ntroduction of coco cola

7/29/2019 Ntroduction of Coco Cola

1/31

INTRODUCTION

A global pe rspective is a matter of survival for businesses. Strategic management is

the process of specifying anorganization's objectives,developing policies and plans to achieve these

objectives, andal lo ca ti ng re so ur ce s s o a s t o i mp le me nt th e p la ns . T he Co ca -

C o l aCompany (Coca-Cola) is a leading manufacturer, distributor andmarketer of Non-alcoholic

bever age concen trat es and syrups, in theworld. The company owns or licenses more than

400 brands, includingdiet and light beverages, waters, juice and juice drinks, teas, coffees,and

energy and sports drinks. The company operates in more than 200countries. Coca-Cola Enterprises is

the world's largest marketer,producer and distributor of Coca-Cola products. It operates in 46

U.S.s t a t es and Canada , and i s the exclus ive Coca-Cola bot t l e r for a l l

o f Belgium, continental France, Great Britain, Luxembourg, Monaco andthe Netherlands. Coca-

Cola is the non alcoholic bottled beverages

OBJECTIVES OF THE STUDY

Every successful study should have specified and well-definedobjectives. A careful statement of

the objective helps in preparing awell-

decorated report facilitating others to take decision on it. Thespecific objectives of the study are

to have knowledge about-

Strategic Management Issues of Coca-

multinational companies

nges of international strategic management

international management strategies

know about the Coca-Cola Companys strategies management process.
http://www.economicexpert.com/a/Organization.htmhttp://www.economicexpert.com/a/Organization.htmhttp://www.economicexpert.com/a/Organization.htm


2/31

SCOPE OF THE STUDY

This study has focused upon the Management Issues those are followed by the Coca-Cola

Company for capturing the global

market.Through our report we try to find out the global challenges of International Strategic Man

agement to assess the basic strategies,describe the international strategic management process of

Coca-Cola Company. We hope this study will help to whom, who want to know more clearly

about strategic management, its issues as well as the key factors which affect the process of

Internationalization for a company.

Data and Methodology

We examine secondary data of which related to the Strategic Management Issues at the global

based Market. Data are collected on various issues from annual report of Coca-Cola Company

(2005-2009).In our report we analysis the monthly, quarterly, half-yearly newsReview of this

company. Based upon this data we like to analysis

theEconomic Review, Statistical Strategic condition of the Coca-ColaCompany. Both the official

and regional website helps us to find out more related to the issues with the global market. Form

those hugedata we take the necessary and used them for the analysis. Ouranalysis data are clearly

represented in our main part of the report through relevant chart, graph with proper description

Definition of Strategic Management

Strategic management is the process of specifying an organizations objectives, developing

policies and plans to achieve these objectives, and allocating resources so as to implement the

plans. It is the highest-level of managerial activity, usually performed by the companys

ChiefExecutive Officer (CEO) and executive team. It provides overall direction to the whole

enterprise
http://www.economicexpert.com/a/Chief:Executive:Officer.htmhttp://www.economicexpert.com/a/Chief:Executive:Officer.htm


3/31

International strategic management is a comprehensive and

ongoingmanagement planning process aimed at formulating andimplementing strategies that ena

ble a firm to complete effectivelyinternationally. The process of developing a particular

international strategy is often referred to as strategic planning.

StrategicManagement is the study of function and responsibilities of seniormanagement


4/31

Five Essential Parts of Strategic Management

Goal-setting

Goal-setting enables a firm to articulate its vision: identify what needsto be accomplished, define

short-and long-term objectives, and relate them to what the organization needs to do

Analysis

Analysis guides to collect and consider information so that a firm understand the situation.assess

external environment and internal environment situation to identify the strenghth and weakness

of the organization and the opportunities and threats face to reach the goals.

Strategy formulation

To determine a strategy, the firm reflects prioritize, develop options, and make decisions.

Review the results of the anaylsis, identify the issues that a firm implementing partners need to

address, and prioritize them in terms of their urgency and magnitude. Use these result to design

alternative strategies and plans that address and the key strategic issues.

Strategy implementation

To implement the strategy, assemble the necessary resources and apply them.put the chosen

plans into practice, marshal the resources and commitments necessary for moving ahead, tap

existing changes capacity and/ or build new capacity, and seek to achieve results.

Strategy monitoring

Monitoring allows checking the progress towards achieving the firms goals and assessing

whether any changes in the environment necessitate alternatives to the firms strategy.modify

plans and action to adjust to the impact of changing in the operating environment.


5/31

Significance of strategic management

Strategic management integrates the knowledge and experience gained in various functinonal

areas.

It helps to understand and make sense of complex interaction in various areas if management

It helps in understanding how policies are formulated and in creating appreciation of

complexities of environment that the senior management faces in policy formulation

Managers need to begin by gaining an understanding of the business environment and to in

control

They should know to manage and understand information technology, which is changing the face

of business

As public and common investors own and more companies managers need to acquire skills to

maximize shareholder value

To have/take a strategic perspective, managers should foresee the future and track changes in

customer expectation. Intuitive, logic reasoning for proper decision-making

As corporate are becoming more integrated with the public life, corporate governance is

becoming important which manager may have to practice.


6/31

( daigram)

Issues in strategic management decision making

While making a decision the company might have different people at different periods oftime

Decision requires judgment; personal related factors are important in decision-making.Hence decision may differs as a person change

Decision are not taken individually but often there is a task in decision which could beindividual Vs group decision-making. There will be a difference between the individual

and group decision-making.

On what criteria a company should make its decision, for evaluating of the efficiency andeffectiveness of the decision making process, a company has to set its objectives which

serves as main bench mark.

3 major criteria in decision making are-a) The concept of maximizationb) The concept of satisfyingc) The concept of instrumentalism

Based on the concept the chosen the strategic decision will differs.


7/31

Generally decision making process is logical and there will be rationally in decisionmaking.

When it comes to strategic decision making point of view there would be properevaluation & then exercising a choice from various available alternatives resources,

which; leads to attain the objectives in a best possible way.

Creativity in decision making is required when there is complete situation & the decisiontaken must be original & different

There could be variability in decision-making based on the situation & circumstances

International strategic management results in the development of various international

strategies, which are comprehensive frameworks for achieving a firms fundamentals

goals. Conceptually, there are many similarities between developing a strategy for

competing in a single country and developing one for competing in multiple countries.in

both cases, the firms strategic planners must answer the same fundamentals questions-

What products and/ or services does the firm intend to sell? Where and how will to make those products or services? Where and how will it sell them? Where and how will it acquire the necessary resources? How does it expect to outperform its competitors?But developing an international strategy is far more complex than developing a

domestic one. Because managers developing strategy for a domestic firm must deal

with one national government, one currency, one accounting system, one political and

legal system and usually a single language and a comparatively homogeneous culture.

But managers responsible for developing a strategy for an international firm must

understand and deal with multiple governments, multiple currencies, multiplepolitical and legal system, and variety of language and cultures.


8/31

Various roles of strategic management

Senior management plays an important role in strategic management.

Role of board of directors: board of directors is the supreme authority in a company. they are

the owners / shareholders/ lenders. They are the ones who direct and responsible for the

governance of the company. The company act and other laws blind them their actions and they

sometime do get involved in operational issues. Professionals on the B.O.D helps to get new

ideas, perspective and provide guidance. They are the link between the company and the

environment

Role of C.E.O: chief executive officer is the most important strategist and responsible for all

aspects from formulations/ implementations to review of strategic and responsible for all aspects

from formulations/ implantation to review of strategic management. He is the leader, motivator

& builder who forms a link between company and the board of directors and responsible for

managing the external environment and its relationship.

Role of entrepreneur: they are independent in thought and action and they set / start up a new

business. A company can promote the entrepreneurial spirit and this can be internal attitude of an

organization. They provide a sense of direction and are active in implementation.

Role of senior management: they are answerable to B.O directors and the C.E.O as they would

work look after strategic management a responsible of certain areas/ parts of terms.

Role of SBU-level executives: they co-ordinate with other SBUS and with senior management.

They are more focused on their products/ burners line.

Role of corporate planning staff: it provides administrative support tools and techniques and is

a co-ordination function.

Role of consultant: often consultation may be hired for specified new business or expertise even

to get an unbiased opinion on the business and the strategy

Role of middle level managers: they form an important link in strategizing and implementation.

They are not actively involved in formulation of strategies and they are developed to be the

future management.


9/31

Company overview

The coco-cola company (coco-cola) is a leading manufacturer, distributor and marketer of non-

alcoholic beverage concentrates and syrups in the world. The company owns or licenses and

more than 400 brands, including diet and light beverages, waters, juice and juice drinks, teas ,

coffees , and energy and sports drinks. The company operates in more than 200 countries.

Approximately 74% of its products are sold outside of the US the company headquartered in

Atlanta, Georgia and employs 71000 people as of September 2006. The recorded of $24,088

million during the fiscal year ended December 2006, an increase of 4.3%over 2005. The increase

in revenue was primarily due to increase in sales of unit cases of companys products in 2005 to

approximately 20.6 billion unit cases of the companys products in 2005 to approximately 21.4

billion unit cases in 2006, the increase in price and products/ geographic mix also boosted the

revenue growth. The company-wide gallon sales and unit case volume both grew 4 % in 2006

when compared to 2005. The operating profit of the company was $6, 308 million during fiscal

year 2006, an increase of 4.3% over 2005.

History of coco-cola

Coco-cola was first introduced by john smyth pemberton, a pharmacist, in the year 1886 in

Atlanta, Georgia when he invented caramel-colored syrup in a three-legged brass kettle in his

backyard. He first distributed the product by carrying it in a jug down the street to jacobs

pharmacy and customers bought the drink for five cents at the soda fountain. Carbonated water

was teamed with the new syrup, whether by accident or otherwise, producing a drink that was

proclaimed delicious and refreshing a theme that continous to echo today wherever coco-cola

is enjoyed

Dr. pembertons partner and book-keeper, frankM.Robinson the name and penned coco-cola

in the unique flowing script that is famous worldwide even today. He suggested that the two cs

could look well in advertising. the first news paper ad for coco-cola soon appeared in the

Atlanta journal, inviting thirsty citizens to try the new and popular soda fountain drink. Hand-

painted oil cloth signs reading coco-cola appeared on store awnings,with the suggestions

drinks added to inform passerby that the new beverage was for soda fountain refreshment


10/31

By the year 1886, sales of coco-cola averaged nine drinks per day. The fisrt year, dr. pemberton

sold 25 gallons of syrup, shipped in bright red wooden kegs. Red has been a distinctive color

associated with the soft drinks ever since.for his efforts, dr. pemberton grossed $50 and spent

$73.96 on advertising.

Dr. pemberton never realized the potential of the beverage he created. He gradually sold portions

of his business to various partners and, just prior to his death in 1888, sold his remaining interest

in coco-cola to Asa G.Candler, an entrepreneur from Atlanta.

By the year 1891, mr Candler proceede to but additional rights and acquire complete ownership

and control of the coco-cola business. Within four years, his merchandising flair had helped

expanded consumption of coco-cola to every state and territory after which he liquidated his

pharmaceutical business and focused his full attention on the soft drink. With his brother, john S.

Candler, john pembertons former partner frank Robinson and two other as sociates,Mr. candler

formed a Georgia corporation named the coco-cola company. The trademark coco-cola used in

the marketplace since 1886, was registered in the united states patent office on January 31, 1893

The business continued to grow, and in 1894, the first syrup manufacturing plant outside Atlanta

was opened in dallas, tezas. Others were opened in Chicago, Illinois, and los angeles , California,

the following year. In 1895, three years after the coco-cola companys incorporation, Mr. candler

announced in his annual report to share that coco-cola is now drunk in every state and territory

in the united states.

As demand for coco-cola increased, the company quickly outgrew its facilities. A new building

erected in1898 was the first headquarter building devoted exclusively to the production of syrup

and the management of the business. In the year 1919, the coco-cola company was sold to a

group of investors for $25 million. Robert W. Woodruff became the president of the company in

the year 1923 and his more than sixty years of leadership took the business to unsurpassed


11/31

heights of commercial success, making coco-cola one of the most recognized and valued brands

around the world.

History of bottling

Coco-cola originated as a soda fountain beverage in1886 selling for fice cents a glass. Early

growth was impressive, but was only when a strong bottling system developed that coco-cola

became the world-famous brand it is today.

Year 1894 : a modest start for a bold idea In 1894 the coco-cola company is in a candy store

in Vicksburg, Mississippi, brisk sales of the new fountain beverage called coco-cola impressed

the stores owner, joseph A.Biedenharn. he began bottling coco-cola to sell, using a common

glass bottle called a Hutchinson. Biedenharn sent a case to asa griggs candler, who owned the

company. Candler thanked him but took no action. One of his nephews already had urged that

coco-cola be bottled, but candler focused on fountain sales.

In 21st century the coco-cola bottling system grew up with roots deeply planted in local

communities. This heritage serves the company well today as consumers seek brands that honor

local identity and the distinctiveness of local markets. As was true a century ago, strong locally

based relationship between coco-cola bottlers, customers and communities are the fountain on

which the entire business grows.

Pictures,


12/31

Vision of coco-cola company

Our mission declares our purpose as a company. It serves as the standard against which we

weigh our actions and decision. It is the fountain of our manifesto.

To refresh the world in body, ming and spirit To inspire moments of optimism through everywhere we enagage To create value and make a difference everywhere we engage

Mission of coco-cola Company

To create consumers products, services and communications, customers service and bottling

system strategies , processes and tools in order to create competitive advantage and deliver

superior value to ;

Consumers as a superior beverage experience Consumers as an opportunity to grow profits through the use of finishes drinks Bottlers as an opportunity to grow profits in volume Bottlers as a trademark enhancement and positive economic value added Suppliers as a opportunity to make reasonable profits when creating real value-added in

an environment of system-wide team work, flexible business system and continuous

improvement

Indian society in the form of a contribution to economic and social development Refresh the world.. in body, mind and spirit Inspire moments of optimismthrough our brands and our actions Create value and make a differene everywhere we engage.

Vision for sustainable growth

Our vision guides every aspects of our business by describing what we need to accomplish in

order to continue achieving sustainable growth.


13/31

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

Portfolio:bringing to the world a portfolio of quality beverage brands that anticipate and satisfy

peoples desires and needs

Partners: nurturing a winning network of customers and suppliers, together we create mutual,

enduring value

Planet: being a responsible citizen that nakes a difference by helping build and supports

sustainable communities

Profit: maximizing long term return to shareowners while bring mindful of our overall

responsibilities.

Quality policy

Coco-cola company follows different quality standard for different countries across the globe.

Coco-cola company has a long-standing commitment to protecting the consumers whose trust

and confidence in its products is the bedrock of its success. In order to ensure that consumers

stay informed about the global quality of all coco-cola products sold in world, coco-cola

products carry a quality assurance seal on them. The one quality worldwide assurance seal

appears on the enrite range of coco-cola companys beverages.

Current organizational organogram


14/31

Brands of coco-cola

Coca-Cola Zero has been one of the most successful product launches in Coca-Colas history. In

2007, Coca Colas sold nearly 450 million cases globally. Put into perspective, that's roughly the

same size as Coca Colas total business in the Philippines, one of our top 15markets. As of

September 2008, Coca-Cola Zero is available in more than 100 countries.

Energy Drinks

For those with a high-intensity approach to life, Coca Colas brands of Energy Drinks contain

ingredients such as ginseng extract, guarana extract, and caffeine and B vitamins.

Juices/Juice Drinks

We bring innovation to the goodness of juice in Coca Colas more than 20 juice and juice drink

brands, offering both adults and children nutritious, refreshing and flavorful beverages

Soft Drinks

Coca Colas dozens of soft drink brands provide flavor and refreshment in a variety of choices.

From the original Coca-Cola to most recent introductions, soft drinks from The Coca-Cola

Company are both icons and innovators in the beverage industry

Sports Drinks

Carbohydrates, fluids, and electrolytes team together in Coca Colas Sports Drinks, providing

rapid hydration and terrific taste for fitness-seekers at any level

Tea and Coffee


15/31

Bottled and canned teas and coffees provide consumers' favorite drinks in convenient take-

anywhere packaging, satisfying both traditional tea drinkers and today's growing coffee culture

Water

Smooth and essential, our Waters and Water Beverages offer hydration inits purest form.

Strategic alternatives of multinational companies.

Multinational corporations typically adopt one of four strategic alternatives in their attempt to

balance the three goals of global efficiencies, multinational flexibility, and worldwide learning.

There four strategies are as follows-

Home replications strategy

In this strategy a firm utilizes the core competency or firm-specific advantage it developed at

home as its main competitive weapon in the foreign market that it enters. That is, it takes what it

does exceptionally well in its home markets and attempts to duplicate it in foreign markets.

Multi-domestic strategy

It is the second alternative available to international firm. A multi-domestic corporation views

itself as a collection of relatively independent operating subsidiaries, each of which focuses on a

specific domestic market.

Global strategy

It is the third alternative available for international firms. A global corporations views the world

as a single marketplace and has its primary goal the creation of standardized goods and services

that will address the needs of customers worldwide

Transnational strategy


16/31

The transnational corporation attempts to combine the benefits of global scale efficiencies with

the benefit of local responsiveness

Strategies for coco-cola Company

These four strategy are shown in the following figure-

From these four strategies coco-cola company follow the multi-domestic strategies. They

produce their products independently in different countries. All countries products are not same.

They produce their products by following different strategy for different countries, based on the

internal and external environment of the country. Coco-cola Company developed their strategy

by considering the nature the people of different countrys people, culture, status and so many

related factors. Behind the reason of following of this strategy may be that, different countries

economies of scale for production, distribution, and marketing are low, side by side cost of

coordination between the parent corporations and its various foreign subsidiaries is high.

Because each subsidiaries in a multi-domestic corporation must be responsive to the local

market, the parent company usually delegates considerable power and authority to managers of

its subsidiaries in various host countries.


17/31

Levels-of strategies followed by coco-cola Company

There are three levels of strategies followed by coco-cola Company. This may be started as the

following-

Corporate level strategy

Corporate level strategy attempts to define the domain of business the firm intends to operate.

Corporate level strategy fundamentally is concerned with the selection of businesses in which the

company should compete and with might adopt any of three forms of corporate strategy:

A single business strategy Related diversification strategy and Unrelated diversification strategy


18/31

Coco-cola company follows related diversification strategy that is calls for the firm to operate in

several different but fundamentally related businesses. Each of its operations linked to the others

coco-cola characters, the coco-cola logo, and a theme of wholesomeness and a reputation for

providing high quality family products. Coco-cola Company follows this strategy because it has

several advantages. At first, the firm depends less on a single products so it is less vulnerable to

competitive or economic threats. Secondly, related diversification may produce economies of

scale for a firm. Thirdly, related diversification may allow a firm to use technology or expertise

developed in one market to enter a second market more cheaply and easily. Corporate level

strategies of coco-cola company is following -

Business unit level strategy

A strategic business unit may be a division, product line, or other profit center that can be planed

independently from the other business units of the firm. Copporate strategy deals with the overall

where as business strategy focuses on specific business, subsidiaries or operating units within the

firm. Business seeks to answer the question how should we compete in each market we have

chosen to enter? the firms develop unique business strategy for each of its strategic business

units, or it may pursue the same business strategy for all of them. The three basic business

strategy are differentiation, overall cost leadership and focus. Coco-cola company uses the

differentiation strategy effectively.

Functional level strategy

The functional strategies attempts to answer to question how we manage the function? the

functional level of the organization is the level of operating divisions and departments. The

strategic issues at the functional level are related to business processes and the value chain.

Functional level strategies in marketing, finance, operations, human resources, and R&D involve


19/31

the development and coordination of resources through which business unit level strategies can

be executed efficiently and effectively.

Functional units of an are involved in higher level strategies by providing input into the business

unit level and corporate level strategy, such as providing information on resources and

capabilities on which the higher level strategies can be based. Once the higher-level strategy is

developed, the functional units translate it into discrete action-plans that each department or

division must accomplish for the strategy to succeed.

E-commerce of coco-cola Company

Good points of coco-cola Company

Brand promotion Attractive products selection Look and feel it Provision of multimedia product, catalogue pages Personal attention Community relationships

Weak points of coco-cola Company


20/31

Performance and service: that is not easy navigation, shopping and purchasing andprompt shipping and delivery

Discount pricing is not being offered.

Developing international strategies.

Developing international strategies is not a one-dimensional process.. simply put strategy

formulations deciding what to do and strategy implementation is actually doing it. Firms

generally carry out international strategic management in two broad strategies-

Strategy formulations

In strategies formulations, a firm establishes its goals and strategic plan that will lead to the

achievement of their mission goals. In international strategy formulations, managers develop,

refine, and agree on which markets of enter (or exit) and how best to compete in each.

Strategy implementation

A firm develops the tactics for achieving the formulated international strategies is known as

strategy implementation. Strategy implementation is usually achieved via the organizations

design, the work of its employees, and its control system and processes.

Every multinational company are developing their international strategies so that they can

survive in the complex business situation. Now the modern market is fully globalised and as a

result its really difficult for every multinational organization in the right track. In such aspect the

importance of strategy formulation and strategy implementation played an important role. Side

by side there is some important process which helps in international strategy formulations.


21/31


22/31

COCA-COLA COMPANY, THE SWOT ANALYSIS

SWOT ANALYSIS

The Coca-Cola Company (Coca-Cola) is a leading manufacturer, distributor and marketer of

Non-alcoholic beverage concentrates and syrups, in the world. Coca-Cola has a strong brand

name and brand portfolio. Business-Week and Inter brand, a branding consultancy, recognize

coco-cola as one of the leading brands in their top 100 global brands ranking in 2008. The

Business Week-Interbred valued Coca-Cola at $67,000 million in 2008. Coca-Cola ranks well

ahead of its close competitor Pepsi which has a ranking of 22 having a brand value of $12,690

million The Companys strong brand value facilitates customer recall and allows Coca -Cola to

penetrate markets. However, the company is threatened by intense competition which could have

an adverse impact on the companys market share.


23/31

Analyzing the primary competitor and identifying their Strengths, Weaknesses, Opportunities,

and Threats (SWOT Analysis) help determine target markets, marketing plan, and customer

service, sales forecasting and sales planning. Examining the following will assist in the

competitive analysis:

tch from a competitor

and components

SWOT Analysis represents the analysis

of the following four things

STRENGTHS

Distribution network:

The Company has a strong and reliable distribution network. The network is formed on the basis

of the time of consumption and the amount of sales yielded by a particular customer in one

transaction. It has a distribution network consisting of a number of efficient salesmen, 700,000

retail outlets and 8000distributors. The distribution fleet includes different modes of distribution,

from 10-tonne trucks to open-bay three wheelers that can navigate through narrow alleyways of

Indian cities and trademarked tricycles and pushcarts.

Strong Brands:

The products produced and marketed by the Company have a strong brand image. People all

around the world recognize the brands marketed by the Company. Strong brand names like

Coca-Cola, Fanta, Limca, and Maaza add up to the brand name of the Coca-Cola Company as a

whole. The red and white

Coca-Cola is one of the very few things that are recognized bypeople all over the world. Coca-

Cola has been named the world's topbrand for a fourth consecutive year in a survey by

consultancy Interbrand. It was estimated that the Coca-Cola brand was worth$70.45billion.


24/31


25/31

Higher Income among People:

Development of India as a whole has lead to an increase in the per capita income thereby causing

an increase in disposable income. Unlike olden times, people now have the power of buying

goods of their choice without having to worry much about the flow of their income. The

beverage industry can take advantage of such a situation and enhance their sales.

THREATS

Imports: For example: As India is developing at a fast pace, the per capita income has increased

over the years and a majority of the people is educated, the export levels have gone high. People

understand trade to a large extent and the demand for foreign goods has increased over the years.

If consumers shift onto imported beverages rather than have beverages manufactured within the

country, it could pose a threat to the Indian beverage industry as a whole in turn affecting the

sales of the Company.

Tax and Regulatory Sector: The tax system in India is accompanied by a variety of regulations

at each stage on the consequence from production to consumption. When a license is issued, the

production capacity is mentioned on the license and every time the production capacity needs to

be increased, the license poses a problem. Renewing or updating a license every now and then is

difficult. Therefore, this can limit the growth of the Company and pose problems.

Slowdown In Rural Demand: The rural market may be alluring but it is not without its

problems: Low per capita disposable incomes that is half the urban disposable income; large

number of daily wage earners, acute dependence on the vagaries of the monsoon; seasonal

consumption linked to harvests and festivals and special occasions; poor roads; power problems;

and inaccessibility to conventional advertising media. All these problems might lead to a slow

down in the demand for the companys products.


26/31

COCA-COLA COMPANY, THE PEST ANALYSIS

A scan of the external macro-environment in which the firm operates can beexpressed in terms

of the following factors:

Political Economic Social Technological The acronym

PEST (or sometimes rearranged as "STEP") is used to describe framework for the analysis of

these macro environmental factors. A PEST analysis fits into an overall environmental scan,

which consists of significant political, economic, social and technological analysis for a firm to

reach their desirable position or to attain the goals and objectives. For operating a business

worldwide it is too much important, because its analysis represent the overall environmental

scanning as shown in the following diagram:


27/31

Coca-Cola Companys perform/ operate their business unit in different country based on the

developing of the PEST analysis. The PEST analysis of Coca-Cola Company is as following

Political Factors

It is one of the significant parts of a company where, in which country they operate their business

unit. Political factors include government regulations and legal issues and define both formal and

informal rules under which the firm must operate. Some examples include:

tax policy

employment laws

environmental regulations

trade restrictions and tariffs

political stability

Economic Factors

Another most imperative element for PEST analysis is economic factors. Economic factor affects

the purchasing power of potential customers and the firms cost of capital. The following are

examples of factors in the macro-economy:

economic growth

interest rates

exchange rates

inflation rate


28/31

Social Factors

Social factors include the demographic and cultural aspects of the external macro environment.

These factors affect customer needs and the size of potential markets. Some social factors

include:

health consciousness

population growth rate

age distribution

career attitudes

emphasis on safety

Technological Factors

Technological factors can lower barriers to entry, reduce minimum efficient production levels,

and influence outsourcing decisions. Some technological factors include:

R&D activity

automation

technology incentives

rate of technological change


29/31

Findings

By preparing this report about the strategic management issues of multinational companies

MNCs, the case study on the coco-cola company, we get some important things. These findings

are as follows-

Coco-cola enterprises are the worlds largest marketer, producer and distributor of coco-cola products.

Coco-cola was the first introduced by john Smyth Permberton, a pharmacist Iin the year1886 in Atlanta., Georgia when he invented caramel-colored syrup in a three-legged brass

kettle in his backyard.

It operates in 46 U.S states and Canada, and is the exclusive coco-cola bottler for all ofbelguim, continental france, great britian, Luxembourg, Monaco and the Netherlands.

Coco-cola is the non-alcoholic bottled beverages.

The company owns or licenses more than 400 brands, including diet and light beverages,waters, juice and juice drinks, teas, coffess, and energy and sports drinks

The company operates in more than 200 countries Strategic management integrates the knowledge and experience gained in various

functional areas.

3 major criteria in decision making are- the concept of maximization, the concept ofsatisfying, the concept of instrumentalism

The vision of coco-cola company is to refresh the world in body, mind and spirit Bringing to the world a portfolio of quality beverage brands that anticipate and satisfy

peoples desires and needs.

Coco-cola zero has been one of the most successful product launches in coco-colahistory.

It has soft drinks, energy drinks, juice drinks, sports drinks, tea and coffee, water andother drinks.

Coco-cola follows the multi-domestic strategy for operating their business. After entering into a new market coco-cola company try to achieve strategic goals and

guide its daily activities with proper observations.


30/31

Good points of coco-cola company are brand promotions, alternative products selections,provision of multimedia product, catalogue pages and so on..


31/31

Conclusion.

Being in such a tense competition (just like the brand coco-cola,) coco-cola should not take

the direct and tough attack upon it. There is no good to either side. The best way is to keep a

peaceful relationship with it and always compare with others; we should find their

disadvantages and show our advantages on this aspect. Then by and by, the people would

like ours is betted of course the most important rule is to improve ourselves. To meet thye

consumers. An organizations strategic thinking is governed by the situation prevalent in its

external environment. The external environment comprises of the strategic moves adopted by

the organizations competitors. The organizations have to carefully study these moves and

accordingly devise strategies to gain competitive advantage. For the same, the organization

needs to conduct an industry and competitive analysis. The paper discusses the steps and

process involved in the same. In formulating business strategy, managers must consider the

strategies of the firms competitors may be less important, in concentrated industries

competitor analysis becomes a vital part of strategic planning.

ntroduction of coco cola

Documents