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Strategic Management Project Report Sample
Strategic Management Project Report Sample
Strategic Management Project Report Sample
Strategic Management
Table of Contents
Description
Page No.
Industry Profile
Company Profile
Mission Vision
SWOT Analysis
13
14
Corporate Strategy
16
17
Space Matrix
18
19
BCG Matrix
20
I-E Matrix
21
TOWS Matrix
22
25
Implementation Stage
26
Conclusion
27
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Acknowledgment
We are very grateful to Allah who blessed us the strength and courage to stand by the difficulties
that came in the way and who enabled us to complete this project effectively.As plants cannot
grow without seeds, birds cannot fly without wings.Similarly knowledge cannot be attained
without proper direction and supervision. We are, therefore, also thankful to our respected
Maam
Quratulein
Muqarab,
because
of
whose
generous
Executive Summary
In this project we have analyzed the companys mission and vision and also proposed a new
mission statement for the company. On the basis of secondary research we have identified the
SWOT analysis of the company and also prepared the five different matrices to identify the
strategies which governed by coca cola and we also give some recommendations about the
strategies which coca cola can use in order to compete in the market.
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Industry Profile
The beverage industry in Pakistan has grown over the time. The industry produces soft drinks,
juices, syrups, milk, and squashes. With about 170 units currently in operation throughout the
country, both upstream and downstream industries have grown and are flourishing.
There are 34 beverage plants in the country and this is one industry, which is very well
organized. Job oriented in nature, the beverage industry employees over 500,000 people directly
and indirectly and also supports many other up/down stream industries such as crown corks,
glass bottles, plastic shells, sugar, transport, advertising and media, P.E.T bottles, concentrates
etc. due to this industry a huge number of outlets/shops are supported to generate wide-spread
economic activity in the country.
Soft drinks market in Pakistan is growing rapidly. And the carbonated category is the leader in
the soft drink market with a share of 63.7 %. This reflects such a huge market to cater. The
beverage industry in Pakistan has a lot of potential and room for growth and development. There
exist a lot of opportunities for new entrants and local players to exploit the untapped facets of the
market, for instance the energy drink market or juices, by strategically positioning their products
and by resorting to innovative and effective marketing strategies.
According to a recent report on Pakistani Food and Beverage Industry, dated January 20th 2014,
the two primary threats to this industry are; political instability and continuous militant activity,
which have the tendency to obstruct foreign direct investment in this industry. Challenges faced
by beverage industry are the high prices and unavailability of sugar and also the taxes, excise
duty, and sales tax at the rate of 15 percent on the retail price. This is the reason that beverage
industry at the moment has very low per capita consumption of 20 serves whereas in other
countries of our region it varies from120-250 on the basis of single serve of 250 ml.
Based upon the aforementioned facts, on can conclude that the beverage industry is Pakistan has
gained momentum and is more likely to continue the growth in coming years as well. Although,
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certain macroeconomics factors certainly do have the potential to corrode this industrys
profitability
Company Profile
The Coca Cola Company
The Coca-Cola Company (TCCC) was first introduced by John Syth Pemberton, a pharmacist, in
the year 1886 in Atlanta, Georgia when he concocted caramel-colored syrup in a three-legged
brass kettle in his backyard. He first distributed the product by carrying it in a jug down the
street to Jacobs Pharmacy and customers bought the drink for five cents at the soda fountain.
Carbonated water was teamed with the new syrup, whether by accident or otherwise, producing a
drink that was proclaimed delicious and refreshing, a theme that continues to echo today
wherever Coca-Cola is enjoyed.
Dr. Pembertons partner and book-keeper, Frank M. Robinson, suggested the name and penned
Coca-Cola in the unique flowing script that is famous worldwide even today.
By the year 1886, sales of Coca-Cola averaged nine drinks per day. The first year, Dr. Pemberton
sold 25 gallons of syrup, shipped in bright red wooden kegs. Candler, an entrepreneur from
Atlanta. By the year 1891, Mr. Candler proceeded to buy additional rights and acquire complete
ownership and control of the Coca-Cola business. Within four years, his merchandising flair had
helped expand consumption of Coca-Cola to every state and territory after which he liquidate.
The business continued to grow, and in 1894, the first syrup manufacturing plant outside Atlanta
was opened in Dallas, Texas. Others were opened in Chicago, Illinois, and Los Angeles,
California, the following year. In 1895, three years after The Coca-Cola Companys
incorporation, Mr. Asa G. Candler announced in his annual report to share owners that CocaCola is now drunk in every state and territory in the United States.As demand for Coca-Cola
increased, the Company quickly outgrew its facilities. A new building erected in 1898 was the
first headquarters building devoted exclusively to the production of syrup and the management
of the business. In the year 1919, the Coca-Cola Company was sold to a group of investors for
$25 million. Robert W. Woodruff became the President of the
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Company in the year 1923 and his more than sixty years of leadership took the business to
unsurpassed heights of commercial success, making Coca-Cola one of the most recognized and
valued brands around the World.
Vision
Be the outstanding beverage company leading the market, inspiring people, adding value
through excellence.
Mission
Build a sustainable and profitable business through refreshing consumers, partnering with
customers, delivering superior value to shareholders and being trusted by communities.
EVALUATION OF MISSION COMPONENTS
Customer
No
Product/services
No
Market
yes
Technology
No
No
philosophy
yes
Self concept
No
No
No
Values
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Our mission is to bring consumers quality refreshments that anticipate and satisfy their desires
and needs through modern technology and inspiring employees to be the best that they can
continue to provide the best products on the market.
Vision:
We are dedicated to upholding standards, while maintaining the leadership position in the
beverages category when delivering superior customer service in a highly efficient and profitable
manner.
Our Goals
People and Organizational Leadership: Build a highly capable organization and be the
employer of choice.
Commercial Leadership: Profitably deliver superior value to consumers & customers at
the optimal cost to serve.
Supply Chain: To be the best in class consumer demand fulfillment organization that exceeds customer
expectations highest in quality, lowest in cost, in a sustainable, socially responsible manner.
Micro-environment
Entry barriers are relatively low for beverage industry: there is almost 0 consumer switching cost
and very low capital requirement. There are more and more new brands appearing in the market
with usually lower price than Coke products. However Coca-Cola is seen not only as a beverage
but also as a brand. It has a very significant market share for a long time and loyal customers are
not very likely to try a new brand beverage. To analyze the micro-environment and its factors,
we use the Porter's five forces model to identify the existing industrial factors, which include the
following:
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the bargaining power is lessened because of the end consumer brand loyalty.
People are getting concerns of negative effects of carbonated beverages. Increasing
number of consumers begin to drink fruit juice, lemonade and tea instead of soda
products.
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SWOT analysis
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Strengths
Financially strong
One of the main strengths of CCBPL is the financial strength of the company because it
is supported and controlled by Coca Cola International. Therefore, unlike past, now they
can start any long term project without concerning too much about finances available.
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Weaknesses
shares in big cities of Pakistan but in rural areas it lacks behind a lot.
Utilization of Resources
The company is also lacking in utilization of the resources. People are having various
facilities but they dont know their best use. For example, people working in fleet
department dont know to make the best use of Fleet Management System and usually
performing tasks in very difficult manner manually that can be easily performed by using
FMS.
Brand failures
Plus, the firms success of introducing new drinks is weak. Either they arent marketed
well or are not launch after a proper market survey. Many of its introduction result in
Opportunities
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product range with drinks that have low amount of sugar and calories.
Enter into new market
A huge part of the market is still waiting for first entry. Coca Cola can get the advantage
Threats
fat. This is the most serious threat as Coca Cola is mainly serving carbonated drinks.
Legal requirements to disclose negative information on product labels
Some Coca Colas carbonated drinks have adverse health consequences. For this reason,
government considers to pass legislation that requires disclosing such information on
product labels. Products containing such information may be perceived negatively and
world.
Local Manufacturers
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The local manufacturers can also disturb the market share due to their low price offerings.
Critical
Weight
Coca-Cola
Rating
Weighte
Success
Pepsi
Rating Weighted
d Score
Score
Factors
Market Share
0.15
0.60
0.45
Price Comp
0.10
0.30
0.30
Financial
0.12
0.48
0.48
Position
0.15
0.45
0.45
Product Quality
0.15
0.60
0.60
Product Lines
0.15
0.60
0.60
Customer
0.11
0.33
0.33
Loyalty
0.07
0.21
0.21
Employees
1.00
3.71
3.56
Marketing
Total
Weighting
Rate
Weighted
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Score
Opportunities
Bottled water consumption growth
0.1
Increasing demand for healthy food and 0.15
4
3
0.4
0.45
0.10
0.05
3
4
0.3
0.2
0.05
negative 0.10
4
1
0.2
0.1
Local Manufacturers
0.15
0.45
0.10
0.3
0.1
0.10
1.00
4
4
0.4
0.4
3.2
beverages
Enter into new market
Availability of Products
Threats
Changes in consumer tastes
Legal requirements to disclose
information on product labels
Based on the above calculations it has been concluded that the companys Total Weighted Score
is 3.2 which shows that the company is hugely successful in utilizing its opportunities and
minimizing the threats around it
Developing the IFE Matrix
Internal Factor Evaluation
Weighting
Rate
Weighted Score
Financially strong
0.1
0.4
Loyal Customers
0.05
0.2
0.3
channel
Hi tech & up-to date Technology
0.1
0.4
0.10
0.4
Working Environment
0.1
0.4
Strengths
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Weaknesses
Less Focus on Small Cities
0.05
0.2
Utilization of Resources
0.05
0.2
0.3
Significant
focus
on
carbonated 0.1
drinks
Undiversified product portfolio
0.15
0.45
Brand failures
0.1
0.3
Total
1.00
3.55
Based on the above calculations it has been concluded that the companys Total Weighted Score
is 3.55 which shows that the company is hugely successful in utilizing its strength and
minimizing the weakness around it
CORPORATE STRATEGIES
Vertical Integration
Vertical integration is the process of combining several steps in the distribution chain either the
inputs or outputs of the organizational controls.
Backward integration
In this case, Coca-Cola started Coca-Cola Enterprises (CCE) and positioned it as an independent
bottling subsidiary of Coca-Cola. The parent company would buy other struggling bottlers and
resell them to CCE.
Diversification Strategy
Diversification strategy refers to seeking unfamiliar products or markets to develop and exploit.
It is a strategy to eliminate the potential risk of a current product or market orientation does not
seem to provide further opportunities for growth.
Related diversification
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Strategic Management
Coca-Cola uses this strategy to explore new drink categories continuously, and it is keeping the
tradition of expanding on their current portfolio of brands and products. Coca-Cola has more
than 3000 products in over 200 countries of the beverage brands with core focus on brand of
Coca-Cola, Diet Coke, Coke Zero, Sprite and Fanta.
INTENSIVE STRATEGIES
Market penetration:
Coke seeking to increased market share for their present product in present market through
greater market efforts. Coke do market penetration through increase advertisement expenditures,
offering sales promotion and also increasing publicity. Coke in 2009/2010 spent million on its
new slogan Open Happiness, which replaced The Coke Side of Life.
Product development
Coca-Cola has long been committed to a product development strategy. This allows Coca-Cola
to penetrate existing markets with new products due to their high brand awareness. This strategy
capitalizes on Coca-Colas favorable trademark reputation
Strategic Alliance
The distribution of Coca-Cola has reached all around the globe; it has a huge and wide customer
base. Therefore, Coca-Cola highly focuses on enabling their customers to reach their products
more regularly. Thus, all partners of Coca-Cola work closely with customers for example they
have strategic alliance with McDonald many others.
Global Strategy
Globalization is the key concern of Coca-Cola. The company has a total control in cost pressure,
so the cost pressure is low. Therefore, Coca-Cola can operate under the Multi domestic Strategy.
Thus, by running the local responsiveness of Coca-Cola is high.
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Strategic Management
However, the features of multi domestic strategy for Coca-Cola are that they mutually extensive
customize both their product offering and marketing strategies in different place with different
national conditions. In addition, they are operating in seven regional operating groups such as,
North America Group, Latin America Group, Europe Group, Eurasia & Africa Group, Pacific
Group, Bottling Investments Group and McDonald's Division. The reason is that they are trying
to create their value innovation activities by doing the market and product research in different
potential national market.
2.
Long learning, knowledge and experience in production and process, as the company
existed more than a century.
3.
4.
Sharing of research and development, advertising and promotions cost among the
brands carried by Coca-Cola has enabled to achieve economies of scope.
Broad Differentiation
Coca-Cola uses Broad Differentiation strategy on the basis of:
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1. Offering of wide range of its drink products are currently being offered in the global
market.
2. High brand image and recognition have resulted in superior product perception among
consumers.
3. Packaging and bottling, the use of contoured shape bottle and the slim curly font have
made Coca-Cola an easily recognized symbol.
Coca Cola
Revenue
%age
Revenues
50 billion
---
of Profits
$
%age
Profits
of Relative
Market
Growth
Share
0.58
Ratio
7%
NOTE:
Revenues of Pepsi were 85 Billion in 2013. And Pepsi is a market leader in Pakistan.
BCG MATRIX
Industry
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Coca
Cola
By making the
analysis of BCG matrix we come to know the Coca Cola is the star product of the Cola industry
in carbonated drinks because they have captured the reasonable market share and making growth
by utilization of resources and making strategies according to the situation. Further Coca Cola
can make growth because there is a potential in the market and more growth and market share
can be captured by making further strategies such as market penetration.
GRAND STRATEGY MATRIX
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As per the figure above Coca Cola comes in the first quadrant. The company must focus on the current market and
achieve growth by adopting product development and market penetration strategies. The company has abundant
resources and competitive advantage through which it can achieve growth by adopting the backward and forward
integration strategies. Coca Cola can also adopt the related diversification strategy to reduce its risk with broad
portfolio or product line. Coca Cola can afford to take benefits of external opportunities in many areas. It can take
risk being aggressive when necessary.
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According to the graph studied above Coca Cola is lying in the 1 st cell which means that it is
using the build and grow strategy in order to achieve the maximum market share and growth. In
this regard Coca Cola can use the certain strategies such as product development, market
penetration and related diversification.
SPACE Matrix
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Strengths
1: Financially strong
2: Loyal Customers
3:
Most
extensive
beverage distribution
channel
4: Hi tech & up-to date
Technology
5: Sustained Quality &
Brand name
6:
Working
Environment
Weaknesses
1: Less Focus on Small
Cities
2:
Utilization
of
Resources
3: Brand failures
4:
Undiversified
product portfolio
5: Significant focus on
carbonated drinks
Opportunities
1:
Bottled
water
consumption growth
2: Increasing demand
for healthy food and
beverages
3: Enter into new
market
4:
Availability
of
Products
Threats
1: Changes in consumer
tastes
2: Legal requirements to
disclose
negative
information on product
labels
3: Competition from
PepsiCo.
4: Saturated carbonated
drinks market
5: Local Manufacturers
6: Rumors of Coke being
Un-Healthy
SO
1.Increasing
the
marketing campaigns to
capture the maximum
share in the emerging
economies S1,O2
ST
WO
1. Allocation of budget
on failed brands to cater
new markets w3, 03
2. Market the products to
rural
areas
in
all
countries like the way its
marketed in Pakistan
w1,O4
1-Market
penetration
through which further
efforts will be made to
increase market share of
products.S1,T4
2-Making the unrelated
diversification such as
entering
in
snacks
division.S1T1
3-Increasing the marketing
budget in order to fight
with competitor. S1,T3
4-Introducing
reward
schemes to make further
growth.S3,T5
WT
1-Product development by
using
best
market
techniques in order to cater
rumors w4,T6
2-market penetration in
rural areas through which
loyalty will be increased in
order to beat the local
manufacturers.w1,T5
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Internal
Factors advertisement /
Weight
Strengths
1: Financially strong
2: Loyal Customers
3: Most extensive
0.1
0.05
beverage distribution 0.1
channel
4: Hi tech & up-to date Technology
5: Sustained Quality & Brand name
6: Working Environment
Weaknesses
1: Less Focus on Small Cities
2: Utilization of Resources
3: Brand failures
4: Undiversified product portfolio
5: Significant focus on carbonated drinks
SUBTOTAL
Marketing Budget
TAS
AS
3
0.3
2
0.1
2
0.2
External
energy drinks
AS
TAS
2
4
3
0.2
0.2
0.3
0.1
0.1
0.1
2
3
---
0.2
0.3
---
3
2
---
0.3
0.2
---
0.05
0.05
0.1
0.15
0.1
1.00
2
----2
4
0.10
----0.3
0.4
1.9
1
----3
3
0.05
----0.45
0.3
2
Increasing
Key
Factors advertisement /
Weight
Marketing
Opportunities
1: Bottled water consumption growth
Budget
AS
TAS
-----
0.1
energy drinks
AS
---
TAS
---
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0.30
0.3
0.10
0.05
2
4
0.2
0.2
4
3
0.4
0.15
0.05
0.10
-----
-----
-----
-----
0.15
0.10
0.1
0.10
1.00
4
--2
3
0.6
--0.2
0.3
1.8
3.7
3
--3
2
0.45
--0.3
0.2
1.8
3.8
As we look upon the results of QSPM we observe that the strategy which got highest score is
related diversification .we will be following this strategy and introducing energy drinks .for this
purpose we will do the following.
Research and development
Firstly the company has to do the research on the consumer preferences the R&D team have to
find out the consumers taste, price they are willing to pay and which category they prefer in
energy drinks .research can include both
Secondary research
Primary research
After conducting the research company will come to know that which product they have to
develop .once the product is developed sampling will be sent to the different markets for
testation purpose.
Coca-Cola can outsource their research team as they have no related experience in this field .so
its better off to out source this department
After the research has been finalized and the company knows what to produce they can build a
team which will work on this project. For this purpose the y can use
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Strategic Management
Matrix structure
Matrix structure is said to be the best structure as it has less disadvantages compare to the other
structures. Here Coca-Cola can bring together the creative heads to work on this project .people
from different department like finance department .marketing department, production department
can together to further proceed with this project.
After the team have put together we will develop certain objectives which each department has
to follow to achieve long term goal.
Production department
To produce to that limit where they can generate the revenues to gain share in the market
Marketing department
It is responsibility of the marketing department to sale those product which are produced by the
production department.
Resource allocation
Recourses are to be allocated according to priorities established by annual objective.
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Financial resources
Physical resources
Human resources
Technology resources
Example