The sweet business of ice cream. Froyo and cupcakes. That is all ahead on lunch money. A change at the top, ford motor company. Effective july 1, alan elected to retire as president and ceo and member of our board. Our board of directors met and elected mark to fill those same shoes. [applause] applause all around for ford employees. Phil has been at the company for 25 years and is young for a ceo at a major carmaker, just 53. The first order of business is to have a great transition over the next couple of months. It continues to stay relentlessly focused on implementing our plan and bringing more great products and innovations with top quality to the marketplace. That is our sole focus. I do not plan to make any changes because it is the Strongest Team and we will continue to grow in the same direction, and it is very exciting to grow a business and everyone is energized around that. People knew the day would come when alan would eventually step down. He led ford through a tumultuous period. When he came in 2006, ford was a moneylosing company and then it lost another 34 million. Mulally eventually returned ford profitability over the past five years. Mark and this team have created this ford that we know and love. I am so confident in ford going forward, i will be their best cheerleader and i cannot wait to see profitable growth going forward. The best cars and trucks in the world. I think you know the story. The ford chairman says there were always other people in the running. He spoke to us about the changes. One of the things we have to do as a company is to always look not just within ford but also around the globe and say where is the best talent. So we looked around the world and looked at executives inside and outside the industry but we came back to the fact we thought mark was the best candidate. That is why i feel so good about this transition. We did our due diligence. The more we did, the better we felt about mark. Was there a defining moment, was there a time we knew this is our guy . There were so many stories about how well he did at mazda. There is a famous story of him catching on to alans strategy and the Corporate Culture and Business Planning review. Was there a moment where you said ok, it is mark . There was never an aha moment. We started talking about on the first day i met alan eight years ago at my house, we talked about having a great transition but also a Good Management development process. There was not really an aha moment. For me, the job market in north america was really defining. That was a huge job and it started before alan got here. Mark came up with a way forward plan. It was a tough job and he took slings and arrows internally and externally early on. He grew and persevered. By the end, he had gained admiration and respect of the men and women of ford around the world. That was very telling. Also, a lot of people back then, if you could remember, thought mark would leave. They thought he would not stick it out. It was a tough job. They underestimated how much he loved the company and the industry and also how tough he is. Were talking about yum brands. The head of the taco bell chain will replace david novak as ceo at the end of the year. He will also join the board. David novak will become executive chairman. The changes will take effect january 1, 2015. The brand trying to regain momentum in china and reward customers at home. In addition to taco bell, yum brand owns kfc and pizza hut. We are going inside texaco. We will show you how they get flavor into the chips. An exclusive interview with the chairman and ceo and she will tell us what she thinks about investor plans to break up her company. President obama, nsync fan . A photo posted on his Facebook Page featured justin timberlake. The caption reads, may. It is a reference to his 14yearold song. It is gonna be me. Get it . May . Me . Were going inside pepsico today. We take you in behind the scenes of americas biggest companies. Pepsico faces challenges on all fronts. Snapple, even an activist investor wants the company to spin off the investment business. We sat down with the pepsico ceo and this is an exclusive interview. Anytime a shareholder gives us feedback and input, we take it very seriously. If anybody has an idea on creating more value, we are the first people to take it to heart. I personally own 20 times my salary in pepsico stock. We take it seriously and our board does. All that we have received, we studied with great care. It is a strategic advantage. We have always known it was a strategic advantage and we went back and studied it and are even more convinced pepsico is about complementary products that work better together. The scale it gives us, the access, the importance that retailers placed on the Pepsico Partnership is spectacular. Walk me through that. You are even more convinced this is the right strategy for pepsico, what gives you the further indication . Personal experience. I was being invited to talk at top meetings for european retailers. It has never happened before, to the extent it was happening now. I am saying to myself, there must be a reason they are inviting me. It is because as snacks and beverages individually, we were maybe the 35th or 32nd player. We started to put the two together and talk about Consumer Insights directly, how to drive it jointly, we became the 12th most important player. That elevated you. Totally. To give you an idea, beverages have turns of about 80. They pay us net 30. We are a huge cash flow generator to retailers. They look at us and say, you have high velocity categories that can drive traffic and you have Consumer Insights that allow me to bring people into the store. Pepsico is a must partner with a company. Asking for more top to top joint Business Planning sessions, they are seeking us out to help us so that they can truly drive ticket sizes, the only goal of retailers. If you are going to craft a snack and beverage or food business, you would craft to pepsico. What is the strategy for staying ahead of the competition, which keeps activist shareholders happy . In todays world, research and development will define a Successful Company from a company that is not. What is different from today than 10 years ago, in the past, there were so many tailwinds in the category. Flavor extensions and somehow manage to deliver the growth. In the last six or seven years with the slowing down of categories, with the internet pervading every country around the world and innovation flowing freely around the world, it is important you spend enough money to develop a friend shaded products and differentiated platforms that could give you real increment tally in terms of volume and revenue and profit. How different can you make snacks . Lets talk about snacks and beverages. When we Talk Research and development, we talk across the food and beverage portfolio. With all of our products, we have to do line extensions, new flavors, new package format. We do all of that almost like we breathe every day, just to keep the core flat. To deliver the growth. We deliver somewhere between three to 4 billion in growth every year. In order to deliver the growth, we have to do a couple of things. We have to look at differentiated innovation. Different shades of animation could be new form functions, new Consumer Needs we have not seen before. Going after competitive products that really did not meet the consumer need. We look at each of these competitive spaces and we innovate against that differentiated products so consumers can come into our industries. How to get those products from a concept into your grocery cart . It all starts with flavor. The definition is literally the blending of culinary arts with technology. The chefs crafting the executions are briefed to mimic what is out there and then create ultimate executions upon their culinary creativity. When those get evaluated, it is a Cross Functional Team of marketing, our executives, and we will bring the consumers in and have them face what we identified as the Gold Standard. Explain exactly what gold tendered is. It is what you want the final execution to be. The final massproduced product should match this flavor. This is a perfect transition to the cheesy garlic red. Parmesan . This is all about layering flavor. Mozzarella, cheddar, and smote guida. We have a raw garlic, sweet puree garlic, some black pepper in there, and that is the Gold Standard execution that became the final earrings for cheesy garlic red. One edition leaves your kitchen, what happens . Scientist start working with their tools to recreate the experience. But they come back to us and we evaluate it as a group. How do you know if you have got it . You will find the flavors are identical but the experience and the emotions they evoke are also identical. We do not want to just sell you potato chips with seasoning on it. Three different types of garlic and different types of cheese. This has the right element to give you a dynamic and multiflavored experience but at the same time, let you feel like you are eating the comfort that is cheesy garlic bread. I will try the chip. Very similar. I hope so. That looks really good. It is not just top chefs helping to make products. Betty also visited the lab where they put athletes in there trying to make gatorade better. The mission is to really help athletes customize their performance through research and education. We work closely with the different parts, including product development. What we do here is really get the insights in the athlete to drive innovation and the future. This adds more fuel so we can put the fuel back into the body. Keep it up. Inhaling and all the air exhaling is all measured from that we can calculate how much oxygen being used. We can compare him to other athletes who do the same thing so we can see where he is. It helps us estimate where he could get there. Keep pushing through. Every athletes sweats differently. We apply this to capture it. Also, that practice, we measure weight again. During the practice, we measure the bottles and how much they drank. We put all the information together and we know exactly how much they are sweating so we know what to replace. What does this measure . Your ability to respond to the signal. Do i dare try . 4305. 2528. What we do globally is very coordinated. The information we collect all comes together in this central database. From there, we start to do analysis and see the patterns and trends we are seeing. We are listening to athletes and trying to understand what their needs are. We also have ideas and there are scientific insights that help us develop products. An interesting stat, has to go is actually the largest food and Beverage Company in the u. S. , russia, and the middle east. Inside pepsi right here and Bloomberg Television and online as well as your mobile device. What do you wear when you go to the office . A ceo gives us his personal debt for how to pick your wardrobe. That is coming up. In sports, the latest in the l. A. Clippers controversy. There is now a new celebrity interested whos potentially buying the team. In sports, the clippers controversy. The next steps in removing Donald Sterling in the league the meeting comes to dougs days after the commissioner and the l. A. Clippers owner for life finest early 2. 5 million for making those infamous racist comments. A lot of highprofile people already voicing opinions, including oprah winfrey. The oracle Ceo Larry Ellison and the former music executive. There is also a certainly late comedian trying to talk his way into the deal. You probably heard a big rumor today, that a group of investors led by me and oprah are planning to buy this. Any information you see in the media is speculation and nothing more but i would like to set things over and i would be great team owners. How does the idea of a halftime bookclub get you . Jimmy kimmel and opera, etc. Theyre not alone. There is a boxer. Yes, we want to buy the clippers. We would keep the clippers right where they are at. Because when i am also not boxing, i am at the games all the time. I walk right over to the game, to the clippers game and lakers game every day. Mayweather went on to call sterling a great guy, adding he was always letting him come to as many games as he wanted. Curious. Lets remember, it is not just the nba. The kings won the Decisive Game seven last night after being down three games to nothing. Four who now join only three other teams in pro hockey and one in majorly based, which have loaned it to nothing lead in the playoffs. Plus, here is where we are going next. Money making cupcakes. We will go inside one Company Whose ceo says his recipe for success was a lot of worrying. We are fully digital, online and apple tv. I am adam johnson. Heavy rain soaked u. S. East coast from maryland to florida. Hundreds of flights canceled. Instead of trying to put out the fire, officials decided to let this slide on my dash on. There were no reported injuries. Investigators are being sent on the scene. The first day of the month is the traditional holiday but thousands of protesters marched in favor of greater pay for women. Russia also revived for the First Time Since the fall of the soviet union. In world today, the spacex chairman wins temporary victory in its fight to stop rocket engines. A federal judge issued a temporary injunction in a short venture moving ahead in plans to provide o for the move back in march, this is where the u. S. Was threatening sanctions against russia in the conflict against the ukraine. It does not make sense to award russia right now with a multihundred Million Dollar for rocket engines. It would be completely inconsistent for policy. It is crazy for me. This is just one argument musk used challenging that over the pentagon. Right now, the joint venture is the only venture certified to operate within the program. Those are supplied by a Russian Company controlled by the deputy prime minister, who just happens to be on the u. S. Sanctions list. We contacted the air force for comment. Ula got back to us saying, ula strongly disagrees the u. S. In the meantime is warning of even more sanctions against russia. Prorussian separatist have expanded their takeover of government buildings. The u. S. And europe accused russia of stoking the turmoil, which just won an International Approval for a 17 billion are alone. We believe the ukraine has an opportunity to seize the moment, to break away from previous practices come both from a fiscal, a monetary, and from a governance point of view. What is the next move in this global and diplomatic chess match we are witnessing . This is on surveillance. Logic tells us if russia actually crosses the border, all bets are off and were talking economic warfare. One institution told me there is 60 to 70 probability of further military action in the seven days. I will say if i had investments on russia, if i were one of the u. S. Companies, we know the white house and state department are briefing bondholders. The risk seems to be growing. Russian president Vladimir Putin today demanded ukraine with raw withdraw the military. Putin also called for a Broad National dialogue about reforms to the ukraine constitution. The ceo of lenovo tells us what he struggles with your personal series, what i wear to work. It wants you to spend 20 bucks. Before we head to break, the railway has been completed running at an altitude of two miles and forge a 24 yards. The tunnel will provide a highspped rail cimmute. Here is one Company Making your kid look cool. Aviators for your baby. How do you get parents to spend 20 on a pair of kids sunglasses . The companys cofounder told us how. This weeks small to big. They are safe and stylish sunglasses for kids. They bend, twist, straighten, and return to their natural shape. We came up with the idea. We were out on the runway and i noticed all the adults had sunglasses on and the kids were squinting in the sun trying to their moms and dads and the planes in the air. We launched these sitting in our respective tables. We surveyed our friends, who are parents. Their biggest complaint is that they get lost. We started toying around and that is how we came up with the guarantee. We are the only brand the world that does this. I get a lot of reactions like, how do you stay in business and how do you stay profitable . In the three years of selling these sunglasses, we have gone from 1 million to 2 million to 4 million in sales. You have those people but those are the most enthusiastic brand. Then he might have sold four or five more because of that one free pair. About of your debts about a year working into them, the first winter we have them, i lost my partners and i all realized we wanted to expand into different products. Why not make a hat. All these things get lost and should be replaced for free and that is what we are doing. Next week, small to big will focus on tough martyr. The extreme Obstacle Course that gets you messy. As for staying clean and looking sharp, andy dreamed of better fitting pants for guys so he started when oboes. In his own words, no more khaki diaper but you can be the judge. It is our latest installment of what i wear to work. We cannot walk around naked. We have to wear clothes. I think our clothing is an expression of who we are to some extent. I am in the business of making men feel awesome about what they wear. Historically, my style has been to overdo it a little bit. I had to physically restrain myself this morning to only wear a pink shirt and a crazy pair of sneakers. Finding the right balance is key. That did not work on these shoes and i was not able to really it in. As long as i wear a little more formally up top, that it would make for good balance. It is an open the question as to whether or not that was achieved. These jeans you want a clean pair that fits well and are dark. That is the staple of how i think about denim. I was up in boston and i found a vintage rolex. I was debating whether to get it and it was 1979, which happens to be the year i was born. It was probably my own confirmation bias but i went for it. A lot of how human beings operate is First Impression until we get to know someone, we make judgments quickly. The way you carry yourself is important and the way you dress is important, too. We would hear from 16 candles ceo i what makes his frozen yogurt better. Some things never go out of fashion. A little ice cream cake, anyone . We will start with americas first retail ice cream franchise. It is turning 80. It is adding 20 stores and changing the look. The biggest thing is the design of our new ice cream shops. You have a different way of selling your ice cream. Where do you do that . Express shops are ideal for nontraditional locations. How are you dealing with cultural change . What works for you in terms of moving culture . We have franchises in the system. I have gone out and spent time with franchise partners. We have integrated that into the strategy. An example is one tom coined back in 1978. We brought that back as our advertising campaign. You have 400. We also have internal National Operations as well. The biggest thing were doing is streamlining. We call it our core market. That is the new york area and surrounding states and southern florida, which is where we have a strong brand presence. Because we go in these locations, they really work anywhere nationally. May be frozen yogurt is more your thing. You will love 16 handles, new yorks first selfserve frozen yogurt place. Today, people are focused on finding something that is not just an alternative, but people are a lot more concerned about what theyre putting into their bodies. I think that is why people are gravitating toward the frozen yogurt products. It really peaked and then dropped off. At that point, it was alternative. It was a nonice cream. It was ice creams stepbrother. 16 handles i thought was a liquor store. How did you come up with the name for the frozen yogurt chain . I loved 31 flavors baskinrobbins. I understood the impact as a child of numbers. One of my favorite movies as a child was 16 candles. There are sugared up and high calorie choices as well. Frozen yogurt your way. Our motto is to flaunt your flavor. Pink berry, one of the originators of the trend any time you have to treat yourself to 57 dollars, didnt that it is a book . She said it was 12 but it may be it may lets round out here. This is courtesy of our londonbased ann edwards. She paid a visit to the hummingbird bakery. It is an oldschool place. The 1950 american baking cupcake hummingbirds to revive the love maybe not in this case anymore. There is virtually no baking at all in my own home growing up. It is not something my mother did. Made brownies and cupcakes, with her friends. 10 years later, he has six in london. Not the most rapid of expansions, but did he want to go any faster . We could have expanded a lot faster, but i feel it really would have affected the quality of our product. We baked on site freshly every day. It does not take well to a very rapid expansion. Oneway hummingbird has branched out has been with cookery books. They have sold 800,000 copies worldwide. Is encouraging home baking good or bad for business . I love people who bacon home and some people who have never been to our shops have our book and bake our stuff and might make a specialty detour when they come to london. What worries a businessman like yourself . Do you worry about anything to do with the business . Where do i begin . I have a whole list of worries to worry about. I do not know what is normal for my sector. If we have not taken tens of thousands that we usually do, i will panic. But then i will hear from someone else and they will be like, that famous restaurant that everyone goes to takes this much per week and im thinking, we take more than that and this is just cupcakes. Everyone worries the customers are happy. Is that what your business is about . Worrying about things . Yes for me. I am sure some people never worry about things but im glad i worry because i make sure i can at least solve any issue that happens. That brings us to todays mystery meat. How about a little bamboo to wash down the sugar . Check this out. Another day in the office. This giant panda. He has been working hard. He needs bamboo. Lets get you caught up. Stocks and equities are mostly flat after the dow closed at a record high yesterday. The nasdaq is the biggest gainer in todays session. Jobless claims climb to a nine week high. The u. S. Economic data is not the only thing moving up the markets. Adam johnson has a look at the other big influence. He joins us now. As it turns out china may be having a much bigger impact on u. S. Companies than you realize. Time for a little insight and action. Lets get the headlines over the past week. Pepsi, china sales up doubledigits. The u. S. Declines. Meanwhile, gm china sales rival u. S. Sales and apple computer, we learned in their Earnings Report about two weeks ago, china sales are up 13 and that sent apple shares up about eight percent in the after hours that day. We spoke earlier today with sir martin sorrel, the man who founded the largest ad agency in the world. Here is what he told us. Look at to china for a lot of the technological developments. 73 of smartphone applications you can sell into china and can also back door your way into china. That is his point. What we decided to do was take all of this under consideration and figure out how to we quantify china exposure for u. S. Investors. Here is what we did. We start with the s p 1500. 1500 stocks. We found 82 of the companies are selling in china and of them, it turns out 45 are expanding the businesses over the last couple of years in china. We narrowed the list further. 22 companies are expanding by at least 10 doubledigit is in china. Here are the top five. Semiconductors. Boeing by 54 . Boeing gets 12 of its business out of china. I have posted all of them on twitter. Go check it out. U. S. Companies selling and growing in china. Thank you