coca cola strategic management
TRANSCRIPT
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Strategic Management Project
EGYPT 2013
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Contents Coca-Cola History Vision, Mission & Objectives PEST Analysis Porter's 5 Forces SOWT Analysis Corporate Strategy Business Strategy Coca-Cola Life Cycle BCG Matrix Recommendations
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COCA-COLA History Coca-Cola history began in 1886 when the curiosity of an
Atlanta pharmacist, Dr. John S. Pemberton, led him to create a distinctive tasting soft drink that could be sold at soda fountains.
He created a flavored syrup, took it to his neighborhood pharmacy, where it was mixed with carbonated water and deemed "excellent" by those who sampled it.
Dr. Pemberton's partner and bookkeeper, Frank M. Robinson, is credited with naming the beverage "Coca-Cola" as well as designing the trademarked, distinct script, still used today
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COMPANY OVERVIEW
A leading manufacturer, distributor and marketer of non-alcoholic beverage concentrates and syrups
The company owns or licenses more than 500 brands
It operates in more than 200 countries
The company is headquartered in Atlanta, Georgia
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Coca-cola Products
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Vision statement:Our vision serves as the framework for our road
map and guides every aspect for our business by describing what we need to accomplish in order to continue achieving sustainable , quality growth
People: Be a great place to work where people are inspired to be the best they can be .
Portfolio: Bring to the world a portfolio of quality beverage brands that anticipate and satisfy people’s desires and needs.
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Vision statement: Partners: Nurture a winning network of customers and
suppliers , together we create mutual , enduring value.
Planet : Be a responsible citizen that makes a difference by helping build and support sustainable communities.
Profit : Maximize long-term return to shareowners while being mindful of our overall responsibilities.
Productivity : Be a highly effective, lean and fast-moving organization
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Mission statement:
Our Roadmap start with our mission, which is enduring. It declares our purpose as a company and serves as the standard against which we weigh our action and decisions.
To refresh the world. To inspire moments of optimism and
happiness. To create value and make a difference .
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Objectives :
The main objectives for the Coca-Cola Company are
To be globally knows as a business that conducts business responsibility and ethically.
To accelerate sustainable growth to operate in tomorrow’s world.
To maximize share owner value over time.
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Coca-Cola’s Objectives To maximize long-term cash flow
To ensure the strongest and most efficient production, distribution, and marketing systems possible
By having these objectives , it forms the foundations for companies in decision making process .
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PEST )) Country Analysis
Political Forces:*Stability of government ( after 25th
(30 June*Tax Law
*Attitude towards foreign companies
Jan. and
Economic Forces *Interest Rate*Inflation Rate
*Energy cost &availability*(Wages ( Low labor cost
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PEST ANALYSIS
Social Forces:*Population growth rate*Life style changes*Religious orientation (Ramadan Season)* Age distribution: 0-14 years: 32.3% - 15-24 years: 18% - 25-54 years: 38.3% (2013 estimate)
Technological Forces:*Spending on R&D
*Telecom Infrastructure*Internet availability
*(Media(TV&Radio
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Industry AnalysisPorter's 5-Forces
Entry Barriers
Bargaining Power of Suppliers
Bargaining Power of Buyers
Rivalry amongCompetition
Threat of Substitute
Medium Pressure
Low pressure
Medium to High pressure
Low pressure
High Pressure
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Porter’s Five Forces Threat of New Entrants: Medium Pressure Economies of scale Switching costs Capital requirement Product differentiation (variety) Access to distribution channels
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Porter’s Five Forces Threat of Substitute: Medium to High pressure
Availability of substitutes
Switching costs
Coca-cola doesn’t really have an entirely unique flavor. In
a blind taste test, people can’t tell the difference between
Coca-Cola and Pepsi.
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Porter’s Five Forces Bargaining Power of Buyers: Low pressure The individual buyer has small pressure on
Coca-Cola Large retailers, like Carrefour, have bargaining
power because of the large order quantity, but the bargaining power is lessened because of the end consumer brand loyalty.
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Porter’s Five Forces Bargaining Power of Suppliers: Low pressureRaw materials of soft drink industry include CO2, water, sugar, syrup, plastic, glass, tins, etc. Amount purchased from supplier Switching costs Suppliers forward integration
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Porter’s Five Forces Rivalry Among Competition : High Pressure
Monopolistic competition
Product characteristics
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SOWT Analysis
Strengths WeaknessesInternal
How maximize them How minimize their effect
1. Negative publicity2. Low profits in strong areas3. Decline in cash flow4. Supply is restricted5. Significant focus on carbonated
drinks6. Brand failures or many brands with
insignificant amount of revenues7. Carbonated drinks have bad
physical effects
1. Global presence2. Brand awareness3. Logo famous4. Strong marketing and advertising5. Customer loyalty6. Bargaining power over suppliers7. Corporate social responsibility8. Strong distribution channels
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SOWT Analysis
Opportunities Threats
1. Bottled water consumption growth2. Increasing demand for healthy food
and beverage3. Growth through acquisitions
1. Changes in consumer preferences2. Water scarcity3. Negative health effect4. Decreasing gross profit and net
profit margins5. Competition from PepsiCo6. Saturated carbonated drinks
market
External
How we avoid themHow we capitalize them
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Corporate Strategy
Manufacturing
Horizontal Integration
New Products New Region
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Business StrategyCompetitive Advantage
MaintainSpecialty
OutstandingSuccess
Hope forMarket Growth
Maintain CostAdvantage
Degr
ee o
f Diff
eren
tiatio
n
Relative Cost
Low
Hi
gh
High Low
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SALESPROFIT
COCA-COLA Life Cycle
Emerging Growth Maturity DecliningMoney
Time
Coca-Cola has more than Life Cycle , on which had a new products and in the same time they are on the Maturity stage
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BCG Matrix
Star Question Mark
Cash Caw DogGrow
th R
ate
Relative Market Share LowHigh
High
Low
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Recommendations Coca-Cola should try to have product differentiation for carbonated drinks through R&D Coca-Cola should spend more R&D on avoiding bad physical effects of carbonated drinks. Coca-Cola should focus on non carbonated drinks as bottled water and healthy drinks Coca-Cola should start producing new products rather than beverages as food and snacks
to enter a new life cycle Coca-Cola should think about Vertical Integration : - Backward Integration: Produce raw Material - Forward Integration : Distribution ( Coca-Cola Stores ) Coca-Cola's distribution channel is mostly through retails. Whereas the competitors also
concentrates more on Restaurants and Coffee shops. Coca-Cola should try to increase their distribution in these areas .
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THSNKS FOR YOURATTENTION