Executive Q&A: PepsiCo CEO Indra Nooyi

PepsiCo CEO Indra Nooyi (Center) meeting with dignitaries in China.

When you see Indra Nooyi, the first thing you notice is her smile. Even on the phone, the PepsiCo Chairperson and CEO projects a rare warmth and attentiveness. She is comfortable with herself, curious about her world, and passionate about her company. It shows in every word and deed.

For Nooyi, leadership has been a calling, ever since she graduated from Yale University’s School of Management 37 years ago. Over more than two decades, she has placed an undeniable stamp on PepsiCo — turning it into one of the most profitable, diverse, and respected companies in the world. Once dismissed as a soda and snack marketer in a health conscious marketplace, PepsiCo has transformed its portfolio during Nooyi’s tenure. During her time as PepsiCo’s chief strategist, CFO, and CEO, Nooyi has acquired or grown wellness brands as distinct as Gatorade, Tropicana, Aquafina, Quaker, and Lipton. In the process, PepsiCo has emerged as the world’s largest food and beverage company, employing more than 250,000 people and producing $63 billion in annual revenue.


For Nooyi, money is the means to a larger end. A decade ago, Nooyi helped to launch PepsiCo’s “Performance with Purpose” initiative. A precursor to today’s sustainability movement, this long-term, big picture vision has already been successful in reducing sugar, sodium and saturated fats in many PepsiCo products. However, “Performance with Purpose” has also set 2025 benchmarks for further reducing the company’s water usage, greenhouse gas emissions, and manufacturing waste. This ‘Doing well by doing good’ ethos may be the rage now, but it took root nearly 40 years ago when Nooyi was studying at  Yale SOM.

“Yale did a great job of opening our minds to, ‘You can go and change the world in any way you want,’” she tells Poets&Quants in an exclusive interview. “They also emphasized for us the linkage between business and society. Even today, whenever I approach a business issue, I think about these questions: What is the impact on employees? What is the impact on communities? What is the impact on society at large? All of that came from my two years at SOM. Going through as many diverse cases as we did, in every case we were thinking about the holistic impact on society. It gives you a different sensitivity and sensibility.”

Yale SOM students

You won’t find a bigger fan of Yale SOM than Nooyi, who earned her Master’s in Public and Private Management — the school’s precursor to its MBA — in 1980. It was a defining time for her, a time when she was exposed to the teachings of top business minds, including leadership guru Victor Vroom and economics “giant” Steve Ross  — the Adam Grant and Austan Goolsbee of their day. While the faculty may have changed — and the action has shifted from the dour Founders Hall to the space age Evans Hall — there is a certain intangible spirit at Yale SOM that comforts Noooyi.

“Yale is a great school,” she emphasizes. “What’s amazing is that when I walk into SOM, I feel like it’s my school. Every part of it. Even though we moved to a new building away from the building where I was taught, I feel like it’s my home. I don’t know why — I don’t visit it often enough —but I feel like it’s my home. I absolutely love it!”


In fact, Nooyi would fit in quite well with today’s SOM MBA students. As a teenager, she played guitar in a rock band and excelled in cricket. A science and math major who graduated from college at 19, Nooyi earned a coveted spot in IIM Calcutta’s MBA program, beating out hundreds of thousands of test-takers in the process. After spending two years in product management, she enrolled at Yale SOM, basically broke, where she worked the graveyard shift as a receptionist to make ends meet.  While Forbes has named her the second-most powerful woman in business, Nooyi’s spent her time as a graduate student in more humble pursuits. During the week, she would throw herself into readings, projects, and case discussions. Come the weekend, she would hone her strategic thinking skills by playing marathon bridge games with dorm mates.

It was times like these — with classmates who challenged and supported her— that Nooyi treasures most. “I graduated from Yale SOM In 1980,” Nooyi says. “It was 37 years ago. I still get together with my classmates from SOM and we still have the greatest time together. We’re older and wiser. We look different, but we still truly love and respect each other and it feels great.”

Recently, Poets&Quants sat down with Nooyi to learn about her experiences at Yale SOM and get her thoughts on the state of graduate business education. What would she change about MBA programs? What advice would she give to new MBA hires in the workplace? How does her MBA experience compare with that of her daughter? Find out in this insightful interview.

P&Q: As an undergraduate, you studied physics, chemistry, and mathematics. What motivated you to pursue a business degree? How did your background give you a leg up in the program?

PepsiCo products range from Mountain Dew and Doritos to Gatorade and Quaker Oats

IN: I loved science and that’s why my undergraduate degree was in chemistry, physics, and mathematics. I went to business school and graduated from IIM Calcutta in 1974. When I went to IIM Calcutta, there were only four reputable business schools in India. Of the business schools, the only kids who went to IIM Calcutta were students who were steeped in science. The entire business curriculum at IIM Calcutta was based on quantitative methods: operations research, production, even mainframe computer usage! Finance was also taught through quantitative methods.

The reason I was motivated to get a business degree was because it represented a major challenge.  It was so hard to get into business school those days. Hundreds of thousands of kids wrote the exam. 150 kids went to Ahmedabad and 100 kids went to Calcutta. Very few women were admitted, so I was motivated to break that barrier if nothing else.

Because my sister had already gotten into Ahmedabad, I was determined to get into Calcutta. So I wrote the entrance exam, passed all of the interviews, and got in. Believe me, if I hadn’t had an undergraduate degree in chemistry, physics, and mathematics, I couldn’t have graduated from IIM Calcutta.

Looking back now, I realize I use math in everything I do. So I am glad I had an undergraduate degree in a STEM area.

P&Q: You entered the MBA program at the Indian Institute of Management in Calcutta soon after earning your bachelor’s degree, a rarity these days. Looking back, do you recommend this? For those students who pursue this path, what advice would you give them?

IN: I think to get the maximum out of an MBA program, you should work for a couple of years at least, because then you really understand what you’re studying in business school. It’s no longer just an academic experience, but learning the theory and how it is deployed and used in business. After I graduated from Calcutta, I worked for a couple of years and then came to the Yale School of Management. I have to tell you, I actually understood everything that was being taught at Yale because I now had some experience with business. Even though I had the basic theory at Calcutta, the fact that I could now apply it at work and then get that theory further refined at Yale made me a better person.

  • historyislife

    She has never put shareholder interests ahead of anything else. Shows how much you actually know about her career. She fought against shareholders to make health oriented products at Pepsi(which is more than a beverages corporation, you know). If Pepsi changed as much as Indra wanted it to, instead of resisting her ‘radical’ social impact based ideas (they have tried to push her back and there are articles about the shareholders hating her sustainability ideas), it wouldn’t be at the place it is today. Pepsi received the Global Water Award under her leadership by giving back more water to the environment than it used. She has often mentioned how she as a mother, wants mothers to feel that Lays and other Pepsi products are safe for kids to eat. She reduced 40% of fat in the snack, and launched a variety of good-for-you food snack brands with organic ingredients. She has food scientists working on them, and thats a lot of money involved to modernise a huge brand in lieu sales of sales that may or may not happen in the future. Indra isn’t all of Pepsi. She is significantly held back by a lot more people who don’t appear for interviews. The only run of the mill CEO stuff she’s ever done is to acquire SoBe and Quaker Oats, and many more companies as a master negotiator.

  • The story clearly states that she was awarded an MPPA, the precursor to the MBA at Yale SOM.

  • tesla

    Thats why greedy boards hire foreigners, they will do whatever it takes to satisfy their masters! cutting costs, get rid off employees, ..etc. Local CEOs behave humanly, foreigners are robotics, they only care about money and eventually passports…

  • halo

    Six years of stagnating sales, and diminishing Operating Income margins. I wonder what she actually accomplished? My favorite takeaway from this article is her “sustainability” and “performance with purpose” “vision”–yet it is widely known that Pepsi has done ton of cost cutting in order to achieve its “performance”.

    Maybe, she’s not the visionary you speak of, but regular run-of-the mill CEO who puts shareholders interest ahead of anything else (not that there’s anything wrong with that).

  • Terry

    Factually incorrect John- lot’s of people have strong work ethic and intelligence, but yet lack the exposure and opportunity that some institutions create. This is the premise behind elitism- which excludes qualified and competent people from competing for work and roles that have such arbitrary boundaries as alma mater for entrance.

  • Perla

    she didn’t get an MBA, it was MPPA.

  • Spartan22

    This is a site for prospective MBAs. Why are you so disappointed that she was asked questions about her experience obtaining hers?

  • MBA-Wach

    That is true. and I wish you have mentioned BCG in the article…as working with this great company is excellent launching pad for outstanding career such as her..

  • MBA-Wach

    No, I don’t. But I know opportunistic and misleading behavior of Yale and Duke with Indra and Tim, and the way they use those two to attract “naive” applicants to their mediocre MBA programs.

  • GZRAMS124

    You know better the “real shaper” of Indra’s career than Indra herself?

  • The reason is Indra is successful has little to do with Yale, BCG or anything other than her smarts and her work ethic.

  • MBA-Wach

    The real shaper of her career, (at least in my view, I might be wrong though) is her work with BCG, which no mention for it here. It is her work with the prestigious consulting firm that open doors to do some work with Pepsi, restructuring , acquisition of tropicana, and other projects, that led Pepsi to hire her, and then moved quickly (well deserved ) up to be CFO in 2001. All we see here is the implicit message and marketing that Yale SOM played the major role in her success, which is inaccurate.

  • Yale SOM had nothing to do with our decision to seek an interview with Indra. We greatly admire her track record at PepsiCo and this is one in a series of interviews with highly successful CEOs who have MBAs.

  • MBA-Wach

    While it is out of question that business leaders such as Indra are outstanding and achieved a lot, it is interesting to notice that schools outside M7 speaks loudly about one or two prominent alumni, you see this in particular with Yale and Indra, Duke and Tim, … But, it is hard to see any of M7 schools brag about specific name of their alumni success..It tells a lot about schools and their true place and how the lower regarded schools use coincidences to market themselves and claim success that is not really theirs..