The Formation Of Coca Cola Company Commerce Essay


The Coca-Cola Company is the worlds largest beverage company. Established in US, Coca-Cola initiated its global expansion in 1919. Along with Coca-Cola®, recognized as the worlds most valuable brand, the Company markets four of the worlds top five non-alcoholic sparkling brands, including Diet Coke®, Fanta® and Sprite®, and a wide range of other beverages, including diet and light beverages, waters, juices and juice drinks, teas, coffees, energy and sports drinks. Through the worlds largest beverage distribution system, consumers in more than 200 countries enjoy the Company's beverages at a rate of 1.5 billion servings each day. It is one of the most recognizable brands on the planet. Despite this, The Coca-Cola Company often struggles to maintain its market share over its main rival Pepsi Co in some overseas market.

This assignment will explore the strategic plan of The Coca-Cola Company. It will identify the aims and objectives, analyse the progress of The Coca-Cola Company towards the strategic plan. Identify alternative strategic option to meet the aims and objectives and finally, justify the strategic option that meets the revised strategic position of The Coca-Cola Company. This paper will analyse the position of The Coca-Cola Company today and the strategies to achieve their vision by 2020 "Growing World of Refreshment".

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LO1: Review and determine the organisational strategic aims and objectives

Identify the current strategic aims and objectives


The Coca-Cola Company roadmap starts with their mission, which is enduring. It declares their purpose as a company and serves as the standard against which they weigh their actions and decisions.

To refresh the world.

To inspire moments of optimism and happiness.

To create value and make a difference.


The Coca-Cola Company vision serves as the framework for their roadmap and guides every aspect of their business by describing what they need to accomplish in order to continue achieving sustainable, quality growth.

People: Be a great place to work where people are inspired to be the best they can be.

Portfolio: Bring to the world a portfolio of quality beverage brands that anticipate and satisfy people's desires and needs.

Partners: Nurture a winning network of customers and suppliers, together we create mutual, enduring value.

Planet: Be a responsible citizen that makes a difference by helping build and support sustainable communities.

Profit: Maximize long-term return to shareowners while being mindful of our overall responsibilities.

Productivity: Be a highly effective, lean and fast-moving organization.

Undertake an evaluation of the component parts of a strategic plan

Mission defines the fundamental purpose of an organisation, succinctly describing why it exists and what it does to achieve its vision. It defines the customer and the critical processes. It informs you of the desired level of performance, where is the organisation at the present moment and also informs about what is the company believes. The Coca-Cola Company wants to refresh the world. The Coca-Cola Company are focused on the consumers and customers and partners. They want to observe, listen and learn from the market. The Coca-Cola Company is working close to the customers to make it possible to bring happiness to everybody. They are connected to the customer on the Facebook, Twitter, Orkut, apps for mobile devices and on their own website

Vision is a statement about what your organisation wants to become. It should resonate with all members of the organisation and help them feel proud, excited, and part of something much bigger than themselves. A vision should stretch the organisation's capabilities and image of itself. It gives shape and direction to the organisation's future. The Coca-Cola Company is focused on the market and they have the courage to make any necessary change to achieve their vision by 2020.

Goals are broad, general intentions, intangible, abstract and can't be validated. Objectives are narrow, precise, tangible, concrete and can be validated. Plans and actions based on clear goals and objectives helps the organisation to keep safe and grow on the market. The Coca-Cola Company 2020 vision creates a long-term destination for their business. It provides The Coca-Cola Company with business goals that outline what they need to accomplish with their global bottling partners in order to continue winning in the marketplace and achieving sustainable, quality growth. For each goal, they have set of guiding principles and strategies for winning throughout the entire Coca-Cola system; ensuring that we are the most preferred and trusted beverage partner, attaining global leadership in corporate sustainability, managing people, time and money for the greatest effectiveness and becoming one of the world's premier employers.

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Analyse the factors affecting the strategic plan

The organisation should consider its environment before beginning the marketing process. Pest analysis should be continuous and supports all aspects of planning.

Fig 1 - PESTEL Analysis

Political Factors: It has an influence upon the regulation of the business. The organisation must consider issues like stability of the political environment, government's position on marketing ethics, government's policy on the economy, government's view on culture and religion, government's laws that regulate or tax de business.

Economic Factors: It is very important to consider the economic aspects in the short and long terms. The organisation need to look at the interest rates, level of inflation and employment level per capita, long-term prospects for the economy Gross Domestic Product (GDP) per capita.

The global credit crisis may adversely affect The Coca-Cola Company liquidity and financial performance. The Coca-Cola Company can be unable to access credit markets on favourable terms which could increase the cost of borrowing. It can make it more difficult for our bottling partners to access financing on terms comparable to those obtained historically, which would affect The Coca-Cola Company system's profitability as well as their share of the income of bottling partners in which they have equity method investments. The significant decline in the equity markets and in the valuation of other assets precipitated by the credit crisis and financial system instability has affected the value of our pension plan assets.

Social Factors: The organisation face social and cultural influences from country to country. These influences can be religion, language, society's roles of men and women, acceptance of foreign products and services, living time and wealthy of the people, attitudes to foreign products and services.

Obesity and other health concerns may reduce demand for some of the products. Consumers, public health officials and government are becoming concerned about the consequences associated with obesity.

Technological Factors: It is vital for competitive advantage and is a major driver of globalisation. The organisation should consider if the technology; allow the products and service to be cheaper and have more quality, offer consumers and businesses innovative products and services; improve the distribution and offer a new way to communicate.

Environmental Factors: It is very important to consider weather and climate change. All these changes can impact and affect many organisations. The global warming is an external factor that is becoming a significant issue for The Coca-Cola Company.

Water scarcity and poor quality could negatively impact The Coca-Cola Company system's production costs and capacity. Water is the main ingredient in substantially all of our products. It is also a limited resource in many parts of the world, facing unprecedented challenges from overexploitation, increasing pollution, poor management and climate change. As demand for water continues to increase around the world, and as water becomes scarcer and the quality of available water deteriorates, The Coca-Cola Company system may incur increasing production costs or face capacity constraints which could adversely affect our profitability or net operating revenues in the long run.

Ecological, Environmental/waste issues, Environmental regulations, carbon footprint/pollution, energy issues, stakeholder/investor values, staff attitudes, organisational culture, staff morale.

Legal Factors: These are related to the legal environment in which organisations operate. The organisations need to consider the current legislation and the future legislation, regulatory bodies and processes, environmental regulations, employment law, consumer protection, international legislation, industry-specific regulations, health and safety and competitive regulations. The legal changes can affect organisations' behaviour, actions, costs and demand. There are different categories of law like; consumer laws, competition laws, employment laws and health and safety legislation.

Around the world The Coca-Cola Company is required to pay deposits, eco-taxes or fees upon the sales, marketing and use of non-refillable beverage containers. The precise requirements imposed by these measures vary. Other beverage container related deposit, recycling, eco-tax and/or product stewardship proposals have been introduced in various jurisdictions in the US and overseas. Similar legislation or regulations may be proposed in the future at local, state and federal levels, both in the US and elsewhere. The Coca-Cola Company's facilities in the US and elsewhere around the world are subject to various environmental laws and regulations. Compliance with these provisions has not had and The Coca-Cola Company do not expect such compliance to have, any material adverse effect on the company's capital expenditure, net income or competitive position.

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LO2: Identify and analyse progress towards organisational strategic aims and objectives

2.2 Apply a range of strategic analysis tools to audit progress towards strategic aims and objectives

SWOT Analysis is a powerful tool to understand the strengths and weaknesses of the organisation; create opportunities and avoid the threats. It is very helpful to the strategic planning. This technique is credited to Albert Humphrey. There are four combinations called maxi-maxi, maxi-mini, mini-maxi and mini-mini. Weihrich (1982) describes the combinations as follows:

1. Maxi-maxi (S/O). This combination shows the organisation's strengths and opportunities. In essence, an organisation should strive to maximise its strengths to capitalise on new opportunities.

2. Maxi-mini (S/T). This combination shows the organisation's strengths in consideration of threats, e.g. from competitors. In essence, an organisation should strive to use its strengths to parry or minimise threats.

3. Mini-maxi (W/O). This combination shows the organisation's weaknesses in tandem with opportunities. It is an exertion to conquer the organisation's weaknesses by making the most of any new opportunities.

4. Mini-mini (W/T). This combination shows the organisation's weaknesses by comparison with the current external threats. This is most definitely defensive strategy, to minimise an organisation's internal weaknesses and avoid external threats.

2.2 Review and assess the expectations of major stakeholders and their influence upon the organisational strategy

Stakeholders: a person or a group who involved with The Coca-Cola Company and therefore has responsibilities towards it and an interest in its success.

The Coca‐Cola Company is committed to conducting business under the highest standards of excellence. Accordingly, The Coca-Cola Company desire to develop relationships with suppliers that share similar values and conduct business in an ethical manner. The Coca‐Cola Company align its supply chain with company values while also demonstrating the Company's commitment to achieving a supply chain that meets stakeholder expectations. Multiple stakeholders expect the entire Coca‐Cola system to have workplace standards that meet or exceed the requirements of local law. These stakeholders include, but are not limited to: direct customers, consumers through customers, shareholders, non‐governmental organisations, student activists, governments, etc.

"Coca‐Cola" is held accountable for anything occurring under the trademark, whether it occurs at an independent bottler, a company‐owned facility, a supplier of materials used in our products or product packaging, a supplier of promotional merchandise, or any other type of supplier. This accountability is another important reason that suppliers within the Coca‐Cola system must operate in accordance with the Supplier Guiding Principles. Responsible workplace practices throughout the system are critical to protecting the value of our trademark and key to achieving our aspiration of being one of the most respected companies in the world.

2.3 Analyse, interpret and produce a structured evaluation of the organisational strategic position

LO3: Decide upon a strategy and identify how, if required, you would justify your selection to meet the required future strategic position

3.1 Identify and develop a range of alternative strategic options to meet strategic aims and objectives

3.2 Determine and justify the strategic option that meets the revised strategic position