Strategic Management and Coca-Cola

This assignment delves into the realm of strategic management by examining the case of The Coca-Cola Company. It requires students to analyze Coca-Cola's strategic management practices, considering factors such as reputation management, financial performance (using provided income statement data), and potential challenges they face in the dynamic global marketplace. Students are expected to draw upon relevant theoretical frameworks and academic literature to support their analysis.

REPUTATION MANAGEMENT PLAN
IN
THE COCA-COLA COMPANY
September 23, 2017

EXECUTIVE SUMMARY
Corporate groups of onlookers (stakeholders) routinely depend on the reputations of firms in
settling on speculation choices, profession choices, and item decisions. Reputations represent
to publics about how a firm's items, occupations, techniques, and prospects compared with
those of contending firms. In this manner, ideal reputations can create a great quantity of
returns for firms by restraining the portability of opponents in industry. Reputations may have
other possibly ideal results. By warning purchasers about an item’s quality.
Therefore, ideal reputations may empower the Coca-Cola Company to charge premium costs
for certain drinks, draw in better candidates, improve their entrance to capital markets, and pull
in financial specialists. Lastly, reputational orderings shape the status of Coca-Cola Company in
a modern social framework; and in this manner constitutes an essential setting for
accommodating monetary and sociological commitments to the investigation of mechanical
stratification.
Accordingly, this paper focuses on the Coca-Cola Company and comes up with a reputational
plan following the crisis in Belgium and France concerning their drinks being festering in 1999.
The targeted publics are the adult consumers of their drinks in Belgium and France.
pg. 2

Table of Contents
Background.............................................................................................................................................4
Brief Background of the company......................................................................................................4
Situation Analysis....................................................................................................................................4
Problem Statement.............................................................................................................................5
The two Schools of Thought...............................................................................................................5
Research..................................................................................................................................................6
Observations of Organizational Reputation.......................................................................................7
Target Publics..........................................................................................................................................7
Goals and Objectives..........................................................................................................................8
Strategy and Tactics............................................................................................................................8
Evaluation...........................................................................................................................................9
Concluding Remarks...............................................................................................................................9
Recommendations............................................................................................................................10
References............................................................................................................................................11
Appendix 1: Evidence concerning Coca-Cola....................................................................................12
Appendix 2: Income Statement of the Coca-Cola Company (millions)............................................13
pg. 3

Background
The idea of reputation, characterized as partners' discernments around an organization's
capacity to make esteem in respect to contenders, has gotten significant consideration from
organizational researchers such as Pederzini (2016). Reputation is seen as a profitable
impalpable resource that gives a firm, reasonable upper hand since it impacts partners'
monetary decisions about the organization and adds to contrasts in organizational execution.
For sure, various examinations have archived a positive connection between an association's
reputation and its money related execution (Alfonso et al., 2010).
Brief Background of the company
Coke or Coca-Cola is a bubbly soft-drink which the Coca-Cola Company manufactures. The
drinks were initially envisioned as deliberate medication. Moreover, they were developed in the
1890s and a businessman highlighted the thirst-quenchers, whose strategies of marketing
directed Coca-Cola to its supremacy of the global liquid refreshments marketplace all through
the 1900s. The name of the soft-drink speaks of two of the initial elements of the portion; coca
plants in addition to kola nuts (a basis for caffeine). However, the existing recipe of the liquid
refreshments is a not exactly known, even though an assortment of stated procedures as well
as trial creations are available.
Situation Analysis
Around 176 individuals in France and Belgium griped of sickness in the wake of drinking Coca-
Cola drinks in 1999. Before long, it was guaranteed this had two causes – flawed carbon dioxide
in a Belgian jug plant and jars spoiled by a fungicide at a French unit. Because of these
assertions, legislatures of seven northern and western European nations issued bans or halfway
bans on Coca-Cola items. Coca-Cola reacted at nearby, national and European level with
reaction groups to counter claims and reestablish client and staff certainty. Its Chief Executive
Officer originated from the US to meet Belgian government authorities and to express
statements of regret. Different activities were set up with far-reaching correspondences to staff
and by corporate promotions in key European markets. Despite the fact that Coca-Cola was not
eased back to go to the circumstance and – not at all like Perrier when looked at cases of
benzene pollute in its packaged waters – did not mount a long stretch of disavowal, it was
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reprimanded. Deals endured a drop of 6% in Europe, and there was a stock value fall of 22%
(Jagersma, 2010).
Problem Statement
As one daily paper in Coca-Cola's main residence, Atlanta, remarked that as the hours fly by,
the valuable Coca-Cola mark in debilitated, with one nation and after that another enrolling
level of worry about the refreshments. 'What turned out badly with Coke?' Essentially, its
endeavors were past the point of no return and lacking. The executive's initial remarks came
four days after the primary claims were made, and he did not go to Europe to the point that
seven days after the emergency began. The analysts noted at the time, 'holding up a few days
to issue a reaction from corporate base camp brought up major issues about the organization's
affectability to client security concerns.
Additionally, the Coca-Cola Company neglected to expect the issues and show critical
comprehension of the European general wellbeing condition in which open worries over
sustenance security had been increased by dioxin terrifies, the BSE outrage and other agrarian
dangers. Besides disregarding the prompt setting, Coca-Cola likewise neglected to appropriately
gage some long-haul issues identified with contrasts between leading business all-inclusive
versus the US local market. The gathered reputation of over a century remained for little since
Coca-Cola did not perceive the gravity of the issue as it broke and after that attempted to
oversee it from a great many miles away. The cost was high, both fiscally and in lost trust with
clients and staff.
The two Schools of Thought
While this exploration has shown unambiguously that a great organizational reputation is
related to financial advantages, it offers a less clear picture of what reputation is and how it is
shaped. An audit of surviving examination on organizational reputation in administration,
financial aspects, and humanism uncovers that two schools of thought educate the developer's
definition. Researchers examining reputation from a financial point of view tend to characterize
it as the onlookers' desire or estimates a specific characteristic of an organization, particularly
the organization's capacity to deliver quality items. As indicated by Peng et al. (2016),
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reputation shapes on the premise of past activities, through which firms flag to partners their
"actual" qualities.
An alternate point of view is exhibited by researchers like Ansgar & Diana (2011) who attract on
the institutional hypothesis to comprehend reputation. These researchers tend to portray it as
a worldwide impression, which speaks to how a group—a partner gathering or numerous
partner gatherings—see a firm. As indicated by this point of view, reputation shapes because of
data trades and social impact among different performers communicating in an organizational
field.
The distinctive routes in which researchers working on financial aspects or institutional
viewpoints see reputation recommend that exploration on this subject can be progressed by a
more prominent combination of the conceptualization of the build. In this paper, these two
points of view are incorporated by suggesting that they speak to two particular measurements
of reputation. The financial aspects point of view tends to how partners assess a specific
organizational trait; in this way, it stresses the apparent quality measurement of organizational
reputation.
Research
Organizational researchers contemplating reputation perceive that reputation is profitable
because it decreases the vulnerability partners look in assessing firms as potential providers of
required items and administrations. Researchers working from various hypothetical viewpoints,
in any case, vary in their clarifications of how reputation lessens partner vulnerability. Those
considering reputation from a financial aspects point of view sees vulnerability as a component
of the data asymmetries between contending firms and their partners.
Firms diminish data asymmetries and subsequently showcase vulnerability when they settle on
decisions that uncover their "actual" traits. Such decisions fill in as signs that empower
purchasers to survey significant firm traits, for example, regardless of whether a firm is a maker
of high-or low-quality products. Accordingly, from a financial aspects point of view, reputation
diminishes partners' worries about the nature of firms' items, consequently, prompting them to
pg. 6

pay cost premiums for firms' items, which thus emphatically impact organizations' financial
results (Aula, 2010).
Observations of Organizational Reputation
Researchers that grasp an institutional point of view on reputation keep up that the
vulnerability about the "genuine" traits of firms (McManus, 2011). In an organizational field,
they contend, certain performing artists, for example, institutional middle people and high-
status characters, have better capacity than getting to or disperse data by their institutional
parts or auxiliary positions. Partners nearly watch the decisions of such performing artists as a
result of their apparent predominance in assessing firms.
Thus, the activities of these characters’ present precise incongruities in the accessibility of data
about various organizations, along these lines making some more notable and focal in the
general population mind. For instance, Binod & Devi (2013) demonstrated that the volume of
media scope a firm gets is emphatically identified with the execution of its first sale of stock
(Initial public offering). Thus, they demonstrated that regardless of whether a specific
investigator covers a firm influence how speculators esteem it.
Generally speaking, the data passed on through the decisions of compelling outsiders vis-a`-vis
organizations decouples the reputation-building process from the key signs of contending firms
and makes a few firms more unmistakable in their organizational fields. The institutional
viewpoint, in this manner, proposes that the degree to which an organization is broadly
perceived among partners in its organizational field, and the degree to which it emerges
concerning contenders, might be an essential measurement of organizational reputation.
Target Publics
To assess the quality, the Coca-Cola Company can anticipate from a supplier of merchandise;
partners depend on signals that uncover the undetectable characteristics that influence the
capacity of a firm to create quality items. Despite the fact that financial experts push that
"vulnerability about quality is a critical element across the board of business sectors for most
firms' products and services," items contrast in the measure of vulnerability about quality they
give purchasers. The more troublesome it is for clients to evaluate item quality before buy, the
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more they are probably going to depend on vital signs to frame assumptions about quality.
Specifically, clients are probably going to depend on signs of quality when the items they are
buying must be assessed with utilizing and after some time or require abnormal amounts of
particular aptitude to assess (Liwen & Jingkun, 2015). The targeted publics include:
 Potential and Existing consumers
 Government bodies
 Local Management team
The sources of info an organization utilizes as a part of its generation procedure can flag quality
since they influence the nature of items. To give partners solid signs of value, the vital
selections of firms must be expensive and inaccessible to all contenders. The procurement and
utilization of high-quality inputs are expensive and not basic to all contenders and in this
manner can furnish partners with signals that impact saw the quality. Intel Inside and
Nutrasweet are cases of info brands utilized by PC and soda pop makers, individually, to flag the
nature of their items.
Goals and Objectives
According to McManus (2011) goals and objectives should be specific, measureable, achievable,
relevant and timely. Therefore, the following are the objectives of managing the reputation of
the Coca-Cola Company:
 To have an effort on brand awareness and acceptance through mainstream media as
well as social media
 To emphasize on the social and biological benefit (reduce thirst) of the
merchandise/drinks
Strategy and Tactics
The first tactic for the Coca Cola Company is:
a) To address customer’s complaint amicably through traditional media. The Coca-Cola
Company can sponsor an event which impacts a whole community positively.
The other option for the drinks manufacturer is:
b) To have a social media strategy and ‘hit’ the social media ‘hard’ and post good images
and engaging content about the drinks on Facebook, Twitter, Instagram and LinkedIn.
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One of the strategy is to share humorous story and photos in order to keep the young
crowd interested. The company has a dedicated Facebook page and a Twitter account
where they can communicate directly with potential and existing customers.
The method Coca-Cola is established and indications the state of affairs; specifically, the
company can’t confine their employees from posting stuff on social media concerning their
business and the overall corporation. However, doing that be associated with (social)
accountability.
Cases of such items and services incorporate new generation innovations, custom-fabricated
data frameworks, and legitimate or administration counseling. At the point when customers
discover item quality hard to assess preceding buy, they may utilize the nature of information
sources or potentially the nature of the gainful resources a firm uses to change over
contributions to yields to shape assumptions about the nature of the last item (Farhad &
Akram, 2012).
Evaluation
Goals Objectives Strategies Tactics Evaluation
Method
Time log
Good
brand
image
Increase
brand
awareness
Address
customer’s
complaint
through
media
Asking for
reviews and
feedback
Trending topics
on social media
concerning the
company
October -
November
Increase
sales
Emphasize
on the
benefits of
the drinks
Sponsoring an
event
Distribute the
drinks
(merchandise) all
over the country
More
customers
Increased sales
Wider
distribution
network
December
pg. 9

Concluding Remarks
This paper has concentrated on the fundamental part of dealing with the interfaces and
information sharing which associate the individual players in a worldwide system. The
provisional model we have proposed likewise features the potential effect of reputational
chance in impacting the impression of partners about the organization and the connections'
solidness. The key writing and illustrations position reputation and reputational hazard in the
more extensive set of associations with every one of the partners. Trust and reputation are
likewise broken down and identified with the test of learning to partake in arranging
connections inside a dynamic business condition.
Recommendations
The paper gives five recommendations keeping in mind the end goal to build up a structure
whereby the positive relationships between reputation, the capacity to pull in – fulfill - hold the
partners, data sharing, and better execution can be distinguished. In this structure, with the
help of some confirmation from genuine cases, a reputational chance is a rising key factor that
prompts a partners' disintegration of trust, influencing, connections and notwithstanding
prompting the fall of the venture.
Finally, the paper proposes some basic parts of comprehension and overseeing reputational
chance inside a system. The organization ought to be touchy to partners' desires and needs to
deliver key duties to ensure the organization's picture, reputation, and system connections. It
additionally requires a powerful correspondence and data sharing inside the organization and
along the system. In the ethical front, the Coca-Cola Company can improve search traffic and
ranking through dynamic content (plus search engine optimization). Additionally, they can
embrace negative feedback and build up a positive brand by being responsive.
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References
Alfonso Siano, Philip J. Kitchen, Maria G. Confetto, 2010. Financial resources and corporate reputation:
Toward common management principles for managing corporate reputation. Corporate
Communications: An International Journal, 15(1), pp. 68-82.
Ansgar J. Thiessen & Diana J. Ingenhoff, 2011. Safeguarding reputation through strategic, integrated and
situational crisis communication management: Development of the integrative model of crisis
communication. Corporate Communications: An International Journal, 16(1), pp. 8-26.
Aula, P. K., 2010. Social media, reputation risk and ambient publicity management. Strategy &
Leadership, 38(6), pp. 43-49.
Binod K. Shrestha and Devi R. Gnyawali, 2013. Insights on strategic management practices in Nepal.
South Asian Journal of Global Business Research, 2(2), pp. 191-210.
Farhad A. and Akram S., 2012. Strategic management: the case of NGOs in Palestine. Management
Research Review, 35(6), pp. 473-489.
Jagersma, P. K., 2010. Managing reputation equity. Business Strategy Series, 11(3), pp. 139-144.
Liwen Tan, Jingkun Ding, 2015. The frontier and evolution of the strategic management theory: A
scientometric analysis of Strategic Management Journal, 2001-2012. Nankai Business Review
International, 6(1), pp. 20-41.
McManus, J., 2011. Revisiting ethics in strategic management. Corporaate Governance: The
International Journal of Business in Society, 11(2), pp. 214-223.
Pederzini, G. D. A., 2016. Strategic management cultures: historical connections with science. Journal of
Management History, 22(2), pp. 214-235.
Peng Wu, Lei Gao & Xiao Li, 2016. Does the reputation mechanism of media coverage affect earnings
management?: Evidence from China. Chinese Management Studies, 10(4), pp. 627-656.
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Appendix 1: Evidence concerning Coca-Cola
pg. 12

Appendix 2: Income Statement of the Coca-Cola Company (millions)
1999 1998
Net operating revenues $ 19,805 $ 18,813
Operating income $ 3,982 $ 4,967
Net income $ 2,431 $ 3,533
Basic net income per share $ .98 $ 1.43
Diluted net income per share $ .98 $ 1.42
Cash dividends per share $ .64 $ .60
Average shares outstanding 2,469 2,467
Average shares outstanding assuming dilution 2,487 2,496
Share-owners’ equity at year end $ 9,513 $ 8,403
The full annual report is in this link.
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