Business and Business Environment: A Comprehensive Analysis of Coca-Cola

This report provides a comprehensive analysis of the business environment, focusing on the Coca-Cola company. It explores different types of organizations, their legal structures, and the impact of macro and micro factors on business operations. The report utilizes PESTEL and SWOT analysis to evaluate Coca-Cola's strengths, weaknesses, opportunities, and threats, highlighting how these factors influence its objectives and decision-making processes.

Business and Business
Environment
1

Table of Contents
Introduction...........................................................................................................................................3
Task 1....................................................................................................................................................4
P1 Explain different types and purposes of organisations; public, private and voluntary sectors and
legal structures...................................................................................................................................4
Task 2....................................................................................................................................................5
P2 Explain the size and scope of a range of different types of organisations.....................................5
M1: Using Coca-Cola as an example, analyse how its structure, size and scope impacts on its
objectives and the products and services it offers..............................................................................6
Task 3....................................................................................................................................................7
P3 Explain the relationship between different organisational functions and how they link to
organisational objectives and structure..............................................................................................7
M2: Using Coca-Cola as an example, analyse the link between inter-functional relationships and its
organisational structure......................................................................................................................9
D1: Using Coca-Cola as an example, critically analyse how functional relationships have affected
its organisational structure...............................................................................................................10
Task 4..................................................................................................................................................11
P4 Identify the positive and negative impacts the macro environment has on business operations,
supported by specific examples.......................................................................................................11
M3 Using Coca-Cola as an example, demonstrate how it applies PESTEL in its operations...........12
Task 5..................................................................................................................................................13
P5 Conduct internal and external analysis of specific organisations in order to identify strengths and
weaknesses......................................................................................................................................13
Task 6..................................................................................................................................................15
P6 Explain how strengths and weaknesses interrelate with external macro factors.........................15
M4: Apply appropriately Coca-Cola’s SWOT analysis result and, justify how they might influence
Coca Cola’s decision making..........................................................................................................16
D2: Using Coca-Cola’s example, critically evaluate how macro and micro factors have influenced
its objectives and decision-making process.....................................................................................17
Conclusion...........................................................................................................................................18
References...........................................................................................................................................19
2

Introduction
The environment consists of factors that are totally external as well as beyond the control of
individual industrial enterprise along with their management. The environment includes the
diversified factors outside the firm which assist in attaining the diversified opportunities for
or threats to the firm. There are diversified factors which are important and essential of the
sectors include competitors, socio-economic, technological along with the government.
Business Environment is dynamic in nature and that implies it continues evolving. The
business condition is perplexing and multifaceted in nature which affects the survival and
development of the business. In this report, Coco-Cola, NHS and British Heart Foundation
are to be taken to carry out the research. In this research, different organisations need to
explain by using their purposes and legal structures. Along with this, explaining the need to
provide to analyse the interrelations the link to its objectives along with the organisational
structure.
3

Task 1
P1 Explain different types and purposes of organisations; public, private and voluntary
sectors and legal structures.
The organisation is a group of individuals who are working together to attain the goals and
objectives. It is categorised into different parts of private sector organisation, public sector
and voluntary sector organisation.
Private sector businesses are owned as well as run by the private individuals. The main
target of this organisation is to increase profit and growth as well as need to enhance market
share. The employees of private sector invest their own capital and need to make a decision
and provide the consumer goods to the people. An example is Coco-Cola and this company
having an aim is to maximise their profits at the time of maintaining a long-term sustainable
growth with the beverage industry. The legal structure of the company is a partnership as it is
an agreement between two or more people (The Carbonated Empire, 2018).
Public sector organisation is owned by the central or state government. It is allotted by the
administration treasury or spending plan of the business. This organization runs more cost
and enhance the nature of administrations. The case of this is NHS and the principle point of
the organization is to deal with the social goals as opposed to benefit. Alongside this, to make
work openings (NHS, 2018).
Voluntary sector organisation as these types of business entity is owned by members on a
voluntary basis. The goals and objectives of the voluntary sector include protection and
development of children. To provide the educational facilities. The example of this is British
heart foundation which provides a lot of financial support (British Heart Foundation, 2018).
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Task 2
P2 Explain the size and scope of a range of different types of organisations
The size along with the scope of the business entity vary accordingly. The best size of the
company is that where employees can work according to the organisational culture.
Coco-Cola is the largest beverage company in the world and employs the 146200 people with
the 275 partners. Along with this company having more than 2.8 million vending machines.
This company is a valuable brand. Coco-Cola owns the 500 diversified brands. Along with
this, the company is selling more than 3500 diversified beverages from sodas, juices,
packaged waters along with the sports drinks. The scope of the company is that no other
companies come close to matching and reach to the global marketplace on the hearts and
minds of consumers in the whole world (The Carbonated Empire, 2018).
NHS refers to the National Health services which are founded in the year 2013 by the British
Regulatory Bodies. NHS is a public organisation and the main aim of the company is to
improve the health of patients and fulfil all the requirements. Along with this, communities
need to provide the innovative along with the excellent services (NHS, 2018).
Another company is British Heart Foundation is a voluntary organisation which is established
to offer the social services to its clients. The unique feature is to identify the best and unique
strategy for offering the treatment to the clients.
5

M1: Using Coca-Cola as an example, analyse how its structure, size and scope impacts
on its objectives and the products and services it offers.
The goals of Coco-Cola company are very straight and specific as well as it includes the
offering of the products at the maximum outlets. This will assist in increasing the brand
association with the reputed fast foods. The company assist in ensuring the safety along with
the health of the consumers by investing the sweeteners. The company provide the effective
services to the consumers. The main aim of the company is to maximise the profits by
maintaining the sustainable growth of the industry for the long term. The organization begins
by assembling the concentrates alongside the syrups which are circulated to packaging
accomplices by keeping the responsibility for brands. This business substance incorporates
the promoting exercises which incorporate print and TV publicizing and in addition bundle
plans (David, 2014).
NHS is the public company and it is controlled and managed by the government. The main
objective or aim is to attain the profitability in the business by increasing or maximising the
productivity. British heart foundation is linked with the objectives and this foundation
provides the heart treatment to the patients effectively and efficiently. This assist in
improving the individuals. The products and services are offered by the company to the
consumers which help in attaining the goals and objectives. Charities raise the funds by
conducting the programmes.
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Task 3
P3 Explain the relationship between different organisational functions and how they
link to organisational objectives and structure.
Organisational functions of the business are the key specialisms which assist in dividing or
categorising the work into different sections which include marketing accounts, research etc.
This assist in fulfilling the responsibility of managers. This help in defining the role of the
individual as well as help in determining the authority. There is the diversified type of
organisational structures include functional structure, divisional structure or matrix structure.
Coco-Coal is following functional organisation structure as a company (Ingram, 2018). The
marketing department of the company is responsible for the market research as well as
market planning. This assist in fulfilling the consumer requirements.
Figure 1: Organizational Chart of Coco-Cola
Source: (Juliegilhuly Wordpress, 2014)
The main objectives of Coco-Cola are that it is more focused on efficiency than the
effectiveness. The organisational goal is to maximise the profits for the shareholders by
selling Coco-Cola products to the wide range of consumers. This assist in increasing revenues
by limiting the expenses. Each division of the company having the vice presidents which
control all the sub-sections of the company. The functional organisation structure is effective
and efficient for Coco-Cola. This assist in operating the same way as well as aid in selling the
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same brand products (Jiliegilhuly Wordpress, 2014). The mission of Coco-Cola is to refresh
the world and inspire the moments of happiness. Along with this, it is necessary and essential
to create the value and make the difference.
8

M2: Using Coca-Cola as an example, analyse the link between inter-functional
relationships and its organisational structure
If the manager of Coco-Coal needs to do an effective production of the products, then for that
they require the effective funds and for that, they have to contact the finance department. To
conduct the research of the market, to identify and analyse the requirements of consumers,
funds are required and for that, they need to contact with finance department as well. If the
manager needs to do marketing of the products then also funds are essential. It means in each
and every department, finance is essential and that’s why each and every department is linked
to each other (Bazil & Janathas, 2015).
The advantages of the functional structure are specialisation which ensures the great division
of labour. The functional structure is more effective as it helps in increasing the performance
of workers by performing the limited number of operations by taking suggestions from
experts. Functional structure help in creating or maintaining the standardisation along with
the specialisation in the diversified fields which assist in facilitating the production on a large
scale which helps in enhancing the production. This structure also having a great scope for
the expansion as compared to line business entity (RMS, 2018).
The disadvantages of the functional structure are that it creates conflict among the staff
members on some certain issues which lead to non-performance. This structure facing
difficulty in fixing the responsibility because of diversified authorities. This structure also
having a lack of coordination (RMS, 2018).
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D1: Using Coca-Cola as an example, critically analyse how functional relationships have
affected its organisational structure
Functional relationships having an impact on its organisational structure. Organizational
structure refers to the relationship between the different functions. This assist in having the
function outsized influence for example sales. The result of an organisational structure having
an influence in a way for the overcompensates. The main aim of the business entity is to
maintain all the functions of the business entity to maximise the profit. This function is not
limited to the private sector but on the other hand, it should be applied in the public sector,
private along with the voluntary (RMS, 2018). The different business structures include
corporations, partnership and sole proprietorship. A sole proprietorship is limited to the
amount of investment as it offers the benefits which include lower taxes and managerial
control. Privately limited company help in making the decision which is taken by the private
owner. The aim of this is to maximise the profits so that overall ability and capability of the
company can be increased as well as the decision can be taken. Coco-Cola is the private
limited company. Another is charities as this assist in offering the products and services so
that they can attain the social benefit. British Heart Foundation is the charity organisation
who provides heart treatment.
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Task 4
P4 Identify the positive and negative impacts the macro environment has on business
operations, supported by specific examples.
The Macroenvironment is less controllable and outside variables having an effect on the basic
leadership of the association. In the event that contender changes in loan fees, changes in
social and taste alongside the administration directions. The primary motivation behind this
investigation is to comprehend the conceivable open doors alongside dangers of the business
substance. The positive effect of full scale ecological factors in the business activities which
incorporate an adjustment in the market slant which relies upon the social variables which
incorporate annihilation of the framework in the UK which had a positive effect of shopper
division and in addition a bigger open door with the goal that they can pull in more
customers. The stable financial condition strongly affecting business tasks of Coco-Cola with
the better open door so business can develop in the market by utilizing powerful innovation
(Kenneth and DeFranco, 2015).
The negative effect of full scale natural factors in the business activities incorporates that
political alongside the lawful requirements can be perceived and broke down as a negative
effect which affects business tasks of Coco-Cola. The products need to meet the rules and
regulations which is provided or offered by the government so that they can put on the store
shelves. They have to make the changes in the established laws which may prevent Coco-
Cola from the distributing drinks (Kenneth & DeFranco, 2015).
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M3 Using Coca-Cola as an example, demonstrate how it applies PESTEL in its
operations
Coco-Cola refers to the empire of soft drink as well as serves the consumers around the
whole world. They have to supply the consumers with their soda and it is necessary that they
have to follow the appropriate and effective regulations and fulfil the consumer demands.
Political Issues: The employees of the company need to make changes in their established
laws so that they can prevent from the distributed drinks. Internal marketing and changes in
labour law having an impact on Coco-Cola.
Economic Issues: The products of the company are distributed in the different countries.
These countries having diversified customs, cultures, tastes as well as desires. Coco-Cola
needs to fulfil consumer requirement by introducing new products so that consumers can
accommodate.
Social Issues: Coco-Cola is the company which distributes the majority of the products only
in the cultured countries. This company meets the demands of the consumers (Ho, 2014).
Technological Issues: Coco-Cola has adopted social media technology as it is the best way
to connect with the audiences.
Environmental Issues: Coco-Cola is affected by the accessibility of water. Water is the main
element for the development of soft drink (Gupta, 2013).
Legal Issues: Coco-Cola need to retail all the rights which are associated with their business
and this includes products which are improved with a patented process.
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Task 5
P5 Conduct internal and external analysis of specific organisations in order to identify
strengths and weaknesses.
Microenvironment analysis assists in identifying the firm’s own strength along with its
capabilities on the particular business. This analysis helps in identifying the expectations of
consumers along with the competitors. Analysis of microenvironment is to find out the way
of investing.
The SWOT Analysis of Coco-Cola which assist in revealing that company can control the
different iconic brands of all the time by using the company’s competitive advantage so that
they become the second largest beverage manufacturer (Nganga and Maruyama, 2015). It
assists in identifying all the key strength, opportunities, weakness along with the threats
which have an impact on the company.
Strength Weakness
Coco-Cola having good brand equity as it is
having a vast global presence.
Coco-Cola having a large market share.
The main competitor of the company is
Pepsi.
Coco-Cola having a lot of consumer loyalty
and company having a good fan following.
The company having a good distribution
network.
Coco-Cola having high competition in the
market.
The company having low product
diversification.
Coco-Cola is the largest manufacturer of
carbonated beverages. This infers the
consumption of beverages in the developed
countries so that they can prefer the healthy
alternative.
Coco-Cola does not have effective water
management and needs to do better.
Opportunities Threats
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Coco-Cola having good diversification in
the health and food business which assist in
improving the offerings of Coco-Cola to
their consumers.
Improvement in the supply chain and
having lesser selling products (Nganga and
Maruyama, 2015).
The company having indirect competitors.
Water is the only threat to Coco-Cola.
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Task 6
P6: Explain how strengths and weaknesses interrelate with external macro factors.
The microenvironment factors having an adverse impact on the business operations include
market structure, customers, suppliers and market trends. Macro environment of Coco-Cola
help in identifying and analysing the opportunities along with the threats for the business
entity. The external macro factors of Coco-cola are related to the strength along with the
weakness of the business organisation.
The main strength which is interrelated with the external factors of Coco-Cola is that
technological advance is the main strength of its promotional activities as well as assist in
spreading the product in the competitive market. Coco-Cola company assist in maintaining
the rights of the business entity along with the laws which are related to the packaging system
and that is not having an impact on the rules and regulations. In the Coco-Cola environmental
factors help in offering the raw material of product and in the soft drink, water is the main
source. Coco-Cola needs to follow the rules and regulations of the government (Szmydke-
Cacciapalle, 2018).
The weakness of Coco-Cola is interrelated with the external factors is that Coco-Cola needs
to consider the appropriate and effective rules and regulations on the products. Coco-Cola is
not offering the healthy products to the consumers. Coco-Cola has faced the flak in the past
because of the issues related to water management. Coco-Cola company having low
diversification of the products.
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M4: Apply appropriately Coca-Cola’s SWOT analysis result and, justify how they
might influence Coca Cola’s decision making
PESTEL and SWOT both are the best mechanism so that they can analyze and evaluate the
environment of business entity. SWOT analysis helps in understanding the strength, threats,
weakness along with the opportunities of Coco-Cola. SWOT Analysis of Coco-Cola help in
making the effective decision in the following manner:
Study of Strength: The main strength of Coco-Cola is having a diversified product portfolio
with the effective brand. This company having an extensive beverage brand portfolio in the
whole industry. This assist in providing the strong competitive advantage over the rivals.
Coco-Cola provides the enjoyable taste to their consumers. The success of the business entity
depends on its ability to connect with the consumers.
Study of Weakness: Company face diversified problems as consumers are becoming health
conscious which has an impact on the sale of Coca-Cola. The company is facing the issue in
increasing the competition from the global companies. Each and region of the business entity
needs to follow the diversified rules and regulations along with the needs of consumers (Al
Hashmi and Cooling, 2018).
Study of Opportunities: The business entity is hard at work by utilizing the ample war chest
so that they can build the presence in the categories of growing beverage. Diversification in
the health along with the food business which assists in improve or develop the offerings of
Coco-Cola to the consumers. It helps in enhancing the offerings of the company by existing
consumers.
Study of Threats: The main threats of Coco-Cola are nutritious selections and also having an
indirect competition. A cultural shift towards the natural and organic products so that they
can opt for different beverage options.
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D2: Using Coca-Cola’s example, critically evaluate how macro and micro factors have
influenced its objectives and decision-making process
PESTEL Analysis assist the business entity in identifying and evaluating the threats along
with the opportunities in SWOT. In Coco-Cola opportunities attain by enhancing technology,
supply methods, government policies and global offerings. The Microenvironment factors
include suppliers, consumers, competition and resellers. Suppliers help in providing effective
control with the success of business when they hold the power. Consumers buying the
products and services according to the requirements. Macro factors of Coco-Cola include
demographic factors, economic, technological or legal. The skills and knowledge of the
employees are applied to the production along with the knowledge which is applied to the
production of drinks (Al Hashmi and Cooling, 2018). The technology, as well as raw
material, are required for the production of products and services which have an impact on
the smooth running of the business. Marketing decisions of Coco-Cola need to consider and
should take into accounts whether it is political or legal developments and that is associated
with the organisation as well as its markets.
The senior authorities of the Coco-Cola need to make an effective decision which considers
its internal factors as well as need to forecast the future aspects of the external environment.
If the competition is increased in the competitive market, then this will be having an impact
on the trends of the process of organisation. The consumers of the company consume the
Coco-Cola then they feel rich and only skilled population use the products and services.
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Conclusion
It has been concluded that in the organisation, all the functions are interlinked with each
other. It is necessary that senior managers of the company need to prepare the strategies so
that it is necessary to apply or implement all the functions in an effective manner. They have
to use innovative ways so that development and planning can be done effectively. National
Health Services is the public company which offers the better services to its clients while
Coco-Cola is a private company which is a beverage brand along with the world’s largest
manufacturer as well as distributor which is used to produce the non-alcoholic beverages.
When a company is preparing the strategy, then failure or success of a business depends on
its strategy. The strategy is having an effective forecasting power by the business entity on
the basis of resources, variability along with the market demand. This also helps in fulfilling
the expectations of stakeholders.
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