Coca Cola Strategic Control
Strategy Implementation of the Coca Cola Company
Every business that is structured is made up of different departments organised according to a hierarchy dependent on the company’s design. Organisational designs can either be functional or divisional. An organisation that uses the functional model is one in which the departments are organised according to the functions that they perform while in a divisional organisation, departments are arranged in line with divisions (Kelser & Kate, 2010). While analysing the strategy of a company, it is crucial to look at the organisational design of that particular company, human resource, cultural values, and to understand from which values and concepts the firm derives its day to day inspiration.
Strategy Implementations and Strategic Controls
The Coca Cola company has adopted both divisional and functional organisational designs because it has allocated different functions to different departments. The divisional structure is, however, its primary design because it has many subsidiaries all over the world that operate autonomously to some extent (Coca Cola, 2016). It is necessary for large scale businesses like Coca Cola to adopt both structures for smooth running because a specific market is taken care of by a single division each of which has a different function. According to Coca Cola (2016), some features are however centralised for purposes of maintaining optimum control of the global strategy. Don't use plagiarised sources.Get your custom essay just from $11/page
Structural controls and Cultural Values
Different tools such are budget, and variance analysis is used for strategic control. The tools are necessary for making sure that the implementation of strategies chosen by managers is done correctly. They can also give an analysis and indications on whether there is a need for a corrective approach. The budget is for determining the company’s spending while the variance analysis is for giving insight on any necessary correction for the achievement of the company’s global goals (Kesler & Kates, 2010).
Being a multinational company operating on a global scale, the company interacts with a diverse environment and intercultural values, an aspect that gives a reflection of the company’s proposition to the public. The company, therefore, adopts a culture that in theory includes and supports diverse cultures. Other than cultural values, the company also has business values such as growth and productivity (Coca Cola, 2018). Kesler & Kate (2010), asserts that cultural values are a reflection of the concerns of the human resource since the divers and unique profile becomes a necessity, and so is the need for hiring skilled personnel for the maintenance of quality work by the company.
Effects of the complementary components on the Coca-Cola Strategy
An organisation with both divisional and functional allows itself to quickly adapt and respond to the disparities and challenges of different markets. It is a more versatile strategy as it is customer-based; for instance, China and the U.S have different market needs. With this structure, it is also possible to have an immediate and rapid approach whenever regional problems arise instead of waiting for the central plan. Centralised quarters are however helpful for the conception and management of a global strategy that is inclusive of every division.
Strategic controls are the principal instruments that drive the company towards its goals and targets. For the Coca Cola company, these instruments maintain control over the divisions besides giving them a chance to achieve their respective objectives using the resources from the central organisation. Variance analysis and budget generally affect the company’s strategy on a basic level because they measure a company’s performance and how much investment can be pumped into each of the firm’s functions (Coca Cola, 2018).
The embedment of cultural values into the company provides it with people from all around the globe who can give their specific input to the business. The external environment also impacts culture and can influence it both locally and globally. For example, the company decided to do away with the polar bear image in its advertisements to avoid negativity because the polar bears are becoming more endangered due to the threat of extinction. According to Kesler & Kates (2010), it is the crescent concern by the public that changed the company’s perception. Human resource concerns do not directly impact company strategies. It is, however, essential to adhere to the firm’s values for the avoidance of negative publicity and making the workplace accessible to all (Kesler & Kates, 2010).
Alignment of the components with the strategy of the company.
Coca Cola’s structural designs fit into their strategy since it brings an approach that is unique and diversified, thus enabling the company to stay in the lead of the soft beverages sector. This is a structural design that is result-oriented and flexible and makes the possibility for worldwide coverage easier as is the company’s mission (Kelser & Kate, 2010). The company’s ability to adapt to changes in its fundamental feature and is reflected by its functional and divisional structure. Variance analysis and the budget builds the base of the company’s strategy. For example, if there are no resources for the achievement of a particular objective, a policy must be changed to fit into the resources owned by the company. In this light, budget and variance analysis are requisite for the company to obtain the goals it has set.
Business Ethics
Schulman (2006), came up with specific prescriptions as regards business ethics; avoid being in an unethical business, conduct an explicit articulation to values as a strategy component as they should be real and reflect actual behaviour especially among the leaders of an organisation, and maintain transparency with constituents as part of the strategy. A person could mistake the Coca Cola company for an unethical business. The business, however, does not involve traditional subjects that are unethical, and some could use the current information available to argue that involvement in an industry associated with severe health issues is wrong. Such questions are currently being addressed in the Coca Cola company strategy, and they are concerns that most people do not consider unethical (Coca Cola, 2018).
Values that form the company’s strategies are clearly articulated in their website and are accessible to everyone who visits the site. Actual costs of the company are reflected even though it is difficult to know whether the company’s leaders are following them. Transparency is also embedded in the company’s strategy and is ensured through the website and the company’s investors (Coca Cola, 2018).
Proposed Changes
Changes necessary for the success of the company as recommended by the company’s CEO, are overall sustainability and transparency of the company. Sustainability would incorporate cultural factors as well as budget and variance analysis as components of the strategy. This would substantially transform the company and make it have a circular product line rather than a linear one, and sustainability would be laid out in other aspects of the firm such as ethics (Kelser & Kate, 2010). Transparency will be improved by hosting videos and events to inform the customer base of the products’ life cycle. Employment policies and the company’s efforts towards health issues and sustainability for future resolving (Coca Cola, 2016).
Conclusion
Complementary components of the Coca Cola company have been briefly discussed, from the organisational design to the budget and variance analysis and a description of the cultural factors and concerns of human resource that are responsible for shaping the company’s strategy. The effects these instruments have on the policy have also been discussed including how they align with the mission, vision and value statement of the company. Ethical issues embedded in the company have been addressed as well as two significant proposed changes of the company; sustainability and transparency.
References
Coca Cola, (2016). Year in Review. Retrieved from https://www.coca-colacompany.com/2016-year-in-review
The Coca Cola Company (NYSE: KO), (2018). Retrieved from https://www.coca-colacompany.com/stories/2018
Kesler, G. & Kate A. (2010). Leading Organisation Design: How to Make Organisation Design Decisions to Drive the Results you want. Jossey-Bass. 1st Edition.
Schulman, M. (2006). Incorporating Ethics into the Organisation.