Globalization's Impact On Factors Of Production

PepsiCo, a renowned brand across the globe, is market innovator in convenient snack foods, foods, and drinks, with revenues of approximately $60 billion and over 285, 000 workforces. PepsiCo is the owner of some of the world's most popular edible brands, including Pepsi-Cola, Hill Dew, Diet Pepsi, Lay's, Doritos, Tropicana, Gatorade, and Quaker. Their brands are available worldwide through a number of distributorship network, including direct store delivery (DSD), broker-warehouse, and food service and retailing. Headquartered in Purchase, NY, with R&D Head office in Valhalla, The Pepsi Cola Company started functions in 1898 by a NEW YORK Pharmacist and Industrialist Caleb Bradham, but following its merger with Frito Lays in 1965, it had become known as PepsiCo. By 1997, it possessed KFC (Kentucky Fried Chickens) a significant fast-food joint, Pizza Hut, and Taco Bell, but these fast-food restaurants were spinned off into Tricon Global Restaurants, now popularly known asYum! Brands, Inc. PepsiCo persisted its expansion policy and purchased Tropicana in 1998 and Quaker Oats in 2001. In December 2005, PepsiCo overcame Coca-Cola Company in market value for the first time in 112 years since both companies commenced to compete.


Globalization is the inclination of businesses, solutions, or philosophies to propagate across the world, or the procedure of making this happen. The global current economic climate is sometimes referred to as globality, characterized as a totally interconnected market place, unhampered by time areas or national boundaries. Proponents assume that globalization has the potential to create better opportunities for growth across the world, benefiting the developed nations while leveling the learning field just about everywhere else; competitors of globalization assume that it will basically improve the opportunities for the wealthier nations to take good thing about the poorer ones and, furthermore, could remove regional variety and business lead to a homogenized world civilization.

PepsiCo can be an person products company functioning in highly aggressive market segments and rely on suffered demand for his or her products. To create revenues and revenue, they must vend products that appeal with their customers and consumers. Any important changes in consumer personal preferences or any failure on the part to give reaction to many of these changes which could impact in reduced demand because of their products and attrition with their competitive and financial position. The MNC's feat is determined by their capacity to react to trends in the consumer field that includes concerns regarding fatness, product features and ingredients. In addition, changes in product grouping demographics of consumer which can reduce the demand with their products. Consumer likings which may differ due to many factors which includes ageing of the common population, changes in public areas developments, changes in travel, retreat or free time activity habits, weather, pessimistic publicity caused by regulatory action or legal action against companies in their industry, a slump in financial conditions which have specific target on the use of their products. Any of these changes may lower consumers' keenness to get their products. Their unrelenting success is also reliant on the product creativity, including keeping a robust array of new products, and the worthiness of their promotional initiatives and marketing programs. Thus it's apparent that PepsiCo is facing stiff challenges in its way towards success but because of its work technique and managerial skills in the field of Globalization, it has been able to sustain itself and emerge a winner. (Globalization, 2003)


In Dubai, PepsiCo has given its singular franchise and distributorship to Dubai Refreshments. Dubai Refreshments (DRC) is an interest in Dubai for more reasons than one. Tactically situated on crossing point number 2 on the Sheikh Zayed Highway, the Pepsi logo catches the first perception of the site visitors going into the metropolitan. Significantly the business successfully launched the Pepsi range of products in the country UAE which includes been doing similar from days gone by 45 years. A broad syndication network of DRC ensure that products of Pepsi are created open to all customers over the country like United Arab Emirates and around the world too. Dubai is a significant tourist vacation spot for the world mainly due to variety it offers in conditions of its culture, ethnicity and architecture. Because of the climate prevalent in Dubai over summer and winter, the occurrence of a significant MNC such as PepsiCo helps it be even more apt to make its presence felt there. PepsiCo brings with itself a big variety of products which for some reason or the other suits the tastebuds of the Global community. PepsiCo has been received by the UAE Administration with open arms mainly due to its less-stringent norms associated with FDI and international trade. UAE has tangled up with various countries to market free trade across borders, which really is a major factor in promoting the concept of 'Globalization'. (PepsiDRC, 2007)


Labor (Manpower) is known as a very vital organ of any organizational framework. PepsiCo is no different. PepsiCo has been a frontrunner in dealing with issues related to wellness of its employees by giving many fringe benefits to its labor force. It recognizes their importance. It generally does not discriminate between gender, caste or religious beliefs, which is evident by the actual fact that the current Chairman and CEO of PepsiCo, Indra K. Nooyi is a woman by gender and an Indian by source. PepsiCo has also been recognized as the top workplace of the world for the year 2010. It has received laureates from across the globe for being the best place to work in. In Turkey, for example, Forbes newspaper acknowledged PepsiCo as the apex company "where women could be marketed the fastest. " In Spain, Actualidad Econmica renounced PepsiCo "one of the best companies that spend money on training. " Thus the Work force of PepsiCo in Dubai have nothing to complain about when they are associated with such an MNC which places the eye of its employees as a high priority. (PepsiCo Recognized as a Top Company around the World, 2010)


Off-centering: That is a major concern faced by many countries across the globe credited to globalization. The MNC's bring with them technology which threaten to eliminate the use of manpower in its operation and cause imbalance between capital and manpower. But PepsiCo has been very diligent to the concern and has ensured that technological progression will not have an impact on the job of any worker in the organization. Wherever technology has bought out manpower, PepsiCo has made sure to relocate the manpower to other tasks. By this technique, the business benefits in both ways.

Work Specialization: PepsiCo still retains the craze of socialization of labor to enhance harmony functioning.

International Competition: Although PepsiCo has shifted as time passes and has tapped cheap labour to improve outsourcing, they have ensured that the prevailing employees do not have to bear the brunt of this move. The knowledge of local manpower will be higher than that of some other countries in its land. Thus PepsiCo has acknowledged this factor and made certain lower attrition.

Collective Bargaining: PepsiCo has been able to maintain tranquility between employers, employees and trade unions giving a common surface to solve all dissimilarities.

Employment Conditions: Since more than 80% of the population of Dubai is non-nationals, it is apparent they are well educated and thus the question of the labour being unskilled within an group such as PepsiCo doesn't arise in any way. PepsiCo supplies the best working conditions to its employees for which it offers received global acknowledgement. (Impact on Dubai WORK FORCE at Micro, Mesa and Macro Levels, 2007)


Micro: As far as Micro factor is concerned, PepsiCo gets the best working environment an employee can ever require. The Micro factors are the working conditions inside the firm and various issues related to romantic relationship between the firm and its own employees. Thus PepsiCo has adhered to maintaining a sound micro environment for its employees.

Meso: This includes the sector which the company operates in. Since PepsiCo is a Food and Drink Company, its purpose is to provide the best quality product and make it available at a reasonable price such that it can be ahead of its rivals such as Coca-Cola. Because of this, PepsiCo has an effective marketing team which has prevailed in projecting an extremely healthy image of the business. Thus it is just a head in its sector.

Macro: With the help of the UAE federal, it is becoming easier for MNC's such as PepsiCo to come and establish themselves in this country because of its lenient FDI norms and trading tactics. PepsiCo has came back the favour by offering employment opportunities to the people of Dubai and also increasing the foreign exchange reserves of the nation. Thus PepsiCo has had an extremely positive effect on the macro factors influencing Dubai Labor force.


After studying the many factors in charge of factors of development especially labor, it is noticeable PepsiCo has been able to overcome the various issues posed by Dubai. PepsiCo has been able to attain the advantages of globalization, that is, less expensive of creation and quality products with a competent work force. Also it has prevailed in eradicating the cons associated with globalization, that is, off centering, effective usage of unskilled labour and equivalent chance to local employees. By creating jobs, PepsiCo has prevailed in applying its Corporate Social Responsibility into the people of Dubai. PepsiCo has empowered the local companies to buck up and come to conditions with quality products made by MNC's. This healthy competition is effective for the customers.

Few advice for PepsiCo are

Introduction of more non-beverage drinks- In order to promote anti-obesity, PepsiCo should bring about more variety in its non- drink section. The marketplace trend is slowly but surely changing towards demand for non-beverage refreshments. In view of its competitor, Coca Cola, PepsiCo is lagging by a long way. It needs to bring about this change quickly.

Lower Costs on Brand Ambassadors- PepsiCo must check the amount it's shelling out for brand ambassadors. If this expenses is controlled, the gains of the company increase many folds.

Integration- For any brand as large as PepsiCo, sky is the limit. It should start focusing on forward and backward integration of its products. This will help the company to attain economies of level and enhance the quality of the existing products. It will look to tie up with major food bones of countries they have entered. This may itself promote the business and the brand. (Shreshtha, 2010)

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