Organizational culture is a system of shared values, beliefs, and assumptions designed to govern the way an organization behaves. The shared values influence the way people dress, act, and perform their jobs in the work setting. Espoused values of Coca-Cola consist of the courage to shape a better future through their leadership, collaboration to gain a collective genius, observe integrity, and accountability (Coca-Cola Company, n.d). The company is also committed to serving their customers at heart and in mind, practice diversity to ensure inclusivity in all their brands, and ensure delivery of high-quality products.
Dimensions of Coca-Cola Organizational Culture
Culture is a force that holds the organization together and determines the way employees act and perform their jobs. According to Gordon and Curlee (2011), to understand an organizational culture, it is important to understand the elements of culture. Consistently, taking into consideration the dimensions of organizational culture, we explore and classify Coca Cola’s culture in each of the areas. Virtually, as Gordon and Curlee elaborate, innovation and risk-taking means the company does not support complacency. Organizations allow people to take risks and innovate at any opportunity they find and do not punish them if they make mistakes. On innovativeness, Coca-Cola has been constantly taking risks to innovate new products such a coke diet with new flavors. It is also important to note that, the company has been resilient in their innovation and risk-taking as with the rebranding of coke zero when it failed to hit the expected sales target. For Coca-Cola, the innovation and risk-taking culture is high. The second element is the attention to detail, where organization is always striving to deliver top quality with minor details being handled as a crisis. One of the things that have made the Coca-Cola Company to become successful for more than a century is the ability to offer their clients quality beverage drinks as outlined in their vision and mission statements. This shows that the company does not compromise on quality, which has made them remain successful over the years. The attention to detail culture is high for Coca-Cola. Outcome orientation means that a success is based by the results yielded, which is not what Coca-Cola stands for.
The other elements include people orientation, which believes that people are what make the project successful, while team orientation is based on making employees feel like part of the organization and motivating them towards company success (Gordon & Curlee, 2011). The company is focused on being a great place to work, where people feel inspired to give the best they can. Coca-Cola is also focused on meeting the needs of people, the consumers, and franchise partners. In this case, the outcome orientation is low, while the people and team outcome are high for Coca-Cola. Aggressiveness is related to the concept of taking an aggressive position to move the company forward. Coca-Cola’s greatest achievements can be associated with their aggressiveness in the soda industry. The company has been aggressive in innovating new products to counter competition from other beverage companies such as Pepsi. Lastly, the element of stability is based on the ability of an organization to embark on new projects without shrinking constantly. Coca-Cola has demonstrated the ability to move from one project to another, without shrinking. The element of aggressiveness and stability are high in Coca-Cola.
External Environment Scan
Impact of the Current Economy on the Coca-Cola Company and Soda Industry
Usually, the economic environment affects the transformation process of any industry as well as the availability of raw materials, the company sales, and even the company’s workforce. According to the International Monetary Fund on World Economic Outlook (2018), the global economic activity is strong and is expected to keep on growing. However, in the past, there has been an economic crisis, which has affected the Coca-Cola Company. For instance, in 2008, the world faced a global economic crisis, which affected the company. The global economic crisis mostly affected the liquidity and financial performance of the Coca-Cola. According to the Annual Report on form 10-K (2008), the company was unable to access credit markets on favorable terms, which would affect the borrowing trend of the company. If the company loses to the economic crisis, banks and creditors are likely to stop losing trusting the company, and such a position is likely to affect the company negatively. Importantly noted, although the company has been experiencing fluctuations in sales, the current economy has not been solely the determinant.
Impact of the Government and Laws on the Company
Government design and implement laws and policies in a bid to guide business operations. Some of the rules include minimum wages, regulatory laws on corporate tax rates, environmental laws, and technological advances that do not compromise the safety of the consumers and the environment. For instance, the current U.S. corporate tax cuts have positively affected the company in various ways. According to Leith (2018), the tax cut makes it more attractive for companies to invest in the U.S., which means the company can enjoy more profits.
The threat of a Competitor
Ideally, Coca-Cola does not have many competitors. In fact, their biggest competitor is Pepsi who has been in the soda industry for almost the same period as Coca-Cola. The competition in the two brands is immense, and Pepsi is not willing to give up easily. Besides, product diversification for Pepsi is bigger than Coca-Cola, which can be a threat for Coca-Cola.
In the current highly competitive market, successful companies are multifaceted, spearheaded by innovation supported by different technologies. According to an article on Business Wire (2016), Coca-Cola company utilizes a wide range of technologies such as re-inventing their digital marketing platforms, as well as in the production of their beverages.
Effect of Globalization on the Company’s Culture
Today, organizations exist in a variable environment that is directly influenced by globalization. According to Stefanovska and Tanushevski (2016), globalization leads to several social changes, changes in the organizational culture, ethical behavior, and values. Further noted globalization imposes various impacts on the technological progress and emphasis on the importance of increased human knowledge as a source of competitive advantage. Notably, globalization influences the organization culture and expects people to change to fit the current setting and way of doing things. In this case, organizations must continually prepare their staff to be competitive by constantly monitoring new trends and adapting to them to enable gradual change.
Largest Challenge facing coca-Cola
Currently, the media is focused on raising awareness about obesity concerns, which has raised scrutiny on the volume of sugar in soft drinks such as Coca-Cola’s. According to Katz (2015), people have become health conscious and prefer healthier drinks to Coca-Cola’s sugary beverages. Although the company has developed beverages with zero calories that are ranking top, the United States is still concerned about sweeteners. For Coca-Cola, the shift to healthier beverages is one of the biggest challenges the company is facing.
Coca-Cola Company. (n.d). Our company” mission, vision & values. Retrieved from: http://www.coca-colacompany.com/our-company/mission-vision-values
Gordon, R. L., & Curlee, W. (2011). The Virtual Project Management Office: Best Practices, Proven Methods. Oakland: Berrett-Koehler Publishers, Incorporated.
International Monetary Fund. (2018). World economic outlook, update, January 2018: brighter prospects, optimistic markets, challenges ahead. Retrieved from: https://www.imf.org/en/Publications/WEO/Issues/2018/01/11/world-economic-outlook-update-january-2018
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