Coca-Cola Strategic Implementation Plan

Posted by melissamiller on June 2nd, 2021

About the author: Melissa Miller is a master in Literature at Maryland University. She is currently working as one of the best writers at place where you can order essay online She also studies male psychology.

Competition is a ubiquitous phenomenon in every entrepreneurial industry. Because of this, companies should be steadfast in identifying and implementing new business strategies to attain a sustainable competitive advantage. In the case of Coke, it is currently the leading beverage seller across the globe. However, pressure from its worthy competitors, such as Pepsi, requires the company to innovate its products continuously to attract more customers. As such, this can be accomplished through increased marketing, product differentiation, and product innovation. However, the management needs to maintain a top-down approach in communication to ensure all stakeholders in the organization are aware of the dynamics of the project being undertaken (Bianchi, 2016). Moreover, it should ensure that it engages all members of the workforce in voicing their opinion regarding the proposed plan. Although Coca-Cola is the leading beverage maker globally, it needs to optimize functions to maintain its current competitive advantage.

Objectives

Coca-Cola is a multinational company, the primary aim of which is to be globally acknowledged as a responsible and ethical business that aims towards accelerating sustainable growth for operations in the future. The second objective of the strategic implementation plan is to enhance unity, happiness, and optimism among people through a refreshing drink. Thirdly, Coca-Colas is to create value and make a difference in the contemporary community through development. Arguably, these objectives guide every activity the company undertakes and are integral components that propel the business to perform even better.

Functional Tactics

As mentioned above, Coca-Colas primary objective is to expand and be acknowledged globally. To achieve these goals, the company has set in motion various functional tactics, through which it pursues its business strategies. Predominantly, the chief one is marketing to attract more customers. Through it, the company runs influential ads extensively keeping its products in the minds of buyers throughout the world. In 2016 alone, the company invested in advertising approximately by 0 million more as compared to the previous year (Coca-Cola HBC, 2017). Therefore, increased marketing efforts constitute a probable functional tactic, which Coca-Cola can use to gain competitive advantage.

Additionally, Coca-Cola can draw a significant value from the differentiation of its products. For instance, the company launched a campaign called Share a Coke in 2011, which was in a bid to shift focus to its customers (Baah & Bohaker, 2015). It also involved printing peoples names on Coca-Cola beverage bottles in an attempt to enlighten them when drinking the beverage. Notably, the campaign turned out to be a huge success that helped Coca-Cola to increase its market share. In conjunction with this, product innovation should be used as a key tactic by Coca-Cola to expand. For instance, when the company had realized that people were becoming more conscious about their diets, it introduced Coke Zero, Coca-Cola Life, and Diet Coke, which had fewer calories than the standard Coca-Cola drink. Therefore, Coca-Cola creates competitive advantage through such functional tactics as advertising, differentiation, and product innovation.

Action Items

Since the primary objective of Coca-Cola is to become the most popular soft drink globally, it should implement various action plans in pursuit of this goal. To begin with, the company should focus more on increasing revenue and profit for growth. In emerging markets, Coca-Cola should aim at raising the volume of its commodities and make them affordable to consumers. Moreover, the company should attempt to strike a balance between prices and quantities in developing markets. However, in developed markets, Coca-Cola should concentrate on improving profits by offering smaller products and premium packages.

Additionally, the company should strive to optimize its operations further. Earlier on, it cut endless bureaucracy in its management by preventing departmental barriers directly connecting regional business units to the companys headquarters (Baah & Bohaker, 2015). In essence, this did not only enable the business to simplify its operations but also saved it a lot of funds, which had been previously wasted on sophisticated procedures. Therefore, Coca-Cola should attempt to streamline its processes even more. In conjunction with this, it should develop its brand through product differentiation. In essence, this will make the company a ubiquitous phenomenon that makes its brand stick in the minds of consumers.

Milestones and Deadlines

Coca-Colas main goals are to thrive globally, enhance unity, and make a difference within society. By December 2015, the company had taken approximately 48.6% of the beverage market (Statista, 2015). To become acknowledged globally, Coca-Cola will have to continuously create awareness through product promotion, advertising, and public relations. If the company increases its advertisement programs by 25%, then it may be able to cover at least 57% of the global beverage market by 2020. Moreover, greater product innovation and differentiation will raise companys commodities globally, thereby enhancing cohesion and customer satisfaction by 2020.

Task and Task Ownership

To achieve its core business objectives, Coca-Cola has to undertake three significant tasks, namely, advertising, product differentiation, and product innovation. The first one can be done either by hiring foreign advertisement agencies or through internal communication. Employees in this department should be highly innovative to make ads that will be appealing to most customers. On the other hand, a product development manager should be appointed to oversee activities regarding product differentiation and innovation. Moreover, the company should establish an integrative platform to enhance communication among stakeholders.

Resource Allocation

In addition to that, Coca-Cola will have to focus more on attracting customers in order to achieve its speculated growth. As such, this calls for numerous advertisement programs, product differentiation, and product innovation. However, advertisements should take a significant portion of resources since the company is quite diversified already; it has more than 500 products under the brand name. In 2016, Coca-Cola incurred an advertisement cost of billion globally, which increased its revenue to .6 billion (Baah & Bohaker, 2015). Therefore, marketing should be allocated at least .5 in the forthcoming fiscal year to further brands acknowledgment. Additionally, funds for research and development (R&D) should be also increased to promote product innovation and differentiation.

Recommendation

For the successful implementation of the action plans mentioned above, organizational change is mandatory. To start with, there should be non-competing initiatives; every employee should work with a common vision of organizational change and growth. Moreover, the HR management should compose a tutorial, which will prepare workers to embrace their new daily activities. Also, the business should maintain a good communication stream among the main stakeholders.

Key Success Factors

Communication

Arguably, this strategic plan will work if the top-down communication approach is employed. As such, this involves communicating the new strategic plan in motion to all stakeholders and what is expected of them in the project. Furthermore, pioneers of the project should conduct surveys and give a timely feedback to the parties concerned. According to Bianchi (2016), maintaining communication with all levels of management ensures that plans are developed in line with the overall strategy of the organization.

Engagement

Engagement of all stakeholders in strategic planning is a critical factor that leads to success. Arguably, most companies only involve a small group of senior executives, who make crucial decisions. However, this is incorrect because the management misses out on valuable information, which could have been contributed by subordinates. Arguably, an employee who is not motivated is less likely to perform his or her duties accordingly. Therefore, it is essential to engage the staff in every step to ensure they agree with the strategic plan and in turn offer their commitment to it. Also, involving different parties within the organization sheds more light on issues and challenges, which might have been previously misunderstood.

Budget

The budget for the strategic plan will be calculated based on the companys previous annual report. It will feature costs of advertisement and research and development.

Table 1

The Budget and Forecasted Financials

Additionally, it is anticipated that Coca-Colas revenue will have increased to billion by 2018. In correspondence with this, the sales of the company will rise to at least three billion units of beverage across the globe. Its share price is also expected to increase to .5 per unit.

Revenue

Break-even Total costs

Total 4

dollars Variable costs

(billions)

2 Fixed costs

4.5 9

Sales ($ billions)

Figure 1. The break-even chart. This figure illustrates the breakeven point that enables to determine sales necessary to cover expenses.

Risk Management

Potential Risks

Given the obesity epidemic currently witnessed in the U.S., opposition against high-calorie beverages has been heightened significantly. Various consumer and interest groups have been already opposing beverages from Coca-Cola due to high calories. For instance, the American Beverage Association has recently negotiated that every beverage vending machine should display the number of calories in a drink and should suggest the one with the lower number of calories (Seghetti, 2012). In essence, this may undermine the Coca-Cola Company and lead to it losing a significant number of customers.

In case such an instance occurs, Coca-Cola will have to reduce the amount of regular Coke it produces. Instead, the company should increase the production of low-sugar beverages, such as Diet Coke and Zero Sugar Coke. Moreover, it will have to spend heavily on advertising these products to appeal to customers. Additionally, the company will have to incur expenses to hire lobbyists to slow down the fight against high-calorie drinks to have time to convince customers to buy low-caloric Coke drinks instead.

Contingency Plan

In case the company is overwhelmed by the fight against caloric beverages, it can opt to replace its standard Coke with sugar-free one. Since it already has facilities across the globe, it is most likely that a new product introduced will be accepted in the market. Alternatively, Coca-Cola can introduce nutrients in its beverages to address deficiencies in different countries around the world. As such, it will not only be a refreshing beverage but a nutritional drink as well.

Implementing the strategic plan at Coca-Cola requires lucrative functional tactics and equally efficient action items. Moreover, the management should engage all stakeholders in the organization during the implementation to make sure that everybody supports the proposed changes and is committed to achieving them. Arguably, entrepreneurship is a risk itself. Therefore, the business should be steadfast in assessing threats that face it and establishing contingency measures to mitigate their adverse effects.