Strategic Operating Environment Analysis for Coca Cola
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This report provides an analysis of Coca Cola's strategic operating environment, including long-term international strategic objectives, SWOT analysis, PESTEL analysis, Porter's 5 forces, and review of implementation and success of international operating strategies.
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Strategic Operating Environment
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INTRODUCTION Strategic Operating Environment refers to the environment in which the organization is operating and thus its analysis is quite crucial for the managers so that they are able to take important decisions(Chellappan, 2021). For this report, Coca Cola has been chosen. In this report, a detailed and specific focus will be made on its Strategic Operating Environment. MAIN BODY Long-term international strategic objectives and strategies- It is important for an organization to determine all them so that the right Action Plan can be prepared accordingly(Luciano, Nahrgang and Shropshire, 2020). For an organization like The Coca-Cola Ltd. It is also important for frame them. They are explained as follows- ï‚·The company will look forward towards making the expansion so that it is able to attain the goals and objectives. ï‚·The company will also look forward towards ensuring that the use of Innovation can be made so that the goals and objectives can be attained. Analysis of internal and external operating environment- It is necessary that this particular analysis can be carried out so that the decisions can be taken accordingly(Malmelin and Virta, 2021). For an organization like Coca-Cola Limited it is important and crucial that it is able to take the right decisions in a proper way. The company has to make sure that it can make the use of the following models- SWOT analysis- SWOT analysis StrengthsWeaknesses ï‚·The company offers a wide variety of products and services to the customers and therefore this is quite helpful in ensuringthatthesatisfactionofthe customers can be ensured. ï‚·Thecompanymakessurethatthe overallsatisfactionlevelofthe customers can be enhanced so that the ï‚·The company is weak in the application ofthemarketingstrategiesand therefore this is creating a high-level of impact on it and therefore can affect it a lot. ï‚·Some of the products of the company are not able to satisfy the customers and therefore this is creating a particular 1
management of the different types of needs and requirements can be done highly effectively and efficiently in a proper and appropriate manner. In this way, the organization will be able to manage the work in a proper way. level of impact on them. OpportunitiesThreats ï‚·The organization can make the use of opportunity of making an expansion to the different areas in the market so that the management of the different types ofneedsandrequirementscanbe carried out. ï‚·In the organization, the opportunity of making the use of Innovation should be used so that the different types of new productscanbeintroducedand thereforetheenhancementinthe overalllevelofprofitabilitycanbe made highly effectively and efficiently. ï‚·The organization is facing a threat due to an increase in the overall level of competition in the market due to which its level of profits is getting impacted. ï‚·The organization is also facing a threat of increase in the overall level of tax ratesdueto whichtherecanbean increase in the expenses and therefore due to this reason the overall level of profits can also be impacted as a result. External Environment- PESTEL analysis- The use of PESTEL analysis is recommended to be made by the organizations because through making its use they will be able to properly draw the conclusions and recommendations and thus the actions can be taken accordingly(Nallareddy, Sethuraman and Venkatachalam, 2020). For an organization like Coca Cola Ltd. It is necessary that its application can be done appropriately. The application of PESTEL analysis can be made as follows- Political factors- Thesefactors can create an impact on the organization because there can be a change in the political situations which are prevailing in the country. For Coca Cola Ltd. 2
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It is necessary that a proper and detailed analysis of these particular factors can be done so that it is able to attain the necessary goals and objectives. This is so because the important decisions can be taken in this way. Economic factors- These factors are also important because the economic conditions of a country can change quickly. In the context of Coca Cola Ltd., it is necessary to consider their impact. Social factors- These are also important factors which are essential to be assessed because the management of the social needs and requirements can be done through properly understanding the influence which is created by these factors. It is necessary for an organization like Coca Cola so that it can attain the goals and objectives. Technological factors- These factors are also necessary to be assessed because the technology keeps on changing quite frequently and therefore can impact the organizations. In the context of Coca Cola Ltd., it is necessary to make sure that the identification of the change in these factors can be done so that the decisions are taken accordingly. Environmental factors- These are also important factors which are to be considered because the customers nowadays are quite conscious about the environment. They desire that the products which are being provided to them should be according to the environmental rules and regulations which have been framed. Legal factors- These are also quite important factors because the legal rules and regulations are required to be given proper and appropriate consideration so that the decisions can be taken accordingly. This is so because an organization like Coca Cola Ltd. is required to make sure that itcan comply with the legal rules and regulations of the country in which it is present. Porter's 5 forces- It is an important model which is required to be used so that the situations which are prevailingintheexternalenvironmentcanbeassessedquiteproperlyandappropriately (Niemand and et.al., 2021). These forces are as follows- ï‚·Competition in the Industry- It is an important force because it is important to assess the overall level of competition which is present so that the right and appropriate decisions can bet taken highly effectively and efficiently(Nwachukwu, Zufan and Chladkova, 2020). The force carried a high power for Coca Cola Ltd. because in this 3
industry there is a lot of competition which is present due to which the overall level of profits is also affected. ï‚·Potential of New Entrants- It is also a crucial force which is required to be given appropriate consideration because there are a lot of new players which are waiting to enter into the market and they can create an impact on the organization. The force therefore carries a high power for Coca Cola Ltd. Because in this industry the new players can easily enter into the market which therefore can affect it a lot. ï‚·Power of Suppliers- It is also an important force which has to be considered because the suppliers control the price which is fixed for each product. This force also carries a high power for Coca Cola Ltd. Because in this industry the management of supplies is done in a proper manner by the suppliers so that the decisions which are quite important and crucial can be taken highly effectively and efficiently. ï‚·Power of Customers- It is also an important factor which has to be given appropriate consideration because the customers are the ones who drive the demand of the products (Padash and Ghatari, 2020). This force has a high power for Coca Cola Ltd. because the demand of the customers for the products can affect the prices and thus the overall level of profitability of the products is also impacted as a result. ï‚·ThreatofSubstitutes-Thisisalsoanimportantforcewhichisrequiredtobe considered. This force has a low power for Coca Cola Ltd. Because the company provides quality products to its customers and they do not prefer to purchase substitute products over its products. Justification- 4 out of 5 forces have a high power and only 1 force has a low power. Thus, it can be stated that Coca Cola Ltd. Is required to make sure that it can provide appropriate consideration to the impact of these forces and is able to take the important and crucial decisions which are highly necessary to be taken. This will therefore help a lot in ensuring that the organization can manage its needs and requirements accordingly which will therefore help it a lot. Review of the implementation and success of the company's international operating strategies- Coca Cola Ltd. is a company which provides a wide range of products to the customers in the market. The company has to make sure that it uses the international operating strategies so that it 4
can manage its wide range of needs and requirements in a proper and appropriate way. The implementation and success of the company's international operating strategies can be discussed as follows- ï‚·The company has introduced a wide range of products in the international market according to the needs and requirements of the customers(Pal, 2020). Thus, it can be stated that this particular strategy of the company has been successful because it has managed to attract the attention of the customers effectively and efficiently. ï‚·The company has made sure to make use of aggressive marketing strategies and tactics so that it can manage to attract the attention of the customers in the market by attracting them effectively and efficiently(Samimi and et.al., 2020). Therefore, it can be stated that this particular strategy of the company has been successful because it has attracted the attention of a lot of customers in the market. Thus, it can be stated that Coca Cola Ltd. has been able to manage its wide range of needs and requirements quite properly and appropriately which will therefore help it a lot to be able to attain the goals and objectives which are necessary. The company should make sure that it can identify the way in which its overall efficiency and effectiveness level can be enhanced. In this way, the company can make sure that it is able to attain a strategic and competitive edge over the competitors which are present in the market which will thus help it a lot(Yildiz and Aykanat, 2021). CONCLUSION From the above report, it can be concluded that Strategic Operating Environment refers to the environment in which an organization is operating. Therefore, it can be stated that the attainment of the goals and objectives can be done by the organizations so that they are able to make sure that they can enhance their overall profitability level. This has to be done by ensuring that the consideration of the factors affecting Strategic Operating Environment can be done which will help the organizations a lot. The managers are required to make sure that they are able to manage the different types of needs and requirements related with the organization by determining the best approach to be taken in such an environment which will help them a lot. 5
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