Coca Cola Final Report: HRM Strategies for Market Challenges

This report offers a comprehensive analysis of Coca-Cola's strategic human resource management, focusing on the company's challenges in maintaining market share, particularly due to the decline in sales of its traditional carbonated beverages. The report begins with an executive summary outlining the problem, followed by an introduction to the company and the specific issues it faces. It then delves into an environmental analysis using the SWOT framework to assess Coca-Cola's strengths, weaknesses, opportunities, and threats. The financial implications of the declining market share are examined, highlighting the costs associated with advertising, inventory, and sales. The report concludes with strategic recommendations for the human resource department to help Coca-Cola adapt to changing consumer preferences by diversifying into the health drink market. The recommendations include acquiring qualified talent, training the workforce, and developing a strong marketing team to promote new health products. The report emphasizes the importance of HRM as a strategic partner in overcoming the challenges and achieving the company's goals. References are provided to support the findings and recommendations.

Running head: COCA COLA FINAL REPORT
COCA COLA FINAL REPORT
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Author Note

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Executive Summary
The given report throws light on the strategic human resource management of an international
organization named Coca Cola. Company. The Coca Cola company is a leading carbonated drink
manufacturer established since the past 140 years. However recently the company has been
losing out on its market share due to its lack of healthy products. This report has outlined the
given loss of market share problem and makes use of the SWOT Analysis to examine the
external environment. The financial implications of the problem have also been given along with
the recommendations on the role of Human Resource Management to help the company in
improving the given problems.

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Table of Contents
Part 1................................................................................................................................................3
Introduction......................................................................................................................................3
About the organization................................................................................................................3
About the Problem.......................................................................................................................3
Role of HR in the given problem.................................................................................................4
Part 2................................................................................................................................................4
Environmental Analysis...................................................................................................................4
Part 3:...............................................................................................................................................7
Financial Implications.....................................................................................................................7
Part 4:...............................................................................................................................................8
Recommendations............................................................................................................................8
Conclusion.......................................................................................................................................9
References......................................................................................................................................11

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Part 1
Introduction
As the competitive business environment has become more complicated, it has become
essential for the business to ensure that it adapts to the needs of the business environment in
order to ensure that it is able to survive. However, safe playing cannot be continued for a long
period of time and very often the organization is faced by certain problems. The given report will
analyze the problem faced by one such organization named Coca Cola (Adekola, & Sergi, 2016).
The report will be highlighting various components of the problem and how Human Resource
Strategic Planning can help in overcoming the given problem.
About the organization
The Coca Cola company is a global producer of concentrates which is then sold to the
bottlers. The company is the owner of various Coca Cola merchandise, vendors and is a major
supplier to various cafes and restaurants all around the world. Apart from the drink it is also the
manufacturer of other variants like Coca Cola Vanilla, Diet Coke and coffee. It has been labeled
as the best brand in 2015 (Coca-colacompany.com., 2018). The products are sold to around 200
countries in the globe with more than 1.8 billion servings daily globally.
About the Problem
The primary problem being faced by the Company comprises of its dropping sales in the
developing as well developed countries alike (Alfes et al., 2013). This problem has become a
major concern because, the cola is supposed to contain soda which has cancer causing

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components. With this and almost no health benefits, the company has been losing its market
share to local companies and better health drink options. Due to this, the revenue of the company
has been affected greatly. The future implication of this problem may be that the company might
suffer a huge blow and would have to reduce its operations due to low to minimum sales in the
country.
Role of HR in the given problem
The given problem relates to the product aspect however, the human resource department
of any organization can be referred to as its strategic parent who can go hand in hand with the
company and allow it to solve its problems and help in achievement of the goals of the
organization (Alfes et al., 2013). In this aspect, the human resource management can help the
firm by forming a comprehensive team in various countries who will be given the responsibility
of bringing up ideas of better products for the organization. It will be the responsibility of the
human resource department to recruit qualified people to bring the organization back on track.
Part 2
Environmental Analysis
An organization does not function alone and therefore, it becomes very important for the
organization to ensure that it functions in tangent to the environment. For this reason, the given
section will undertake a SWOT Analysis of the Coca Cola and briefly discuss the findings with
reference to the given problem of losing market share (Armstrong et al., 2015).

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SWOT Analysis examines the Strengths, Weaknesses, Opportunities and Threats of an
organization with respect to its functioning.
Strengths of Coca Cola are as follows:
 Brand Equity- The brand equity of Coca Cola is extremely strong as the company is more
than 140 years old and the customers have been consuming it for a long period of time
(Wild, Wild, & Han, 2014).
 Global Presence- The company has its operations al around the globe. It is very popular
among all the countries and a common household name.
 Large market share among its competitors- Among the black carbonated drinks, Coca
Cola has the strongest market share.
 Customer Loyalty- Certain customers who have been with the company for a long time,
prefer purchasing the given product (Armstrong & Taylor, 2014).
 Distribution Network- Coca Cola company has one of the strongest distribution networks
around the globe.

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Figure 1: SWOT Analysis of Coca Cola Company (As created by the author).
Weaknesses of the Coca Cola Company
 The competitor Pepsi- In the drinks segment, although Coca-cola has a greater share than
Pepsi, Pepsi has a growing market
 Low diversification- The products of Coca Cola are quite limited and it lacks
diversification into other segments (Budhwar & Debrah, 2013).
 No health beverages- The company offers little to no health beverages and all the
products are assumed to be unhealthy.
Opportunities of Coca Cola Company-
 Health sector entrance- It can try and enter into the health care sector with health drinks
and other products.
Strenghts:BrandEquityGlobalPresenceCustomerLoyaltyDistributionNetworkLargemarketshareWeaknessPepsiasacompetitorLowdiversificationNohealthbenefitoftheproductsOpportunitiesHealthsectorentanceDiversificationEmergingMarketsSupplyChainimprovementThreats:WatersourcingIndirectcompetitionSWOT

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 Diversification- The company can make sure that it is able to diversify into other
segments.
 Emerging markets- There are many emerging markets which can be captured.
 Supply chain improvement- The company can improve its supply chain management and
go beyond the value chain.
Threats of the Coca Cola Company
 Water sourcing- Water seems to be one of the biggest problems of the company and it is
believed to leave pesticides in the water used for the cold drinks (Marchington et al.,
2016).
 Indirect competition- It has been receiving indirect competition from the local suppliers.
Findings:
From the given analysis it can be seen that the company faces major threat from the
indirect competition due to its lack of hath component aspect. As people are becoming more
health conscious recently, they prefer the consumption of more health friendly products.
However, as Coca cola has not explored this segment, it has been facing a drooping market
share. This weakness of the company is the major source of its problem (Marler & Fisher, 2013).

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Part 3:
Financial Implications
According to Purce (2014), the drink market now is largely captured by the health drink
companies and due to thus the profit of the Coca Cola company has fallen down considerably
and the revenues were missed by nearly $300 millions.
The health conscious customers are trying to cut out on the health drink for lower calories
and sweeteners. For this purpose the given company has bearing the given costs:
 Advertisement Costs- As the sales of the company are falling, the company engages in
high scale advertisement costs (Jackson, Schuler & Jiang, 2014). This advertisement
costs targets at increasing the sales of the company which would then lead to an impact
on the budget of the company.
 Inventory Costs- The inventory of the company is also going through a waste due to the
dip in sales. This also gives rise to other costs such as rent and electricity which is not
getting utilized properly.
 Sales Costs- The company is trying to push down the products in the market and for this
reason the company incurs high sales cost which further takes a dig at the company`s
revenue system.
 Human Resource Costs- The human resource costs in pursuit of the sales has also been
increasing considerably (Lengnick-Hall, Lengnick-Hall & Rigsbee, 2013). If the problem
persists, the company will continue incurring high costs and diminishing profits.

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Part 4:
Recommendations
After analyzing the given aspects of the problems which are facing Coca Cola, certain
recommendations will be made so as to help the company to solve the problem of losing market
share:
1. The human resource department needs to understand the sales strategy and acquire talent
accordingly.
The firm needs to sit together with the top management and understand the problem
on a first person basis and then help the firm in acquiring talent which will go a long way in
helping the company to carry out the smooth transition from a soda drink to a health drink
diversification strategy (Cascio, 2018). It needs to acquire highly qualified talent who will
help the firm in researching the market and finding the right talent with the help of which it
can enter the market of health drinks.
2. Understanding the role required and work accordingly towards successful completion of
organizational objectives
The whole organization needs to undergo a change. As the company already has a fine
share of market, it needs to see to it that the transition is smooth. For this purpose, the whole
organization is required to undergo a change and training has to be provided to the employees to
assist them in the change process (Renwick, Redman & Maguire, 2013). The human resource
department will carry out this training which will help the employees to focus on the new
objectives of the firm.

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3. Finding a good marketing team to then change the positioning of the firm
Once the newly recruited team has been able to come out with the new health products,
the firm then needs to appoint or train the existing marketing team to help them in their efforts to
promote the health products of Coca Cola (Baluch & Ridder, 2017). They can be provided
training on various aspects with respect to different countries on how to make use of appropriate
marketing tools. This is an integral part of the organization as the success of its new
diversification heavily depends on the ability of the firm to communicate to its customers.
Conclusion
Therefore from the given analysis it can be stated that the primary problem of Coca Cola
lies in its ability to provide the healthy offering to its group of consumers. It is for this reason
that the company should try to expand into the health drink market and for this the human
resource department needs to act as a strategic partner and help the company by providing them a
strong employee base to carry out the various tasks involved in this new venture.

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References
Adekola, A., & Sergi, B. S. (2016). Global business management: A cross-cultural perspective.
Routledge.
Alfes, K., Shantz, A. D., Truss, C., & Soane, E. C. (2013). The link between perceived human
resource management practices, engagement and employee behaviour: a moderated
mediation model. The international journal of human resource management, 24(2), 330-
351.
Alfes, K., Truss, C., Soane, E. C., Rees, C., & Gatenby, M. (2013). The relationship between line
manager behavior, perceived HRM practices, and individual performance: Examining the
mediating role of engagement. Human resource management, 52(6), 839-859.
Armstrong, G., Kotler, P., Harker, M., & Brennan, R. (2015). Marketing: an introduction.
Pearson Education.
Armstrong, M., & Taylor, S. (2014). Armstrong's handbook of human resource management
practice. Kogan Page Publishers.
Baluch, A. M., & Ridder, H. G. (2017). Strategic Human Resource Management. In The
Nonprofit Human Resource Management Handbook (pp. 89-106). Routledge.
Budhwar, P. S., & Debrah, Y. A. (Eds.). (2013). Human resource management in developing
countries. Routledge.
Cascio, W. (2018). Managing human resources. McGraw-Hill Education.