Strategic Analysis Report: The Coca-Cola Company (SIM336, TNE)

This report presents a comprehensive strategic analysis of The Coca-Cola Company, examining its internal organization, organizational design, mission, and vision. The analysis delves into the company's strengths, weaknesses, opportunities, and threats through a detailed SWOT analysis. The research explores the company's evolution from a centralized to a decentralized organizational structure, its international divisions, and its strategic management under various leaders. The report also reviews the company's literature, research methodologies, and provides recommendations based on the findings. Furthermore, the report discusses Coca-Cola's marketing and management strategies, including product differentiation, human resource management, and the impact of external environmental factors. The study uses a variety of research methodologies, including internet research, questionnaires, and observations of company operations. This analysis provides a thorough understanding of Coca-Cola's strategic approach, market position, and management practices.

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THE COCA COLA COMPOANY STRATEGIC ANALYSIS
Name:
SIM336: Strategic Management (TNE), strategic analysis
Date:

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TABLE OF CONTENT
Introduction …………………………………………………………………………………1
Literature review…………………………………………………………………………….2
Research methodologies…………………………………………………………………….5
Main analysis………………………………………………………………………………5
 Internal organization …………………………………………………………… 5
 Organizational design…………………………………………………………….7
 Mission and vision ……………………………………………………………….8
 SWOT analysis………………………………………………………………………9
1. Strength
2. Weaknesses
3. Opportunities
4. Threats
Recommendations ……………………………………………………………………………12
Conclusions……………………………………………………………………………………13
References …………………………………………………………………………………….14

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The coca cola company strategic analysis
Introduction
In this world, there are over 2000 organizations, which serve different functions and
different purposes. All these organizations have a history of success and failures. They have also
faced different challenges and opportunities during their time of operation. Some organizations
have failed to attain their objectives while others through good management and participation
from the employees have proudly achieved their goals and objectives. The coca Cola Company
is one of the most successful profits making organization has also faced these challenges and
opportunities. The company is a worldwide known company, which started in the United States
of America as a small retail business of Pemberton. The company has a long story of successes
and supplies products to over 200 countries in the world. The company serves around 1.7 billion
of its drinks in one day and is the best soft drink company in many years. 1
Management strategies and other factors of an organization determine whether the
company will perform better in its operations or not. The coca cola company has had different
1 Adeyemi, S. L., and A. O. Salami. "Inventory management: A tool for optimizing
resources in a manufacturing industry a case study of the coca-cola bottling company, Ilorin
Plant." Journal of Social Sciences 23, no. 2 (2010): 135-142.

4
management strategies, which keep on changing for the company to be able to meet the ever-
changing demand for its products. It also has a mission and visions set by the management to
enable the company staff to remain focused on achieving this goals and objectives. The
company has faced different challenges discussed below in its organization and management and
opportunities. It is affected by the external environment, which has also contributed a lot to its
success. The following is a research on the organizational and management strategies of the
company. The research evaluates the company’s management structure, environmental effects
and competition, a SWOT analysis and pest test of the company. It also gives recommendations
on the best management strategies that can be adapted in the company.
Literature review
Before we embark on the strategic management, strategies there is need to understand
some overall information about the company. The company is the largest supplier of soft drinks
around the globe. It has a large network of supply where it supplies its drinks to over two
hundred countries. These drinks are over 399 brands of soft drinks. The large network has
incorporated more than 140000 associates of the company so that it can be able to distribute this
large amount of soft drinks.2 Because of this huge product portfolio and the fact that the
company has very different customers there is the need for a very smart and specific marketing
and management strategies. Therefore, the company has narrowed down its management and
marketing strategies in different countries because a strategy that works for one country might
not work in another company.
2 Albert, Pauline J., Patricia Werhane, and Tim Rolph. "Introduction." In Global Poverty
Alleviation: A Case Book, pp. 1-11. Springer, Dordrecht, 2014.

5
The company in order to be more competitive has a differentiation strategy that is met
through producing high-quality products that excel over their closest rivals and brings a very
high image of the brand and recognition. The company also achieves a product differentiation
with promotions and a unique packaging. For instance, the company uses one bottle that has now
become an internationally recognized symbol.3 The above methods are primarily the methods
that the company uses for its strategic direction and management. The company through the
above measures is able to bit its competitors and provide products that are uniquely valued by its
customers. Its product is in a good way incorporated into a huge portfolio that enables the
products to hold a huge market from the world.
Like in any other organization and corporation, managing this huge corporation involves
many challenges in the management of human recourses and which should never be neglected
for the success of the corporation. These challenges are experienced in training of the employees
and other areas in the human resource management. The coca cola company took three different
approaches to address these challenges. The company involved in strengthening their
development focus and business strategy links, it also put measures to involve their leadership in
all areas involving development and used different tools of development to counterpart
organizational and personal needs in a better way.
The company uses both mentoring and coaching methods concurrently that brings a great
benefit to the employees. Through coaching, the company is able to increase its performance.
An activity occurs between the employer and the employees, which is informal. On the other
3 Ansari, Asim, Florian Stahl, Mark Heitmann, and Lucas Bremer. "Building a social network for
success." Journal of Marketing Research (2018).

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side mentoring is when the company’s employees relate to another person who is not part of the
organization or area. The reasons for mentoring are broader even though the mentor applies all
coaching aspects.4 The company through applying both mentoring and coaching believes that
the two plays their own different roles in the human recourses effort of development. The
company also greatly affirms that development of staff plays a great role in bringing competition
benefits to the organization. This has increased the company performances thus the great success
of the organization.
Research Methodologies
In order to be able to obtain clear information about the company and its management
strategies, there was the need to apply different methodologies in doing my research. The
following are some of the different methods used in obtaining information about the
organization. First and for most I used the internet to obtain information directly from the
company website. On the same, I obtained information from articles written by different
personnel concerning the company. Secondly, I prepared questionnaires based on the case study
of my research, which I administered to different people in the organization. These people
included workers from the organization, customers, and managers. In addition, I took a visit to
different branches of coca cola Company around the country to understand organizational and
management strategies of the company. Through observation and direct interview of staff about
4 Armitage, Kevin C. "Environmentalism of the Rich. By Peter Dauvergne." (2018): 406-408.
Chu, Jenny, Patricia Dechow, Kai Wai Hui, and Annika Yu Wang. "Maintaining a Reputation
for Consistently Beating Earnings Expectations and the Slippery Slope to Earnings
Manipulation." (2018).

7
the company operations, I was able to obtain first-hand information about the management
strategies.
Main analysis
The internal organization of the company
Over the years, the company has been changing its organizational structure to be able to
meet its market demands. The company changed from a centralized organizational system to a
decentralized organization where it has managers based on the local level. It has a separated
international division structure where its staff operates in a different way depending on the
country. These divisions are in isolation from the higher management and operate locally. This is
useful because they are able to evaluate the market of the product from a closer view to be able
to make changes where necessary. They are also able to receive direct feedback and opinions
from the direct consumer of the product. The company has divisions a management group in all
the continents with presidents who control the different divisions in the continents. The company
has an overall of five continental divisions that are as follows;
1. European group
2. Latin America group
3. North American group

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4. Pacific group
5. Eurasia & Africa group
The company has a president for each group in different continents.5 The structure used by the
company is too large and cannot operate from one management group. The head management
controls all the company operations in the different continents through the divisions. The
following is a diagram showing the organizational structure of the company and the divisions
Organizational design
The coca cola company due to increased marked demand realizes that there is need to
have a well-designed management structure to be able to meet the ever-changing demand. The
company, therefore, moved from centralized organization to decentralized system. The
organization came up with two operating groups that are corporate and bottling investments
groups. These divisions allow management decisions to be made at a local level and therefore the
organization can respond to the changing demand of the market quickly.
This gives the higher-level management enough time to focus on planning the
organization's strategies in long-term bases. Most decisions and innovations are located in the
corporate division of the company. This design includes advertising and other decisions affecting
the sales of the company’s products. However, the major decisions affecting the company’s
operations are left to the higher management.
5 Conlon, Patrick. "Grandfathered into Commerce: Assessing the Federal Reserve's Proposed
Rules Limiting Physical Commodities Activities of Financial Holding Companies." NC Banking
Inst. 22 (2018): 351.

9
Strategic management of the company is evident in the leadership of Neville Isdell who
was made the CEO of the company and the chairperson in 2004. In his management as a CEO,
he used mechanisms of integration that were more complex so that he could increase the growth
rate of the company. He used the top management personnel to come up with solutions for the
problems affecting the organization. In addition, he called for frequent face-to-face, meetings to
held at the local level so that the company’s employees could remain updated at all times. He
also applied the use of intranet so that different information that is important to the company is
shared in a faster and effective way. These complex management strategies are important in
raising the performance of the organization and increasing productivity of the employees. The
organization has the board of directors who are the greatest contributor to the capital of the
company. The boards of the director are responsible of making the very important decision of the
company. These are decisions involving great risks and the higher-level management cannot be
trusted with such decisions.
Mission and vision of the organization
Strategic management of an organization involves setting a vision and mission for an
organization. This enables the organization to come up with a good operational plan to be able to
meet the mission and vision set. It also enables the organization employees to remain focused
and work hard towards realizing the organization goals. The coca cola company due to the
changing world has to view the trend of business look ahead and set goals and missions that will
enable it to remain purposed and to shape the future of the business. The company must take
actions to get ready for the future in the present times. This enables the company to have a safe
destination in the end and a direction of succeeding together with other partners who deal with
the same products.

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The company has a mission based on three objectives, which the company is determined
to achieve. The objectives involve; exhilarating the globe, bringing happiness and optimism
experiences, adding value and making a difference. On the other hand, the company vision
guides in the things that the company is required to accomplish so that it can achieve quality
growth and sustainability. The company has a vision to be a great place of work that inspires
their workers work to their best abilities. It also wants to provide the world a wide range of
brands of beverages, which are of high quality that brings great satisfaction to the customers.
Maximization of profit, increasing productivity and becoming a good partner to other companies
is also part of the vision.
SWOT analyses
Each operating organization in the world has strengths, weaknesses, opportunities, and
threats that it faces in its operation. The strengths are those that contribute to the company’s
success and those that make the company remain operational. On the other side, weaknesses are
those aspects of an organization, which brings the operations of the business down and works as
a barrier for the company to meet its objectives. Opportunities are chances and offer created for
the company to venture into certain productive actions by the environment. Threats are factors
that if not taken care of appropriately may lead to poor performance of the organization.
Strengths: the company produces the best brand of beverages in terms of quality and
value. It has been for a long time the best soft drink producing company that has acquired
customers all over the world. The company has also attained the largest share of the world's
market for beverages products. The market share is estimated to be around 58% of the world's
market for beverage drinks. The advertising and marketing strategies are also part of its strength.

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The company uses of expensive advertisement methods and is highly recognized around the
globe. The company also supplies its commodities to over 200 countries in the world and makes
sales of over $1.65 billion per day. The company has a strategy that enables it to compete
effectively whereby it has branches all over the world and produces its products at a local level.
This enables the company to evade the government regulations discouraging importation.6
Weaknesses: the company focuses on producing carbonated drinks where it focuses on
selling coke, Sprite, Fanta and other varieties of carbonated drinks. On the other hand, the world
has put in place different strategies to fight with obesity and people are encouraged to take
healthier drinks and foods. Therefore, the work of the company of embarking on the production
of the carbonated drinks will just have a short-term effect on the organization. The company has
also focused on the production of beverages, unlike the other competitors that are a disadvantage
to the organization. From the fact that the company does not engage in the selling of other
commodities such as foods and the fact that the sale of soft drinks is stagnating the company will
get challenges in joining the selling of other commodities. The company also faces a weakness of
having a huge amount of debt because of acquisitions. For instance, the company level of debt
increased due to the debt that the company acquired about $8 billion from CCE's. The company
is also facing a negative influence from what people say about the company. It is criticized by
people in the areas where there is no enough water for consuming a lot of water. The firm also
does not have a good strategy of introducing new drinks to the market and out of the many
6 Taylor, Charles R. "Red Alert: On The Need for More Research on Corporate Social
Responsibility Appeals in Advertising." (2018): 337-339.

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brands it produced are not ball having the same level of the market. Very few brands result to at
least $1billion value of sales.
Opportunities: the company other than the soft drinks deals with selling bottled water to
different parts of the world. The market for bottled water is growing at a higher rate in different
parts of the globe. For instance, in the US and in the other parts of the world there is an increase
in demand for drinks and food, which does not bring health complications. Therefore, demand
for water has increased to a higher level, which is an excellent opportunity for the company. The
company also has an opportunity created by the emerging markets from the developing
countries. The company has a chance to maintain the market share in those countries.7
Threats: the threats that face the company are the changing of consumer tastes and
preferences. Consumers are not willing to consume carbonated drinks for they are concerned
about their health. This has posed a great threat to the company as it produces carbonated drinks
only. The scarcity of water is also a threat to the company. Around the world, scarcity of water is
a trending issue, which increases the cost of producing the drinks and public critics to the
company. The company also faces a threat from the legal regulations by the government on the
production of carbonated drinks, which are not suitable for human consumption. Lastly, the
company is facing a great threat due to the reduced net profit margin and gross profit. The profit
has been decreasing for the previous 5 years and has continued to reduce even in the current
years
7 Serôdio, Paulo M., Martin McKee, and David Stuckler. "Coca-Cola–a model of transparency in
research partnerships? A network analysis of Coca-Cola’s research funding (2008–2016)."
Public health nutrition 21, no. 9 (2018): 1594-1607.

13
Figure 1.3
External environmental effects
For the company to operate effectively it relies so much on the external environment. The
environment provides opportunities for the company and threats that may affect the productivity
f the company. The company uses clean water that is a great problem to get the water in different
parts of the country.8 The company also depends on the environment for market and other raw
materials. The company faces a challenge of only depending on a few suppliers of raw materials
that is a great threat to the company. On the other hand, the company contributes to the
environmental pollution with plastic cans, which are a great pollutant. In the strategic
8 Armitage, Kevin C. "Environmentalism of the Rich. By Peter Dauvergne." (2018): 406-408.
Chu, Jenny, Patricia Dechow, Kai Wai Hui, and Annika Yu Wang. "Maintaining a Reputation
for Consistently Beating Earnings Expectations and the Slippery Slope to Earnings
Manipulation." (2018).

14
management of the company, the managers and directors are supposed to consider the effects the
company brings to the environment.9
Recommendations
After looking dip into the strategic management analysis I would want to recommend the
following for the company; the company in order to be environmental friendly should replace the
aluminum and plastic containers with burlap containers, which are friendly to the environment.
Secondly, the company should come up with strategies so that they can be able to increase the
marketing teams in the rural. The company should also introduce non-carbonated drinks in order
to be able to sell to those who do not drink carbonated drinks. In addition, the company should
venture into selling other products other than just beverages. This product includes food staff and
other products, which are not beverages. In addition, the company should involve other direct
product promotion methods like giving gifts to the customers and not telling them to shake a
soda but to buy one for their own. Finally, yet importantly, I would recommend the company to
get the supply of raw materials from different suppliers so that they can reduce the risk that
comes with the failure of the suppliers.
Conclusion:
In conclusion, Coca-Cola Company is a very effective and efficient company. it serves
around 200 countries in the world and is recognized all over the world. The company has a
strategic management system that involves having independent groups of managers in different
9 Rosenberg, Martha. "US public health agency issued over failure to release emails from Coca-
Cola." BMJ: British Medical Journal (Online) 360 (2018).

15
countries. These divisions are able to make decisions at a local level that enables the company to
be able to respond to the change in demand in a quick way. The company has a board of
directors who are involved in making decisions on the most important matters of the company.
The company is a very competitive company and with different strategies of differentiating its
products has been able to bit its competitors. The company has a vision and a vision that
motivates the employees and keeps the focused towards the goals of the organization. It has its
strengths, weaknesses, opportunities, and threats, which affects the countries operations.10 Lastly,
the company should apply different strategies to be able to counter the decreasing rate of its net
profit.
Bibliography
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Chu, Jenny, Patricia Dechow, Kai Wai Hui, and Annika Yu Wang. "Maintaining a Reputation
for Consistently Beating Earnings Expectations and the Slippery Slope to Earnings
Manipulation." (2018).
Conlon, Patrick. "Grandfathered into Commerce: Assessing the Federal Reserve's Proposed
Rules Limiting Physical Commodities Activities of Financial Holding Companies." NC
Banking Inst. 22 (2018): 351.
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18
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