Analysis and Discussion of Coca-Cola: Historical Analysis and Strategic Choices

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Table of Contents
ANALYSIS AND DISCUSSION..............................................................................4
1. Introduction...................................................................................................4
2. Internal Analysis.............................................................................................4
2.1 Historical Analysis.....................................................................................5
2.1.1 Strategic Choices.................................................................................7
2.1.2 VMOST............................................................................................8
2.1.3 Product Portfolio...............................................................................10
2.1.4 Market Definition and Location.............................................................13
2.1.5 Current Competitive Position................................................................14
2.1.6 Current Competitive Strategy................................................................18
2.1.7 Green Strategy..................................................................................20
2.1.8 Summary of Historical Analysis............................................................21
2.1.9 FINANCIAL ANALYSIS....................................................................21
2.1.10 Summary of Financial Analysis.............................................................22
2.2 Value Chain Analysis...............................................................................23
2.3 Value Chain Analysis Summary..................................................................24
2.4 Core Competencies..................................................................................24
2.5 McKinsey’s 7-S Framework.......................................................................25
2.6 Summary of Strengths and Weaknesses.........................................................26
3. External Analysis..........................................................................................28
3.1 Environment Basics.................................................................................29
3.2 Customer Analysis and Market Segmentation.................................................29
3.3 Competitor Analysis.................................................................................30
3.4 Competitive Industry Environment...............................................................30
3.5 Key Factors for Success............................................................................32
3.6 Industry Life Cycle..................................................................................32
3.7 PESTEL Analysis....................................................................................33
3.8 Degree of Turbulence in the Environment – Lynch (2015, p72)...........................34
3.9 Summary of Opportunities and Threats.........................................................34
4. Strategic Fit Analysis.....................................................................................36
4.1 SWOT Analysis......................................................................................37
4.2 EVR Congruence.....................................................................................38

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4.3 Balanced Scorecard..................................................................................41
4.4 Summary of Strategic Fit...........................................................................42
Section 2 – Recommendations................................................................................42
1- Trend and Sensitivity Analysis.......................................................................42
2- Risk Management.......................................................................................43
3- Growth Strategic Options.............................................................................43
3.1. Strategic Direction...................................................................................44
4- Suitability – Suitable to whom and what...........................................................44
(Ghosh, 2010)..............................................................................................45
4.1. Suitability to Resource Base.......................................................................45
(Adeyemi & Salami, 2010)..............................................................................45
4.2. Suitability to Culture.................................................................................45
4.3. Suitability to Purpose of the Company...........................................................46
4.4. Suitability to Stakeholders..........................................................................46
(Adeyemi & Salami, 2010)..............................................................................47
4.5. Summary of Suitability..............................................................................47
5- Acceptability.............................................................................................47
5.1. Acceptability of Business Model..................................................................47
(Hoekstra, et al., 2011)....................................................................................47
5.2. Acceptability to Ethics and Social Responsibility.............................................47
(Hulsether, 2018)..........................................................................................48
5.3. Acceptability to Knowledge Management......................................................48
(Iwamuro, et al., 2015)....................................................................................48
5.4. Acceptability to Technology.......................................................................48
(Kayabaº, et al., 2017)....................................................................................48
5.5. Acceptability using Blue Ocean Strategy........................................................48
(Adeyemi & Salami, 2010)..............................................................................49
5.6. Summary of Acceptability Analysis..............................................................49
6. Feasibility.................................................................................................49
6.1. Internal Feasibility Checklist...................................................................52
6.2. External Feasibility Checklist...................................................................57
6.3. Financial Feasibility Checklist.................................................................57
6.4. Financial Evaluation..............................................................................57
6.5. Summary of Feasibility..........................................................................58

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6.6. Summary of Suitability, Acceptability and Feasibility....................................58
7. Internal Development..................................................................................59
8. E-Commerce.............................................................................................59
9. Implementation and Control..........................................................................61
9.1. Alignment of Company Structure..............................................................61
9.2. Elements of the Implementation Process.....................................................61
9.3. Project Management Approach.................................................................63
9.4. Project Monitoring and Control................................................................65
9.5. Green Strategy.....................................................................................66
9.6. Managing Change.................................................................................67
9.7. Managing Strategic Leadership................................................................68
9.8. Business Plan......................................................................................69
9.9. Execution Plan for Chosen Strategic Option.................................................70
10. Conclusion...............................................................................................71
References........................................................................................................72

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List of Figures
Figure 1: Product Portfolio (Banutu-Gomez, 2012)......................................................12
Figure 2: BCG Matrix (Srikanth et al., 2018)..............................................................13
Figure 3: Porter's Generic Forces (Barkay, 2013).........................................................16
Figure 4: Preferred Cola........................................................................................32
Figure 5: Competition in the industry.......................................................................33
Figure 6: Industry Lifecycle (Adeyemi & Salami, 2010)................................................34
Figure 7: Strategic Fit (Adeyemi & Salami, 2010)........................................................36
Figure 8: Strategic Approach (Adeyemi & Salami, 2010)...............................................37
Figure 9: SWOT Analysis (Banutu-Gomez, 2012).......................................................38
Figure 10: Congruence Model (Benjamin Jr et al., 1991)...............................................40
Figure 11: EVR Congruence (Balogun et al., 2012)......................................................42
Figure 12: Financial Projection: Feasibility Report.......................................................52
Figure 13: Net Cash flow......................................................................................53
Figure 14: Ansoff Matrix (Baah & Bohaker, 2015)......................................................57
Figure 15: Cash flow projection (Benjamin Jr et al., 1991).............................................58
Figure 16: Breakeven Analysis...............................................................................59
Figure 17: Corporate Strategic Plan (Elmore, 2013)......................................................63
Figure 18: Project Management: 5Cs (Baah & Bohaker, 2015)........................................64
Figure 19: 5Ds of Strategic Management (Banutu-Gomez, 2012).....................................65
Figure 20: Budgeting (Hulsether, 2018)....................................................................66
Figure 21: Green Strategy (Banutu-Gomez, 2012)........................................................67
Figure 22: Strategic Management (Ghosh, 2010).........................................................68
Figure 23: Strategic Leadership (Hoekstra et al., 2011).................................................69
Figure 24: Elements of Business Plan (Gehani, 2016)...................................................70
Figure 25: Business Model of Coca-Cola (Balogun et al., 2012)......................................71
Figure 26: Gantt Chart..........................................................................................71

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ANALYSIS AND DISCUSSION
1. Introduction
Strategy can be defined as the plan for the organization to achieve one or more goal based on
market conditions to lead the company towards the right position. It requires the managers to
work on aligning different skills based on required tactics, siege craft, logistics, marketing,
management, and others. In other words, the strategy is referred to as the allocation of resources
with a defined pattern in achieving their goals and objectives in executing their plans (Kunerth
& Mosley, 2011). Strategic management is associated with concepts such as business model
competitive advantage, value chain analysis, generic strategies, performance effects, and others.
Successful strategic management ensures long term success of the company followed with the
unfolding of internal and external aspects resulting in socio-economic context (Hoekstra et
al., 2011). The process of strategy is based on two primary processes – formulation and
implementation involving the analysis of the environment to make a diagnosis and developing
guiding principles. The other part based on strategic planning and thinking refereeing to an
action plan to establish its policy following the principles (Luthans & Doh, 2012).
2. Internal Analysis
Internal environmental analysis is associated with components of the firm based on its current
employees, management, corporate culture, and organizational behavior to define its workplace
environment following the industry standards. The assessment of internal analysis of a firm
defines the internal resources of a company to determine its competency, cost position,
competitive viability in the industry (Irefin & Mechanic, 2014). While conducting a
strategic analysis of a firm, it is essential for an organization to incorporate measures in

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providing information about the strengths and weaknesses of a company using strategic models
such as SWOT analysis. Other models of internal analysis include TWOS, value chain analysis,
and others. The considered case study taken for the research is Coca Cola to formulate
perspective and identify the key pointers in the right places in forming a perspective (Adeyemi
& Salami, 2010).
2.1 Historical Analysis
The timeline of Coca-Cola from the initiation of its operation is as followed,
- 1892 – Founded Coca-Cola Company as an American Corporation as manufacturers of
Carbonated and citrus beverages.
- 1886 – Coca-Cola was introduced in the market by Atlanta Pharmacists, he named the
drink which later becomes its trademark.
- 1891 – the ownership of the business was taken by Asa Griggs Candler for a cash outlay
of $2,300 for Proprietary rights (Benjamin Jr et al., 1991)
- 1893 – The trademark Ownership was registered in the US Patent Office
- 1899 – The company signed its first bottling company; it allowed the owners to buy the
syrup, produce the drink, manage the packaging, and distribute the drink around the
world. This has helped the company to maintain the world’s best supply chain
management.
- 1903 – Cocaine from the coca leaf and caffeine of Kola Nut was removed from the drink
formula (Benjamin Jr et al., 1991)

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- 1919 – The company was sold to Atlanta businessman Ernest Woodruff for $25 million,
the leadership, and management worked successfully for Coca-Cola for 1923 - 1955
successfully.
- 1941 – post-World-War II, Coca-Cola diversified its packaging and introduce new
products and marketing tactics. The word Coke was introduced in the advertisement for
the first time, which later becomes its trademark (Benjamin Jr et al., 1991).
- 1946 – It bought the rights of Fanta from a German-based company.
- 1960 – The company registered it's contoured bottled for the first time, even though it
was introduced in 1916 for the first time (Benjamin Jr et al., 1991).
- 1961 – It introduced new flavors in drinks include Sprite, diet Cola. It also purchases
Minute Maid Corporate the same year.
- 1978 – It becomes the only company which was allowed to sell cold packages beverages
in China
- 1982 – Low calorie sugar-free soft drink was introduced in the product line of Diet Coke
(Benjamin Jr et al., 1991).
- 1985 – It changed the primary flavor of Coca-Cola as New Coke, but it was not liked by
its target market. Thus, the management revived its flavor.
- 1982 – 1989 – it holds the controlling interest in Columbia Pictures Industries.
- The 1990s – It started expanding its business in new markets include East Germany and
Asia. It started working with recycled plastic using innovation in its operations by
investing in CSR approach. It introduced new products in Children Fruit drinks,
Powerade Sports Drinks, and Dasani Bottled water. It also acquired companies such as
Barq’s in the USA, Inca Kola in Pero, Maza, Thumbs-Up, and Limca in India, alongside