Experiential / Reality-based Learning / November 15, 2011

CEO@Smith: Al Carey, CEO, PepsiCo Americas Beverages

For Albert “Al” Carey, CEO of PepsiCo Americas Beverages, Tuesday night’s CEO @ Smith presentation was more than an opportunity to talk about being the CEO of a major company; it was an opportunity to speak with students at his alma mater and to visit the campus of which he has fond memories.

On Nov. 15, 2011, Carey joined the Robert H. Smith School of Business for the last presentation in the CEO @ Smith Speaker Series for the fall semester: “It is a real honor for me to have the opportunity to be back on this campus and for me to be here at the business school,” he said. “I am passionate about the work I’m doing, but I’m even more passionate to speak to this young audience. The most exciting part of the job is to nurture the young people in the business world – you are the future. If one or two of you take away just one piece of career advice, I would consider tonight a success.”

Carey assumed his role as the CEO of PepsiCo Americas Beverages, a unit of PepsiCo, in September 2011 and is responsible for overseeing all aspects of PepsiCo’s beverage business across North, South and Central America. He joined the company 1981, and has served in a variety of positions, including COO of PepsiCo Beverages and Foods; president of PepsiCo Sales; and most recently as president and CEO of Frito-Lay North America (FLNA). In this role, Carey was responsible for overseeing all of FLNA, the company’s most profitable operating division and largest North American business.

Before joining PepsiCo, Carey worked at Procter & Gamble. He received his BS from the University of Maryland, College Park, in 1974 and is a former member of the Dean’s Advisory Council at the Smith School.

Carey focused his presentation mostly on his time spent at Frito-Lay, discussing their strategy for performing with purpose: “We’ve always been known as a company with good performance, but the whole idea of having a purpose was quite different. If you don’t have purpose, you won’t attract young people into your business.”

Frito Lay tried to make their products healthier than before, looked to their customers for feedback, made great strides in bettering the planet (Sun Chips are cooked by an entirely solar-powered system!), and worked to create an environment that inspired confident employees.

“If you only do one thing well, treat your people well. Make it your mission to inspire greatness in others – this is the most important part of our vision,” he explained. “Your number one job as a leader is to lead optimistically. If you do, your people will see the positivity and the hope and will show their best selves and produce the best results possible.”

Carey also spoke to marketing a company whose products are pretty much all junk food. For several years, Frito Lay focused its marketing on making their products seem healthier, thinking that an overall health and wellness concern was causing business to slow down. They learned that of the market, 10 percent of people are purists who would never touch a potato chip; 25 percent are conflicted and on different days act differently about their food choices; and 65 percent will eat a snack regardless of the nutritional information once they’ve decided they want one.

They also learned that people act differently when they are home alone versus when they are with others: “When you are at a barbecue you are drinking beer and eating the hot dogs, but when you are at home you are a bit more controlled with what you are eating,” Carey said, giving props to McDonalds and Subway for serving healthy options alongside their not-so-healthy menu counterparts.

“They are selling as many Big Macs as before and they’re still offering salads for those people who want the healthier alternative,” he said.

Still, Frito Lay has started making 50 percent of its products with all-natural ingredients and has taken 15 percent of sodium out of its potato chips. In addition, 80 percent of the products are gluten-free.

“Our products have gotten a lot healthier, but we don’t talk about it on the front of the bag because ‘low fat’ and ‘low sodium’ are both phrases associated with poor taste,” Carey explained.

Carey finished his talk with questions from students and advice for their time at the university: “My experiences at this university definitely affected my career. This school prepared me as a leader I had the opportunity to get a great education. My advice for you is to take on many activities in addition to your studies – It was good training for me to learn to balance multiple things at once and it has definitely helped me in my career to be able to multitask well.”

Jessica Smith, Writer and Editor, Office of Marketing Communications

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About the University of Maryland's Robert H. Smith School of Business

The Robert H. Smith School of Business is an internationally recognized leader in management education and research. One of 12 colleges and schools at the University of Maryland, College Park, the Smith School offers undergraduate, full-time and part-time MBA, executive MBA, online MBA, specialty master's, PhD and executive education programs, as well as outreach services to the corporate community. The school offers its degree, custom and certification programs in learning locations in North America and Asia.

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