Change Management Reflection-Coca-Colas Introduction of New Coke

Change Management Reflection-Coca-Colas Introduction of New Coke

Change Failure         

Coca-Cola’s introduction of New Coke represents one of the strategic change company failures. The new beverage had been advertised as a less sweet option than the original Coke and competitive products such as Pepsi. However, the company went against the promise to its key stakeholders and introduced an even sweeter option (Peaslee Levine & M. Levine, 2023). The new product may have passed all tests, but the fact that it went against the company’s promises as advertised earlier led to the failure.

Another reason for the New Coke failure is that the company broke the bond it had with its customers by splitting its customer base. Even though there was a call for a less sweet product, some segments of the company’s customer base still preferred the sweeter option (Peaslee Levine & M. Levine, 2023). In the days before introducing the new product, the company cast sweeter options in a bad light. Some segments of the company, especially young customers, preferred a sweeter option, while the health-aware segment preferred a less-sweet option. Competitors like Pepsi grabbed customers who felt that Coca-Cola was no longer serving their interests.

Furthermore, Coca-Cola’s market research was limited to taste and ignored other crucial product features. The company conducted a survey that reached out to 200,000 people, most of whom expressed their preference for the new product (Peaslee Levine & M. Levine, 2023). However, the company failed to address more market research attributes beyond taste, such as familiarity. The company would have avoided a backlash if it had asked its customers whether they were interested in a new product while conducting the survey.

Alleviating Stakeholder Concerns

Netflix’s change management process is one of the most successful change examples which took into account stakeholder concerns. The primary stakeholders throughout Netflix’s change process have been its customers, engineers, product managers, and top management. To that end, the company’s most significant change took place in 2007 when the company introduced online movie streaming (Rothaermel, 2020). The change was disruptive and welcomed by the company’s consumers. A growing number of movie consumers gradually put aside cinema movie consumption while embracing technological means. Besides, the ever-increasing number of laptop, smartphone, and iPad users encouraged the company to introduce online movie streaming. The company relied on social media to communicate the upcoming changes to its consumers.

Netflix has a team dedicated to change management. The change management team collaborates with the company’s engineers and product management teams. Since Netflix operates globally, and given the sensitivity of the film industry, there is a need for regulated production to ensure safe content is produced (Rothaermel, 2020). The content must also comply with the regulations in different societies. To that end, the internal change management team coordinates all organizational stakeholders to ensure the final product is safe. Netflix has managed to implement change successfully with minimal disruption to its business due to the presence of the change management team that coordinates internal communication.

Another concern characterized by Netflix’s change process is the consumer needs assessment. Even as the company seeks to adapt to new technology, the change process is primarily guided by consumer data (Rothaermel, 2020). The company uses social media and consumer surveys to get in touch with its customers and understand their needs. The company’s data team acts as a conduit between the company’s engineers/product managers and consumers and passes any important communication between these stakeholders.

References

Peaslee Levine, M., & M. Levine, D. (2023). A Coke by Any Other Name: What New Coke Can Teach about Having Trust, Losing Trust, and Gaining It Back Again. The Psychology of Trust. https://doi.org/10.5772/intechopen.108982

Rothaermel, F. (2020). Ise Strategic Management: concepts. (5th ed.). Mcgraw-Hill Education.

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Reflection
Assignment
Competency 3 – Justify an organization’s strategic plan to gain stakeholder support. This reflection activity is comprised of two sections, collectively totalling a minimum of 500 words. Complete your reflections by responding to all prompts. This competency focuses on the creation of an implementation plan and associated change management.

Change Management Reflection-Coca-Colas Introduction of New Coke

Examining How Change Management Failed Think of an example within a company where change was attempted but failed. Using the concepts presented in this module’s readings, discuss what contributed to the failure and what might have been done to prevent it.
Alleviating Stakeholder Concerns
Think of a change in a company you are familiar with. Who were the stakeholders in this change? Discuss what concerns different stakeholders might have and how communication is needed to address those concerns.
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