Coca-Cola’s Internal Environment

Coca-Cola’s Internal Environment

Coke’s Value Chain- What does Coke do that adds value to the Coca-Cola Company

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The inbound logistics aspect of Coca-Cola is very strong as they have over 300 distribution or bottling centers across the globe serving to over 200 countries.

Having many distribution facilities will minimize shipping time to decrease shipping costs and therefore increase revenue.

A lot of research is put into the design and layout of the warehouse and other bottling centers. Since having intelligently laid out these warehouses, Coca-Cola has increased efficiency. Not only having inbound warehouses being effectively designed, Coca-Cola incorporates this layout technology in their outbound factories to increase their overall workflow design.

Coca-Cola is one of the most recognizable brands in the world and continues to market their product extremely well. Coke’s trademark value is estimated at a whopping $25 billion. The brand basically sells itself, but Coke is not just sitting back and being lazy. The Coca-Cola Company actively researches the needs of its customer segments and targets to provide drinks and snacks that people will want. As a luxury product, Coke understands that luxury items are the first things to go when times get tough. For this reason they provide excellent service to their suppliers and customers. Without excellent service, a beverage company will fall by the wayside as there are many other products out there to substitute any type of drink.

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With over 500 brands owned by the Coca-Cola Company, there are many raw materials that are needed to support these snack and beverage brands. The main ingredient most of Coca-Cola’s products is water. Coke understands the difficulties with many countries receiving fresh water and they work hard to deliver to these remote areas. Other than water, nutritive and non-nutritive sweeteners are used in their products. Coke has developed win-win relationships with their suppliers because both parties are in understanding that they will do a lot of business together. Coke does depend on one supplier for different ingredients they use. This could be dangerous for Coke as the supplier may take advantage of this relationship.

The Coca-Cola Company is massive and has its own internal administration. These internal divisions include Human Resources, Information Technology, Accounting and others. They also spend millions of dollars a year on research and development of new products. Continually changing and understanding the needs and wants of the world’s population will lead to happier customers and increased revenues.

Required:

(a) Analyze this case and conduct a Value Chain Analysis (VCA) for Coca Cola Company. [20 MARKS]

(b) Managing the value system for a global business like Coca Cola requires an organisation to make two broad choices.

Discuss the two choices in light of the Coca Cola Company.

[10 MARKS]

[TOTAL: 30 MARKS]

QUESTION TWO

The BCG (Growth-Share) Matrix is old but has stood the test of time. How significant and practicably usable is it today, in the light of vast developments in management tools that help assess market conditions. Use an organization of your choice for analysis. [20 MARKS]

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QUESTION THREE

(a) There is a proposition in management studies that leadership affects performance and that there factors in leadership that are determinants of effective leadership. All those who aspire to leadership, senior and key positions must have a distinctive and powerful set of attitudes and values.

Discuss the values a leader should possess to achieve results, inspire others, and work effectively.

[10 MARKS]

(b) Corporate governance is concerned primarily with protecting weak and widely dispersed shareholders against self-interested Directors and Managers,

Discuss the pillars of good corporate governance citing appropriate industry examples. [8 MARKS]

(c) Any strategy directions may be undertaken in a different way or by a different strategic method.

Explain the means by which a strategy can be pursued.

[2 MARKS]

[TOTAL: 20 MARKS]