Why did Manu Anand really leave Pepsi?

When Manu Anand, the India and South Asia president of beverage and snack giant PepsiCo, suddenly quit last month after 19 long years with the company, and clea red his table the very next day of the announcement, there was speculation that the parting of ways had not been amicable. Moreover, the company did not name a replacement for Anand, which is the usual practice. His abrupt departure caused some people to point fingers at Pepsi losing market share in the soft drinks space to its old rival, Coca-Cola. Others attributed hi s exit to a string of failed product launches, including that of a stronger cola in Pepsi Atom. There was also speculation that Anand paid the price for splurgi ng a hefty Rs 400 crore for the title sponsorship of the Indian Premier League ( IPL), nearly double of what the previous sponsors DLF had paid, and topping it u p with another Rs 50 crore to become the broadcast partner for Set Max . Was thi s decision a disaster because it did not increase market share and the tournamen t saw a sharp drop in TV ratings after the spot-fixing scandal broke out? A new twist As the story now unfolds, his exit seems to have nothing to do with the beverage giant's performance during his tenure. Those in the know say that various third -party studies show that IPL has given the company a boost in terms of brand rec all and exposure. And the jury is still out on Pepsi Atom which has been launche d only in a few markets. While both PepsiCo India and Anand aren't saying much, sources say that Anand to ld the PepsiCo brass just a few days before the formal announcement that he was quitting to join chocolate and confectionery giant Mondelez. With a three-month notice period, which is the rule in the company, PepsiCo would have got enough t ime to plan a smooth succession. The company in recent years has looked for peop le internally for its senior Indian management, and it is unlikely this rule wou ld have been changed. However, Anand's decision to join Mondelez, say sources, did not go down well wi th the bosses as, according to the unwritten rule, top managers are not supposed to join a rival company. It is a rule which many multinationals and even Indian companies follow to the hilt. Mondelez, surely, fits that list because it also makes snacks and has brands like Tang which compete directly with PepsiCo's rece ntly-introduced powdered fruit juice under the Tropicana brand. Considering the fact that he would continue to have assess to the company's strategy, he was req uested to leave immediately. A text message to Anand asking him on the sequence of events did not elicit any answer. PepsiCo India, too, declined to comment. Nevertheless, Anand's exit has put the spotlight on some of his decisions which have been panned by his critics. One of them has been that he paid too much to b e involved with IPL. Independent studies, however, show that the company's assoc iation might not be as bad as many make it out to be. Pepsi & Coca cola The battle for market share between PepsiCo and Coca-Cola is nothing new, with t he pendulum shifting in either company's favour from time to time. In 2011, Peps i gained market share over its rivals; in 2012, it lost marginally; and in the f irst quarter of this year, it has held on to its position. In the second quarter , those tracking the numbers expect Pepsi to maintain-if not gain-market share. The results are also far from conclusive on the performance of Pepsi Atom. The p roduct was launched as a strong cola to take on Thums Up, the number one carbona ted beverage brand in the country. Pepsi spent over 18 months to develop the bev erage which has a differentiated and an unconventional taste meant for people wh o want more fizz in their drink. Those associated with the product say that the response to Pepsi Atom has so far been mixed. In places where returnable bottles are being pushed, consumers are coming back for more. "It has only been two mon ths, the company believes that there is a market for this product. It's a flavou r that some will like, some will not. So, one has to give it some time," says a source associated with its distribution. the cola war is far from over. Source: Articles/"business - Standard" july 03 2013