Dive Brief:
- PepsiCo promoted Al Carey, CEO of the North America Beverages division, to a newly created position, CEO of North America. He will oversee all three divisions of PepsiCo's North America business, including beverages, Frito-Lay, and Quaker.
- Carey's promotion was prompted by the departure of Tom Greco, who is vacating his position as CEO of Frito-Lay North America. Carey, 64, will report directly to CEO Indra Nooyi.
- This promotion has generated speculation among analysts that PepsiCo could be grooming Carey to eventually succeed 60-year old Nooyi as CEO, according to Fortune.
Dive Insight:
When the time comes, replacing Nooyi will be no easy feat. Through tough times for soda — which hit a 30-year low in annual per capita consumption last year — Nooyi has steered the company toward innovation and adaptation to consumer trends. In the most recent quarter, net revenue fell 7% to $18.59 billion but still topped analysts' estimates, while net income rose 31%.
PepsiCo has positioned itself in fast-growing categories with products like Pure Leaf in RTD tea and, most recently, Quaker Oats' Quaker Breakfast Flats, a new line of breakfast biscuits. PepsiCo has also removed sugar and salt from many of its products and introduced Diet Pepsi sans aspartame last year.
Innovation has been a key element in Nooyi's success, and PepsiCo's board has rewarded her for her efforts. She was the highest-paid food and beverage CEO in Food Dive's recent analysis of CEO compensation for 2015. Nooyi received a 17.6% pay bump last year, mainly from increases to her non-equity incentive plan and pension plan.
Hormel also announced management changes this week. Two members of upper management are retiring, including Roland Gentzler, vice-president of finance and treasurer, and James Schroeder, vice-president of engineering. Gary Jamison, vice-president and CFO of Jennie-O Turkey Store, will replace Gentzler, while Tyler Hulsebus, director of purchasing, will replace Schroeder.