Case Analysis of Coca Cola Essay

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Case Analysis of Coca Cola

1. In the 1980s, under CEO Roberto Goizueta, Coca-Cola was a global brand with a growing presence in global-emerging markets like Europe, Russia, and South East Asia. It beat back its main rival Pepsi to be a leader in the carbonated beverage market with a 70% market share. During the 1990s however, under new CEO M. Douglas Ivester, the company’s market share started declining due to political (regulatory), economic, social (consumer), and technological (operations) challenges in the marketplace.

While Coca-Cola was trying to consolidate its position in it’s core cola market, there was an increasing shift in consumer tastes in favor of non-carbonated beverages such as juice, tea, and bottled water. Local
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Coca-Cola also faced a great deal of negative publicity from a race discrimination suit filed by African-American employees.

Coca-Cola’s response: In pursuing a goal of retaining global preeminence and a 15-20% earnings growth, Coca-Cola took on too much, simultaneously, in expanding its markets. Ivestor employed stopgap measures to correct Coca-Cola’s image. He personally apologized for the missteps in Europe & lobbied with the French & Belgian governments. He attempted to streamline the organizational structure by realigning his direct reports on a regional basis. However, these changes were not enough, and it was only under Daft that Coca-Cola effectively tackled environment and performance related issues in meeting its goals.

Internal effectiveness: Daft decentralized operational & marketing functions to give local managers more authority over product portfolio development.

Emotional health measure: Daft was an amiable personality, and in an effort to settle Coca-Cola’s racial discrimination suit he rehired Carl Ware to head the company’s Africa unit.

Systems resource effectiveness: Daft formed strategic alliances with other companies like the Creative Artists Agency, to gauge customer & market preferences.

Stakeholders’ satisfaction: Daft attempted to repair relations with European regulators by being more culturally sensitive.

2. Coca-Cola’s strategy, under Ivestor, can be broadly analyzed using Hambrick
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