4. Case Title: PepsiCo: Breeding Reverse Innovation in India.

Tasks:

A: To understand the changing role of emerging economies as drivers of innovation for

The purpose of innovation is to come up with new ideas and technologies that increase
productivity and generate greater output with the same input. If we look at
the transformation of the US, once a largely agrarian economy that advanced from emerging
nation status in the mid-19th century to an industrial economy by the First World War, we can see
that the agricultural innovations and inventions were actually one of the largest factors that
helped bring about the Industrial Revolution. Vast improvements in agricultural productivity had
already previously transformed the way people work in Europe, releasing farmers for other
activities and allowing them to move to the city for industrial work. The shift from hand-made to
machine-made products increased productivity, directly affecting living standards and growth.

Reverse innovation is the process whereby goods developed as inexpensive models to meet the
needs of developing nations, such as battery-operated medical instruments in countries with
limited infrastructure, are then repackaged as low-cost innovative goods for Western buyers. The
process of reverse innovation begins by focusing on needs and requirements for low-cost
products in countries like India. Once products are developed for these markets, they are then
sold elsewhere – even in the West – at low prices which creates new markets and uses for these
innovations.

Innovation strategies of MNCs: Generational innovation = Intermediate phase where both

Radical innovation = Fundamental changes that represent revolutionary changes in technology.

B: To understand the expansion of PepsiCo’s product profile over the decades and the way
R&D has been organized and reorganized and how the organization structure has been
adapted.

Pepsi has been repeatedly criticized by environmentalists for its relationship to

PepsiCo’s case, the organizational structure enables control over the expansive reach of the
company around the world, considering significant differences among market conditions.
PepsiCo’s organizational structure’s characteristics are based on the company’s approach to
maximize its control of the business while continuing to grow internationally.

PepsiCo’s strategies are also manifested in how its organizational structure supports international
growth. A firm’s organizational structure defines the system and design of business components,
and how these components interact to fulfill the firm’s mission and vision. PepsiCo’s
strategies are also manifested in how its organizational structure supports international growth. A
firm’s organizational structure defines the system and design of business components, and how
these components interact to fulfill the firm’s mission and vision.

C: To discuss about PepsiCo’s reverse innovation and analyze how India became an
innovation hub.

Global soft drinks and snacks major PepsiCo today said its innovations in India are being
adapted for the firm's other international markets with the products gaining interest from
overseas.
Snacks like Kurkure and Aliva, and lemon-flavoured drink Nimbooz are some of the successful
innovations in India that have attracted attention from outside. Global soft drinks and snacks
major PepsiCo today said its innovations in India are being adapted for the firm's other
international markets with the products gaining interest from overseas. Snacks like Kurkure and
Aliva, and lemon-flavoured drink Nimbooz are some of the successful innovations in India that
have attracted attention from outside. While Pepsico India said these "products are not being
exported to other countries", company insiders said 'Nimbooz' and 'Aliva' are finding their way
to Middle-Eastern and Western markets.

5. Case Title: Toyota Product Recall: Does Quantity and Quality Go Hand-in-
Hand?

A: To get an insight into the growth and evolution of Toyota Motor Corporation as a
leading manufacturer of cars.

By the 1950s Toyota’s automobile production factories were back in full operation, and to gain
competitiveness the company began a careful study of American automobile manufacturers,
owing to perceived U.S. technical and economic superiority. Toyota executives toured the
production facilities of corporations, including the Ford Motor Company, to observe the latest
automobile manufacturing technology and in turn implemented it in their own facilities, yielding
a nearly immediate increase in efficiency. In 1957 Toyota Motor Sales, U.S.A., Inc., was
established, and the following year the company released the Toyopet sedan, its first model to be
marketed in the United States; it was poorly received because of its high price and lack of
horsepower. The Land Cruiser, a 4 × 4 utility vehicle released in 1958, was more successful. In
1965 the Toyopet, completely redesigned for American drivers, was re-released as the Toyota
Corona, marking the company’s first major success in the United States.

The company continued to thrive in the American market as well, gaining a reputation for its
low-cost, fuel-efficient, and reliable vehicles such as the Corolla, which was released in the
United States in 1968. The company took its present name in 1982, when Toyota Motor
Company was merged with Toyota Motor Sales Company, Ltd. Two years later Toyota
partnered with General Motors Corporation in the creation of New United Motor Manufacturing,
Inc., a dual-brand manufacturing plant in California, where Toyota began U.S. production in
1986. The company experienced significant growth well into the 21st century,
with innovations such as its luxury brand, Lexus (1989), and the first mass-produced hybrid-
powered vehicle in the world, the Prius (1997).

B: To understand the quality problems faced by Toyota.

Toyota’s quality problems in the United States were signaled with the initial recall in late 2009
for problems with floor mats, but they didn’t end there. Over the next four months, the company
recalled 3.4 million more vehicles in three separate recalls over and above the initial 3.8 million,
for a total of more than 7 million. There were several issues: potentially sticky gas pedals, pedal
entrapment and software glitches that affected braking on some models.

A Gallup national survey in late February 2010 found that 31% of Americans believed Toyota
vehicles were unsafe; the percentage among Toyota owners was only 14%, but for non-Toyota
owners the figure shot to 36%.2 Even if the media exaggerated the seriousness of problems and
politicians politicized them, customer perception is the final arbiter.
Automotive News reported that more than 20 million Toyota vehicles had been recalled since
autumn 2009.

C: To analyze whether quality and quantity go hand-in-hand.

It’s time to shift this mindset and look at both metrics as critical to success. While there will
always be a trade-off when deciding which metrics to focus on, it’s important to remember that
one cannot function without the other.

Attracting more leads will always be a prerequisite to increasing the number of sales
conversions, and prioritizing lead quality becomes a necessity once business operations achieve a
certain level of maturity. Doing so becomes an effective tactic to reduce overhead costs and
improve ROI in the long term.

Sales and marketing teams must form a unified front to achieve the right balance between lead
quantity and quality. We’ve already established that high lead quantity provides the best
opportunity for collecting customer data, which can be used to gain insight into customer
behavior and provide a clearer picture of who your target audience should be. These accounts not
only provide a steady revenue stream for an extended period but also help spread the good word
about your brand and help improve your company reputation once they become brand advocates.
Everyone loves a bit of free PR.