The Coca-Cola Company Business Environment - Term Paper Example

An Overlook and Analysis of the Coca Cola Company The analysis of a company is important in providing solutions for both the internal and external environments presented to different teams or the organization as a whole. It provides an essential strategy as an element to scan the strategic management and conducting market research for the company. Some of the areas that are important in the value creation opportunities of a company and require analysis include the legal, social and economic environments. The Coca-Cola Company is recognized worldwide as an essential brand due to its ownership of more than 500 brands. The company is the largest in manufacturing, distribution and marketing of nonalcoholic beverage syrups and concentrates. It maintains its operations in more than 200 countries. The company thus needs to analyze their internal environments for threats and opportunities in order to maintain their position in the ever dynamic competitive field. These different environments fall under the Pestle analysis that help the company managers to make macro decisions on policy changes. These include taxes, new laws, trade barriers and government policy changes among others. At the coca cola company economical challenges are posed by inflation due to economic crisis in most countries. The customer purchasing power is reducing to high oil and product prices. There is also a high rate of unemployment. Moreover, competition from other brands such as Pepsi is increasing. However, the company does not plan to cut down the price of their products. Socially, the lives of customers especially women is changing. Most of them are going out to work. It has resulted in the need for time management and the preference for healthier foods. Many people currently opt for tea, milk, coffee and juices putting pressure on the Coca-Cola Company. Consumers between the ages of 37 and 55 are more concerned about extending their lives hence focused on nutrition. Soda and sweetened drinks have been associated with obesity. This has affected sales as consumers have become more aware about healthy lifestyles. Both the legal and political environments affect marketing decisions at the company. These include laws, pressure groups like the “killer coke” and government agencies. For instance in the 1970s a subsidiary group in India wanted the company to share their secret formula under the Foreign Exchange Regulation Act. They declined and had to halt their operations for 16 years (Kaye, 2006). The producers have been forced to provide exclusive territories to distributors. In addition, the European Commission alerted EU members to ban the sale of coca cola products due to a recent poisoning of 100 children in Belgium as a result of wrong use of carbon dioxide. In India, Protestants wanted the ban of coca cola claiming that the company was depleting ground water. There are also claims in India that coca cola possesses some amounts of pesticides that pose a risk to life. Hence, the need to ban it. The Coca Cola Company has a broad supply chain, which causes a great challenge in the development of tactical and strategic decisions. It is because of this that it faces strategic management issues globally. For instance, the same set of rules is not applied throughout the company leading to an insufficient metric system for the company. As a result, there is a difference in simple things like the stock out and fill rate. These enhance the need for corporate level strategies as well as market and product development. Project management at the Coca Cola Company involves both logistics and procurement activities. Through purchasing and the involvement of ITC Infotech and consultation in SAP, there has been an improvement in supply chain management. Nonetheless, the company needs to find ways of investing in profits for future growth and earn more market shares and profits. They also need to find which products they should invest in heavily to push them to a star status. These may include Fanta and Sprite. As the rate of growth declines and market share becomes an important component in determining profits, the differentiation of products has become key issues towards cost management. Additionally the organization has to critically study the movements within the external environment and devise appropriate strategies to maintain their competitive advantage (Agrawal, 2011). In order to attain success in most of their projects, the coca cola company has made efforts to work within their set timelines. One of such projects was the one done in collaboration with USAID where the Haiti Hope project was launched. It was mainly to assist in the promotion of economic growth and sustainable development in Haiti. This has also been made possible by critical paths that make use of project management and methodologies of operational effectiveness. It is done through the management of contingency planning that ensures that product supply initiative are completed in a timely manner (Zagami, 2012). As such, various problem solving methods have been used as tools to ensure that the quality of products is consistently driven towards improvement. It is because of the global nature of its business, which demands high standards and consistent quality levels. To maintain this, the coca cola system operates on the Operation Requirements (KORE) that replaced The Coca Cola Management System (TCCMS). According to Journey Staff, it addresses the changing landscape of the business while helping to focus on growth plans (2012). However, staffing of the coca cola company has been poorly approached due to the harsh conditions experienced. Despite the global staffing philosophy, the company still needs to expatriates to connect the staff who are separated by barriers of culture, language and geographical disposition. However, as Eberly reveals, the hiring process has been thoughtful making it possible to build capability and focus on the future growth (CCIW, 2013). With the potential change factors and the improved functions of management, the Coca-Cola Company is likely to be the globally recognized great place to work in. Subsequently this will improve employee motivation and their ability to feel part of the company. Employee input will thus increase hence customer satisfaction and retention which will lead to the elevation of the company’s competitive advantage. Ultimately, the company goals will be realized, and maximization of profits realized. http://www.slideshare.net/CarlaMcCoy/gantt-chart-unit-5-group-project http://www.slideshare.net/CarlaMcCoy/unit-5-group-project-management-plan-mgt110 References Agrawal, Vanita. (2011). Strategic management of Coca cola. Retrieved 14 March 2013 from http://www.slideshare.net/VanitaAgrawal/strategic-management-of-coca-cola Coca Cola International Workforce (CCIW). (2013). HR Management April 14. Retrieved 14 March 2013 from http://www.hrmreport.com/article/coca-colas-international workforce/ Kaye, J. (2012). Coca Cola In India (PDF). Tuck School of Business at Dartmouth. Retrieved 14 March 2013. Journey Staff. (2012). Quality. Retrieved 14 March 2013 from http://www.cocacolacompany.com/stories/quality Zagami, Evelyn. (2012). Evelyn Zagami’s Experience. Retrieved 14 March 2013 from http://www.linkedin.com/pub/evelyn-zagami/5/1bb/756 Read More