The business world is ever-changing. Every day, new trends come up, and it is up to a manager to understand the impact of these trends on the firm and how they can ensure profitability. Two of the greatest changes that have taken place in the 21st century is the adoption of technology by most business operations and globalization. Most companies have continued to adopt technology in an effort geared towards improving their overall efficiency. Corporations have also globalized their operations to increase their customer base and profitability. It is, therefore, prudent for any manager to strategically position his/her company to guarantee a competitive edge. This essay thus analyzes how business dynamics e.g. globalization and technology changes have impacted the operations of Coca-Cola.
Globalization and Technology
Coca-Cola is by far the most recognized brand in the world. Since its inception, Coca-Cola has had a more global view of its operations. Its founders had an aim of reaching the remotest of consumers in the world. The globalization efforts began in the 1920s and by 1970, the company was operating in more than 100 countries with over 20 brands under its name (Coca Cola, 2012). Globalizing its operations has seen the company increase its sales. The company’s portfolio has also increased significantly, as it has acquired other bottling and soft drinks manufacturing enterprises in the countries in which it operates in.
On the downside, globalization has increased the number of competitors for Coca-Cola. The company is thus tasked with the responsibility of creating a strategic plan on how to compete with each competitor. Globalization has also tasked Coca-Cola with being socially responsible and ensuring that the social welfare of the societies in which it operates in around the world is improved (Coca Cola, 2012).
Technology has also improved the efficiency of most operations of Coca Cola especially in the production and distribution sectors. The company continues to research into more technical ways in which it can complement its human talent. The automating of its production lines has however been met with a lot of criticism as it has led to the loss of many jobs.
Application of Above-Average Returns Models
Under the industrial organization model, Coca-Cola will have to put an emphasis on its external environment for it to realize above-average profits (Hitt, Ireland, & Hoskisson, 2013). Coca-Cola should understand the operations of its competitors e.g. PepsiCo and develop clear strategies through which it can realize above average returns. The preliminary step would be to conduct a SWOT analysis of the company (Hitt, Ireland, & Hoskisson, 2013). From the analysis, managers at CocaCola can establish opportunities such as the low sugar, diet and energy drinks niche that exists in the market. Though the company already has a brand serving the niche i.e. Diet Coke, it needs to increase more products in this segment to meet the demands of each consumer and also tap into its full potential.
The resource-based model has a more internal approach towards achieving above average returns (Hitt, Ireland, & Hoskisson, 2013). Under this model, Coca-Cola will have to complete an evaluation of its processes establishing which are the most profitable and which are dragging its profits down. More resources should be directed to the highly performing processes and divisions while those that are poorly performing should be sold off (Hitt, Ireland, & Hoskisson, 2013). The company should also develop its human talent and acquire more unique resources i.e. patents that will aid it in achieving above average resources.
Vision and Mission Statement
Coca Cola’s mission is to “refresh the world, inspire moments of optimism and happiness, and create value that makes a difference.” This mission statement embodies the values that Coca-Cola holds dear (Coca-Cola, n.d.). Its shows that the company is geared at improving the welfare of the world and not just to increase profits. This customer-oriented vision is admired by its customers and continues to ensure the success of the company.
The vision of Coca-Cola centers around 6Ps i.e. people, portfolio, partners, planet, profit, and productivity (Coca-Cola, n.d.). This vision statement encompasses these six factors that Coca-Cola believes are critical to its success. It appreciates that people (employees), a variety of products and a diverse network of customers and suppliers are the foundation of a successful business. The company also understands that a sustainable planet and profits will ensure its productivity continues into the foreseeable thus maintaining its success in the industry.
The company is a public traded corporation listed on the New York Stock Exchange. It shareholders continue to provide funds that finance its numerous projects around the world. Its pool of employees and management are responsible for the day-to-day operations, maintain the company’s success. The company’s suppliers are responsible for the company’s success by ensuring the production lines receive the required raw material for production. The company’s distributors are also tasked with the timely delivery of products to the market. Therefore, the different types of stakeholders all contribute to the success of Coca-Cola.
References
A Global Business. (2012). The Coca-Cola Company. Retrieved 2 January 2017, from http://www.coca-colacompany.com/stories/the-chronicle-of-coca-cola-a-global-business
Hitt, M., Ireland, R., & Hoskisson, R. (2013). Strategic management (1st ed.). Mason, OH: South-Western Cengage Learning.
Mission, Vision & Values. (n.d.). The Coca-Cola Company. Retrieved 2 January 2017, from http://www.coca-colacompany.com/our-company/mission-vision-values
