Coca-Cola Business Strategy: A Comprehensive Analysis

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BUSINESS STRATEGY
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Contents
INTRODUCTION............................................................................................................................. 4
TASK 1............................................................................................................................................ 4
LO1:............................................................................................................................................... 4
1.1. ASSESSMENT OF COCA COLA’S MISSIONS, VISIONS, OBJECTIVES, GOALS, CORE
COMPETENCIES..........................................................................................................................4
1.2. ANALYSIS OF FACTORS TO BE CONSIDERED BY COCA COLA WHEN FORMULATING
THEIR STRATEGIC PLANS............................................................................................................6
1.3. EVALUATE THE EFFECTIVENESS OF TECHNIQUES USED IN BUSINESSES DEVELOP THEIR
STRATEGIC PLANS...................................................................................................................... 7
TASK 2............................................................................................................................................ 9
LO2:............................................................................................................................................... 9
2.1. ORGANIZATIONAL AUDIT FOR COCA COLA AND ANALYSIS OF CURRENT STRATEGIC
POSITION................................................................................................................................... 9
2.2. ENVIRONMENTAL AUDIT FOR COCA COLA.......................................................................10
2.3. SIGNIFICANCE OF STAKEHOLDER ANALYSIS OF COCA COLA.............................................13
2.4. USING THE RESEARCH AND INFORMATION COLLECTED ABOUT COCA COLA, PRESENTING
A NEW STRATEGY COCA COLA CAN FOLLOW..........................................................................13
TASK 3.......................................................................................................................................... 15
LO3............................................................................................................................................... 15
3.1. MARKET IDENTIFICATION AND ANALYSIS OF SUITABLE STRATEGY FOR COCA COLA........15
3.2. JUSTIFICATION OF ONE OF THE STRATEGIES FOR MARKET ENTRY AND GROWTH...........17
TASK 4.......................................................................................................................................... 17
LO4:............................................................................................................................................. 17
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4.1. ASSESSMENT OF THE ROLES AND RESPONSIBILITIES OF PERSONNEL...............................17
4.2. ANALYSIS OF THE RESOURCE REQUIREMENTS FOR THE IMPLEMENTATION OF THE
STRATEGY................................................................................................................................ 18
4.3. EVALUATION OF SMART TARGET......................................................................................19
CONCLUSION............................................................................................................................... 20
REFERENCES.................................................................................................................................20
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INTRODUCTION
This assignment is based on the business strategy of Coca Cola. In this assignment, the
evaluation of strategies and factors will be analyzed with the formulation of strategic plans. The
environmental audit and the justification will be provided for stakeholder’s analysis. The new
strategy will also be presented to understand the development process of business strategies.
Besides, this will also include the strategic choices for business development in which the
identification of different markets and the analysis of appropriate strategies will be done for the
growth of the organization. Further, the implementation of strategies would be done where the
roles and responsibilities of personnel and the resources which are required will be analyzed
and the evaluation of SMART target will also be done to achieve the strategic objectives.
TASK 1
LO1:
1.1. ASSESSMENT OF COCA COLA’S MISSIONS, VISIONS, OBJECTIVES, GOALS,
CORE COMPETENCIES
Every organization wants rapid growth in his company and Coca Cola is also very focused on the
development of business at wide range. There are some missions, visions, objectives, goals and
core competencies of Coca Cola insist every member within the organization to work hard to
achieve the organizational goals. To achieve the organizational goals, there must be the proper
planning of activities and effective strategy to work within and outside of the organization so
that the task could be completed effectively and efficiently to fulfill the organizational goals.
There must be a right valuation of all strategies which are made.
Mission statement
The mission statement is important for every organization in terms of getting significant
information about the organizational objectives. This also highlights the actual aim of the
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business. The mission statement of the Coca Cola is to refresh the mind, spirit, and body of the
world’s population and to develop a unique value and difference from its competitors.
Vision Statement
Vision means to have an idea and the vision statement is all about achieving the organizational
objectives and goals by providing the instructions to stakeholders. The vision statement of Coca
Cola is divided into several categories;
People motivating people to work with the company as it provides a great place to work
Portfolio developing product portfolio that would anticipate and fulfill different needs of the
people
Partners build network loyalty by maintaining long term relationship with them
Profit increasing the profitability of the company and return it to shareholders along with
fulfilling all responsibilities
Productivity the company wants to become effective as well as a fast-moving company in terms
of production
Core competencies
Competencies are all about competitiveness over the other businesses and organizations. Any
organization which is having the competitiveness can enter in any aspired market and can
achieve the organizational goals. The Coca Cola Company is very focused on its strengths and
weaknesses to make effective strategies and maintain a good relationship with employers,
traders and other stakeholders to achieve the business goals. Coca Cola also uses advanced
technology to keep every people updated about the latest information and changes to the
company.
Goals and Objectives
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Goals are all about a strong desire to achieve some specific objectives. Goals are set by the top-
level management of the organization where the objective is all about measurement of targets
and goals to be the best among all. The desires of Coca Cola Company to achieve the
organizational goals and objectives are very strong. This could be only the reason that this
company has developed itself in a wide range in international level (Jones and Comfort, 2019).
The main objective of the company is to be globally recognized for achieving its responsibilities
as well as ethical and become sustainable to grow in tomorrow's world.
1.2. ANALYSIS OF FACTORS TO BE CONSIDERED BY COCA COLA WHEN
FORMULATING THEIR STRATEGIC PLANS
There are some factors which could be very effective at the time of formulation of strategic
plans such as-
Culture- culture is one of the important factors that affect the strategic plan of the business.
The cultural activities involve the behavior of individuals like how employees are behaving with
customers and other members of the organization. They are capable enough to deal with
employees or not and so on. The Coca Cola’s culture is based on maintaining the quality of
output, effective communication, and operations with low risk, routine activities and work to
achieve the organizational goals. The Coca Cola also provide a better environment to
employees so that they can work with comfort and provide the training to every individual so
that they can perform their task effectively.
Communication- Communication is one of the important and effective factors. The
communication must be very effective whether it is between the senior to top-level
management or between employees and customers. Coca Cola is more focused on providing
the quality services to customers and hence they maintain the very effective and professional
communication with each other within the organization and also with customers (Voigt et al.,
2017). They use both verbal and non-verbal communication to produce quality services to
customers and to satisfy them with their work.
Environmental factors- The environmental factors involve the internal and external factors and
the analysis of these factors can help to analyses and evaluate the market condition. This will
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help to make effective strategies to deal with internal and external factors. Some internal and
external factors affect the working of Coca Cola which is the entrance of rivalry, negotiation of
suppliers, prevailing competitors in the industry, well-organized operations and procedures of
saving cost. These are the factors that affect the working of Coca Cola and also affect the
decision-making process of managers.
1.3. EVALUATE THE EFFECTIVENESS OF TECHNIQUES USED IN BUSINESSES
DEVELOP THEIR STRATEGIC PLANS
This is important for every organization to have an effective strategic plan for the development
of business and hence there is one technique by which the Coca Cola can develop its strategic
plan.
SPACE Analysis
Business can only develop when the business will have effective planning and strategies. With
the help of SPACE analysis, the Coca Cola can generate new ideas to make effective strategies in
the business and they can also set and effective strategic position in the market to compete for
the other grocery markets.
Figure 1: SPACE Matrix
Source: Dujak et al., 2017
BCG Growth-Share Matrix
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This matrix is used to evaluate different products sold by the company in the market. The
factors which are considered in this matrix are total sales of the year, the possibility for growth
and overall market share in the industry. Coca Cola is a big giant multinational company
operating in several countries even more than a century. The BCG Growth-Share Matrix of the
company is divided into four quadrants which are as follows:
 Question marks
 Cash cows
 Stars
 Dogs
Figure 2: BCG Growth-Share matrix
[Source: BCG Matrix, 2019]
Cash Cows
The products in the cash cows mean that there is not the growth of the product in the large
market share. The product still generates cash in the organization even the market is in a
mature stage. However, the market of Coca Cola is at a mature stage and its products such as
Limca falls into categories of a cash cow.
Stars
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The products in the stars are having rapid market growth as well as a large market share. They
are the products which generate maximum revenue for the company and help them to increase
the market share. The products of the company which falls into categories of stars are Thumps
up, Maaza and Kinley.
Question mark
Many of the products start at the stage of a question mark and they require a huge amount of
investment and even they are not contributing much in the growth of the company. A question
mark can become a star or dog depending on the response get from the target audience. The
products of the company which are included in question mark are Sprite and Fanta.
Dogs
The categories of dogs cannot generate cash and it consumes the cash of the company. The
market is in a declining stage and even after the efforts of the company it cannot perform well.
The products in this stage are Minute maid and Diet Coke.
TASK 2
LO2:
2.1. ORGANIZATIONAL AUDIT FOR COCA COLA AND ANALYSIS OF CURRENT
STRATEGIC POSITION.
The organizational audit helps to analyze the position of the company from every aspect. This
helps to analyze the strengths and weaknesses, threats and opportunities of the organization.
To analyze the current strategic position of the market and for organizational audit, the SWOT
analysis would be better.
Strengths Weaknesses
 Coca Cola has its market presence in more
than 200 countries and successfully
satisfying the needs and desires of millions
 Due to the absence of healthy beverages,
the company is not able to target those
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of customers.
 Coca Cola has a wide range of verities of
differentiated products or it could be said
that it has a great product mix that attracts
the customers to purchase the products
from Coca Cola and this again increase the
profitability of the company.
 The company also enjoys customer loyalty
as there are some products such as Fanta
which are preferred over other products.
customers who are health conscious.
 The product diversification strategy is
absent in case of Coca Cola as compared to
its competitors i.e. Pepsi which is dealing
in snacks segment also.
Opportunities Threats
 Diversification strategy in other segments
can help it to increase the revenue and
market share.
 The company can also target small regions
or villages which are slowly adopting the
consumption of beverages.
 The company can reach every part of the
world by building a strong supply chain
and distribution strategy.
 The company does not easily get raw
material due to the scarcity of natural
resources.
 The presence of other competitors also
decreases its revenue such as Starbucks,
Tropicana for health beverages, etc.
2.2. ENVIRONMENTAL AUDIT FOR COCA COLA
The environmental audit is also very important for the development of the organization. The
PESTLE analysis can help to audit the environment more effectively.
PESTLE Analysis
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Figure 3: PESTLE Analysis
Source: Reuer, 2019
Political factors
The most important political factor affecting the company is rules and regulations for food and
beverages. Other than this, regulations of quality, quantity, standards, etc. is also affecting its
business. The company also has to change according to tax or regulations of different countries.
Economic factors
The economic crises faced by the company affects the profitability and its customers. The
increasing prices of raw material, scarcity of water, etc. all have a deep impact on the business
of Coca Cola. The company manages its operations at the time when economies of different
countries crises, the management, and prices of the product even match with low-income
consumer goods.
Social Factors
Different taste and preferences of customers become opportunities for the Coca Cola and
company manufactures different varieties, taste, and flavors in the product categories. to
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match the changing needs of the consumers, the company also manufactures low-calorie food
so that they can satisfy the needs of their loyal customers.
Technological factors
Technology is used in distribution, production, packaging, and also labeling. This helps the
company to expand its business by ensuring that production and distribution should be as per
the need of the target customers. All these activities contribute to increasing its revenue
although it requires a huge investment in maintenance and installation it helps in bringing
efficiency and consistency in the operations.
Legal factors
Different laws and regulations of different countries increase threats for the company. Any
complaint or non-compliance of rules may damage the reputations and goodwill of the
company and even the fine of billions. Therefore, this is the reason the company follows its
ethics and corporate governance in all countries in which it operates.
Environmental factors
The company focuses on using recyclable and environmentally friendly products so that it
efficiently utilizes scarce resources. The concerns of the environment are growing at a fast rate
due to the involvement of government and other institutions for protecting the scarce
resources.
Porter’s Five Forces analysis
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