Coca-Cola Company is one of the leading beverage companies in the global market. The company relies on plastic bottles to package its products. Recent studies have shown that plastic bottles are some of the leading land and marine pollutants. In this project, the focus is to discuss a solution that should be embraced by the company that would help solve the problem of plastic pollution. The strategy involves the introduction of renewable plastic bottles to replace disposable bottles. The alternative would be to use traditional glass bottles. However, the new bottles are easier to use than traditional bottles.
M1A1 Strategic Analysis: The Coca-Cola Company
The Chosen Organization and Rationale
In this study, the researcher has chosen the Coca-Cola Company as an appropriate organization for this analysis. The company was chosen because of various reasons. The first reason is that the company operates in the global market. As Butler and Tischler (2016) observe, the Coca-Cola Company has remained successful in North and South America, Europe, Asia, and African markets. As such, its activities have a global impact, especially when focusing on issues about sustainability. The second reason why this company was chosen is that it uses massive amounts of water. In some parts of the market where it operates such as India and sections of the United States, water is becoming a problem. It is necessary to find ways of ensuring that this company’s use of water for its cola products do not compromise the availability of this important resource for domestic use. Finally, this company uses a plastic bottle for some of its products. A report by Terry (2015) shows that the plastic bottle is one of the mainland and sea pollutants in modern history. Sustainable development cannot be achieved without determining how to deal with the plastic menace. This company was chosen specifically because of its heavy reliance on plastic bottles when packaging its products. This study will help develop a strategy that can be used by the company to ensure that its operations are environmentally sustainable.
The Organization’s History, Industry, and Market Position
According to Butler and Tischler (2016), the Coca-Cola Company is an American beverage company that specializes in manufacturing, retailing, and marketing of non-alcoholic beverage syrups and concentrates in the global market. The company was founded on May 8, 1886, in Atlanta, Georgia. It was founded by an American pharmacist and businessman, John Pemberton Coca-Cola. Asa Griggs Candler acquired the formula from Pemberton at a cost of $ 550 in 1888 and later renamed the Coca-Cola Company. The company has since achieved massive success in the beverage industry both locally and internationally. It diversified its beverage drinks to include a wide variety of cola drinks. It has also made a successful entry into the bottled water market as a way of expanding its products line and increasing the company’s revenues. Currently, it is estimated that the company controls 48.6% of the global carbonated drinks market, making it the leading company in that industry.
The Organization’s Staff, Relations, Corporate Culture, and Mission
The Coca-Cola Company is one of the leading employers in the world. The company has 61,800 employees that work in its various branches around the world (Butler & Tischler, 2016). The report also indicates that millions of others are hired by the Coca-Cola bottling companies in these countries. Another significant number of people are working in the distributing and retailing outlets. Butler and Tischler (2016) state that if those who are hired directly and indirectly by this company are to be considered, the Coca-Cola Company is by far the largest employer in the world. The company has a public relations department that ensures its image in the market and among the employees is protected. Employees have the capacity to contact senior managers whenever they feel there is a need to do so. It has embraced open-door policy as one of its most important corporate cultures. As Butler and Tischler (2016) observe, the mission of the Coca-Cola Company is “to refresh the world in mind, body, and spirit and to inspire moments of optimism and happiness through our brands and actions.”
The rationale for the Sustainable Initiative
A report by Terry (2015) indicates that global warming is increasingly becoming a threat to the sustainability of the natural environment. Pollution from the industrial sector is also chocking nature. Figure 1 below shows a section of the ocean that is chocking with plastic waste that has been accumulating over the decades.
The wastes have a devastating impact on aquatic life and marine economic activities. Used plastic bottles from companies such as Coca-Cola and Pepsi form a significant portion of wastes on land and in the sea. If the current trend is not contained, the level of waste may be unsustainable. Terry (2015) warns that plastic wastes are non-biodegradable and their negative impact on the environment can last for a very long time. The company has been issuing attractive dividends to the shareholders, which is an indication that it is registering impressive growth in the market. However, the benefits that these stockholders get should not come at the expense of the environment. One of the three pillars of sustainability of a company is to ensure that its operations do not have any negative consequences on the environment. As such, the Coca-Cola Company must find a way of recycling its plastic bottles, just as it used to do with the glass bottles. Recycling of the plastic bottles will reduce the need to continue manufacturing more of these bottles. When these bottles are taken back to the factory after use, they will be eliminated from the environment where they are becoming a menace. The strategy will help reduce the cost of production for the company as well as address the problem of environmental pollution.
M3A1 Strategic Analysis: SWOT analysis
The need to recycle plastic bottles used by The Coca-Cola Company will be of great benefit to the company itself and to the environment. However, it is important to appreciate that such initiatives may be affected by various issues that can affect the company negatively.
SWOT Analysis of the Initiative
The initiative to start recycling plastic wastes, especially plastic bottles at the Coca-Cola Company is a timely move that should be supported by all the stakeholders (Butler & Tischler, 2016). It is necessary to look at the strength, weaknesses, opportunities, and threats related to this initiative.
This initiative will be of great benefit to the company and to the environment. The following are the main strength of this initiative that the management of the company should capitalize on:
- The initiative will significantly reduce the production cost of the company. Instead of manufacturing new bottles, the Coca-Cola Company will only need to clean and disinfect the used bottles.
- The initiative will reduce the company’s dependence on other companies to sustain their operations. Currently, it heavily relies on plastic bottle manufacturers to provide these bottles. The initiative will reduce the need for new bottles.
- The initiative will help the company to promote a positive image as a firm that is keen on maintaining a clean environment.
- Using this initiative, the Coca-Cola Company will help in reducing the land and sea pollution that is often caused by poor disposal of plastic bottles.
- The strategy will also help in significantly reducing air pollution that is caused by the constant burning of plastic bottles once they are disposed of.
It is important to appreciate that despite the numerous benefits of this environmentally friendly initiative, there are some weaknesses that can affect its implementation. They include the following:
- The process of recycling plastic bottles is involving and may force the company to hire more employees to do that job.
- If it is not done in the right manner, the process of collecting, disinfecting, and cleaning the bottles can be more costly than purchasing new ones.
- The company currently lacks the necessary systems and structures that can facilitate the process of recycling.
- The initiative may force the company to have close control of the bottling companies.
- There is no goodwill within the company to support the initiative.
The decision to embrace the new initiative comes with numerous opportunities that the company will tap into within the local and global markets. They include the following:
- The company will have an opportunity to promote its brand as one that is sensitive to issues about global warming and environmental degradation.
- It will offer the company an opportunity to play a direct role in ensuring that nature (one of the three pillars of sustainability) is protected.
- The initiative will make people in the global market start embracing cola drinks knowing that in so doing they help protect the environment.
- The company will have a chance to redefine its marketing strategies and proposition in line with the new initiative.
- The initiative will help the company to overcome the massive criticism it has regarding the impact of its activities on the environment.
The new initiative will have the following environmental consequences:
- Some customers may not be pleased with the new initiative.
- The company may be faced with the issue of ensuring health standards are met when re-using the bottles.
- Other companies follow the same pattern, making it difficult to claim credit as expected.
- The approach will demand increased usage of water.
- It may have a negative impact on the hygiene of the company.
SWOT Analysis of the Manager
As a manager, my main strength is the academic knowledge and experience I have gained through the years. I am also committed to ensuring that every initiative that I start is completed. My main weakness is impatience. I cannot withstand waiting for a long time to see a project succeed. The new initiative will offer me an opportunity to take part in cleaning the environment (Morden, 2017). The main threat that I expect is a possible opposition from fellow managers at the executive.
How the Manager Can Use Strengths to Address Weaknesses of the Initiative
In this section, the researcher has conducted a SWOT analysis of the initiative and the manager to find a way in which the company can embrace recycling of used bottles. Using my skills and experience, I will be able to address the challenges and threats outlined above. I will seek the support of the other executives to ensure that the initiative is a success.
M3A2 Strategic Analysis: Competitor Analysis
The Coca-Cola Company is facing stiff competition in the non-alcoholic beverage market. The primary competitor both in the local and international market is PepsiCo, Inc. In this section, the researcher will conduct a comprehensive analysis of this competitor to determine the level of threat it poses to the Coca-Cola Company.
Summary of Competitor’s Goals and Objectives
PepsiCo, Inc. was founded in 1898 as a food processing and beverage company by Caleb Bradham. It has achieved massive success in the local and international market to become one of the major global beverage companies (Butler & Tischler, 2016). The primary goal of this company is defined in its vision statement which is the performance with purpose. Its purpose is to meet the needs of its customers in a way that is environmentally friendly. The following are the specific objectives that it seeks to achieve in the market:
- To promote sustainable farming initiatives for its raw materials.
- To develop innovative ways of saving water in its productions.
- To reduce its carbon foot-print locally and internationally.
The company is using emerging technologies to enable it to realize the set objectives. It has embraced creativity and innovativeness in the production process.
According to Morden (2017), it is always not easy to determine the specific assumptions that a company makes in its strategic activities because it is often one of the secret weapons used to achieve the desired level of success. However, the decisions and actions made by the firm can help in predicting the assumptions. One of the fundamental assumptions made by the company is that embracing environmentally-friendly initiatives will help it in promoting its brand in the market. It explains why it is making heavy investments in green initiatives. Another major assumption made by this company is that using emerging technologies can give it a competitive edge over its rivals. It has been promoting creativity among its employees. It is also known to retain highly skilled workforce through attractive remunerations.
PepsiCo Inc. has immense capability to advance in the market. In the financial year that ended on December 31, 2017, the revenues made by the company were USD 63.525 billion compared with the Coca-Cola Company’s USD 35,410 billion. The new income of this competitor in the same period was USD 4.908 billion while that of the Coca-Cola Company was USD 1.248 billion. It means that its financial capacity is greater than that of the Coca-Cola Company (Hitt, Ireland, & Hoskisson, 2017). It can easily finance its innovation initiatives with ease without having to get additional funding from external sources. With over 264,000 people directly employed in its global branches (compared with the Coca-Cola Company’s 61,800 people), its capacity is great. When it comes to creativity and innovativeness, the company has invested a lot in empowering its employees. The management has ensured that its workers have the right skills that can enable them to come up with creative solutions on how to solve the challenges that they face in their workplace. The Coca-Cola Company should take advantage of the superiority of its brand to achieve success in the global market.
M5A1: Evidence-Based and Theory-Based Solutions
The sustainable initiative focuses on enabling the Coca-Cola Company to introduce reusable plastic bottles as a way of reducing plastic waste pollution that is chocking the sea and affecting the ecosystem on land. It is important to look at the activities that should be carried out to ensure that this program is rolled out successfully and means through which the management can improve efficiency of its operations.
Activities that will impact successful implementation of the initiative
One of the main activities that will have direct impact on the success of this new initiative is the manufacture of high-quality heavy-gauge plastic bottles that will be used by the company to replace the current plastic bottles. As Terry (2015) notes, the current plastic bottles cannot be recycled because of their low-quality. It means that if this firm is to implement this new sustainable initiative, the first step will be to manufacturer the right plastic bottles that will meet the required standards. The new bottles must meet the set health standards, other than being strong enough to last as long as would be desired.
Functions of the activity and sub-activities
The function of this primary activity is to provide the company with the right container that is healthy to the customers, environmentally-friendly, and easy to recycle. This activity has different sub-activities that will also have to be completed. One of the primary sub-activities will be buying of the right materials for manufacturing of the bottles. The company will have to contact the local suppliers to ensure that it gets access to the exact quality of materials necessary for this activity in the right quantity and at the right time. The next phase is to hire employees who will be involved in the manufacturing of the bottles. The firm will need to employ designers, chemical engineers, computer engineers, chemists, operation managers, quality assurance managers, and non-skilled workers to work in this new area of business. Instead of outsourcing the activities, this initiative should be conducted by this company to ensure that it is done appropriately. The last activity will be to deliver the bottles to the partners responsible for bottling the beverages. They should be trained on how to recycle the new bottles.
What can be changed to improve efficiency
The management should remain committed to ensuring that the activities are conducted efficiently. One of the changes that the firm may embrace is to adopt emerging technologies. New technologies are emerging that make the process of producing high-quality plastic materials cheaper and faster. The firm should upgrade its production systems as regularly as possible. If possible, the logistics department will need to ensure that all the raw materials are bought from a single or selected few suppliers instead of relying on numerous suppliers. Currently, the Coca-Cola Company has only specialized in manufacturing of the syrups and concentrates and delivering the same to the bottlers all over the world. However, this may need to change when implementing the new initiative. As suggested above, the company should ensure that it is fully responsible for the manufacturing of the bottles. It should set up regional centers that will be responsible for this initiative.
How the proposed change will improve workflow and increase success
The proposed changes will improve chances of successfully implementing the sustainable initiative. It is in the interest of the shareholders and the executive board of this company to ensure that costs of operation are maintained as low as possible. That will be achieved by embracing emerging technologies. As Terry (2015) observes, the cutting-edge technologies that companies are currently employing helps in reducing the need to use human resource as most of the activities can be done by the machine. The new systems will also help in maintaining wastage at the bare minimum, further cutting operational costs. When the firm identifies one or two reliable suppliers, it will be easy to develop a close partnership with them. They can deliver the right quality of the raw materials at the right time and in the right quality. Taking control in manufacturing of the new bottles will ensure that the company is fully responsible for the activities of the new initiative. Outsourcing other firms will mean that the company will hand over the responsibility to that company. The outsourced company may try to cut down the cost of operation by compromising on the quality of the products. Such attempts may have serious impact on the Coca-Cola Company’s image, especially if the new bottles fail to meet the basic health standards.
In the recommendation section, it was stated that this initiative is feasible. It is necessary to look at how relevant business theories can help in achieving the desired level of success when implementing the initiative. McGregor’s Theory Z, which is parts of human relations movement, is considered the most relevant theory that can enable this firm to be as successful as would be expected. According to Hill, Jones, and Schilling (2017), this theory is part of the motivational approaches that focus on ensuring that employees remain committed and focused on their work. The theory, which is sometimes referred to as ‘the Japanese Management Style’ aims at increasing loyalty of the employees by promoting stable employment environment that balances career and private life of the employees. It is important to look at how this theory can help the Coca-Cola Company to achieve success when implementing the sustainable initiative.
Minimal interruptions to business productivity
When using this theory, this company will ensure that there is minimal interruption to business productivity. This will be achieved because the concept emphasized on promoting both private and career life of their employees. It encourages the management to understand family issues that may have an impact on the performance of the employees. If there are issues that may reduce the output of an employee, this theory encourages the management to find ways of addressing them. For instance, if an employee has a problem of finding a suitable house for the family, the firm may try to find affordable housing for such an employee to ensure that they are comfortable when they are at work and home. Sometimes it may be necessary to transfer an employee to the other branches so that he or she can be close to family and friends. The deliberate step made by the management to make employees comfortable helps in eliminating cases where some workers fail to report to work unexpectedly. It means that operations will be subject to very minimal interruptions. Terry (2015) explains that the productivity of a department depends on its ability to have predictable outcomes.
Increasing the profits
Using Theory Z will help this company to increase its profits when this initiative is rolled out. As explained above, the initiative focuses on maintaining the motivation and loyalty of the employees to the highest level possible. It seeks to ensure that issues that may affect the workers, both at home and when at work, are addressed to the best of the capacity of the organization. It means that that the performance of the workers will be at the optimal level. Mistakes often made when people feel frustrated and stressed out will be eliminated. Such high levels of efficiency will eliminate wastage within the company. When that happens, it means that the firm will cut the unit cost of operation. As Sindi and Roe (2017) observe, one of the ways of increasing profitability is to reduce the cost of production.
When the employees feel committed to their work, they will have no problem working beyond their shift. Sometimes it is necessary to extend the shift of the employees instead of hiring new workers. It is easier to convince satisfied employees to extend their shift than to do so when workers are disenfranchised. Industrial actions often have a serious impact on the productivity and profitability of a company. When workers fail to report to work, the operations of a firm will be paralyzed. Sometimes the employees may go on a rampage within the company to demonstrate their frustrations towards the management and the pain they go through working for an organization that do not understand their needs. When Theory Z is embraced by the management, such undesirable occurrences will be eliminated.
Benefit to the organization as a whole
When using this theory, the organization as a whole will benefit. The employees will enjoy working in an environment where their needs are met. The fact that their family concerns are taken serious means that they do not have to handle most of their private life frustrations alone. They have the management and fellow employees to share their problems. The management will enjoy working with a team of highly loyal employees committed to their work. Such employees will always go out of their way to ensure that their employer is successful. They know that they can only continue enjoying the benefits if the organization is successful (Varbanova, 2013). They tend to be more creative because they have a settled and more focused mind than their colleagues who feel frustrated both at work and home. When the management and employees work in a mutually beneficial environment where everyone is committed to his or her work, the firm will be successful. The success of the firm will benefit the shareholders, managers, customers, suppliers, employees, and other relevant stakeholders. It will also enhance the sustainability of this company in the current competitive business environment.
In this section, the focus will be to provide solutions to some of the challenges that this firm may face when implementing the new sustainable initiative. It will be necessary to provide evidence-based practical solutions that can be implemented by the Coca-Cola Company at various stages of embracing the new approach of bottling its products. As Terry (2015) observes, sometimes a company may need to embrace best practices in the industry or other related sectors when to learn and determine the best path that should be taken to achieve the desired goal. The Coca-Cola Company will not be the first organization to embrace eco-friendly initiatives meant to reduce the negative impact of their operations in the market. Other companies have embraced this approach and it is important that this company learns from them when planning to implement this new system. Some of the strategies they have used to achieve success may offer critical solutions to the challenges that it would face in its operations.
In this initiative, the Coca-Cola Company will need to monitor and understand the patterns that other companies have taken to introduce environmentally-friendly initiatives that helped them improve their performance in the market and profitability. Eco-fi is one of the best examples that have set the right standards in the manufacturing of sustainable polyethylene terephthalate PET bottles. Its products are 100% certified recyclable and the company has been keen on meeting the varying demands of its customers (Varbanova, 2013). It is important to understand that that the plastic bottles manufactured by Eco-fi are not the same quality as that which is recommended in the Coca-Cola Company’s new sustainable initiative. However, the technological input and expertise that Eco-fi employed are worth emulating when taking this initiative. It will help in solving so many problems. For instance, to address the problem of limited knowledge among its employees, this firm went a step further to source for highly talented experts in this field. If this new sustainable initiative takes the same approach, it will solve similar problems that Eco-fi was able to address.
Pentagonia is another American firm that has been able to embrace sustainable initiative in the clothing sector. Its model was also used by ReKixx to come up with recyclable sneakers. Although these companies are not as large as the Coca-Cola Company, their bold initiatives to embrace environmentally friendly strategies can help this firm to understand what is expected of it. PepsiCo, the Coca-Cola Company’s archrival both in the local and international markets, has taken some environmentally-friendly initiatives which can be considered best practices worth emulating. Through its ‘Our Planet’ goals, the company has partnered with Starbucks in some of the markets to promote the use of recyclable bottles. Although the initiative is largely credited to Starbucks, PepsiCo has also made significant contributions to ensure that it is a success. The Coca-Cola Company has an opportunity to take full credit for this initiative if it achieves the desired success.
The simulations helped in determining how this company can help address some of the problems that it is likely to encounter when undertaking this project. One of the proven ways of solving problems that may arise during the process of implementing a project is the use of the problem-solving cycle. When using this concept, the management must appreciate that a project will always have all sorts of problem. Each may require a unique solution based on its nature. However, there is a pattern that the management should take when dealing with any problem. The first step is to identify and clearly define the problem. If it is limited expertise among the current workforce, it should be stated in clear terms. The next phase is to brainstorm possible solutions. The top managers may need to come together and propose possible ways of solving the problem and a justification for each proposal.
The third stage is to pick the most appropriate solutions from the proposals made. After picking the right proposal, the next step is to implement it as accurately as possible. The final stage is to review the results. If it is determined that the problem is solved, then the cycle ends there. If not, then the team will go back to the brainstorming stage. The steps are shown in figure 2 below. Sometimes it may be necessary to use concepts and theories that have been proven to work. Using a model such as Total Quality Management will enable this firm to understand how to maintain high quality when undertaking the initiative. The supply chain operations reference model (SCOR) on the other hand can help the firm to have a steady flow of the materials needed for the production. These materials must be made available to the company at the right time and in the right quantity to ensure that the firm’s operation is not disrupted.
M7A1 Recommendations and Conclusion
The Coca-Cola Company is one of the leading beverage companies in the global market. It has evolved over the years from the time it primarily used glass bottles for its products to the modern society where plastic bottles have become popular. The number of direct and indirect competitors has also increased over the years. According to Morden (2017), the environmental concerns in the 19th century when this company was founded are very different from the concerns that we have in the modern society. Issues that this company had to deal with at that time have also changed. The company has successfully transformed from its previous image at that time to what it currently is as one of the most successful global beverage companies in the world.
The new initiative of recycling plastic bottles has been encouraged by environmental experts, but many beverage companies around the world, including the Coca-Cola Company itself, have not embraced it. Morden (2017) argues that many of them believe that the odds of using recycled plastic bottles are greater than the alternative of buying new ones. Despite the challenges that most of these players cite when it comes to embracing the proposed initiative, the information gathered through this study gives the research an authority to state that yes, the proposal is economically feasible and environmentally friendly. The company only needs to understand how it should be done and the many hurdles that they cite will be easy to overcome. If the company is able to reuse glass bottles, it should not find recycling of plastic bottles a serious challenge. The following are the comprehensive recommendations why and how the plan is feasible based on theory and evidence-based research:
- The Coca-Cola Company should redesign its plastic bottles to ensure that they are thicker, stronger, and able to last longer than the current disposable plastic bottles. Using high-density bottles will be costly, but Terry (2015) observes that they are durable because of their ability to withstand wear-and-tear. The process of cleaning and disinfecting these high-density bottles is simple. It means that if the company can afford to recycle glass bottles, it will be cheaper to do so with the new plastic bottles.
- The company should have a policy where retailers are charged relatively less when they return the crates of plastic bottles for re-fill. According to Morden (2017), the Reinforcement Theory holds that people’s behavior and attitude can be changed using rewards and punishment. When the price of the products is lowered slightly for the clients returning the bottles, they will be motivated by the reward. The practice will be promoted both locally and internationally.
- The board of directors and the company’s stakeholders should be ready to meet the initial high cost of manufacturing the renewable bottles that can be recycled as proposed in this initiative. The initial cost will be high because of the quality and design that will be used. However, the company will recover from such costs through continual use of these bottles.
- The top management of the company should be reminded of the benefits of the new technology as a way of promoting the company’s brand in the market. The global society is becoming concerned with the problem of pollution and impact of plastic materials on the environment. Reminding the customers that this firm is using eco-friendly materials will endear them to the brand. This reminder will eliminate possible rejection of the initiative among the executives of the company.
- The management should promote creativity and innovativeness to help the bottling companies that does the bottling process on behalf of the Coca-Cola Company (Terry, 2015). It will be necessary to find creative ideas of making this initiative popular around the world. Improved cleaning technologies may help in assuring customers all over the world about the benefits of the new bottles.
- The company should remind the bottlers of the ease of handling the plastic bottles. Plastic bottles are lighter than the glass bottles even if they are made of hardened plastic that reduces tear and wear (Morden, 2017). They are not as fragile as glass bottles that break when handled poorly. These are the benefits that the partners should be informed about to make them convinced about the need to embrace the new initiative.
This project is important because it proposes ways of eliminating the problem of increasing production of plastic wastes by the Coca-Cola Company. Plastic bottles are some of the leading marine and land pollutants. Recent statistics show that the Coca-Cola Company is a major producer of plastic bottle wastes (Butler & Tischler, 2016). The proposed approach of using renewable bottles supports the company’s strategy of reducing plastic wastes while at the same time increasing its production. If this company implements the strategy, it is expected that other firms will embrace the best practice, and the amount of plastic wastes will be significantly reduced. The proposed strategy emphasizes the need to utilize reusable bottles as a way of reducing the amount of plastic wastes.
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