The Diversity Index

9 Importing the Important People

PEPSICO UNDERSTOOD THE BUSINESS CASE FOR RACIAL DIversity decades before other companies did. In 1940, the company hired a black sales representative, Herman Smith, and two young black business interns, Allen McKellar and Jeannette Maund, to develop Pepsi in the “Negro market,” as it was called at the time. To connect with black customers, they traveled throughout the country under difficult conditions, sleeping on the floors of friends’ and relatives’ homes in the South before desegregation when there were few motels or hotels for blacks. By 1947, black consumer power was estimated to be worth $7–10 billion a year, and PepsiCo, then a relatively small upstart, wanted to capture the black soft drink market.¹