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Improving Decision Making in the Coca-Cola Company - Case Study Example

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In the paper “Improving Decision Making in the Coca-Cola Company” the author focuses on changing and improving the taste of Coke. Thus, the company reformulated and created the New Coke. In a double-blind test conducted by the company, it appears that 60% of consumers prefer the new taste…
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Improving Decision Making in the Coca-Cola Company
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Download file to see previous pages The experience of Coca-Cola which is discussed above has become a classic marketing tale documenting the mistakes that managers can make in their decision-making process. The failure of Coca-Cola can be largely attributed to two factors namely, narrow definition of its marketing research problem and poor judgment in interpreting the research planning strategies around it (Kotler and Armstrong 2001). The experience of Coca-Cola which is discussed above has become a classic marketing tale documenting the mistakes that managers can make in their decision-making process. The failure of Coca-Cola can be largely attributed to two factors namely, narrow definition of its marketing research problem and poor judgment in interpreting the research planning strategies around it (Kotler and Armstrong 2001). Managers became narrow-minded and myopic in diagnosing the problem that Coca-Cola was facing. Instead of looking at all the factors which may be influencing the buyers in their purchases, these managers only look at the taste of the product. Their research has focused only at the taste ignoring the customers’ feelings about dropping the product. It turned out that Coke’s symbolic meaning in the United States is more important than taste. Coca-Cola’s managers also failed to use wise judgment in the introduction of New Coke. Even though their decision of dropping the old Coke is warranted by the 60% acceptance rate of the new formula, they did not anticipate that the 40% might still like the old Coke better. Conclusion Decision-making process must not be too narrow to overlook some of the important factors and details. As the situation of Coca-Cola shows us, managers should always avoid hasty generalizations and marketing myopia. In the business environment, decisions should always be grounded on all the factors affecting performance. Focusing on one aspect only will yield a one-sided and inadequate decision. ...Download file to see next pagesRead More
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