Coca-Cola and Boeing Companies’ Organizational Culture and Strategies

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Executive Summary

Organizational culture and strategies used by companies are determining factors of their success. This paper briefly reviewed how Coca-Cola and Boeing, two companies that are older than a century, have managed to survive within the competitive market. Each of these companies relied on their unique vision of what markets to serve and how to measure performance. Quality control and employee motivation strategies have also played an important role. Besides reviewing these companies, the paper also discusses what type of decisions should be made in the current situation with COVID-19. The last section of the paper discusses organizational objectives and describes why employee engagement in goal construction is beneficial.

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Researching Two Companies

Coca-Cola

This company started in the late 19th century and has become one of the most well-known companies in the world despite facing challenges throughout history. John Pemberton invented the original drink, but the recipe was bought by an American businessman named Asa Candler (The Coca-Cola Company, 2019). The latter individual can be considered as the founder of the company, because prior to incorporation in 1892, Coca-Cola had been promoted and sold informally with only a limited budget (The Coca-Cola Company, 2019). The company headquarters are in Atlanta, Georgia, where it was first founded.

One of the significant reasons why Coca-Cola has been successful is its organizational leadership. Coca-Cola’s strategic thinking has allowed the company to sell its product to a variety of markets that differ in size and solvency (Sharman et al., 2019). For instance, to keep profitability at a high level, the company sells larger quantities at lower prices in developing markets (Sharman et al., 2019). In developed countries, Coca-Cola focuses on the balance between the price and the quantity. Also, the company invests a substantial amount of money in advertising and marketing to build a more memorable brand image (Singaram et al., 2019). Imitators would have defeated Coca-Cola if it had not created a recognizable trademark sign.

The company operates in more than 200 countries; such a scale requires hundreds of thousands of employees from diverse cultures. Coca-Cola has been successful at motivating its employees because annual financial results show a constant increase in revenue. Besides financial incentives, the company offers mentorship and training (The Coca-Cola Company, 2019). Also, the communication process is transparent, and anyone can propose their ideas to senior management. There are other perks depending on the location of employment – free parking, free food, and drinks are some of the examples.

According to the company’s mission statement, its products’ safety and quality are prioritized aspects of Coca-Cola’s business. Therefore, the company employs a rigid quality control process that is based on standards that are set to evaluate the quality of water, efficiency of its usage, and its safety for a consumer (The Coca-Cola Company, 2019). The requirements are summarized as the document called KORE, which stands for Coca-Cola Operating requirements.

Boeing

The company is one of the largest manufacturers of commercial aeroplanes in the world. It was founded in 1916 by William Boeing, a pioneer in aviation (Boeing, 2020). Today, the company operates in several areas, including defence, aerospace and telecommunications (Petrescu et al., 2017). It has been a significant player in the aeroplane market, but recent crashes of its latest commercial plane, 737 MAX, severely damaged the company’s reputation and brand image (Lawrence & Thornton, 2017). The company is genuinely multinational – 70% of Boeing’s total revenue throughout history has from international clients.

To stay competitive on the market, Boeing has accomplished a number of strategic moves throughout its history. The merger with United Airlines, subsequent division, and the alliance with McDonnell Douglas are some of the examples (Lawrence & Thornton, 2017). Senior management of the company has always been ready for new markets and new endeavours. Therefore, besides manufacturing planes, the company has also become a leading producer of military and communications equipment (Lawrence & Thornton, 2017). Each of the areas the company operates within has its own management team and its own headquarters.

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Financial incentives and rewards are only a small part of how the company motivates its employees. Each of the company’s sites is equipped with recreational facilities that extend beyond usual gyms and fitness halls (Boeing, 2020). For instance, some sites have means for tennis, alpine climbing and windsurfing. Also, the company has an employee assistance program that helps workers cope with a variety of personal challenges, including family problems, issues at work, and mental difficulties. By ensuring high employee motivation, Boeing has been able to achieve favourable results in engineering and sales.

Quality control is an absolute necessity when it comes to commercial planes. Therefore, Boeing had invested a substantial amount of resources into developing a quality control process that does not allow to overlook any details. The control process is broken into two parts – internal control and supplier control (Lawrence & Thornton, 2017). The objective of the latter is to determine whether or not all of the materials meet the standards. Internal control had historically relied on the expertise of human inspectors (Lawrence & Thornton, 2017). Recently, however, the company shifted toward automated testing, which might be the reason behind 737 MAX crashes.

What Can Be Learnt from Such Organisations

There is no universal approach to success because there is a majority of ways of increasing profitability and staying competitive. However, it is imperative to think strategically and have a long-term vision. The presence of these two elements allowed Coca-Cola and Boeing to remain market leaders for more than a century. Both companies value their employees and try to motivate the workers to achieve the most favourable results.

Effective Decision-Making for Today’s World

Types of Decisions

There are three major types of decisions made by managers – operational, tactical and strategic. Operational decisions are related to routine tasks and take place in large amounts; they are usually isolated from each other (Proctor, 2018). Tactical decisions are short-term choices aimed at accomplishing a subset of organizational objectives (Proctor, 2018). Strategic choices are high-level decisions that are made in accordance with the company’s mission and long-term goals (Proctor, 2018). In current circumstances, it is rarely possible to think strategically because the world is demanding immediate results. Therefore, operational and tactical decisions are most suitable for current conditions. Strategic decisions require vast amount information, which is not currently available.

Making Effective Decisions

The first step is to identify what problem the manager is aiming to solve. Without an accurate definition of the issue, it is not possible to make an effective decision (Rothaermel, 2016). Further actions of the manager are bound to balancing between time, resource and quality requirements. It is not possible to make a high-quality product in a short time with few resources (Proctor, 2018). Conversely, a quality outcome demands time and a substantial amount of resources in terms of workers and finances.

Goal Setting

Well-Constructed Organizational Goals

The general criteria for well-constructed goals can be summarized in the SMART acronym – specific, measurable, aligned, realistic and time-bound. Some examples:

  1. By the third quarter of 2020, increase the market share from 14% to 20%.
  2. 50% of employees should start working from home within the next year.
  3. By the end of 2021, all employees should receive training on the new information system.

Employee Engagement in Goal Construction

As it has already been mentioned, employee motivation is a critical factor of organizational success. Without keeping workers engaged and motivated, it is not possible to decrease employee turnover. Evidence suggests that mutual goal setting may facilitate motivation significantly (Soda & Furlotti, 2017). Allowing the employees to participate in the construction of organizational objectives makes workers feel that they are being cared for and that their opinions matter. In turn, such a situation will boost productivity and workplace effectiveness.

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Traditional Process vs. MBO

Traditional management puts a manager in a superior position. Subordinates strictly follow the orders of the manager, and all decisions are made by the director. In MBO, however, an employee is granted the role of a partner – both the manager and the worker can openly discuss a problem and both of their opinions are considered when making the final decision (De Harlez, 2015). Companies have realized that favourable ideas do not always come from managers – even ordinary workers are capable of generating promising ideas.

Conclusions

In this paper, managerial approaches of Coca-Cola and Boeing were discussed. Also, decision-making and setting organizational objectives were briefly covered. The primary outcome of this paper was an increased understanding of various strategies in business, and the impact management decisions have on company success. Employees play a significant role in achieving organizational goals, and therefore, should always be kept motivated. MBO can be considered as one of the ways of increasing employee engagement and motivation.

References

  1. Boeing. (2020). The Boeing Company. Web.
  2. De Harlez. (2015). Management by objectives. 50Minutes.
  3. Lawrence, P. K., & Thornton, D. W. (2017). Deep stall: the turbulent story of Boeing commercial airplanes. Routledge.
  4. Petrescu, R. V., Aversa, R., Akash, B., Corchado, J., Berto, F., Apicella, A., & Petrescu, F. I. (2017). When boeing is dreaming–a review. Journal of Aircraft and Spacecraft Technology, 1(3), 1-13.
  5. Proctor, T. (2018). Creative problem solving for managers: developing skills for decision making and innovation. Routledge.
  6. Rothaermel, F. T. (2016). Strategic management: Concepts. McGraw-Hill Education.
  7. Singaram, R., Ramasubramani, A., Mehta, A., & Arora, P. (2019). Coca Cola: A study on the marketing strategies for millenniums focusing on India. International Journal of Advanced Research and Development, 4(1), 62-68.
  8. Sharman, A., Larkin, J., Fernandez, I., & Esteves, G. (2019). The diversification of Coca-Cola: Globalization & strategic fit. Journal for Global Business and Community, 10(1), 1-13.
  9. Soda, G., & Furlotti, M. (2017). Bringing tasks back in: An organizational theory of resource complementarity and partner selection. Journal of Management, 43(2), 348-375.
  10. The Coca-Cola Company. (2019). Our company. Web.

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BusinessEssay. (2022, June 11). Coca-Cola and Boeing Companies' Organizational Culture and Strategies. https://business-essay.com/coca-cola-and-boeing-companies-organizational-culture-and-strategies/

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BusinessEssay. (2022) 'Coca-Cola and Boeing Companies' Organizational Culture and Strategies'. 11 June.

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BusinessEssay. 2022. "Coca-Cola and Boeing Companies' Organizational Culture and Strategies." June 11, 2022. https://business-essay.com/coca-cola-and-boeing-companies-organizational-culture-and-strategies/.

1. BusinessEssay. "Coca-Cola and Boeing Companies' Organizational Culture and Strategies." June 11, 2022. https://business-essay.com/coca-cola-and-boeing-companies-organizational-culture-and-strategies/.


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BusinessEssay. "Coca-Cola and Boeing Companies' Organizational Culture and Strategies." June 11, 2022. https://business-essay.com/coca-cola-and-boeing-companies-organizational-culture-and-strategies/.