Critical Evaluation of Most Important Leadership Skills for PepsiCo

This report provides a critical evaluation of leadership skills and competencies within PepsiCo, focusing on the context of organizational change. The report begins by introducing the need for flexible organizational structures in today's competitive environment and highlights PepsiCo's plan to modify its structure and leadership styles to gain strategic advantages. The main body of the report examines three key leadership skills: Traits theory, Behavioral theory, and Leader Member Exchange (LMX) theory. For each theory, the report discusses its application within PepsiCo, including the relevant competencies needed for effective leadership. The report also addresses the limitations of each theory. The conclusion emphasizes the importance of leadership and competencies in maximizing productivity and achieving organizational goals, particularly in the context of PepsiCo's strategic initiatives. This report is a valuable resource for students on Desklib, offering insights into leadership management and organizational change.

Critical evaluation of most important
Leadership Skills
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Table of Contents
INTRODUCTION ...............................................................................................................................3
MAIN BODY.......................................................................................................................................3
SKILL 1................................................................................................................................................3
SKILL 2 ...............................................................................................................................................5
SKILL 3................................................................................................................................................6
CONCLUSION ...................................................................................................................................7
REFERENCES.....................................................................................................................................8
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INTRODUCTION
In the today's competitive environment, an organization adopts flexible organizational
structure. It is not only promote the workforce to take advantage of competition but also increase
their productivity with the time (Importance of Leadership, 2016). But for attain all these, it is most
important to follow right leadership style. With appropriate leadership skill, it can be easy to lead
the group of the people (Rothwell, 2011). The following study is relating to importance of
leadership skills and to understand its importance within the organization, PepsiCo is taking into the
consideration. It is multinational firm which director plan to bring the modifications in structure of
enterprise and make it more flexible so that it be easy to adopt any kind of modifications in the
future. The scope of proposed changes in the organizational structure is it will allow PepsiCo to get
strategic advantages and make it more competitive in the upcoming years (Collinson and Cook,
2013). In this context, firm is also planning to changes in leadership style to attain the objective.
The areas that will cover under the present research is different leadership skills and competencies
to achieve the alteration within the organization.
MAIN BODY
Most essential leadership skills and competencies for PepsiCo
The Director of Consumer Strategic Insights (CSI) Jorge Rubio that is a part of PepsiCo
Foods Mexico (PFM) has developed a creativity centre with the name of Brain Spa which similar to
Google's corporate creative centre where a process is carrying out to find new innovative and
productive ideas (Fullan, 2011). Now, he decides to make this department more proactive and
flexible. For this, he take decision to bring the changes in organizational structure and leadership
skills. Jorge Rubio wants that organization structure should be flexible so that it can be easy to raise
the productive level of both firm and employees. Along with this, the staff can give their huge and
complete efforts in bring the new innovation in the products. In this context, it is essential to follow
right and effective leadership style so that flexible organization structure can be imposed within the
company (Iqbal, 2013). The aim behind adopting such kind of strategy is make the firm as a
independent market research enterprise in the world. Along with this, there are various long and
short terms of objectives and goals of PepsiCo and that can only be accomplish by appropriate
leadership style and competencies.
SKILL 1
Leadership and competencies both are important part and play an essential role in the
leaders life. From the given case study, it has found that PepsiCo wants to bring the changes in the
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existing organizational structure and make more flexible so that new modifications in future can be
adopt. The new structure of the organization should in such a way that every employee become self
responsible with some authorities to take decision regarding the work (Chand, 2016). In this
regards, the first suggested leadership style to the company to implement new organizational
structure is Traits theory which is as follows:
Traits theory
It reflects the important characteristics that a person as a leader should require. It may
include skills, communication, personality etc. In a successful leaders, they have personality traits,
abilities and interest that make them unique and different from the other less effective leaders (Trait
Theory of Leadership, 2016). The qualities of such type of people are intelligence, self-confidence,
self motivated, honesty and integrity and sociability. This theory is useful for PepsiCo because it
can apply all management level in the entire organizations. The managers of the company can use
the information to assess their position within the firm. Along with this, they can also defined the
different ways by which they can make their position and role more stronger (Trait theory of
leadership, 2016). With the help of trait theory, PepsiCo Company can bring the changes within the
organizational structure. It assist the different level managers to know about their own identity and
the impacts of their activities and actions within the firm. So, by imposing trait theory, PepsiCo
managers can determine their weaknesses and strengths so that they can develop more leadership
qualities in order to achieve the objective behind bringing the changes within the organizational
structure (Cherry, 2016).
But the negative aspect of trait theory is it takes time to find the traits in the leaders of
PepsiCo. It not gives general overview and other information that can be used to achieve the
objectives.
On the other hand, in order to meet the aim of organizational change, PepsiCo Company
needs some major competencies which are as follows: Managing change skills: The leader of company should be have enough skills and abilities
to manage the changes within the workplace. Because at the time of bringing the
modifications in the organizational structure, it is sure that this thing will change the
expectations of the employees (Kathy and Deborah, 2007). In this context, the leader of
PepsiCo should have appropriate capabilities to manage the various alterations within the
firm. Taking risks and innovation skills: The leader of PepsiCo should have to adopt the attitude
of risk taking because without taking the risks, it becomes hard to deal with different
situations of the workplace Along with this, the leader should always open his mind and
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looking towards new ideas by which the existing products can be make more attractive and
innovative (Krogh, Nonaka and Rechsteiner, 2012).
 Communication skills: An organization cannot be run without the effective communication
skills because to perform the operations of business, it is necessary to share the information
with each other. This can only be possible with appropriate communication skills. The leader
of PepsiCo should adopt right style of communication with the different level of
management so that all can get proper data and take the decision according to it (Lee and
Lawrence, 2013).
SKILL 2
Behavioural theory
Under this theory, the major focus is on behaviour of a leader in the specific situations.
According to this hypothesis, the behaviour of a leader can be predict from his behaviour and it
denotes the success level of him (Carpenter Bauer and Erdogan, 2016). With the help of this, it can
be easy to analyse that what leaders actually do rather than on their qualities and abilities. PepsiCo
leaders can use behavioural theory because it promotes the values of this leadership style by
emphasizing on collaboration of the employees during bringing the changes within the
organizational structure and make it more flexible. Along with this, it assist the management of
company to promote and increase participative decision making and develop a team that align their
objectives with the organization objectives (Termeer and Nooteboom, 2012). On the other hand, the
leaders and the managers of PepsiCo can evaluate how their behaviour affects the employees and
motivate them to give contribution in achieve the goal. So, wih the help of behavioural theory, the
managers and the leaders of PepsiCo can make the balance between various leadership styles and
able to take decisions how to behave like a leader to lead the organizational structure change
(Wong, Mahmud. and Omar, 2015).
But the limitations or weaknesses of behavioural theory in the context of PepsiCo is it does
not focus on those environment which shows the behaviour of the leaders. Some time, it may be
hard to predict the right leadership style of the leaders in the given circumstances (Kaur, 2015).
Rather than this, the competencies which are required in a leader of PepsiCo who follows
behavioural theory are explaining below. Mindset skills: The leader of PepsiCo should be mentally stable and try to include all the
employees in the decision making process. It increases the engagement of the staff in
various business activities and make them more confident to perform the tasks and achieve
the set objective regarding setting of flexible organizational structure (Akers, 2013). Setting vision and plans: The leader of PepsiCo should set own vision and mission towards
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the objective of the company. These should be align with the organization objectives and
make the good plan to achieve them in effective manner.
 Open minded and flexible skills: A leader of PepsiCo should be open-minded at the time of
interacting and communicating with the employees (AlMazrouei and Zacca, 2015). By
listening their issues, ideas and suggestion, he can take right decisions to accomplish
organizational change structure objective.
SKILL 3
Leader Member exchange theory (LMX)
The following theory focus in the relation between the leaders and their followers. As per
this hypothesis, leader forms various kinds of relationship with their subordinates groups. The
relationship between the leaders and followers can be define within three stages: role taking, role
making and routinization (Leadership-Member Exchange (LMX) Theory, 2016). Such kind of
people can be divided into in-group and out-group. In in-group, the subordinates shar4e the
information with the leader and influence from the ideas, suggestions or opinions. But out-group is
less compatible with the leader because they are just performing their duties. They have not got any
kind of opportunities of growth and challenges during the work. The formation of both the groups
are based on trust, capabilities and loyalty (Avolio and Mhatre, 2012). So, with the help of LMX
theory, it becomes easy to separate talented and highly skilled leaders from the others. If PepsiCo
implies the following leadership theory within the workplace than the management can identify
those groups and leaders which are highly talented and motivated. It brings the focus of the
management of the organization on importance of communication in leadership (Barrick and et.al.,
2013). With the help of this, a good communication medium can be create between the leaders of
PepsiCo and their subordinates.
But LMX theory have some limitations in which one is can create discrimination and unfair
situation within the workplace with the employees and develop a negative environment for whole
organization (Daft, 2014).
The leaders of PepsiCo who follows LMX theory, they should have some competencies that
would help in bringing the changes within the organizational structure. In this context, few
competencies are as follows: Problem solving skills: At the time of bring the changes within the organizational structure,
various kinds of issues can be faced by PepsiCo leaders. So to deal with those problems, it is
important to develop or have problem solving skills so that issues can be resolve in effective
manner (Daicoff, 2012).
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 Social judgement skills: The leaders of PepsiCo should have the capacity to judge the
employees and their behaviour in the different situation. With the help of this capabilities,
the leaders can easily evaluate the behaviour of the followers (Frick and et.al., 2014).
 Technical skills: The leaders of PepsiCo should have the proper knowledge of technical
skills because at the time of change in organizational structure, the analytical skills will
needed to analyse the impacts of new structure on the firm as well as on employees
(Hakanen and van Dierendonck, 2013).
CONCLUSION
From the following study, it can be concluded that leadership is an essential element of
management of an organization that assist in maximizing productivity and efficiency of employees
towards achieve the goals of the company. It has delivered the several benefits to the firms that
helped in taking competitive advantages. It has an important factor for made the enterprise
successful in the upcoming years. On the other hand, competencies has an essential component for
the organization because by matching individual competencies with the job competency, the
productivity of the workforce can be increase. It has helped in identified talented workforce by
which companies can take competitive advantages in the market. In the case of PepsiCo, both
leadership styles and competencies have played an crucial role because at the time of bring the
changes in the organizational structure and made them more flexible with the intention of gain high
competitive advantages. In this regards, the leaders of the firm has the good leadership skills to lead
the team in the right direction to achieve the aim. The core competencies have helped them to faced
the various issues. The proposed leadership styles have both positive and negative impacts during
managing changes within the organizational structure.
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