Strategic Management for Coca-Cola: Objectives, Internal and External Analysis, and Porter's Five Forces Model

This report provides an analysis of strategic objectives, internal and external environment, and Porter's five forces model for Coca-Cola. It includes SWOT analysis, PESTLE framework, and suggestions for further business growth.

Strategic Management

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY...................................................................................................................................3
Strategic Objectives....................................................................................................................3
Internal Analysis.........................................................................................................................3
External Analysis........................................................................................................................5
Porter's five forces model ...........................................................................................................6
CONCLUSION ...............................................................................................................................7
REFERENCES................................................................................................................................9

INTRODUCTION
Strategic management is the on-going planning, monitoring and analysing all the
necessities for an organisation in order to meet its aims and objectives. Changes in the business
environment leads to have proper employees on the business strategies so that they can rightly
maintained. It is also vital to have the direct emphasis on the strategies so that all the operations
can be move in the right direction(Suharjo and Wibawa, 2021). Coca-Cola is the multinational
beverages company which is headquartered is in Atlanta, Georgia. The company is dealing in
dealing in non-alcoholic beverages, concentrates and syrups. This report will cover the strategic
objectives ad the internal and external analysis of the company and suggest the specific strategies
for the further business growth in to expand the market.
MAIN BODY
Strategic Objectives
Strategic objectives are the challenging attributes of a strategic plan as it build the way
between the big, bold vision and the goals required to achieve. This also set the boundaries for
the efforts of the organisation. It an be defined in quantifiable and measurable terms as it is the
key to get success for the business. In context to Coca-Cola, the main aim is to build a winning
consumer-centric portfolio for every event and having leveraging affordability to drive
sustainable growth. They are planning to have the market expansion so that they become the
leader in the market.
Internal Analysis
Internal environment is the set of elements which defines the atmosphere of the
company and their structure. It describes the way that how all the activities can be run in an
appropriate manner. It describes the way in which all the activities are being performed within
the business organisation and basically with the co-workers (Bonfante And et. al., 2021). SWOT
analysis is being conducted in order to understand the internal environment of the company an it
is defined as the framework of identifying the strength, weakness, opportunities and threats of
the organisation. In context to Coca-Cola, SWOT analysis is explained further.
Strengths describe the uniqueness from their competitors as they have their effective
brand, loyal customers base, a effective balance sheet, unique technology and many more. In
context to Coca-Cola, In 2011, the company is being awarded with the highest brand equity

award and with vast global presence ans the differment brand identity is one of the costliest
brands with high brand value. Coca-Cola is operating their business in 200 countries globally
that is contributing to the brand name of the company. They are having fantastic marketing
strategies as the promotion is being done by the Amitabh Bacchan, Aamir Khan etc. the
company is also having strong distribution channel due to high demand in the market. With these
strong products, It is common that coca-cola is having a a more of customer loyalty as the
individual prefer soft drinks over others. The company is also having more market share as there
are only 2 big competitors in the beverage segment such as Pepsi and Coca-Colas, out of these
two, coca-cola is the clear winner & thus, has largest market share.
Weaknesses hurdle the organisation in their proper functioning at its optimum level.
There are the areas of improvement to remain in the competition. In context to Coca-cola, they
are having huge competition with Pepsi and they are the clear market leader and Pepsi can not
easily give up easily as they are having good brand image in the large market. Coca-cola is
having less product diversification as they are dealing in beverages only and other hand, Pepsi
have made the smart move & differentiation onto snacks segments wit the goods like lays and
kurkure. Such products would have been as more revenue drivers for the company.
Opportunities refers to the favourable external factors which can give the competitive
advantage by which company can generates the higher profits and revenue. In context to Coca-
Cola, They can offer the diversified products in health & food business which can gain the
overall sale f the company and they can generate effective revenue from the existing buyers by
cross selling their products (Anand and Mantovani, 2021). The supply chain also make the better
approach while delivering their snacks thereby sharing the overall supply chain expenses. Al
through, the company is having global presence but they must emphasis on expanding their
business to the developing nations as they can rightly make the better approach in the market.
Packaged drinking water is becoming a main product and it has been seen its way into
individuals mind. Coca-Cola is having presence in the packed drinking water through kinley.
Threats refers to the factors that is having significant harm to an company. For example,
drought is the threat to a wheat producing company. Another threats includes the increasing cost
of materials, increasing competition, and less labour supply so on. In context to Coca-Cola, water
is the threat and the weakness of Coca-Cola was to suspected use of pesticides or huge
consumption of water. However, the threat arises, due to increasing water scarcity due to climate

change. Another is the competitors as Starbucks, Cafe coffee day are on hike and they are giving
healthy competition to the coca-cola(Thomas And et. al., 2021). They are offering carbonated
drinks such as Tropicana as well as energy drink like Red bull which is enhancing or stealling
the market share indirectly.
External Analysis
External environment is composed of all the factors which impact and influence the
business operations and the company is having no control overall these factors. For analysing the
external environment, PESTLE Analysis is being conduced in order to understands the impact of
political, economical, social, technological, legal and environmental factors on the business
operations. In context to Coca-Cola, these factors are further explained.
Political factor are the aspects which includes the government stability, tax policy, trade
restrictions an reform, tariffs and environmental regulations. These are the factors which can
determine the extent to which a government may influence an company or the industry. There is
huge impact of laws & regulations of government on the food products as earlier due to some
trade sanctions of US & Burma, the overall sale of Coca-cola was banned in Burma and there
are nations like North Korea in which Coca-Cola cannot sold because of political conditions
which impact the overall sale of the company.
Economical factor are the factors which is concern with the economic growth, interest
exchange, inflation, wages rates, working hours and unemployment and credit availability in the
market(Muttaqien, 2021). Despite the increase in the price due due to tariffs as it is seen that 8%
growth in the overall revenue in the financial year 2019. with this margin, Coca-cola have badly
impacted by acquisition of the company. The new agreement between United States, Mexico &
Canada is supported by the organsiation for free and fair trade among the countries. The coca-
cola has reported 8% rise in retail value of their product such as Diet Coke and Zero sugar.
Social factor are the aspects which includes the cultural norms & expectations, health
consciousness, growth rate, career attitudes, health and safety of the society & the employees.
The online coca-cola store also customised name on their bottles as the brand connect to the
customers to their own level. They are also having its social media management with the mission
of becoming more optimistic company on the social media platforms. The demand of the
consumer has chnaged from sugary drinks to low calorie drinks by which firm can face the slight
change in the demand of the beverages.

Technological factor are the factors which includes the innovation and development in
technologies and these such factors impact the overall operations of the company. In context to
Coca-Cola, they are having innovation in the operations as it also invites the consumers to access
the online game & associate with the Coca-cola products(Cheng, 2021). It uses social
networking technology to stay young, fresh & current. They also offer freestyle dispenser that
allows the customer to create their customised beverage in different combinations. It also gather
data for market research that allow the organsiation to understand the taste and preferences of the
customers.
Legal factor are the aspects which includes change in laws that is impacting employment,
access to material, quotas, resources, imports and export taxation in the business. Coca-Cola has
faced difficulty due to quantity of caffeine in its goods in the various nations. The company was
also accused to pay less wages to their employees that attracts the various protest from the labour
union. It is the main concern for the company that they are mislabelling on their products as a
pomegranate & blueberry juice by which company is under the serious concern in the market.
Environmental factor are the factors which mainly includes the affects of the
surrounding environment & the influence of ecological aspects that includes waste disposal laws,
environmental protection law and energy consumption regulation(Rossidis, Belias and
Vasiliadis, 2021). In context to Coca-Cola, They have faced the excess amount for the reason of
draining off the ground water and it is reported that they are biggest consumer of freshwater
globally. In order to reduce these problems & reduce its carbon footprints to approach zero that
they are using smart farming techniques like RAIN & CARE that uses as less water as possible.
They are also moving to solar energy to make their beverages.
Porter's five forces model
It is the strategic tool which helps analysing key sources of competitive pressure within
the company. Michel Porter observed the five forces that is having major affects on the
profitability of the company. The Porter five forces are further explained. Threat of new
entrants as there is huge innovation in soft drinks, new ways of doing things make difficult for
coca-cola company by lowering their prices, reducing cost and offering new value to the
potential buyers. Coca-Cola can innovate their new products & services that not only getting new
customers but also give old customer a perfect reason to buy the particular product. For tackling

this strategy, they can building the economies of scale by which they can lower the prices per
unit of their products.
Bargaining power of suppliers, In the soft drinks industry buy raw material to the
numerous supplier which also decreases the profit margin in the products. Powerful supplier can
use their negotiating power to remove higher prices from the companies which can hurdle the
overall profitability and sale of the company. Coca-Cola can implement this strategy by having
effective supply chain with differment suppliers in order to ensure the easy availability of raw
material. Bargaining power of buyers, now a day buyers are usually demanding a more as they
want to have the best products by paying minimum amount of prices. This put pressure on the
Coca-cola profits in the long term so they are build the large customer base which can reduce the
bargaining power of their buyers as well as it also boast the overall sale of the company(Greve,
2021).
Threats of substitute, It is the state in which the company the product is meeting a
customer needs in various ways then the company suffers its revenue. They can meet this
strategy by being service oriented rather than just product focused and by understanding the core
need of the buyers rather than what the buyer is purchasing. Rivalry among the existing
competitors, If the existing player is intense in the market then it will downfall the prices and
decreases the overall products of the company. Coca-Cola operating in every competitive
beverages so for meet the huge competition in the market they can building the sustainable
differentiation and by having scale so that they can maintain in an better approach.
CONCLUSION
It is concluded from the above report that strategic management plays an signifiant role in
the easy accomplishment of the business goals. For analysing internal environment, SWOT
analysis is being conducted by which strength, weakness, opportunities and threats for the
company is being accumulated. Further analysing the external environment, PESTLE framework
is being conducted & it is summarised that social and technological factor has the positive
impact on the overall profitability of the company and legal factor have the negative impact on
the business.

REFERENCES
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Online
Coca Cola PESTLE Analysis, 2018 [Online] Available Through
<https://www.mbaskool.com/pestle-analysis/companies/18043-coca-cola.html>