Which of the following recommendations makes a better case for the suggested corporate strategy? (While the name of the company is real, other details are all made-up, and if they are true, it is purely coincidental. These sections were made up only for the purpose of this examination, and do not imply what the company should have done, or is doing in real life. No research is needed to answer this question, and comparing actuals with the details mentioned here will not provide you any direction to select the right answer.).

a. Pepsico should start a line of healthy snack foods. Pepsi has had good success with its financial performance. Its stock price has out-performed the S&P 500 benchmark average for the past three years. It has had consistency in its top management. More recently, it was awarded the most innovative beverage company award by the beverage industry association. It operates on all continents of the world. Twelve of the top twenty airlines in the world by passenger miles flown select Pepsi for their on-board beverage company. Pepsico has provided credible competition to Atlanta-based Coca Cola, which even Cokes CEO acknowledges. Healthy snack foods will be an excellent addition to Pepsi. It will add some sparkle and bubbles to their offerings.

b. Pepsico should acquire an existing company making healthy snack foods, like the makers of Skinnypop popcorn. Pepsico has a great ability to understand and manage distribution systems in even the most difficult countries by infrastructure, business climate, and culture. Its managers do not hesitate to take risks, and learn quickly from their mistakes. The top management provides employees a lot of discretion in doing their job, and focuses on removing the obstacles that may stymie the employees. As the worlds population ages, there may be less home cooking and more focus on small but nutritious meals. In many countries, people also will live alone, and will not have the energy to cook meals for themselves. Healthy snack foods will be an excellent addition to Pepsi. It will add some sparkle and bubbles to their offerings.