LSBM100 - Coca-Cola's Business Development Through IT Management

This report analyzes Coca-Cola's management of information technology to gain competitive advantages. It covers background information, products, and services, and uses Porter's Five Forces to analyze the competitive environment. The report also explores inbound and outbound logistics, value-adding activities, and the deployment of IT within Coca-Cola, linking these to Porter's Value Chain model. The analysis highlights how Coca-Cola leverages IT solutions to enhance productivity and maintain its market position within the beverage industry. Desklib offers a range of similar solved assignments and study resources for students.

Managing Information and
Technology
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Table of Contents
Introduction......................................................................................................................................3
Background information..................................................................................................................3
Products and services.......................................................................................................................4
Analysis of the competitive environment (Porter’s 5 Force analysis with justifications)...............4
Inbound logistics..............................................................................................................................6
Operations........................................................................................................................................6
Outbound logistics...........................................................................................................................6
Two support activities in Porter's Value Chain ..............................................................................6
Value adding activities.....................................................................................................................6
Deployment of information technology (IT) ..................................................................................6
Conclusion.......................................................................................................................................6
References........................................................................................................................................8
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Introduction
Managing information technology is said to be the actions taken into consideration by a
business organisation in order to take right decisions to gain competitive advantages. Basically,
resources in relation to information technology is specifically managed in relation to all the
needs and requirements of a company. Under this report, organisation which is utilised to show
the management of information system is Coca-Cola (Cresswell, Bates and Sheikh, 2013). It is
an American carbonated soft drink manufacturer which was found in the year of 1886 and
invented by 19th century by John Stith Pemberton. This report is going to be enclosed with
different models like Porter’s 5 Force analysis, Porter's Value Chain model and it will also put
light on different value adding activities done by the company to gain competitive advantages.
Away with this, report will also cover the information in relation to operations, inbound and also
outbound logistics as well. Lastly, deployment of information technology (IT) is also be
performed, which would lead the company to gain number of ideas for bettering their IT
solutions at workplace.
Background information
One of the famous carbonated soft drink manufacturer i.e. Coca-Cola which was found in
the year of 1886. Primitively, this organisation marketed as a temperance drink and intended as a
patent medicine. In late 19th century, this carbonated drink was invented by John Stith
Pemberton & later on, it was specifically purchased by Asa Griggs Candler (a businessman).
This action, which was taken by Asa changed the whole viewpoint of the whole world,
whose marketing tactics led Coca-Cola to its dominance of the world soft-drink market
throughout the 20th century. If it is talked about drink's name which was utilised was specifically
originated from Coca leaves, and kola nuts (a source of caffeine). The current formula of Coca-
Cola remains a trade secret, although a variety of reported recipes and experimental recreations
have been published. Along with this, it is said that company is holding more than, 3,900
sparkling product related choices offered by business firms (Marchewka,2014). This led Coca-
Cola, to become one of the famous valuable along with the recognizing brand in all over the
world. Including this, it has been examined that Coca Cola is also holding a brand portfolio
considering an amount of 21 billion-dollars (Pearlson, Saunders and Galletta, 2016). This
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organisation (Coca-Cola) is also working in more than 200 nations, which made this organisation
much more fruitful in nature.
Products and services
In present time, Coca Cola, which is one of the famous soft carbonated drinking
manufacturer developed different syrups along with the finished beverages. Here, number of
products like water and sports drinks, sparkling soft drinks, dairy and plant based drinks, juice,
coffee and tea as well. Including this, These brands include Coca-Cola Zero, Diet Coke, Dasani,
vitaminwater, Fanta, Sprite, Minute Maid, Powerade, Del Valle, Simply, Gold Peak, Georgia and
so on.
Analysis of the competitive environment (Porter’s 5 Force analysis with
justifications)
Porter’s Five Forces Analysis of Coca Cola:
Porter's Five Forces is a model that recognizes and examines five serious powers that
shape each industry and decides an industry's shortcomings and qualities. Five Forces
examination is as often as possible used to distinguish an industry's structure to decide corporate
technique. Watchman's model can be applied to any portion of the economy to comprehend the
degree of rivalry inside the business and improve an organization's long haul benefit. The Five
Forces model is named after Harvard Business School educator, Michael E. Porter. This model
was found by Michael E Porter, which helps organisations in performing strategic analysis in
order to examine the competition within the industry in which they are performing operations.
Basically, this tool that has been taken into consideration aid a company in analysing different
critical forces, which affects competition within the industry. Including this, five forces that this
model evaluates are a part of every industry and every market. Away with this, Coca Cola has
also utilised this tool to improvise, their decision making process through evaluating rivalry
within the beverages sector (Schwalbe, 2015). These forces are bargaining power of suppliers,
bargaining power of buyers/customers, threat of new entrants, threat of substitutes and
competitive rivalry between existing players within beverages sector.
Bargaining power of suppliers: Suppliers' bargaining power is weak in nature within
beverage industry. It is so on the grounds that the quantity of providers is high and the
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exchanging costs for Coca Cola low. While Coca Cola can undoubtedly change starting with one
provider then onto the next, it isn't workable for any provider to change away from Coca Cola as
no problem at all. That can prompt misfortunes for any of the providers (Holtshouse, 2013)
While there are a few providers, the size of individual providers is little or decently huge. In
addition, forward reconciliation is an inaccessible chance for a large portion of its providers.
Regardless of whether there are no substitutes for crude materials like sugar, the quantity of
providers is still high. Along these lines, the fundamental factors that have become known with
respect to the haggling intensity of providers are: Large number of providers, Small to modestly
huge size of individual providers, forward coordination difficult, for the providers and Switching
costs for Coca Cola not all that high.
Bargaining power of buyers/customers: Herein, the bargaining power of customer is
very high. There are a lot of competitor prevailing in the market so that customer have a right to
switch their brand to other product. If the company increases the price of product the buyer have
a power to switch their brand to other brand. In context of Coco-cola, the marketing team of this
company emphasised on providing superior quality drink to its customer in order to satisfy them.
If there is a change in the price of Coco-cola there are large number of competitors available at
marketplace such as Red bull, Pepsico, Fever-tree and many more (Margetts, 2012). Therefore, if
the company charge high price to its customer they switch their brand from Coco-cola to some
other brand available in the market. There is a change in taste and preferences of customer so it
is difficult for company to gain competitive advantage over rival firm. So it is necessary for
supervisor of company to provides a high quality products to its customer for enhancing their
satisfaction as well as motivational level. Herein, the supplier decide the cost of product
according to the price charged by its competitor otherwise the customer switch their brand to
other product.
Threat of new entrants: The threat of new entrants in food and beverage industry is very
high. But for the Coco-cola company the threat of new entrance is low because it is already
having a good brand image all over the world. Due to existence of threat of new entrance it
accelerate the cost to the product of the company. Therefore it is very difficult for the new
company to increase their goodwill at that level so that threat of new entrant is low. The Coco-
cola is one of the most popular food and beverage industry with high market share. This
company cover the largest share of market that is not possible for competitive firms. The
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supervisor of this company focuses on providing superior quality products to its customer at
reasonable price. This will helps in increasing brand image and goodwill of the company
(Galliers and Leidner, 2014). The Coco-cola company already having a good brand image as
well as reputation in the marketplace so it is very tough for new companies to enter into this
sector. In addition to this, the supervisor of this company provide unique and specific product to
its customer that is different from the product of other company.
Threat of substitutes: It is considered as a process in which there are different type of
alternative available at the marketplace. The availability of various products such as Red bull and
Pepsi co that increases competition level within the marketplace. The company focuses on
providing unique and specific products to its customer in order to gain competitive advantage
over rival firms. In context of Coco-cola, the supervisor emphasised on offering unique products
that is different from other products (Major and Savin-Baden, 2012) They provide high quality
product to its customer so that customer are not willing to switch to other competitor product.
There are different substitute product available in the marketplace that creates a competition
level in the workplace. In addition to this, threat of substitute is very high in the market in order
to gain competitive advantage over substitute products. Along with this, it is very important for
company to provide unique products to its customer in order to attract them for purchasing them.
Competitive Rivalry between the existing players: The competitive rivalry in respect of
food and beverage industry is very high. The main competitive firms such as Red bull, Pepsico
and many more which provide high quality products at affordable prices to its customer. The
large number of competitor is available at marketplace that increases competition level.
Moreover, the companies follow the economic pricing strategies that enhance the competition in
the marketplace. Therefore the supervisor of Coco-Cola company focuses on making effective
strategies in order to gain competitive advantage over rival firm. This company provides unique
and specific products to its customer in order to differentiate them from the competitor products.
They offer superior quality product to its customer at affordable price for satisfying the need and
wants of consumer. The main purpose of company is to provide best product at reasonable price
(Valacich and Schneider, 2015)
Inbound logistics
This is being considered as one of the primal activity, that would lead the business
organisation in considering a much more effective process. Basically, Inbound logistics is said to
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be one of the crucial function of value chain analysis, which mainly consists of the initial stage to
the end, where suppliers sells products along with the services to customers (Drucker, 2012).
Internal handling and dispersion to the warehouse store and finally placing the products on
display at the table. Since, Coca-Cola is dealing in beverage industry, therefore it is said that
quality control specifically being considered as one of the primal key factor for Coco-Cola.
Considering this approach, it is said that appropriate functioning would lead the whole process to
bring or develop number of opportunities that helps the customer to acquire true value of money
and removal of additional cost charged to its customer.
Operations
In present context, it is said that operations are required by a company to perform in a
smooth manner when it comes to grab a good position within the market for a longer period of
time (Mondo and Musungwini, 2019). It is same with Coco-Cola as well, where operations
management process holds from inputting the raw materials to pull out final goods. This is
something, where stock management along with the display of product in an effectual manner in
order to achieve competitive advantage at the workplace. This is the second level of value chain
within the business organisation. In assistance of this, the supervisor of Coco-Cola will
effectively be focusing upon continuous improvement through conducting number of tasks,
which may aid these companies in disposing the extra stock in specified time frame. Through
this, it can be said that company like Coca-Cola would become able to consider right IT
Solutions for itself and this will lead to adopt an effective along with the innovative approach to
improvise productivity of Coco-Cola in much effective and efficient manner.
Outbound Logistics
These are said to be the logistics which helps an organisation to deliver final goods to the
customers and it also lead the company to improvise the motivation level among staff members.
Coca-Cola, has been one of the crucial business organisation that not only targeted consumers on
the basis of the pocket but they have also developed their carbonated drinks much more cheaper
in order to target every single aged person. Including this, many of the business organisations
like hotels and restaurants has been offering their clients with appropriate quality products which
made this company as its supplier. this, the focuses on offering products to its customer
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conveniently by providing them home delivery (White, 2015). It offers various benefits to its
customer such as good packaging, product deliver on time, lack of disruption and other facilities
that is according to the need and preferences of customer. It is the place where final products is
delivered to its customer in order to satisfy them.
Two support activities in Porter's Value Chain
Porter’s Value Chain is a system for building up an investigative structure that follows
reliant exercises from crude material procurement or thought through creation lastly, under the
control of a client. This model is as valuable today as it was more than 30 years back on the
grounds that organizations in all enterprises can distinguish coalitions or linkages between the
discrete exercises that add to their item advancement. Coca-Cola, which is one of the famous
carbonated drinks manufacturer can effectively take into consideration of porter's value chain
model. With the help of this existing taste of drinks can effectively be changed based on the the
requirements and the demand of customers (Drucker, 2012). Basic reason behind this can be
anything from adding value to the services for its customers and many more. 1985 was the year
when this model was found by Michael Porter. This approach consists of different stages that
may help a company like coca cola in in adopting changes true altering the activities of the
business (Tesco Value Chain Analysis, 2019). In present time, Coca-Cola is facing competition
from its customers, which has affected both the productivity and profitability of the company in
order to give the competitive advantages and to offer true value to the customers, company has
taken into consideration of value chain analysis. This analysis is performed underneath:
Two secondary activities of TESCO:
Human resource management: this is one of the primal business function of a company
like coca cola which helps the customers in getting better support where they can offer the best
of service they can. In present time, Coca Cola has also adopted an effective recruiting and
selection policy where it is is looking forward to develop diversify culture within the company
and at work station so that satisfaction level of the customers can effectively be fulfilled
considering an approach of mixed culture. With the help of this, it can be said that Coca-Cola
will start reaching to an all new level through developing number of unique ideas from the
talented employees that belongs to different cultures which will help in retaining the customers
for a longer period of time (Hall, Site 1001 Inc, 2019).
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Technology development: since the company is offering customers with carbonated soft
drinks, it has become vital for Coca-Cola to keep there machines updated so that competition can
easily be given to the rivals like Pepsi co. The management team emphasised on providing latest
technology that helps in increasing drinking experience of its customer. In addition to this, the
supervisor of Coca-Cola emphasised on introducing new distribution channel such as selling
through intermediates to reach fresh customers and increase its profitability ratio (Rizzo and et.
al., 2016).
KEY VALUE ADDING ACTIVITIES WITH JUSTIFICATION
Over the years, many business organisations has started adding value to their products in
order to deliver proper satisfaction to their customers so that appropriate engagement and
relationship can effectively be built with them. Some of key value added services offered by
Coca-Cola are presented underneath:
 Coca-Cola has given its customers an effective value added service where hi tech
Customer service department resolve all the queries of their customers in an effective and
efficient manner (Desouza, K. C. and Hensgen, 2015). It has helped business organisation
in maintaining loyalty with consumers and helped them in gaining all the detailed
knowledge about what appropriate ingredients that they fell in at the time of building this
carbonated soft drink like diet coke.
 Another value added service that has been given by Coca Cola is directly linked with
promotional services. Basically advertisement, free samples and discounts are given by
this company in order to gain brand loyalty. This has given importance to do what exactly
their customers feels when they consume Coca-Cola product. Only for this Coca-Cola
has also given any discounts on their services as well which helped company in giving
competitive advantages and customer engagement for a longer period of time.
Above value added services, has given opportunities to Coca-Cola in order to gain competitive
advantages and also show to effectively reach to the extra attention that a customer can give to a
company while purchasing products and services from departmental store or from a supermarket
(Feng and et. al., 2016).
BUSINESS COULD DEPLOY INFORMATION TECHNOLOGY (IT)
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Coca-Cola's introduction of information technology will lead directly to becoming one of
the most important business institutions. Except for this, it is often said that Coca-Cola carried
out Porter's study of five factors, which helped the company assess the industry's attractiveness.
This also helped to make a number of decisions about what could be detrimental when
introducing a whole new IT setup. Also, it has been analysed that Coca-Cola also is using digital
technology to create new consumer experiences via innovative programs like sip & scan, which
lets consumers unlock experiences and prizes by scanning icons on Coke packages with their
mobile phones. Away with this, it is also said that Coca-Cola performance level will also get
improvised in specified time frame. There were some of plus points that came in front of
adopting or modifying the Information System then, it would lead Coca-Cola to improvise the
profitability and productivity at the same time (Cartwright and Cooper, 2012). These components
may lead Coca-Cola to improvise the performance level through reducing number of negative
effects. Away with this, it is also said that it will be required by company to use development so
they can overhaul their activities and addition their profitability by satisfying their customers
with number of elements that would help organization in fulfilling needs and necessities in a
limited frame of time (Fiorini and Masic, 2017).
Conclusion
With the help of above mentioned report, it is being concluded that management of
information and technology would lead firm to gain competitive advantages in specified time
frame. Through this, it is said that information technology in relation to inbound logistics,
operations and outbound logistics would lead a company in taking right decisions and deploying
updated technology in specified time frame.
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References
Books and Journals
Cartwright, S. and Cooper, C. L., 2012. Managing mergers acquisitions and strategic alliances.
Routledge.
Cresswell, K. M., Bates, D. W. and Sheikh, A., 2013. Ten key considerations for the successful
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the American Medical Informatics Association. 20(e1). pp.e9-e13.
Desouza, K. C. and Hensgen, T., 2015. Managing information in complex organizations:
semiotics and signals, complexity and chaos. Routledge.
Drucker, P., 2012. Managing in a time of great change. Routledge.
Drucker, P., 2012. Managing in the next society. Routledge.
Galliers, R. D. and Leidner, D. E., 2014. Strategic information management: challenges and
strategies in managing information systems. Routledge.
Holtshouse, D. K., 2013. Information technology for knowledge management. Springer Science
& Business Media.
Major, C. H. and Savin-Baden, M., 2012. An introduction to qualitative research synthesis:
Managing the information explosion in social science research. Routledge.
Marchewka, J. T., 2014. Information technology project management. John Wiley & Sons.
Margetts, H., 2012. Information technology in government: Britain and America. Routledge.
Pearlson, K. E., Saunders, C. S. and Galletta, D. F., 2016. Managing and Using Information
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Schwalbe, K., 2015. Information technology project management. Cengage Learning.
Valacich, J. and Schneider, C., 2015. Information Systems Today: Managing in a Digital World
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White, J. D., 2015.Managing information in the public sector. Routledge.
Fiorini, R.A. and Masic, I., 2017. Managing information in Health Informatics. Acta Informatica
Medica, 25(3), p.191.
Feng, N. and et. al., 2016. Managing security risks for inter-organisational information systems:
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Hall, E., Site 1001 Inc, 2019. System and method for monitoring and managing information. U.S.
Patent Application 16/151,285.
Mondo, L. and Musungwini, S., 2019. Developing a Change Management Model for Managing
Information Systems Initiated Organisational Change: A Case of the Banking Sector in
Zimbabwe. Journal of Systems Integration, 10(1), pp.49-61.
Hall, E., Site 1001 Inc, 2016. System and method for monitoring and managing information. U.S.
Patent Application 15/221,523.
Rizzo, P. and et. al., 2016. Method and device for managing information exchange between a
main element, for example a NFC controller, and a set of at least two auxiliary
elements. U.S. Patent 9,515,701.
Smith, L.C. and Wong, M.A. eds., 2016. Reference and Information Services: An Introduction:
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Online
Tesco Value Chain Analysis. 2019. [Online]. Available through: <https://research-
methodology.net/tesco-value-chain-analysis/>.
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