Change Management in Coca Cola: New Coke, Strategies, and Failure

This essay provides an in-depth analysis of the change management strategies implemented by Coca-Cola, specifically focusing on the failure of the "New Coke" product. It explores the reasons behind the change, including market competition and industry trends. The essay examines the three dimensions of change: reasons, influences, and environment, and identifies developmental change as the type of organizational change applicable in Coca-Cola. It also analyzes the change strategies that Coca-Cola could have implemented, such as improved communication and considering consumer emotions. The essay delves into the factors that contributed to the failure of New Coke, including the lack of a proper change model like Kurt Lewin's, and organizational and individual resistance. The analysis highlights the importance of understanding consumer attachment and the impact of emotional connections on brand loyalty, ultimately concluding that the failure stemmed from a disconnect with Coca-Cola's established consumer base. The essay provides valuable insights into the complexities of change management within a major corporation and the critical role of consumer perception.

Running head: CHANGE MANAGEMENT IN COCA COLA
CHANGE MANAGEMENT IN COCA COLA
Name of the Student
Name of the University
Author Note

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1.1 Introduction
As opined by Albers, Wohlgezogen and Zajac (2016), Change management can be
defined as the approach that is implemented in order to drive the effective usage and adoption
of the changes so that the initiatives are helpful in delivering the expected outcomes and
results. Change management is always based on an altered framework that is focussed on the
transition or transformation of the set of processes, results or acts that lead to different
organizational operations. Change requires the employees to engage themselves in different
ways of thinking and achieving transformation levels as well. The proper implementation of
organizational change is based on the changes that can take place in the subsystems and work
based processes as well (Albrecht et al. 2015).
The essay will be based on the analysis of the change that had been implemented in
Coca Cola and the failure that was experienced by its product named New Coke. The
dimensions that are related to effective changes implementation will be analysed in the essay
in detail. The alternative change strategy that could have been implemented by Coca Cola
will also be discussed in the essay. The changes based activities of the organization will be
analysed with respect to different aspects of operations of Coca Cola and the development of
its product name New Coke (Coca-cola.com 2019).
Three main dimensions of change
The process of change management is based on different components that are able to
affect the changes that are implemented in the organizations. The change implementation is
initiated by different factors like, motivation and processes. The environment mainly contains
elements that are based on success levels of change management (Al-Haddad and Kotnour
2015). The three major dimensions of change are as follows,

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1st dimension – The reasons for change – The reasons that are related to
implementation of change mainly contains three elements like, customers, competition and
industry. The changes that take place in the industry and introduction of technologies are
considered to be important factors that are able to affect the operations of organizations. 2nd
dimension – Influences of the change – This dimension is based on the areas in which
changes can take place (Alvesson and Sveningsson 2015). The characteristics related to the
organization that include, work ethics, processes and attitudes that have direct influence on
the successful change implementation. 3rd dimension -environment – The environment in
which changes are targeted have a huge influence on the rejection and acceptance. The
motivation based on change in the environment and culture where the change can take place
is able to play a major role (Bertram, Blase and Fixsen 2015).
Types of organizational change applicable in Coca Cola
Coca Cola had developed its position as a major brand in the soft drink based market
since its launch. The organization has been able to develop a connection with the customers
with the help of its products. Coca Cola had however faced major competition from its arch
rival Pepsi. The competition that has been developed between the two organizations is not
healthy in nature and has an impact on the ways by which the consumer base can be
developed. Pepsi had always planned to provide competition to Coca Cola by implementing
offensive marketing methods (Bird and Mendenhall 2016). As discussed by Burke (2017), the
organization has always targeted Coca Cola directly with the help of its products. The
development of a young brand image of Pepsi among the customers had reduced the gap
between the revenues of the two organizations. Coca Cola had thereby aimed to tackle this
issue with the help of the development of a product named “New Coke”. This change that has
been implemented by Coca Cola can be termed as developmental change. Developmental
change is mainly based on the ways by which improvements are made in the organization in

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the existing situation. The change has been planned with respect to the ways by which the
company can improve the revenue levels in comparison to its competitors that operate in the
industry (Cummings, Bridgman and Brown 2016).
1.2 Change strategies that can be implemented in Coca Cola
The change management strategies are mainly based on the ways by which the goals,
objectives of change process can be outlined in an effective manner. This is able to allow the
manager to identify the responsibilities, deadlines and activities that are based on change
management. Change management is able to provide directions and decision making process
is also informed with the help of proper implementation of change process (Engert, Rauter
and Baumgartner 2016).
Coca Cola also could have implemented effective change strategies in order to operate
profitably in the industry and to face the competition provided from its arch rival Pepsi.
Simplifying the communication - Coca Cola could have developed efficient communication
based process in order to introduce the product to the market. The communication could play
an important role in the ways by which the customers can be made aware of the features of
the product and its attributes (Feng, Huang and Zhang 2016). Not underestimating the power
of emotions - The emotions of customers that are related to the products that are offered by
Coca Cola could have been taken into consideration by the organization in order to develop
the products. The lack of attention that is provided by Coca Cola to the emotions of
customers can have a major negative impact on the revenues that can be gained by the
company with the help of sales of the new product. The failure of New Coke has been able to
depict that Coca Cola had not provided effective attention to the levels of emotions that are
related to consumers (Goffin and Mitchell 2016). This had led to major levels of negative
responses that had been received by the organization based on its new product “New Coke”.

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The withdrawal of its old product is also considered to be another major factor that is related
to the introduction of New Coke.
1.3 Failure of New Coke
1.3.1 Factors that could have made New Coke a success
The change management process that has been implemented by Coca Cola has not
been successful due to the lack of application of a proper change model. Kurt Lewin’s change
management model could have been implemented by Coca Cola in order to implement the
developmental change that had been planned by the management. The three major parts of
Lewin’s change management model include, unfreezing, change implementation and
refreezing. The unfreezing stage will help the employees and customers to get ready for the
products that are developed by Coca Cola (Helfat and Martin 2015). Change implementation
will be based on the ways by which the change can be implemented in the organization in s
successful manner. The organization refreezing process will be based on the tackling the
issues that can take place after change implementation. Coca Cola could have introduced the
new product by retaining the classic product as well. The two different products will be
targeted towards different types of target audience. This could have helped Coca Cola to face
the competition that is provided by Pepsi and also to maintain the classic product that is
considered to be its trademark (Hitt, Ireland and Hoskisson 2016). The implementation of an
effective and systematic change management process could have helped the organization to
maintain its operations in the industry.
1.3.2 Factors that led to the failure of change management in Coca Cola
The major factors that have led to the failure of change management in Coca Cola are
related to the lack of understanding of the organization based on high levels of emotional

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attachment of consumers with the products. Coca Cola had been in operations in the soft
drinks market for a long time. The organization had developed a leadership position in the
industry with the help of its trademark products. However, it soon faced major levels of
competition from its arch rival Pepsi based on the image that had been developed in the
minds of consumers (Holten and Brenner 2015). Pepsi had formed a youth brand based image
that had proved to be helpful for the company to develop a young fan base. Pepsi had also
implemented aggressive methods in order to provide competition to Coca Cola. Coca Cola
had therefore aimed at targeting the younger group of consumers with the help of the new
product that had been introduced in the industry. The company had introduced the product in
the market by withdrawing the classic Coke based product (Lin, Su and Higgins 2016). The
organization had aimed to target a new group of customers with the help of its product “New
Coke”. However, the major mistake that had been made by the organization was based on the
lack of importance that has been provided to the customers. Coca Cola had not taken into
consideration emotional connection that the customers have with the products and the ways
by which this connection is able to affect the loyalty levels (Petrou, Demerouti and Schaufeli
2018). The new product was not able to connect with the emotions of customers of Coke and
this factor had led to the boycott of products by the customers in the US. Although Coca Cola
had faced major competition from the new types of products of Pepsi, the value of the classic
products has been considered to be quite high and the company had to focus on bringing
improvements in the classic products rather than delivering a whole new product
(Schnackenberg and Tomlinson 2016).
1.3.3 Organizational resistance factors that affected the success of New Coke
The decision that is related to introduction of “New Coke” in the industry was not
supported totally by the executives of the organization. The change that was implemented in
the new product of Coca Cola is related to the modifications that have been made in the taste

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and the whether these changes have made the product similar to that of its rival. This factor
had caused issues in the effective operations of Coca Cola in the soft drink based industry
(Stephan et al. 2016). The image that had been developed by Coca Cola with the help of its
previous advertisement had been affected in a negative manner by the contradictions that had
taken place due to advertisements of New Coke. The management level employees of the
organization were also not convinced about the effects of New Coke. Although Coca Cola
had done sufficient levels of market research based on the taste of New Coke, the
organization was not able to understand the market in an effective manner (Vaara,
Sonenshein and Boje 2016). The lack of proper understanding of the emotional factors was
also based on the absence of employee motivation to develop connection with the customers.
1.3.4 Individual resistance to change in New Coke
The individual resistance of changing the flagship product of the organization was
mainly related to the resistance that has been provided by the customers of Coca Cola. The
resistance levels were mainly related to the ways by which customers of the organization are
related to the classic product. The youth brand image that had been formed by Pepsi was a
major target related to development of a new product by Coca Cola. However, a major
resistance has been provided by the loyal customers of the organization who were highly
familiar with the actual taste of the classic product (Petrou, Demerouti and Schaufeli 2018).
This resistance had proved to be so strong that the organization had to withdraw “New Coke”
from the market. The organization had to change the ways by which products are advertised.
The resistance that has been provided to the development of a new product by the customers
had led to its failure. The competitor of Coca Cola had also taken major advantage of
situation that had been developed in the market due to development of “New Coke” (Lin, Su
and Higgins 2016).

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1.4 Change responsibilities in Coca Cola
The change management resource team is able to play a major role in the ways by
which change process can be implemented in the organization. The team that has been
developed in Coca Cola will decide the change that needs to be implemented. The design of
new products will be finalised by the members of the change management resource team. The
senior managers or executives are able to play the key role in communicating the changes to
employees. The executive team of Coca Cola had communicated the change implementation
process to the employees (Hitt, Ireland and Hoskisson 2016). The decision related to product
development that is made by the change management resource team has to be communicated
to the employees. This is considered to be an important part of the entire change management
based process. The supervisors and managers have been able to play a major role in the way
by which the entire work process based on development of the products has been managed.
The development of “New Coke” has been made possible with the help of collaboration that
has been formed between the employees and the supervisors in an effective manner (Feng,
Huang and Zhang 2016). The launch of a new product can be considered to be a part of
macro change that is able to play a major role in the ways by which the company can
maintain its future operations. The project team is able to play the most important role in
change management based process. The team members have been provided with different
tasks based on their capabilities. The different tasks that are provided to the team members
mainly include, strategizing, developing, producing and distributing (Engert, Rauter and
Baumgartner 2016). The tasks that are provided to each of the employees have been fulfilled
in order to complete the entire production based process. The project support based functions
are also considered to be an important part of the organizational processes of Coca Cola. The
different groups of the organization that have provided effective project support in case of
implementation of the change are internal communication staffs, human resource staff,

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organization development related staff, training staff and business analysts (Hitt, Ireland and
Hoskisson 2016). The entire process of development of the product is thereby based on the
ways by which “New Coke” has been launched in the market (Feng, Huang and Zhang 2016).
Conclusion
The essay can be concluded by stating that Coca Cola has faced major issues in
gaining market shares with the help of its newly launched product that has been named as
“New Coke”. The most important part of the issue that has been faced by the organization is
mainly based on the lack of proper connection with the customers that was to be developed
by Coca Cola. This had led to the failure of the product and its withdrawal from the market as
well.

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