Introduction
Starting in 1888, Coca-Cola became the leading soft drink company. The company has expanded to become a global player with several branches in various continents and countries. Coca-Cola boasts of being a prominent brand in the soft drink industry, and its products are known for their universal image and name. Despite having branches in different regions, the central body makes the company’s critical decisions regarding marketing strategies, product quality, and other critical strategies.
Even though the company boasts of great success, as seen by its high growth rate and globalization, the success story is attributed to its business strategy, which has proved sustainable. As other branches spread worldwide, Coca-Cola South Africa, as one of the subsidiaries in Africa, has replicated the success stories of the umbrella company. South Africa Coca-Cola boasts of the strategies of its CEOs, who have shown great leadership through proper strategies.
Coca-Cola Business Strategy
Coca-Cola is one of the largest firms in the soft drink industry, boasting that it is the market leader. Coca-Cola practices corporate business strategy, which sees the critical decisions concerning operation, marketing, product quality, and other strategies regulated by the central body. Even though Coca-Cola has made in-roots in most countries, the company has maintained common practices among the constituent firms (Wang et al., 2022). The central body is responsible for developing strategies for the growth and success of all the firms under the company’s umbrella, which has seen the Coca-Cola brand making headlines in the international news (Arlet, Eknath, and Popova, 2022). The company’s corporate strategy is binding to all the players, including constituent firms, teams, and individuals, to work uniformly regardless of the location or market they serve.
Understanding the importance of management, all the groups under the company always recruit managers with the best skills to provide leadership and influence positive organizational behaviors (Griffin, Phillips, and Gully, 2019). For instance, South African Coca-Cola has been under the best CEOs. Secondly, individuals working under the company are compelled to maintain the quality of the products wherever they are, which is why all Coke products are homogenous everywhere. Similarly, the cost leadership of the central body dictates the pricing behavior of all the constituent firms and small groups in the retail business who are compelled to maintain affordable prices for Coke products (Wang et al., 2022). As a result, the Coca-Cola brand has been enjoying a huge market following and customer loyalty worldwide.
Growth Strategy
Coca-Cola Company employs a growth strategy when realizing its corporate strategy. The firm is known for market penetration, as it has scaled new markets and expanded its influence worldwide, as seen from its ability to have several subsidiaries in foreign markets such as South Africa. In particular, the company has been using diversification to practice its growth strategy. For example, Coca-Cola has a wide range of soft drink products including Coke Zero, Diet Coke, Coca-Cola Life, Claceau Vitaminwater, and Glaceau Smartwater for various customers (Tata, 2022). Sprite, as one of the many diverse products of the company, is associated with the young generation, another proof of strategic management (Griffin, Phillips, and Gully, 2019).
Differentiation is another technique in the growth strategy used by Coca-Cola through the universal image (Griffin, Phillips, and Gully, 2019). All constituent firms in various markets are dealing strictly with the same products. For instance, Coca-Cola South Africa has the same products as that in the European market, thus creating a universal image, brand, and trademark. The differentiation makes Coke products outstanding in the market, thus building the company’s global brand.
Cost Leadership
Coca-Cola products are known for their affordability in all markets. Whether in Africa or Asia, the pricing policy of the central body dictates affordable prices for all the products under the company name (Wang et al., 2022). As a result, the firm has managed to attract a wide range of customers regardless of economic status. For instance, in South Africa, Coca-Cola products are the cheapest in the soft drink industry. Cost leadership strategy dictates the pricing policy of every constituent firm working under the Coca-Cola brand and ensures they set their prices at affordable rates to attract more customers.
Product Quality
Regardless of the market’s location or country, Coca-Cola products have the same quality in terms of taste. Coca-Cola drinks in Japan taste similar to an equivalent drink in Spain. Similarly, Sprite in South Africa tastes the same as in South Korea (Li, 2022). The company has managed to maintain its product quality throughout the market for a long period. Product quality strategy compels every player within the umbrella of the Coca-Cola brand, including those working in the production sector, designing, and supply, to work towards maintaining high product quality (Griffin, Phillips, and Gully, 2019). Managers in all constituent firms are tasked to ensure the product always retains its quality. As a result, Coca-Cola is enjoying loyalty among its many customers.
Diversity Issues for Coca-Cola South Africa
South Africa is one of the most multiracial countries in Africa and the world, comprising various ethnic and racial groups. In addition, South Africa is multi-religious, with citizens belonging to various religious organizations (Atuluku, 2022). As a result, many firms operating in the country will likely experience diversity issues. Like other organizations, Coca-Cola Company is faced with the task of maintaining inclusion in its workplace amidst numerous diversity issues, including’
Racial Inequality
South Africa is a multiracial country comprising different races and ethnicities, with each group competing for limited opportunities. Several firms have been accused of racial discrimination, providing opportunities to the White community at the expense of the Black population. Similarly, Coca-Cola South Africa is facing diversity issues as they are accused of practicing racial discrimination in their workplace (Okorie, 2023). The members of the White community are alleged to occupy all the senior positions at the expense of the Black population.
Gender Imbalance
Gender is another contentious issue in South Africa, with the female gender facing marginalization and discrimination in the workplace. Most companies are accused of favoring the male population at the expense of their female counterparts (Li, 2023). In addition, women in South Africa face low pay. Like other companies, Coca-Cola is facing the challenge of gender diversity as it has failed to keep the gender balance. The company has employed more men than women.
Religious Discrimination
South Africa is characterized by numerous religious organizations. Various religious groups are fighting for space and dominance. Most companies find themselves entangled in religious wars as they are accused of practicing unfairness and discrimination in their recruitment and organization (Tata, 2022). Similarly, Coca-Cola Company is facing the challenge of religious diversity as they are accused of favoring Christians over other religious groups in their recruitment, leadership, and organization.
Coca-Cola South African CEOs
Coca-Cola Company is a leading firm in the soft drink industry. The company boasts good leadership from the central organ of the firm (“Science of People,” 2019). The success is shared by its constituent firms’ managers in its subsidiaries, such as Coca-Cola South Africa, who have ensured the company is always on the right track through strategic leadership. South Africa Coca-Cola has two CEOs with great leadership skills, overseeing the firm to higher heights (Sinek, 2020). The former Coca-Cola South Africa CEO was Jacques Vermeulen, who has since been promoted to become the African Coca-Cola leader, and the current CEO, Velaphi Ratshefola, has a wide range of experience in leadership.
Former CEO, Jacquues Vermeulen and Current CEO, Velaphi Ratshefola
Acceptance
A good CEO should practice acceptance leadership to promote inclusion in the workplace. Vermeulen showed great acceptance and leadership during his time as the CEO of Coca-Cola South Africa. Even though diversity is a serious challenge in South Africa due to factors such as race, religion, and gender discrimination, which affects most companies, Vermeulen, through his acceptance leadership, tried to promote inclusion in the firm (Gao et al., 2022). As the CEO, he tried to practice diversity in Coca-Cola by including various groups of people. As his predecessor Vermeulen, Velaphi has shown great acceptance leadership since he took office, practicing diversity and inclusion. The new CEO has overseen the empowerment and inclusion of women in leadership to promote gender balance in the company. His effort to empower women, including females in leadership and gender balance, saw him win two prestigious awards, Standard Bank Top Women Awards in 2019 and 2020.
Loyalty
As the head of the organization, CEOs should demonstrate high loyalty to their company to inspire their teams. Vermeulen is one of the most loyal members of Coca-Cola. Since the 1990s, the current leader has been working at Coca-Cola, occupying various roles and positions. The loyalty helped to organize and steer his team to increase the productivity and growth of the company (Gao et al., 2022). As a leader, he saw Coca-Cola South Africa overtaking the rival firms in the soft drink industry and becoming a market leader for soft drinks and beverages. Like the former CEO, the current CEO, Mr. Velaphi, is loyal to the core and has been focusing on improving the company. For instance, the CEO oversaw the merger of small beverage firms to create the larger South African Coca-Cola.
Values of Coca Cola
Coca-Cola Company works as a single entity with the most values commonly shared by its constituent firms. Despite the geographical separation, all the company branches are regulated by common principles intended to protect the image and brand of the firm. Values such as diversity, a component of the company’s mission, vision, and objective, are shared by all the players and must be practiced by all the branches of the firm (Griffin, Phillips, and Gully, 2019). However, due to the differences in culture, market makeup, and economic policies, some Coca-Cola firms may be forced to adopt and embrace unique values to survive and satisfy the market.
Quality
Coca-Cola Company is a single universal brand with all the forms working under it, sharing the title. As a result, the company is strict on offering and maintaining its quality to protect its image. However, in some countries with different tastes and preferences, the company may be forced to compromise its quality value by introducing diversification (De Souza Tavares & Silitonga, 2023).
For instance, most people in Middle Eastern countries prefer sugarless soft drinks. Therefore, Coca-Cola must consider that and produce sugarless Coke products in the regions. Quality’s value helps Coca-Cola drive success by building and maintaining customer loyalty. Normally, consumers prefer consistent quality products and stick to brands doing the same.
Diversity
Coca-Cola considers diversity one of its values, as it aims to promote the inclusion of women and other marginalized groups. The company encourages policies among its firms to promote diversity and inclusion as it understands the several benefits of diversity (‘Potential’ 2018). However, cultural differences and some individual policies may force some companies working in different countries to compromise their values (Gao et al., 2022). For instance, some Arab Islamic countries have strong cultural practices that outline leadership roles. Diversity as a value helps to drive success by promoting creativity in the company. In addition, diversity can drive success by attracting more customers to the company and instilling a sense of belonging among consumers.
Work Motivation
Work motivation is important in business because it enhances efficiency and work rate, whose endgames are increased productivity. Most successful companies have strategies to motivate their employees (Baran, 2012). People have different reasons for seeking jobs and working and thus would have unique motivations to continue. According to Vroom’s expectancy theory, employees’ motivation is affected by the expectation from their work (Gyepi-Garbrah et al., 2023). The theory states that individuals work because they expect something in return; thus, increased effort will further increase the return. For example, those working for money believe that an increase in their effort will increase the money they get. South Africa is one of the countries with most people living below the poverty level; the main motivation for work is improved living standards through money.
Financial Incentives
Financial incentives such as allowances, increased salaries, and rewards can help Coca-Cola Company to motivate its employees in South Africa as the staff will always increase their efforts to receive the tokens. For instance, overtime allowance can motivate employees to work extra hard and extend their time to earn more (Gyepi-Garbrah et al., 2023). Similarly, increasing the salaries would motivate the staff to work extra hard to earn more at the end of their tasks.
Conclusion
In summary, Coca-Cola is among the leading companies in the soft drink sector, and its success is attributed to its corporate business strategy. The company has employed growth, pricing, and product strategy to expand its market base and build its brand. Coca-Cola South Africa, as one of its major branches, is doing well in the market; however, diversity issues such as racial inequality, gender imbalance, and religious unfairness are inhibiting inclusion efforts. As the overall manager, former and current Coca-Cola South African CEOs Vermeulen and Velaphi have uniquely done well in improving the company. Through values such as quality and diversity, Coca-Cola has successfully built and protected its brand and image in the market. Finally, Coca-Cola South Africa can motivate its employees through financial incentives such as allowances.
Reference List
Arlet, J.N., Eknath, V. and Popova, O. (2022) ‘Effectively engaging the private sector in the business reform process’. Web.
Atuluku, A. (2022) ‘Sustainability leadership in Africa: Six case studies. In K. Ogunyemi et al. (Eds.) Management and leadership for a sustainable Africa, volume 1: Dimensions, practices, and footprints (pp. 175-192),’ Cham: Springer International Publishing. Web.
Baran, B. (2012) Employee motivation: Equity theory. Video.
Coca-Cola Bottling Company in Saudi Arabia (CCBCSA) Olayan. (no date). Web.
Coco-Cola Zero Sugar Archives-Hien THao Shop. (no date). Web.
De Souza Tavares, W. and Silitonga, R.U. (2023) ‘The Coca-Cola Company’s advertising history is illustrated through phone cards,’ International Journal of Arts and Humanities, 4(1), pp.137-146. Web.
Gao, Q., et al. (2022) ‘Explore the reasons for Coca-Cola’s high-profit margins. In B. Chongxi et al. (Eds.), 2022 7th international conference on financial innovation and economic development (ICFIED 2022) (pp. 1430-1436),’ Atlantis Press. Web.
Griffin, R.W., Phillips, J.M. and Gully, S.M. (2019) Organizational behavior: Managing people and organizations. Cengage Learning.
Gyepi-Garbrah, T., et al. (2023) ‘Using goal-setting theory and expectancy theory to understand career goal implementation in the hospitality industry,’ Journal of Hospitality, Leisure, Sport & Tourism Education, 32. Web.
Li, M. (2022) ‘Strategy and financial statement analysis of the Coca-Cola Company. 2022 2nd International Conference on Financial Management and Economic Transition (FMET 2022) (pp. 264-273). Atlantis Press. Web.
Li, X. (2023) ‘The strategy analysis of Coca-Cola,’ Web.
Okorie, N. (2023) ‘Theorizing the power of celebrities in the media landscape of Africa. In T. Owalobi et al. (Eds.), Media and communication theory in Africa (pp. 245-255),’ Cham: Springer International Publishing. Web.
Potential. (2018) ‘Diversity. 5 reasons why workforce diversity is good for your workplace. Video.
Science of People. (2019) ‘10 Leadership skills that every leader should have,’ Video.
Sinek, S. (2020) ‘What makes the highest performing teams in the world?’ Video.
Tata, S. (2022) ‘A note on the influence of grand strategy on business strategy. In S. Tata (Ed.), Reflections on grand strategy: The great powers in the twenty-first century (pp. 185-191),’ Singapore: Springer Nature Singapore. Web.
Wang, H. et al. (2022) ‘COFCO and Coca-Cola Company’s cooperation business negotiation and business strategy research. In G. Ali et al. (Eds.), 2022 6th international seminar on education, management and social sciences (ISEMSS 2022) (pp. 1369-1376),’ Atlantis Press. Web.