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Coca-Cola Company’s Strategy & Globalization Issues


As trade barriers are minimized and information is being de-regularized the world is becoming a ‘global village’. Elements like outsourcing, environmental stability, globalization; sustainability etc has changed the working patterns of organizations. Multinational corporations are increasing day by day and they are usually criticized because of issues like environmental stability, sustainability etc. Organizations that are experiencing their expansion phase are mostly directly to boost up their profits and they usually show lesser concern with elements like sustainability and environmental care.

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Coca-Cola is considered to be the cola giant in today’s world and in nearly all the countries of the world this beverage is consumed. Coca-Cola Company has 49 production plants in India catering to a coke thirsty nation. It is found that 3.8 liters of water is necessary to produce 1 liter of cola beverage. There has been a hot debate over utilization and quality of water used for soft drink production in different countries such as India, Mexico and Columbia. The largest plant of Coke is placed in Kerala (India) and this plant has been criticized a number of times for putting farmers out of work and because of the fact that land is being poisoned with toxic waste. To achieve economies of scale Coca-Cola has been pumping out millions of gallons of water every day from underground reserves and reservoirs. This has raised questions regarding the shortage of water supply in areas surrounding its plants. The authentic figures are not revealed by Coca-Cola and other brands however the production of cola is presumably draining the reserves which are crucial for cultivating crops and drought sickened population. The dearth of water in some areas is pushing such companies towards either complete shut-down or finding other resources. Cola consumption growth and unregulated pumping of water is increasing as the awareness of cola brands and feel of cola becomes popular amongst end consumers. The only positive point one can found for this action is the increase of profits and expansion of operations. Moreover the plant is placed to satisfy the demand of coke in India.

There are numerous issues that are at stake for Coca-Cola and that can easily tarnish overwhelming image of world’s leading brand. Locally people can abandon buying Coke because of the environmental hazard it’s creating. This outcome is quite rare but it can happen because people have numerous alternatives of Coke. People locally can opt for Pepsi and other Cola’s available in the market. This radical shift would definitely have a negative effect on the regional sales of Coca-Cola and their sales would decline. Furthermore, government can pose a ban on Coke’s operation in Kerala because of the environmental hazard they are creating and this can badly hurt Coke’s image. This action if not stopped would create havoc and can severely damage the brand image of Coca-Cola. People are badly affected by this and they are facing problems like stomach pain and other related diseases are affecting them. Coca-Cola is not only affecting the environment but also stopping the water and they are consuming them for their own needs. Thus they are exercising their undue power.

Globally the most important issue is the image of Coca-Cola which is affected because of this and competitors of Coke can use this issue and through PR activities and competitive advertising can badly affect their image. Moreover, Coke spend a hefty amount of dollars in the programs associated with corporate social responsibility and this activity of poisoning farms and leaving the farms parched can create a confusion in the minds of global consumers. Globally this action can reduce the sales of Coke and some people might change their prefrenes and can opt for other Cola’s. Globalization although has changed the working phenomenon in today’s world and companies just have to spend a certain amount of dollars to start their operations in any country they want. This action of stopping the water and intoxicating the water in India can create problems of entering into new states in India and in other countries too.

The term sustainability has raised number of questions for consumers and producers. It’s basically the phenomenon that big organizations are affecting the needs and lives of future generations by catering to the current generation. Ecological changes, environmental hazards, intoxicating the water are actually creating a clash between development and sustainability. Researchers found out that the water sludge in Kerala contains cadmium and lead which can lead to severe circumstances and people can even suffer from cancer and it can severely affect pregnant women. However, the company claims that the water sludge is good for the people and it’s good for the crops too. Moreover, the company’s vice president believes that the water shortage is because of the shortage of rainfalls and the company is using their allotted share of water. This conflict is creating problems for the residents and the company isn’t suffering because of this.

In this case one can easily evaluate that there is a genuine clash between development and sustainability. Coca-Cola is developing and they are growing on continuous basis but this development is harming the localities of India and they are suffering from the evils of environmental hazards. Moreover, Coke’s regime to cater the needs of its current customer is actually affecting their prospect customers.


Thus, we can conclude that by following this strategy Coke will definitely lose its customers in the long run and this customer loss would not only take place in India but might also affect Coke’s campaign internationally. An individual can easily understand that Coke is following the development strategy but the issue of sustainability is raised because of this. This attitude of Coca-Cola is against business ethics and its hurting Coke’s image too. International social organizations are not laying that much importance on this issue because small villagers of Kerala are suffering and Coke is continuously negating this point that the villagers are suffering. They are standing firm on the point the strategy of Coca-Cola is benefitting the villagers as the crops are improving. But villagers claim that the development of crops are worsening day by day and rice and pulses are not suitable for eating because they can’t be cooked properly. Therefore, Coca-Cola’s interest do tend to influence the decision making process and governments should sincerely take notice of far damaging effects on the ecological settings of the world we are living in. This issue must be addressed properly on local and international forums and Coke must take care of its brand image which is diminishing through these actions.

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