Can Wayne Calloway Handle The Pepsi Challenge?

It wasn't that D. Wayne Calloway had never proven himself in the trenches. In two decades with PepsiCo Inc., he had earned a reputation as a sharp financial thinker and popular manager. But when Calloway took over as chief executive in 1986, it was with shaky knees. Where predecessor Don Kendall was a master of self promotion, the mild-mannered Calloway lacked confidence. Speechmaking unnerved him. When the two attended company meetings, Calloway would look deferentially toward Kendall, expecting him to address the group. Recalls Kendall: "I'd have to push him and say, `Wayne, you're the chief executive officer."'

Calloway, 56, may still approach business with a low-key, North Carolina style. But PepsiCo's CEO has emerged from Kendall's shadow to string together five impressive years of 20% compound earnings growth, doubling sales and nearly tripling the company's value on the stock market. Although earnings took a beating last year as recession tore into Pepsi's soft-drink, restaurant, and snack-food businesses, Calloway insists the slowdown is temporary. Still, the question remains: Has the $20 billion-a-year food conglomerate grown too big to maintain its heady pace?