Type: Economics
Pages: 7 | Words: 1930
Reading Time: 9 Minutes

Coca-Cola Company was founded in 1886 in Atlanta Georgia. The company produces market and distributes concentrates and syrups to bottling companies all around the world, which are used to manufacture more than 400 soft drinks in the word. The company has adopted a marketing chain through which its products are distributed and sold in the global market. The strategic plans in production, marketing, and distribution have elevated the company to being the world leader in non-alcoholic beverages industry (RMI Media Productions, 1995).

The success of this company focuses not only on the cost minimization strategies and financial measures (Jain & Kedia, 2011). The emerging issues in contemporary management and planning of the business and the pursuit of ensuring customer satisfaction have been some of the critical factors that have led to the success. A SWOT analysis on the operations of the Coca-Cola Company establishes the strengths, weaknesses, opportunities and threats that the company faces in pursuit of it objectives. The main objectives of a SWOT analysis are to ensure that the company formulates policies and strategies that ensure the company gain a competitive advantage. A cost management system provides platform upon which transactions are reported. They also ensure accuracy and relevancy of data used in decision-making. The organization must identify the critical success factors (CSFs), so as to achieve a competitive advantage. These critical success factors are identified by carrying out a SWOT analysis.

SWOT Analysis of the Coca-Cola Company

Each organization faces its own unique challenges in pursuit of its objectives (Hill & Richard, 1994). Therefore, each company carries its own SWOT analysis to identify the various critical factors key to its growth. The main objective of the analysis is to identify the various strategies and polices the company can consider in obtaining a competitive advantage. The analysis should be diverse in nature covering both financial and nonfinancial aspects that contribute to achievement of the company strategic objectives.

Each firm faces its own unique challenges in the course of carrying out its business. Therefore, each firm carries its own SWOT analysis to identify it own unique challenges and competitive advantages arising from the internal and external environment. The analysis encompasses the maximization of both the internal and external strengths and opportunities, while minimizing the weaknesses and threats.

Under the case above, Coca-Cola Company has been able to create competitive advantage by identifying its own unique, critical success factors and the opportunities available for growth (Kotler & Armstrong, 1991). The company’s strength arises from the strong brand name, large-scale operations that reduce cost and strong revenue base. The opportunities available for growth arise from the developed information and technology that can be used in advertising the unpopular brands, a high-income population, unexploited domestic market and potential growth for exports. The weaknesses arise from the company’s unpopular brands, low profile or inexistent advertisements on those brands, and the growing awareness on health issues creates negative impact against the popular brands. The company faces threats from the intense competition from the competitors (Pepsi) and the changing legal environment. The competition reduces the market share while the legal issues increase the operating costs of the company.

Management accounting involves identification of factors that are critical to company success rather than only the financial factors. Therefore, it involves identification of the critical success factors that the company uses to create a competitive advantage. A balanced score card is a method in management accounting used in implementation of strategies. It utilizes the strategy map, which is a cause and effect diagram that links the financial and the nonfinancial factors.A balanced scorecard chart is an accounting framework, which uses strategic, financial and nonfinancial information to formulate strategic policies that ensure achievement of strategic objectives, by identifying firm’s critical success factors in both financial and nonfinancial perspectives.

Critical Success Factors of Coca-Cola Company

The critical success factors of Coca-Cola Company include the financial perspective and the nonfinancial perspectives. The company boasts of high brands valued at $67000 million in 2008 (Jain & Kedia, 2011). The high brand value facilitates customer satisfaction, which enables the company to penetrate into the market. The high revenues generated by the brands have enabled the company to carry out massive advertisements that have led to increased sales of the company brands. The increased sales reflect that the company’s revenues have increased. In 2010, the company recorded revenues amounting to $35,119 million, an increase of 13.3% from the previous year revenues (Jain & Kedia, 2011). The revenue base of the company has enabled develop the company’s global distribution network and marketing strategies, which have facilitated the company’s expansion in the market. The high revenues have also led to the acquisition of potential competing firms to reduce the competition against its brands. The variety of brands has enhanced risk diversification between different brands in the marketing strategies.

The organization global supply chains have enabled the company to expand the market and encourage innovation with the bottlers, distributor and retailers, in the global market. The variety of brands meets versatile tastes, needs and preferences of the customers. The product innovation strategies have created a competitive edge for the company enhancing its revenue growth. The company gives a sufficient margin to its bottler’s and distributors, to maintain the global network, and the margin ranges from15-25% (Jain & Kedia, 2011). These margins act as an incentive to the global network for keeping Coca-Cola products. The supply chains ensure customer satisfaction through timely deliveries of products and after sales services. This network has provided strategic information that the company uses to identify new market and opportunities.

Good reputation and the brand name have created myriad of opportunities and competitive advantage to Coca-Cola Company. Previous research has shown that reputation of the company is a critical determinant of the organization’s success. The improvement of technology has led to fast dissemination of information in the global market. Public opinion of the company is, therefore, an important factor in building the reputation of the company. A company reported to have unethical practices experiences reduce the value of its stocks. The reputation of the company depends on the opinion of the public, relationship with their employees, customers, government and the suppliers. Coca-Cola has been able to build its reputation in the world through continued supply of high quality products and the positive public picture build through advertisements. Customer brand loyalty has been an outstanding asset to Coca-Cola Company. This brand loyalty has been created over a long period through customer satisfaction of timely deliveries and quality guarantee.

The company has created a global market and myriad opportunities for future growth. This has been facilitated by the presence of a global marketing network through adoption of innovations and information technology. This global presence has created a competitive advantage, for the company to expand its market and increase its revenues exponentially. Product differentiation and massive advertisements, rather than engaging in price wars with its competitors, have been some of the strategic policies, that the company adopted to increase their sales. This has also enabled them to explore new market and customer satisfaction globally (Armstrong & Armstrong, 2009).

The company has continuously improved the integrated management systems. This has been enhanced by upgrading and use of environmental friendly technology in manufacturing. Adoption of new technology in its business processes has enabled the company to achieve more efficiency and effectiveness. Promotion of high teamwork through process ownership and employee participation has enabled maintenance of quality through minimal cost. The company has identified that efficiency in its internal operations is a key determinant to success of the company. Employment of highly skilled workforce facilitates the running of internal operations of the company to ensure competence in the challenging environment.

Evaluation Coca-Cola Achievement of CSFs

The success of Coca-Cola company in achieving its critical success factors can be measured by an evaluation of the strategies employed by the company and the success of each strategy. An evaluation of the financial and non-financial factors affecting the business revolves around the social, cultural and political considerations that the company must consider when making decisions. Coca-Cola Company, as discussed above, has been able to capitalize on its strength by identifying the critical success factors. SWOT analysis has enabled the company to identify and capitalize on its strengths and opportunities, while learning and understanding their weaknesses and strengths.

The company has been able to expand its financial revenue base through increased sales (Bruner & James, 1992). This has created a competitive advantage ahead of their competitors. The revenues have been used to employ skilled labor force, which has led to increased effectiveness and efficiency in business processes. The increased revenues have facilitated advertisement and product differentiation that have created a wide, global market and customer satisfaction. The advertisements have also improved the image of the company in the global market. Increased revenues facilitate adoption of the required technology in production, marketing and distributing the firm’s products. Revenue growth have led to payment of high dividends to the shareholders and improving the company credit rating among the financial providers. This has enabled the company to acquire the necessary finance to expand its operations.

The global marketing chain adopted by the company has facilitated timely delivery of products, ensuring customer satisfaction. Maintenance of high quality products at affordable prices has enabled the customers to be loyal to the company brands. Customer satisfaction increases the sales volume that reflects to high revenues and net profit to the company. This wide network aids in the collection of information about customer complaints. It also proposes the various strategies that the company can employ to expand the market further.


The increased globalization and information technology has increased pressure on multinational corporations, so that they had to formulate strategic policies that ensure they remain competitive in the global market. The firm has to carry out various analysis to come up with these strategic polices. SWOT analysis is an essential procedure that the firm adopts to ensure proper decision-making. A scorecard is a framework that explains the various factors that determine performance of a firm. The factors include both the financial and the nonfinancial factors like customer satisfaction, efficiency of the internal processes and learning opportunities of the firm.

In this analysis, the case of Coca-Cola Company, the various critical success factors are considered and reflected, which have created competitive advantages for the company over their competitors (Pepsi) (Kotler, 1980). High revenue base of the company has facilitated the creation of a sound reputation through product differentiation and advertisement. Brand loyalty was arising through the customers’ satisfaction, which, in turn, derived from the company products quality and timely deliveries; consequently, these led to increased sales and hence revenue growth. The global production, marketing, and distributor chain have been one of the critical success factors that the company has used to remain competitive in the global market. The company also recognizes the importance of internal operations as a great determinant of the company success. The internal operations ensure production of quality brands adoption of the necessary technology to enhance efficiency and effectiveness of the firm. Employee satisfaction increases morale and innovations in the company, and this increases the production of quality products. Coca Cola Company has ensured employment of high skilled employees who are competent to guarantee product quality and efficiency in the business processes. A strong reputation has been another critical success factor for Coca-Cola Company, and the growth of revenues has facilitated payment of high dividends to shareholders. The customer satisfaction, through high quality brands and timely deliveries, has created the company reputation globally. The company has been able to capitalize on the above critical success factors, so as to obtain a competitive advantage over its competitors.

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