Introduction
Strategic management directs and supports organizational activities for sustainable growth. The Coca-Cola Company integrates strategic management in its local and global operations contributing to its success in the beverage sector. DuBrin (2020) states that planning, organizing, leading, and controlling fall under the primary management principles. Coca-Cola’s vision is to become a global anchor bottler with a mission of refreshing everyone, which guides its management team during planning. Thus, the company engages in formulating long-term and short-term plans imperative to the current market trends. Further, the leading and organizing function at Coca-Cola guides resource allocation, coordination, and communication. On the other hand, the company’s controlling function primarily revolves around review and evaluation. Given the growing competition in the beverage sector, Coca-Cola must revamp its managerial approach. Coca-Cola should individualize its management practices to maximize production.
Coca-Cola Company
Coca-Cola is among the companies with the largest market capitalization in the world. Founded by John Stith Pemberton and headquartered in Atlanta, Georgia, the company was incepted in 1886 (Caroff & Berkowitz, 2022; Vincent & Kolade, 2019). Much history lies behind its formation until it became a global soft drinks company. In addition to studying pharmacy, Pemberton joined the Georgia State Guard to take part in the American Civil War as a Confederate soldier (Caroff & Berkowitz, 2022; Thakkar et al., 2022). After succumbing to serious injuries during the Columbus battle, doctors gave Pemberton morphine for the pain. Despite signs of recovery, the treatment continued, and Pemberton got addicted to painkillers. Given their side effects, Pemberton experimented with coca plants to reduce his addiction. Pemberton’s first product Coca Neve Tonic was a mixture of strong liquor and cocaine that was marketed as a drug for medical pain, chronic headaches, and opiate addiction. However, Pemberton’s invention came with some perks, thus, sought other alternatives.
During the period Pemberton had invented his first drink, Georgia had placed a ban on alcohol production and sale. Consequently, Pemberton changed the composition of his product with non-alcoholic ingredients (Caroff & Berkowitz, 2022). People liked the new concoction, encouraging Pemberton to partner with Willis Venable to help him refine his recipes, and Coca-Cola got incepted and first marketed at Jacob’s Pharmacy Atlanta in 1886. However, in 1887, Pemberton sold the company to Asa Chandelier who used aggressive marketing to introduce Coca-Cola in the global market (Vincent & Kolade, 2019). During this time, the company manufactured one brand but gradually introduced more brands. Today, Coca-Cola has ventured into a range of drinks and juices and continues to gain a strong customer and distribution base globally. Therefore, the company’s tremendous product base expansion puts its ahead of other players in the beverage industry.
The Coca-Cola company’s industry type is beverages, which formulates high competitiveness. However, given the brand’s visibility and marketing strategies, Coca-Cola has taken a strong position in the market. It helps the company not experience discomfort due to high competition, as its performance remains at the same level. This industry includes several well-known brands and many unknowns trying to carve out a niche in the market.
Organizational Mission, Vision, and Culture
Coca-Cola’s mission and vision influence its organizational culture and management process. The company’s vision is to “craft the brands and choice of drinks that people love, to refresh them in body & spirit” (The Coca-Cola Company). Coca-Cola’s vision serves as a framework to guide every aspect of its operations: providing a great place that inspires people to be their best; bringing a portfolio of top-tier beverage brands. Further, the company aims to be highly effective and fast-moving by nurturing a global network of suppliers and customers for mutual value; maximizing long-term value; supporting and building sustainable communities. Coca-Cola’s vision starts with a mission “To refresh the world in mind, body, and spirit, to inspire moments of optimism and happiness through our brands and actions, and to create value and make a difference” (The Coca-Cola Company). The mission statement reflects the company’s purpose and endeavors in attaining all its fundamentals.
Furthermore, the company’s mission and vision combine to provide a statement of its values. Among Coca-Cola’s core values include leadership, integrity, diversity, quality, accountability, collaboration, and passion. The brand ideally develops positive relations inside and outside the company (Singaram et al., 2019; Thakkar et al., 2022). In turn, this allows employees to share ideas and produce quality results and solutions. Thus, Coca-Cola develops a work environment and culture that encourages accountability among all stakeholders. The brand further represents qualities like integrity, excellence, caring, and sharing, all of which the company mirrors in its organizational culture. Therefore, the company goes beyond its portfolio of brands to ensure an inclusive and fair workplace that embraces unique talents dedicated to supporting the community; Coca-Cola operates as a local entity on a global scale.
Coca-Cola’s Management Functions
Management style informs organizational purpose, strategy formulation, and development of measurable goals and objectives. The foundations of successful managerial operations include planning, organizing, leading, and controlling (DuBrin, 2020; Griffin, 2021). Coca-Cola has particularly harnessed these four pillars to support its global success. The first of the managerial functions is planning; senior management must plan operations to effectively manage their business. Most recently, the Coca-Cola Company announced an initiative to reorganize its system while executing its beverages for long-term strategy, including a diverse portfolio well-positioned for growth in a rapidly changing marketplace (The Coca-Cola Company). Coca-Cola’s strategic plan emphasizes an understanding of set objectives and goals to identify and assign resources accordingly. The organization exhibits efficient planning by placing the general manager as head of all operations including packaging decisions, advertisements, distribution, and price reductions. Therefore, decision-making in Coca-Cola is centralized such that apart from leading their subordinates, senior management is responsible for making crucial administrative decisions.
Furthermore, planning at the company entails targeting stakeholders at all levels to actualize cooperation and coordination. Apart from strategic planning, the key players engage in organizing operations. The Coca-Cola Company follows a decentralization model within a centralized structure. Although overall decision-making is retained at the headquarters, the company is divided into geographical territories. The regional divisions are further organized into functional departments that comprise sales and marketing, production, human resource, and industrial relations. According to Heimstädt and Dobusch (2020), roles and responsibilities are clearly defined in every department to ensure transparency and accountability. Despite the company being organized in various regions and departments, it celebrated transformative leadership at local and global levels.
In addition, the company’s planning is to set specific goals for the levels of key indicators. These include revenue/sales levels, new product launches, challenges, and performance goals. In turn, the organizing includes the implementation of the planning, and the control implies tracking procedures. Finally, leading is responsible for developing and implementing appropriate leadership styles and maintaining market position. It refers to the current status of the company’s everyday activities, namely the preservation of positions and development.
Senior management and departmental heads decide on the most effective strategy for their respective territories that permeates organizational culture and norms. Apart from transformational leadership, Coca-Cola follows a laissez-faire and democratic leading approach (Twekambe, 2019). Typically, senior management has managerial subordinates who assist in transforming macro-level mission and vision into a micro level for execution. Moreover, the managerial styles follow an incentive-based system, including bonuses, commissions, and pay hikes, to actualize good performance. Moreover, Coca-Cola’s controlling function is performed through periodic performance reviews. Further, this function ensures that top management prepared a performance development plan targeting growth in market development and ales. The fundamental aspect of Coca-Cola’s planning, organizing, leading, and controlling function is to follow a global approach matching contemporary market demands.
Recommendations
Coca-Cola’s business environment is largely characterized by the dynamism invested in research and development. However, companies like Red Bull, PepsiCo, Nestle, and Unilever are gaining precedence in the beverage sector. Thus, developing a competitive advantage by analyzing Coca-Cola’s strategic management is fundamental. The recommendation of the company is based on setting specific, measurable, achievable, relevant, and time-bound goals in a managerial style. For one, Coca-Cola should expand its brand advantage and leadership in the beverage sector by occupying more market share for stable sales and cash flow. The entity has a large customer base that identifies its unique taste and is recognized by distributors globally. Thus, the company should use its brand effect in its next planning phase to improve the quality and safety of its products. Liu (2021) suggested that Coca-Cola should consider marketing in more remote areas by making use of its distribution network to access potential customers and distributors. Increasing investments to drive innovation can further help Coca-Cola open up more product segments. The company can measure the success of implemented strategies by checking its customer acquisition cost, employee satisfaction level, return on investment, and total revenue annually.
Conclusion
Strategic management is an essential factor to any successful corporation in today’s marketplace. The benefits of strategic management are evident in the world’s largest companies like Coca-Cola, which witness increased operational efficiency, in turn, leading to increased sales and more profits. Coca-Cola consistently offers people a chance to experience new flavors which are homogenized and sweetened into soft drinks. The company’s managerial style, from planning to controlling, places it at a level greater than rivals like PepsiCo, Nestle, and Red Bull. Nonetheless, Coca-Cola should expand its leadership, and brand advantage, and open more product segments to remain competitive in an ever-changing business landscape.
References
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