A CASE STUDY ON THE ORGANIZATIONAL CULTURE AT COCA COLA

COMPANY, ETHIOPIA

Executive Summary

The company's inclusive workplace culture that encourages diversity is crucial for sustaining leadership
in the global beverage industry through respecting individuals, valuing differences, and effectively
representing consumers and markets where they transact business within various global locations.
Effects of organizational culture is the main and core issue that can influence organizational
effectiveness.

Background Organizational culture refers to a system of shared meaning held by members that
distinguishes the organization from other organizations. The system is a set of characteristics that the
organizations value.

The Coca-Cola Company is the world’s leading manufacturer of non-alcoholic beverages, with its
products being the most recognized brands in the world. The company owns and market more than 500
brands in more than 200 countries, including Ethiopia. Manufacturing beverage concentrates and
syrups, the multinational company has millions of employees who manufacture, market and distribute
the products. The Coca-Cola Company also has ownership interests in numerous beverage joint
ventures, bottling, and canning operations, with significant markets existing in all the world’s geographic
regions (The Coca-Cola Company, 2018).

Case Evaluation

A DISCUSSION OF THE OVERALL ORGANIZATIONAL CULTURE

It is in the culture of Coca-Cola that all the stakeholders contribute to the growth and development of
the company. The company engages its varied partners in long-term agreements that provide significant
contribution towards the transformation of the decision-making process. The daily operations of the
company are controlled by the stakeholders such as the suppliers, customers, and competitors. With the
company’s 2020 sustainability goals, it has a particular way of engaging the stakeholders, with the
objectives put in place controlling its actions towards the stakeholders (YouTube, 2018).

The culture of the Coca-Cola Company requires that the management of the multinational corporation
engages the stakeholders in both formal and informal talks. The stakeholders are often engaged in
meetings and dialogue that revolve around the supply and consumption of the products. For instance,
The Coca-Cola Company is reported to be carrying out negotiations with the suppliers of bottling
equipment on the most appropriate ways that would lead to a healthy business between the two
partners (Dumitrescu, Luigi, & Vineraean, 2010, p 152).

The company considers the increasing global challenges when discussing key worldwide problems with
its suppliers, in an attempt to protect the environment in which the companies operate.

The culture of Coca-Cola Company recognizes the need to protect the environment from global warming
that arises because of intense uncontrolled production activities within the company. The culture of the
company recognizes the need to ensure the safety of its customers as they may be the victims of
uncontrolled production activities.

The company strives to protect the surrounding environment from pollution by preventing the emission
of harmful substances into the atmosphere during mass production and the manufacture of bottles used
for packaging (Baah, Sandra, &Bohaker, 2015, p 16).

In business ethics, protecting the consumers is an indication of the company striving to consider the
natural environment; thus, allowing suitable working conditions for both the consumers and the
employees of the company. As the culture of the company requires, it has mastered the art of working
together with its partners and competitors to acquire knowledge on how to improve the quality of
services and production.

Coca-Cola is known to recognize, learn, and attend to issues of concern that bring together knowhow
and information that other partners possess (Baah, Sandra, &Bohaker, 2015, p 18). In the world of
business, corporations are known to have varied managerial teams that put different ideas into practice,
which when combines, may be significant in achieving far great positive impact on the environment and
other issues of social concern. The issues of social concern may not be addressed by the Coca-Cola
Company if its culture does not require that it works together with its partners.

The culture of working with competitors has enabled Coca-Cola Company to identify healthy
competition practices that are not bound to have negative impacts on the trading companies when
implemented. The management team of the Coca-Cola Company has a culture of combating new
entrants into the market, a culture that is distinct from other areas of the organization. The modern
world comprises of competitive businesses where new players come into the market on a daily basis.
The management of Coca-Cola has been on the spot for their impressive job of carrying out negotiations
with the new companies that are cracking into the market (Gupta, 2011, p 60). The negotiations are
carried out to come up with various ways of forming trade groups that would be helpful in the growth of
both companies.

Trade groups are known to enhance businesses by creating connections that were not identified before.
Another key factor that has ensured the growth of Coca-Cola Company is industry collaborations,
whereby joint venture initiatives are conducted to pave way for new policy engagement initiatives that
boost the activities of companies. The culture of collaborating with other companies has ensured the
growth of Coca-Cola across the globe as there is a tremendous reduction in operation costs. For
example, by collaborating with recycling firms to set up enterprises next to the Coca-Cola plants, a lot of
time and money is saved while transporting the containers (Gupta, 2011, p 60). CocaCola is highlighted
as one of the huge profit-making firms across the world because of the deals it strikes with other
partners to reduce operation costs and to save time. that work together. The systems theory asserts
that an institution is a collection of parts that have been combined to accomplish certain objectives.

Coca-Cola Company has been in a position to work with minimum interruption in the activities that are
associated with the manufacture and marketing process. The culture of working with the company’s
competitors creates an opportunity for the company to diversify its operations to suit the existing
customers and find new customers in the market. Currently, Coca-Cola’s major competitor, Pepsi, has
been noted by health officials to be a health hazard, a factor that has led to its reduction in sales
(Hartogh, 2007, p 1).

Initially, Coca-Cola was faced with the challenge of low product diversification as compared to its
competitor, Pepsi. With the reduction in sales of Pepsi products, Coca-Cola Company has the right
information on how to market the lesser selling products in markets that were initially dominated by
Pepsi. In marketing, promoting the lesser selling products is a strategy used by corporations as a result
of a proper supply chain management (Hartogh, 2007, p3).

The threat of indirect competitors is a factor that could drastically bring down the growth levels that
have been achieved by Coca-Cola; thus, combating the new players in the market and collaborating with
indirect competitors has led to the continued growth of Coca-Cola. The culture of mastering the art of
working together with all the stakeholders has contributed to the brand equity in Coca-Cola. Moreover,
Coca-Cola brands are probably the costliest in the market; hence, earning more revenue to the
company. A strategic management system is significant to Coca-Cola as the company is currently the
most valued company with assets that allow mass production (Rafaeli, A., & Pratt, M. G. 2013). Coca-
Cola is noted to be operating in more than 200 countries across the world, collaborating with the
beverage companies on various continents. Coca-Cola has the largest market share, with its only
competitor being Pepsi. Working with its competitors has been beneficial in reducing the damage that
unhealthy competition can cause to the growth of the company (YouTube, 2018).

Coca-Cola is evenly distributed across the globe; thus, leading to its identification of new markets.
Measuring the risks that Coca-Cola may face has led to strategic management methods product
promotion that has led to brand loyalty across the world. In the field of insurance, measuring risks that
corporations may face is regarded as impossible is the measurement is based on the probability
distributions that are more of financial markets. Such measurement is characterized by errors that may
make the organization impossible to control (Taleb, Nassim &Martin, 2012, 49). The coordination
between departments in Coca-Cola has allowed the risk management professionals to come up with
strategies that have continued to boost the image of Coca-Cola Company as any slight misunderstanding
could damage the company’s reputation; thus, leading to a decline in global sales.

Proposed Solutions

An excellent corporate culture is a significant condition that paves way for the formulation of corporate
strategy. Corporate culture also highlights the characteristics of the enterprises, the formation of values
that are common among all the stakeholders, and has a distinct personality.

In the Coca-Cola Company, the corporate culture has been useful in developing strategies that are
different from other companies and are vital in combating competitors (Baah, Sandra, &Bohaker, 2015,
p 17). For example, the corporate culture in Coca-Cola Company highlights the company’s organic
habitat in which the organization’s strategy lives. The corporate culture used by Coca-Cola is equally
emotional as it considers the well-being of all the stakeholders and the environment in which the
company operates. Corporate culture is a significant means of implementing a corporate strategy as it
determines and measures desire, engagement, and execution of the strategies. It is a requirement that
an active and effective implementation of the strategy is carried out after corporate strategy
development (Kotter, 2008, p50. organization structure in Coca-Cola stimulates the enthusiasm of
employees and the unified stakeholders who jointly strive to achieve the goals that have been set by the
company’s management team. Before the implementation of the strategies, it may be important to
ensure that the strategies are corporate culture oriented and that there are cohesion and motivation of
the corporate members. Corporate culture and corporate strategy ought to adapt to each other, mutual
organization and strategy development, business culture should be altered with the formulation of
strategy. However, changing corporate culture may not be possible once the culture of an organization
has been formed (Nawaser et al, 2014, p 178).

It is, therefore, required that corporate culture maintains greater rigidity and certain continuity in the
implementation of corporate strategy. Coca-Cola Company aims at earning profit so that it could survive
and have a source to grow. In most cases, earning profit is used as a measure used to access the
performance of a company. For non-profit organizations, the success of the institutions may be viewed
from different angles such as providing free education to students (Zaheer, Muhamamd, and Saleem, n,
p 10).

The strategies in Coca Cola are often implemented in relation to the corporate culture in an attempt to
maintain the profits and success of the company. In various types of industries, different cultures could
give rise to different types of strategies implemented for the success of the organizations. Companies
such as Coca-Cola have flexible and adaptive cultures that can be of help in producing innovative
products that result in a successful strategy. The strong organizational culture in Coca-Cola Company has
been one of the most sustainable competitive advantages that the company has. Despite the presence
of competitors, copying an organizational culture may be difficult as culture is defined as a collection of
norms that are shared within the place of work (Dartey-Baah, K. 2013).

Different companies have different ways of carrying out their operations, some of which have a positive
impact on production while others contribute to organizational problems. Since organizational cultures
are unique and offer strategic advantages, it is a clear indication that companies would opt to consider
culture in strategic management. Cultures that do not align well strategies implemented by corporations
are just the headline of the companies’ story while culture requires that a commonly understood
language is used to embrace and tell the story (Kotter, 2008, p4). For example, Coca-Cola has ensured
that all its stakeholders understand its mission, vision, the values that the company stands for, and the
clear expectations from all the stakeholders. The common language among the stakeholders ensures
that all the strategies are implemented to achieve a common goal for the company.

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