Coca-Colas Organizational Strategy and Design Criteria

Coca-Colas Organizational Strategy and Design Criteria

Coca-Cola is the leading producer and distributor of soft drink concentrates and syrups. Some of the reasons for the company’s rise to the top include systemic innovation embedded in its operational culture and the ability to develop new products now and then. Despite the company’s success, it faces serious health and environmental concerns. On the one hand, health-aware consumers are concerned about the company’s use of excess sugars in soft drinks, attributing the same to the rise in obesity cases (Yoffie & Kim, 2012). On the other hand, there are concerns that the plastic bottles used by Coca-Cola pose serious environmental concerns when disposed of. Besides, the company does not control its entire supply chain. The problems facing Coca-Cola call for the need for the company to align its operations with its strategy.

Background

Galbraith’s model provides organizations with a foundation they base their design choices on. Among others, the framework focuses on overcoming the negatives of any structural design. Every organization has a structural design with both positive and negative attributes associated with it. Therefore, it is incumbent upon the management to identify the negatives associated with its current design and develop a better structural criterion. This paper will identify gaps in Coca-Cola’s structural design and the potential corrective measures using Jay Galbraith’s Starpoint model.

Gaps in Coca-Cola Company

One of the major problems associated with Coca-Cola is the failure to align with the demands of the millennial consumer segment. Having blamed sodas for the rising obesity cases, the millennials are demanding healthier options with less sugar (Yoffie & Kim, 2012). The company has made efforts to introduce low-calorie sodas, but consumers remain dissatisfied. Also, Coca-Cola has a fractured bottling franchise since the company is unable to control its entire supply chain. As a result, the company leaves the bottling business to independent bottling companies.

Redesign Criteria

To address the environmental problem associated with Coca-Cola’s packaging system, the company should adopt the use of recyclable materials. The company should strive to make its aluminum cans, plastic bottles, and glass bottles as recyclable as possible. Other beverages can also be served in alternative packages; hence the company can work with its suppliers to redesign such packages. Implementing these changes will go a long way to solidifying Coca-Cola’s position as a global citizen and enhancing its reputation (Chua et al., 2020). Centralizing bottling operations will go a long way to ensuring the company uses the right packaging.

Also, the company should lead from the frontline in fighting obesity associated with its beverages. Previously, Coca-Cola had taken a backseat and failed to accept that it was partly responsible for the obesity crisis (Yoffie & Kim, 2012). The company does not necessarily have to accept its responsibility in the obesity crisis, but it can undertake intentional steps to help the most affected populations adopt healthier lifestyles. For instance, the company can set up school fitness centers and programs that can encourage a workout culture.

How Redesign Criteria Will Enhance Coca-Cola’s Competitive Advantage

Consolidating Coca-Cola’s bottling operations is reminiscent of killing two birds with one stone. Coca-Cola will be in a position to use recyclable materials in production, and this will go a long way to boost its reputation as a socially responsible company. Considering how environmentally aware the modern consumer is, such a perception will boost the company’s sales. Another advantage that will result from acquiring bottling franchises and consolidating bottling operations is saving revenue that could otherwise be remitted to bottlers as a percentage of total sales (Chua et al., 2020). Also, participating in promoting fitness campaigns will endear the company to a majority of its global consumers. Therefore, consolidating bottling operations and promoting a fitness culture aligns with the company’s sustainability strategy.

Conclusion

Galbraith’s star model shows that the Coca-Cola Company faces a misalignment between strategy and business operations. One of the main gaps identified is the company’s bottling strategy. Coca-Cola has traditionally relied on external bottling companies to undertake bottling and retain a percentage of the sales revenue. However, this business process derails the company’s strategic push for environmental sustainability, which can only be made possible through the use of recycling packages. Also, Coca-Cola can bolster its bid to attain sustainability by providing fitness awareness and programs as a response to claims that its beverages contribute to the obesity crisis.

References

Chua, J. Y., Kee, D. M. H., Alhamlan, H. A., Lim, P. Y., Lim, Q. Y., Lim, X. Y., & Singh, N.      (2020). Challenges and solutions: A case study of Coca-Cola Company. Journal of the       Community Development in Asia, 3(2), 43-54.

Yoffie, D., & Kim, R. (2012, August). Coca-Cola in 2011: In Search of a New Model – Case – Faculty & Research – Harvard Business School. Www.hbs.edu. https://www.hbs.edu/faculty/Pages/item.aspx?num=40591

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Mini-Paper: Organizational Strategy and Design Criteria
Due Date
Saturday by 11:59 pm PT
Instructions
Review the Case Study Coca-Cola in 2011: In Search of a New Model. Write a paper that addresses the following:
1. Reflect on a problem Coca-Cola faced using Galbraith’s Star Model. What are the gaps between the organization’s strategy and business processes? Clearly define the problem.

2. Write 1-2 design criteria the organization could use in a redesign to make improvements on the gaps you have identified.
3. Explain how your design criteria are aligned with the organization’s strategy and the desired capabilities that promote competitive advantage.
Within the assignment, reference key concepts in the course, as well as course readings. Cite sources in APA style.
Formatting
• Adapted APA: Style: Your paper should be written using well-developed paragraphs.
• Length: Your paper should be approximately 2-3 pages in length. Points will be deducted for papers that exceed the specified length (see the rubric below for more details).