Strategic Management Assignment Solution (GC0463)

Table of Contents

1.0 Introduction.

2.0 Coca Cola background.

3.0 Industry analysis.

3.1 Competitors of Coca-Cola.

3.2 Market details.

3.3 Current trends in the market

3.4 Future trend of Coca-Cola in the market

4.0 External environment analysis.

2.1.1The PESTLE Analysis for Coca-Cola.

5.0 Internal environment analysis.

5.1 SWOT Analysis.

5.2 Porter Five Forces Analysis.

6.0 Strategies of Coca-Cola.

6.1 Coca-Cola strategies to manage its resources and capabilities.

6.2 Coca-Cola Value Chain Analysis.

6.3 Critical Success Factors of Coca-Cola.

7.0 Conclusion.

6.0 References.

1.0 Introduction

The highly competitive marketplaces and the rapid changes in technological development are forcing organizations to manage their strategies more effectively to succeed in business operations. According to Kotler et al. (2012), strategic management refers to the processes of defining, describing, and applying different business strategies into business activities for gaining competitive advantages and better organizational performances. Strategic analysis is the key method of conducting effective strategic management. According to Palmer (2015), strategic analysis is the process of investigation, evaluation, and developing business strategies to meet organizational goals and objectives. The strategic analysis focuses on both internal and external business environments. Consequently, the key tools of strategic analysis are Value Chain Analysis, SWOT analysis, PESTLE analysis, and Porter’s Five Forces analysis. This reported has conducted a strategic analysis for a particular company named “Coca-Cola”.

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2.0 Coca Cola background

Coca-cola is the largest manufacture in the world, which was founded by a pharmacist named John Pemberton in 1886. Coca-cola is now operating across the globe covering most of the countries. Coco-cola is serving millions of customers every day by its million of devoted and dedicated workforces, distributes, representatives, wholesalers, and retailers. The key products of Coca-cola are soft drinks, carbonated drinks, juice, juice-drinks products. Coca-cola customers are of all ages people including children, young, adults, old, men, and women. The target markets of Coca-cola are all of the nations of the world including developing and developed countries, and the US, the EU, Asia, and Africa (Coca-Cola Annual Report, 2014).

3.0 Industry analysis

3.1 Competitors of Coca-Cola

Graphs: Coca-Cola’s competitor’s Source: Statista (2016)

This statistic highlights the market share of leading carbonated beverage companies worldwide as of 2015. The carbonated soft drink market was dominated by the Coca-Cola Company, which held a market share of 48.6 percent. The global market was estimated at 341.6 billion U.S. dollars.

3.2 Market details

Coca-Cola is a true giant in the beverage industry. With more than 130 years of serving customers, the company has scaled up to an impressive size. Almost 22,000 Coca-Cola beverages are consumed every second.

Here are a few other statistics on the company’s massive scale:

Products sold in more than 200 countries
More than 1.9 billion daily servings of Coca-Cola products
$44 billion of net operating revenues
$7.4 billion of net income
$176 billion market capitalization (as of January 12, 2016)

Diagram: Market details of Coca-Cola Source: The Financial Canadian (2017)

As Coca-Cola has grown, so has its product lineup. Although Coca-Cola has the third most valuable brand valued at $73 billion in the world according to Interbrand, they own many other products that have been developed internally or through acquisition. Many people are surprised to learn that many of their favorite drinks are owned by the Coca-Cola company, even if they do not explicitly bear the Coca-Cola name.

Diagram: Coca-Cola sub-brands Source: The Financial Canadian (2017)

Coca-Cola now has 20 brands with over $1 billion per year in sales. This diverse product portfolio creates significant operational diversification and insulates the company from any downturns in interest for any single one of their product.

Still, drinks (non-carbonated beverages such as water, juices, and teas) have been very popular in recent years because of growing concerns surrounding the health effects of sparkling products (often sugary sodas). The significant potential that exists in Coca-Cola’s portfolio of skills will be discussed in detail later in this article.

Coca-Cola’s broad portfolio of products has given the company a very diversified business model, which has handsomely rewarded investors. The company has generated significant free cash flow that has been returned to investors in a very shareholder-friendly manner.

In the past 5 reported fiscal years, more than $39 billion of capital has been returned to Coca-Cola’s investors through a combination of dividends and share repurchases. A breakdown is shown in the following slide……………..

Strategic Management