in down times than in boom times

It

is right and proper to pay in accordance with the contribution made by

individual
Creating Effective PRP Plan
79

Full commitment from the management and senior executives

Compensation system that

Differentiates rewards, not just performance

Sets clear performance-reward linkage

Support and involvement of senior executives and managers who will own,
educate and communicate the plan

Good Performance Management Program (PMP) in place which

Establishes clearly defined SMART individual objectives and competencies

aligned to overall organization goals

Encourages and supports open, honest feedback and review of all

Hold employees accountable for results

Hold managers for substandard performance and for improving or removing poor
performers

Formally recognizes and rewards the higher performance

Clear identification of the target group, department, level etc.

Requires high performance culture

MEASURING PERFORMANCE
GOALS 2007
Name
Reporting to

December, 2007
Qualification
Date of joining

Job Title
Deptt.

GOALS FOCUSING ON GROWING THE BUSINESS

80

GOALS/OBJECTIVES
1. SALES VOLUME/
MARKET SHARE

DESIRED
RATING
(66)
25

2. DISTRIBUTION
LEADERSHIP

STRATEGIC
PRIORITIES/ACTION PLAN

8
10

3. VISIT MANAGEMENT

12

4. PROFITABILITY/ COST/
DISCOUNT CONTROL
12
5. PROCESS ORIENTATION

67

GOALS FOCUSING ON GROWING PEOPLE/ORG. CAPABILITY

OBJECTIVES
1. COACH AND DEVELOP
FOR

DESIRED
RATING(33)
18

2. SALES TRAINING

STRATEGIC
PRIORITIES/ACTION PLAN

15
33

PERFORMANCE RATING SCALES & LEVELS

5
SAT Significant Above Target : Significantly exceeded expectations
4
AT
Above Target : Consistently exceeded expectations
3
OT
On Target : meet all & exceeded some expectations
2
BT
Below Target : Meet some, but not all, expectations
1
SBT Significant Below Target : Significantly below expectations

ARRIVING AT PERFORMANCE LEVEL

PERFORMANCE
LEVEL
SAT

PART - I
WEIGHTED
AVERAGE
PERFORMANCE
LEVEL
5 X 2 = 10

PART - II
WEIGHTED
AVERAGE
PERFORMANCE
LEVEL
5X1=5
81

PERFORMANCE
LEVEL
( TOTAL OF PART
I & II)
15

15

AT

4X2=8

4X1=4

12

OT

3X2=6

3X1=3

BT

2X2=4

2X1=2

SBT

1X2=2

1X1=1

14
13
12
11
10
9
8
7
6
5
4
3
2
1

ESTABLISHING LINKAGE OF PERFORMANCE TO

REWARD
PART - I
PERFORMANC
E LEVEL

PART - I I

TOTA BASE
TOTA
WEIGHTED
WEIGHTED
L OF PAY VARIABL
L
AVERAGE
AVERAGE
PART RAIS E PAY (%)
INCR
PERFORMANC PERFORMANC
I & II E (%)
E LEVEL
E LEVEL
82

SAT

5 X 2 = 10

5X1=5

AT

4X2=8

4X1=4

OT

3X2=6

3X1=3

BT

2X2=4

2X1=2

SBT

1X2=2

1X1=1

15
15 14
13
12
12
11
10
9 9
8
7
6 6
5
4
3
3
2
1

15
14
13
12
11
10
9
8
7
6
5
0
0
0
0

15
11
7
4
2
0
0
0
0
0
0
0
0
0
0

30
25
20
16
13
10
9
8
7
6
5
0
0
0
0

DATA ANALYSIS AND

INTERPRETATION
Number of Employees working at different levels in Pepsi
Employees
Top-level

Years
2005
14

2006
17
83

2007
23

2008
22

Managers
Middle-level
Managers
Front-line
supervisors
Total

78

88

102

106

23

22

22

41

115

127

147

169

Number of Top-level Managers in different departments in Pepsi

Managers
HR
Sales
Marketing
Production
& Quality
Finance
Shipping
Purchase
Head Office
Store

Years
2005
1
4
1
5

2006
1
6
1
4

2007
1
7
1
7

2008
1
8
1
7

1
1
0
1
0

2
1
1
1
0

2
2
1
1
1

2
1
1
0
1

Number of Employees placed at different Performance Level according to their

roles and responsibilities change:
Top-Level Managers:
Year 2007=14 Managers
Year 2008=17 Managers
Year 2009=23 Managers

84

Year 20010=22 Managers

Performance Level
SAT
AT
OT
BT
SBT

5
4
3
2
1

Years
2007
4
7
3
-

2008
6
9
2
-

2009
10
11
2
-

2010
16
6
-

In 2007, there were 14 Managers. 3 more Managers were joined in 2007 and 6
Managers were joined in 2007. But in 2008, there were only 22 Managers because one of
them is transferred to another State.

ANALYSIS:
Most of the Managers are at SAT (Significant Above Target)
Performance Level
Maximum of the Managers are at AT (Above Target) Performance
Level.
Some of the Managers are at OT (On Target) Performance Level.
85

This is due to their efficiency and contribution towards the organization.

Middle-Level Managers:
Year 2005=78 Managers
Year 2006=88 Managers
Year 2007=102 Managers
Year 2008=106 Managers

Performance Level
SAT
AT
OT
BT
SBT

5
4
3
2
1

Years
2006
9
25
42
2
-

2008
19
30
38
1
-

86

2009
23
50
29
-

2010
31
60
15
-

In 2005, there were 78 Managers. 10 more Managers were joined in 2007, 14

Managers in 2007 and 4 Managers in 2008 were joined. There is a continues increase in
the number of Middle Level Managers.
ANALYSIS:

Poor Performance due to

Lack of alignment of individual and organizational goals.
Managers are not thrilled to deliver less then favorable news.
Influence of higher rating by other department.
But there were continues improvement in their Performance Level.
Front-Line Supervisors:
Year 2006=23 Supervisors
Year 2007=22 Supervisors
Year 2008=22 Supervisors
Year 2009=41 Supervisors

87

Performance Level
SAT
AT
OT
BT
SBT

5
4
3
2
1

Years
2007
5
5
10
3
-

2008
7
6
7
2
-

2009
10
8
3
1
-

2010
21
15
5
-

In 2007, there were 23 Supervisors. 22 Supervisors in 2008 and in 2009 but in

2010, there was high increase in number i.e. 41 Supervisors. There is a continues increase
in the number of Front-Line Supervisors.
ANALYSIS:
Poor Performance due to
Lack of confidence and competence.
Lack of productivity and effectiveness, contributes least to organization bottom
line.

88

SUGGESTIONS AND RECOMMENDATION

1. Pepsi should build a strong management and development framework to stand the
vigorous competition from the various industries.
2. Paper work must be reduced, computerized work should be more.
3. There should be on-line information of all the employees regarding all the activities
performed by them like performance, communication skills, quality of work, over
time devoted by each employee, etc.
4. By adopting MBO method, Employees compete against each other and dont help
others.

89

CONCLUSION
The Performance Appraisal methods vary from one organization to another.
Change in method of Performance Appraisal has observable and immediate side effect on
organizational processes like work task, job design, organizational structure, knowledge
and skill required, and values, attitudes and behavior of employees. Substantive changes
in one or more of the above factors leads to perceive or actual psychological threat of job
displacement, reduction in economic security, disruption of social arrangements and
redefining of authority relationships. These threaten the psychological and social status of
an employee, triggering off resistance to change.

90

QUESTIONNAIRE
CONTACT PERSON:.
ADDRESS:

Number of Employees working at different levels in Pepsi

Top-level Managers

Middle-level Managers

Front-line supervisors

Others

Number of Top-level Managers in different departments in Pepsi

HR

Sales

Marketing

Production& Quality

Finance

Shipping

Purchase

Head Office

Store
Number of Employees placed at different Performance Level according to their roles and
responsibilities change:
Year 2007=14 Managers

Year 2008=17 Managers

Year 2009=23 Managers

Year 2010=22 Managers

But there were continues improvement in their Performance Level.

Year 2007=23 Supervisors

Year 2008=22 Supervisors

Year 2009=22 Supervisors

Year 2010=41 Supervisors

Kind of shop:
Eatery

Confectionary

Grocery

Others

91

Which brand do you purchase:

PEPSI

BOTH

COCA-COLA
Average monthly consumption of PEPSI & COCA-COLA:
PEPSI
COCA-COLA
Which company do you like to promote more ;
a) Pepsi
b) coke
If yes, then what type:

Any suggestion to the company:

92

BIBLIOGRAPHY
BOOKS

Marketing management -

PHILIP KOTLER

Research Methodology -

KOTHARI,C.R

WEBSITE

www.google.com

www.pepsico.in

www.rkigroup.com

www.wikipedia.com

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