Team Project Report for Business Management
Introduction
On January 29, 1892, the Coca-Cola Company was established and had had its headquarters located in Atlanta, Georgia. Coca-Cola is the most significant beverage industry globally and owns many other beverages in the market all over the world, starting with most notably Coke, Sprite, Fanta, Dasani, Smart water, Minute Maid, Simply Orange, Powerade, Vitamin Water, and many more. On May 8, 1886, Coca-Cola served its first drink in a pharmacy located in Atlanta, Ga, called Jacob’s pharmacy. The drink Coca-Cola was created by Dr. John S. Pemberton, an Atlanta pharmacist. It started with Dr. Pemberton making the syrup for Coca-Cola, then heading down to the street where Jacob’s Pharmacy was located, selling it for five cents a glass labeled as a fountain drink. That marked the creation of one of the most popular beverages and continues to be to this day. The businesses of Coca-Cola have been decreasing due to the impact of COVID-19, going down by 25%, with the company’s current revenue reported at $8.60 billion. The current stock prices are 50.54 USD. Coca-Cola’s company mission statement is to “Refresh the world. Make a difference.” With the company’s vision and goals to continue creating brands and drinks that people enjoy and love to refresh them in body and spirit, in multiple ways that can enable them to maintain the business and better future that can make a difference in the lives of the people, communities, and the planet.
General Environment-Technological Advancement
Technological advancement is required in a significant company such as Coca Cola because they use its production/packaging and distribute their product. For the organization to ensure profits, there is a need to rely on technology to carry the aforementioned tasks. It requires a significant investment. The use of technology will ensure the efficiency and production of its products on a timely basis. Also, the use of technology provides an efficient distribution of its products worldwide (Baah & Bohaker, 2015). All these are critically important for the business’s revenue generation, as there will be efficient production and distribution. While these technologies do not change daily, there is a need for the company to make a significant investment and ensure that it is adequately maintained. The other areas that require the use of technology include water processing and packaging of its product. Hence, investment in technology is critically important for the company, as they will hurt the business if they are not adopted.
The business is also involving the use of technology to ensure a competitive advantage. While the business’s primary aim is to provide soft drinks for its customers at a profit, the company has been innovative in using technology. Because of the change in technological advancement, the organization is adopting new strategies as evident with their advertisements, rebranding, and product presentation to ensure high sales. The company has also involved social networking through the green movement, ensuring it stays connected with its customers.
It introduced greener bottles in the past decennium, which has enabled them to produce more than a 2.5billion bottles while using less petrol. The other organizations, like Heinz, have started adopting the technique because of its success. Secondly, the advancement in social media platforms like Facebook, Twitter, and Instagram implies that the organization can easily advertise its products less expensively. Hence, the organization has been effective in using the online advertisement. However, the company faces a challenge from its competitors because it has also adopted current technologies to compete. Besides, technological advancement affects the industry’s product offering and costs structure, creating the organization’s need to analyze the technology disrupting the soft drink industry.
Specific Environment-Industry Regulations
Suppliers
The suppliers’ bargaining power for the company is weak because many companies are willing to supply the coca-cola company’s products. Even though it can move from one supplier to another, it is not likely that a supplier will switch from the company to the competitors because it has been one of the significant companies established since the 19th century. It can cause losses for the suppliers if this happens. Various suppliers provide raw materials for the company; however, it is difficult to find individual suppliers. While there is no substitute for products like sugar, the number of suppliers offering their products for the company remains high.
The companies involved in the soft drink industry source their raw materials from various suppliers. As such, it cannot reduce the margins for the company because of the high number. Powerful suppliers have been known to use their power to demand a high price for their raw materials. However, it cannot affect the company’s operation, as it can easily switch from one supplier to another.
Customers
The company offers its products to corporate and individual buyers. With time the organization has become a dominant force in the market by establishing excellent ties with leading corporate buyers such as fast-food chains. Besides, the organization has used its presence in the market share by providing its products in convenient stores/vending machines. The buyer power for this group is high. However, for individual ones, it is limited because they buy in slow volumes. The customers purchasing the organization products are not sensitive to the changes in prices. As such, backward integration is possible for corporate/individual buyers. The retailers will only increase their buying power when they can purchase the products in large quantities. The customers can also substitute products like Pepsi because of similar flavors (Ling, 2017).
Internal Environment-Strategic Management
Strategic management is an internal process of the company defining its operations. As such, the organization has been using viable strategies to improve the performance of the business. For there to be a success, the company has adopted strategic management strategies. It has the following steps
Environmental Scanning
The company is diagnosing the present and future business environment before launching its products. The internal and external factors in the domain that may affect the business operations are carefully analyzed continuously. Because it is an organization found in all parts of the world, the global factors are also explored as they could affect the business’s operations, influencing its expansion process (Ling, 2017). Environment scanning involves different facets like tax regulations, environmental laws, political stability, and employment policies, affecting its operations.
Formulation of strategy
It involves selecting strategies essential in achieving the company’s objectives/goals, which starts with creating the mission/vision statement. The mission explains why the business was formulated, which can help communicate with internal/external stakeholders. The company’s vision is supportive of the developed strategies, as it has a primary goal of ensuring customer loyalty and increased profits.
Strategic implementation
It involves the implementation of the chosen strategy. For this to occur, there is a need to model the organization’s structure, distribute resources, and design decision-making. The company has also ensured the quality management system’s provision, which is critically important for its operations’ coordination and guidance to ensure quality. The company has created a notion that the formulation of excellent strategies is essential for succeeding in new markets (Frynas & Mellahi, 2015).
Evaluation of Strategy
In this phase, the company considers the appraisal of internal/external environmental factors essential in formulating strategies and measuring performance. It is critical in enabling it to achieve its goals.
The organization employs a multi-domestic growth strategy, which has enabled it to provide products based on independent countries’ environmental factors, including cultural factors, socio-economic factors, etc. (Kimathi, 2016). As a result, it is using it responds to the demands of the market. Finally, the organization uses a differentiation strategy and diversification to ensure that it can distinguish its products/services from other organizations.
References
Baah, S., & Bohaker, L. (2015). The Coca-Cola Company. Culture, 16, 17.
Frynas, J. G., & Mellahi, K. (2015). Global strategic management. Oxford University Press, USA.
Kimathi, F. M. (2016). Factors Influencing Strategic Change Management Practices At Coca Cola Company In Kenya (Doctoral dissertation, University of Nairobi).
Ling, X. (2017). Customer Relationship Management: Case study Coca-Cola Company.