PepsiCo is a company with a remarkable tradition of product and management innovations, over the past several years PepsiCo is facing increased competition from its arch-rival Coca-Cola and struggling to navigate the challenges of an ever-changing marketplace. As the new CEO scans the situation, it is difficult to know how to prioritize. Where to begin? Assume that you are a consultant working with PepsiCo's new CEO. Your job is behind the scenesyou are simply helping the CEO brainstorm and think carefully about how to lead this company, improve performance, and restore the once-vibrant culture of creativity that made PepsiCo a leader in its industry. Step 1: Outline leadership criteria. Develop a set of leadership recommendations that are well matched to the PepsiCo situation. What do you think employees need most from their new leader? Should the CEO help employees look back and learn from the company's past, or should the CEO encourage employees to move on and focus on the future? What are the trade-offs in each approach? Explain. The scenario highlights some key areas of concern: (a) increased competition, (b) rising cost structures, (c) declining financial and marketing performance, and (d) declining brand image (e.g., as a contributor to unhealthy eating habits and childhood obesity). So how would you recommend that the CEO prioritize these issues? Are there creative possibilities for tackling some of these concerns simultaneously? Explain. Step 2: Determine a coaching plan. Prepare to coach the CEO during the process of transforming PepsiCo. How might path-goal thinking help the CEO guide PepsiCo employees through the transition? Explain.

What should the CEO keep in mind regarding such situational factors as worker readiness, situation favorableness, and environmental contingencies? Explain. Assuming the CEO possesses charismatic capabilities, would you recommend relying upon a charismatic leadership style in this situation? Why, or why not? Explain. Step 3: Conclusion. Summarize some of the highlights of your recommendations, and what leadership consultants/coaches need to know to effectively advise their clients.