BMGT 500 GMB/NE/0645/05/14

BMGT 500 – Principles of Management

Management styles & Leadership practices at Coca-Cola.

Report submitted to

Prof. Chepkilot

In partial fulfillment for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION (MBA)

By
Jesse G. Munyua
GMB/NE/0645/05/14

Kabarak University Nakuru Town Campus

Management styles & Leadership practices at Coca-Cola. I

 BMGT 500 GMB/NE/0645/05/14

Table of Contents
1.0 Introduction...........................................................................................................................2
2.0 History of the Company........................................................................................................2
3.0 Mission and Vision...............................................................................................................3
4.0 Culture and values................................................................................................................5
5.0 Organizational Design..........................................................................................................6
6.0 Organization Structure..........................................................................................................8
7.0 Organizational goals.............................................................................................................9
8.0 Leadership Style.................................................................................................................10
8.1 Core Capabilities.............................................................................................................11
9.0 Management Styles.............................................................................................................12
9.1 Democratic......................................................................................................................12
9.2 Autocratic........................................................................................................................13
9.3 Laissez-faire management style......................................................................................14
9.4 Consultative democratic..................................................................................................14
9.5 Team Work.....................................................................................................................15
9.6 Employee Engagement..................................................................................................16
10.0 Management Functions of Coca-Cola Company................................................................16
10.1 Planning..........................................................................................................................16
10.1.1 Strategic Goals........................................................................................................17
10.1.2 Tactic Goals............................................................................................................17
10.1.3 Operational Goals...................................................................................................17
10.1.4 Decision Making.....................................................................................................18
10.2 Organizing.......................................................................................................................18
10.2.1 Departmentalization................................................................................................19
10.2.2 Work Specialization................................................................................................20
10.2.3 Delegation and Accountability...............................................................................20
10.2.4 Resource Allocation................................................................................................20
10.2.5 Organizing the Human Resources..........................................................................20
10.3 Leading............................................................................................................................21
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10.3.1 Motivation...............................................................................................................21
10.3.2 Communication.......................................................................................................22
10.3.3 Corporate Culture...................................................................................................22
10.4 Controlling......................................................................................................................22
10.4.1 Sales Person’s Reporting System...........................................................................22
10.4.2 Sales Person Evaluating System.............................................................................23
Reference.......................................................................................................................................24

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1.0 Introduction
The Coca-Cola Company, a retailer, manufacturer and marketer of non-alcoholic
beverages, is a market leader in its industry currently offering more than 500 brands in over 200
countries or territories. The company operates a franchised distribution system dating from 1889
where the Coca-Cola Company only produces syrup concentrate which is then sold to various
bottlers throughout the world who hold an exclusive territory. The Coca-Cola Company
headquartered in Atlanta, Georgia owns its anchor bottler in North America, Coca-Cola
Refreshments.

This behemoth has managed to maintain its position as a market leader for over a hundred years
and is still going strong. This paper explores the history, mission, vision, and organizational
structure and management functions of the Coca-Cola Company and tries to explain leadership
and some management styles applied by the company.

2.0 History of the Company

Coca-Cola is a multinational company who started its business on May 1886 in Atlanta as
a beverage (formal drink) industry. Dr. John Styth Pemberton made a cough syrup which he
named “coke” on 8th may 1886. Its price was 5 cent per glass and was available at the largest
pharmacy of Atlanta known by the name of Jacob’s Pharmacy. Later on it was purchased by a
well-known businessman Asa Griggs Candler who introduced it as a “carbonated soft drink” in
the market and hid marketing tactics led coke to Coca-Cola and it dominated the market of
carbonated soft drinks throughout the twentieth century.

In 1895 the company started to sell their product coke in bottles which was a strategy of the
company to be recognized well in the International market. Their strategy worked and the bottled
form of coke was successfully recognized all over the world in the beginning of 1896. Now a
day’s Coca-Cola is the most famous and highly consumed brand in all over the world
(Wikipedia, 2014).

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3.0 Mission and Vision

The company is facing a huge numbers of challenges from all over the world. Competitors are
coming up with brand new strategies that threaten Coca-Cola. The company’s mission is to
continue thriving as a business over the next ten years and beyond. The company is looking
ahead, understanding the trends and forces that will shape its business in the future and moving
swiftly to prepare for what's to come. That's what the company’s 2020 Vision is all about. It
creates a long-term destination for the business and provides it with a "Roadmap" for winning
together with its bottling partners.

Mission

“Our Roadmap starts with of our mission, which is enduring. It declares our purpose as a
company and serves as a standard against which we weigh our actions and decisions.

a. To refresh the world.

b. To inspire moments of optimism and happiness.
c. To create value and make difference.”

Coca-Cola has used the word “roadmap” which indicates that their mission statement is positive
and optimistic because they’re saying there’s a future to look forward to. Their mission is a
standard to which they create values and make differences in communities too poor to afford
even basic necessities. So Coca-Cola decides to fund these communities and in turn they create a
new place to generate profits (The Coca-Cola Company, 2014).

Vision

“Our vision serves as the framework for our Roadmap and guides every aspect of our business
by describing what we need to accomplish in order to continue achieving sustainable quality
growth.

a. People: Be a great place to work where people are inspired to be the best they can be.
b. Portfolio: Bring to the world a portfolio of quality beverage brands that anticipate and
satisfy people desires and needs.
c. Partners: Nurture a wining network of consumers and suppliers, together we create
mutual, enduring value.

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d. Planet: Be a responsible citizen that makes a difference by helping build and support
sustainable communities.
e. Profit: Maximize long term return to shareowners while being mindful of our overall
responsibilities.
f. Productivity: Be a highly effective, lean and fast moving organization.” (The Coca-Cola
Company, 2014).

Objectives

The main objectives for the Coca-Cola Company are to be globally known as a business that
conducts business responsibility and ethically and to accelerate sustainable growth to operate in
tomorrow's world. By having these objectives, it forms the foundation for companies in the
decision making process (The Coca-Cola Company, 2014).

By having objectives, the Coca-Cola Company can strive towards a goal and create new drinks.
With objectives, they can continue to plan for the next five to ten years. Coca-Cola can spend
more time in creating new ways to commercialize their product everywhere. Such as helping
local communities and supporting them financially so they can create more businesses and
maximize profit.

Strategies and Tactics

The Coca-Cola Company aims to be globally known, they do this by targeting different areas
across the globe with different products, gaining their brand name and popularity. All the
bottling partners work closely with their customers such as convenience stores, grocery stores,
movie theaters and street vendors to create and use localized strategies developed in partnership
with the Company. Their competition with other beverage companies are also narrowed down as
they own various brands that could be possible competition. For example, the company sells
Coke without the competition of other popular soft drink brands like Sprite and Fanta because
the company owns those brands as well. The company often reviews and evaluates their business
plans and performance to improve their earnings and analyze their competitive position in the
market. They make decisions in realigning their business models to match the objectives of the
company by using strategies and tactics in the analysis of their performance (The Coca-Cola
Company, 2014).

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4.0 Culture and values

Every business is made up of different cultures and the cultures that are present within the
business depend on the management style and the organizational structures that are used. The
different types of structures are:

 Role Culture- This is best suited to a hierarchy organizational structure. This type of
culture works best by every employee playing the role that he or she has been
predetermined and corresponds with the rules and regulations of the business
 Task Culture- This culture encourages people to work as a team; this works best in a
star structure.
 Power Culture- This works well in a matrix structure. It is based around one dominant
individual/leader.
 Person Culture- this culture focuses on providing administrative help and support and
close attention to one person in the organization (Wikipedia, 2014)

Role culture is the culture that Coca-Cola adopts. This is where all members have a defined job
or role to carry out. Role culture is normally split up into a number of functions that are
organized in a hierarchical way. Coca-Cola would divide themselves into various functions like
accounts, marketing and production. These also have hierarchical ordering of office examples of
these are production director, production managers, supervisors, technicians, operatives etc. This
type of culture works by logic and rationality. Role culture is mainly used in large organization.
In this culture position in the main source of power and rules and procedures are the main source
of influence.

Values

Coca-Cola’s values serve as a compass for its actions and describe how it behaves in the world.
These values include:

 “Leadership: The courage to shape a better future

 Collaboration: Leverage collective genius
 Integrity: Be real
 Accountability: If it is to be, it's up to me
 Passion: Committed in heart and mind

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 Diversity: As inclusive as our brands

 Quality: What we do, we do well” (The Coca-Cola Company, 2014).

Focus on the Market

 “Focus on needs of its consumers, customers and franchise partners

 Get out into the market and listen, observe and learn
 Possess a world view
 Focus on execution in the marketplace every day
 Be insatiably curious” (The Coca-Cola Company, 2014).

Work Smart

 “Act with urgency

 Remain responsive to change
 Have the courage to change course when needed
 Remain constructively discontent
 Work efficiently” (The Coca-Cola Company, 2014).

Act Like Owners

 “Be accountable for our actions and inactions

 Steward system assets and focus on building value
 Reward our people for taking risks and finding better ways to solve problems
 Learn from our outcomes -- what worked and what didn’t” (The Coca-Cola Company,
2014).

Be the Brand

“Inspire creativity, passion, optimism and fun.” (The Coca-Cola Company, 2014).

5.0 Organizational Design

Before the nineties the Coca-Cola company was having a centralize system of control, but after
sometime they realized that if they had to meet the demands of the customers they should adopt a
decentralized system in which the authority of decision making is distributed between different

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managers so that every sector can be managed effectively. This system was implemented in the
nineties by the company’s board of directors (Gilhuly, 2014). Now the organization is having
two groups who are responsible for operating:

 Bottling Investments
 Corporate

Operating groups are also divided by different regions i.e. Africa, Asia, Middle East, European
Union, Latin America, North America etc. All the divisions are further divided into
geographical regions. This allows the local market to involve in decision making, due to this the
organization responds quick to the changing demands of the market, this helps the upper level
managers to concentrate on the long term planning of the organization.

The company’s corporate division is filled with different departments which are as follow:

 Finance Department
 Human Resource Department
 Marketing Department
 Innovation Department
 Planning Department

Some of the above mentioned departments are in the lower levels in the regions of the company,
the decision making job is most of the times done by the top level management.

Sharing the latest information with each other is very fast by all the departments and by such
activities the organization appears to be doing their job effectively by balancing standardization
and mutual adjustment. The organization has made the Code of conduct which is a guidebook for
the employees on how they should act? The disciplinary actions are the main subjects of the code
of conduct (The Coca-Cola Company, 2014).

The larger role in the organization’s success is played by the mutual adjustments due to the
changes brought upon by the CEO and Chairman of the company 2004, Nevile Isdell. The
turnover has been reduced because the employees feel more engaged in the work. The
organization’s growth rates increased and the return of equity for stockholders went from a
negative return to a 20 percent return. The changes brought by Isdell proved to be good for the

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organization and the employees were also happy with the change which is reflected by the end
results of the company (Gilhuly, 2014).

Such balances are indispensible because due to them the employees feel some flexibility and it
also gives some time to the organization to forecast their future plans about the organization. The
structure of the Coca-Cola Company is made up of both “Mechanistic & Organic” models. The
Coca-Cola Beverage Company mainly focuses on the responsiveness (Gilhuly, 2014).

All the complex integrating mechanisms are the characteristics of the organic structure. The
company uses survey and interviews for the flow of information from bottom to up, latterly the
information is exchanged over the intranet. The surveys have made the Coca-Cola Company to
believe of simplification and standardization. Centralization and standardization are associated
with mechanistic structure (Gilhuly, 2014).

The mix of the two structures looks to be ideal for the organization. When organization wants to
appeal to a huge independent market, on one hand it requires to be flexible and on the other hand
to be more efficient in production. Coordination is easy for the company when it uses complex
integrating mechanisms. Due to centralization the organization goals and organizational choices
are kept align. Now that the information in the company is flowing very easily, the top level of
management will receive the information much faster due to the organization’s flexibility and
responsiveness.

Recently there was a shift in the organization to make it more decentralized and organic which
corresponded with quite uncertainty with organization.

6.0 Organization Structure

Coca-Cola is “Tall” in terms of organizational complexity. Coca-Cola is controlled through a
vertical hierarchy, with decision-making authority residing with the company’s upper
management. Daily and routine decisions are made by the line managers at the middle level
(Narayan, 2010).

Coca-Cola has more than 700,000 system employees, including their bottling partners. The
company’s operations reach over 200 countries worldwide, with six geographic operating

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segments. Coca-Cola’s head office is responsible for providing the company with an overall
direction and support to the regional structure. The company’s Executive Committee makes key
strategic decisions for the company. The Chair of the Executive Committee acts as a figurehead
for the company and chairs the board meetings. He is also the CEO and is the senior decision
maker (Narayan, 2010).

Each division of the company has a marketing manager, public affairs director, finance director,
etc. When one of these divisions is planning to do something, an advertising campaign for
example, the division has to communicate with their superiors to get approval. Since the
company’s hierarchy is so tall, communication has to travel back to corporate headquarters in the
U.S, where the Executive Committee has the final decision making power for activities the
divisions have proposed. Below is an organizational chart of the company (Gilhuly, 2014).

7.0 Organizational goals

Coca-Cola is both effective and efficient, as they have made it their objective to succeed in these
areas. Coca-Cola is more focused on efficiency than effectiveness, but they still achieve in both.
Regardless of what they specialize in, their organizational goal is to maximize profits for

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shareholders by selling Coca-Cola products worldwide to a wide range of customers. They are
able to do this by having a very vertically hierarchical organization that allows them to take
advantage of a low cost strategy, limiting expenses and increasing revenues.

8.0 Leadership Style

For effective leadership, there can be no substitute for strategic thinking and tireless, relentless
execution. There can be no alternative for attracting and retaining the absolute best people to lead
and creating a dynamic environment for them. And there can be no job more important than
communicating effectively with your customers and all your key stakeholders. Coca-Cola
achieves this by formulating a clear and compelling vision, getting their system aligned behind it,
executing and constantly communicating intentions.

Let's face it; vision without execution is merely daydreaming. And execution without vision is
like running in the dark - you're moving but probably not in the right direction. Coca-Cola
understands that capturing new opportunities is going to require both vision and execution across
the company and its wonderful system of bottling partners. That's where the company’s vision
which they call Vision 2020 comes into play. It's a look at where the company and its bottling
partners need to be heading in the future. The vision is centered on capturing unprecedented
opportunities emerging in future within the global non-alcoholic beverage industry (The Coca-
Cola Company, 2014).

The company’s vision is to harness new wealth, new beverage requirements and new innovations
to accelerate growth and create the world's most respected consumer goods system. Leaders at
Coca-Cola have created a clear and compelling vision for their organization, and work to inspire
their people to achieve that vision. Equally important is getting the bottling system leadership
and company employees aligned behind the vision.

Muhtar Kent is Chairman of the Board and Chief Executive Officer of The Coca-Cola Company.

Mr. Kent joined The Coca-Cola Company in Atlanta in 1978 and has held a variety of marketing
and operations roles throughout his career. In 1985, he was appointed General Manager of Coca-
Cola Turkey and Central Asia. From 1989 to 1995, he served as President of the Company's East
Central Europe Division and Senior Vice President of Coca-Cola International, with

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responsibility for 23 countries. Between 1995 and 1998, Mr. Kent served as Managing Director
of Coca-Cola Amatil-Europe, covering bottling operations in 12 countries (The Coca-Cola
Company, 2014).

In an interview with Management Paradise.com, the CEO states, “my job is to create a climate of
success for our people and inspire them to achieve the vision we have created for our business.
That's really the true essence of leadership”. At the end of the day, it all comes down to
execution. For The Coca-Cola Company, execution involves focusing on three core capabilities
of:

 Consumer marketing - which generates that bond and emotional connection with
consumers.
 Commercial leadership - which involves all the strategic actions taken with over 20
million retail customers who sell Coca-Cola brands around the world each day.
 And franchise leadership - which is working with its 300 bottling partners around the
world to create greater system alignment (Shetty, 2011).

8.1 Core Capabilities

Consumer Marketing

Marketing investments are designed to enhance consumer awareness of and increase consumer
preference for Coca-Cola brands. This produces long-term growth in unit case volume, per capita
consumption and the company’s share of worldwide nonalcoholic beverage sales. Through
relationships with bottling partners and those who sell Coca-Cola products in the marketplace,
the company creates and implements integrated marketing programs, both globally and locally,
that are designed to heighten consumer awareness of and product appeal for brands.

Commercial Leadership

The Coca-Cola system has millions of customers around the world who sell or serve their
products directly to consumers. The company focuses on enhancing value for these customers
and providing solutions to grow their beverage businesses. Coca-Cola’s approach includes
understanding each customer's business and needs, whether that customer is a sophisticated

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retailer in a developed market or a kiosk owner in an emerging market. We focus on ensuring

that our customers have the right product and package offerings and the right promotional tools
to deliver enhanced value to themselves and the Company.

Franchise Leadership

The Coca-Cola Company must continue to improve its franchise leadership capabilities to give
the company and its bottling partners the ability to grow together through shared values, aligned
incentives and a sense of urgency and flexibility that supports consumers' always changing needs
and tastes. The financial health and success of bottling partners are critical components of the
Company's success. The company works with the bottling partners to identify system
requirements that enable them to quickly achieve scale and efficiencies, and the company shares
best practices throughout the bottling system. Coca-Cola’s system leadership allows it to
leverage acquisitions to expand its volume base and enhance margins (USSEC, 2009).

Under the leadership of Muhtar Kent, its dynamic Chairman and CEO, Coke has made a strong
commitment to inclusiveness. Since Muhtar Kent took the helm of Coca-Cola, in July 2008, he
has set a course for ambitious, long-term growth with the goal of doubling revenue by 2020.
Kent has tried to rejuvenate an inward-looking, “arrogant” corporate culture and has reinvested
cost-cutting dividends in brand development.

9.0 Management Styles

A management style is an overall method of leadership used by the manager. The success that
the management team at Coca-Cola has in motivating its employees to meet their objectives is
based on the management style they adopt. There are three main management styles democratic,
autocratic and the laissez-faire style.

The Coca-Cola Company uses the following management styles, but each one in different
departments. There are three main types of management styles used in businesses:

9.1 Democratic

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The democratic leadership style consists of the leader, sharing the decision making abilities with
the group members by promoting the interests of the group members and by practicing social
equality.

This emphasizes on group agreements to generate new ideas. There are two types of democratic
management styles; democratic and consultative democratic. Democratic is where all the
managers, junior managers and employees are involved in the ideas and final decision process.
Out of all the workers, no-one has a higher level than the others in this management style.

Democratic style is the management style that Coca-Cola adopts. This sort of management style
involves empowerment. In this management style individuals and teams are given
responsibilities and decisions to make, usually within a given framework. If anything wrong
happens then the individuals and teams are then held responsible for the decisions that are
chosen. With this type of management style it allows the manager to feel comfortable with other
people in the organization making some of the decisions. Democratic managers will often want
feedback from their employees on decisions being made. Democratic leaders listen and act on
the opinions of the group. This type of management is good as it makes the employees happy and
productivity is high. This is a very good method because employee's thoughts and suggestions
are listened to by the business. This makes the employees seem as if they are respected and that
their thoughts are valid.
Feedbacks from managers at Coca-Cola’s bottling system across the globe provide vital
information that is incorporated in their strategies.

9.2 Autocratic

The authoritarian leadership style or autocratic leader keeps strict, close control over the
followers by keeping close regulation of the policies and procedures given to the followers. To
keep main emphasis on the distinction of the authoritarian leader and their followers, these types
of the leaders make sure to only create a distinct professional relationship.

Where the leader makes all the decisions, there is no negotiation and is very prescriptive and
there is little job satisfaction. However, the job gets done quickly and there is less conflict
between different ideas. This style is hardly used among the company as they believe that the

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lack of input could lead to poor results. Autocratic does save a lot of time as quick decisions can
be made and there is no time wasted on discussion resulting in the business saving time and
money.

On the factory floor at Coca-Cola, there is an autocratic system of management where the
employees are controlled by the managers and follow their procedures.

9.3 Laissez-faire management style

The Coca-Cola Company has a culture that is run in the laissez-faire style meaning the ‘hands
off’ approach. The laissez faire style is sometimes described as the "hands off" leadership style
because the leader delegates tasks to their followers, while providing little or no direction to the
followers.
If the workers are meeting their Key Business Indicators, then the managers and the directors of
the company take this relaxed style of coordinating their business. They have a vision to ‘refresh
everyone everyday ’and the values ‘to take pride in their work , to be honest , fair and
determined to win and have a passion for their actions’.

9.4 Consultative democratic

This is where the managers allow the employees to make the ideas but the ideas are forwarded to
the executive's or the manager consults their team to make the final decision. Coca-Cola applies
consultative management style to the company more as there can be less conflict for what the
final decision is. The advantage of this is that it helps to motivate staff as they are aware that they
have a say in the company to some extent. The disadvantages of this that the process is very time
consuming and effort will be needed by a manager to do this.

Management encourages employees to set goals in line within the organization aims. There are
reviewed regularly in performance appraisals. The advantages of this style are that it will
increase efficiency of individuals and help to motivate them and train them so they are
productive.

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The world's premier marketer and beverage industry leader for more than 118 years, Coca-Cola
are focused on the strategic workplace programs that help assure the success of their
commitment to embracing the similarities and differences of the people, cultures and ideas. The
strategies Coca-Cola uses to achieve these objectives include the use of certain mechanisms that
facilitate such communication to take place. These mechanisms include the use of:

Diversity Advisory Council

The Company’s corporate Diversity Advisory Council consists of the representative group of
employees from all the levels, functions and business units of the organization. The Council
develops recommendations for all the senior management on advancing the company's efforts,
towards achieving its diversity objectives.

Employee Forums

Coca-Cola believes that the sense of community enhances their ability to attract, retain and
develop diverse talent and ideas as the source of competitive business advantage. Through
employee forums, the employees can connect with their colleagues who share similar interests
and backgrounds.
In these forums and elsewhere, the employees support each other's personal and the professional
growth and enhance their individual and collective ability to contribute to the company. The
success at Coca-Cola is due to their laissez-faire culture and the culture is important because it
can affect the people and the things to do with the business.

The company’s culture is generally inviting and managers get along well with the staff. Staff
members have less stress to deal with and a friendly environment to work in, thus work is done
more efficiently.

9.5 Team Work

Team work is a sub culture within the Coca-Cola Company. Teams are accountable for activities
like:

 Quality
 Utilization and

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 Yield

Within the system, there needs to be a balance of Utilization, speed the factory works at, and the
Yield. Working together in teams provides the cooperation necessary to achieve this smoothly.

9.6 Employee Engagement

Another part of the culture and the management style at the Coca-Cola Company is its employee
engagement. Employee engagement consists of the following five points:

 Realizations that delivery of the hard stuff is simply not enough.

 Openly acknowledging this to the workforce.
 Doing what it takes to engage every employee in the space of 16 days.
 Involving everyone in the design of the management style consistent with vision and the
values.
 Identifying talented individuals across the operation to act as the internal facilitators to
train out the new behavioral standards (The Coca-Cola Company, 2014).

10.0 Management Functions of Coca-Cola Company

There are four major functions of management of the Coca-Cola Company which are as follow:

1. Planning
2. Organizing
3. Leading
4. Controlling

10.1 Planning

The Coca-Cola Company consists of just a three layers of flat hierarchy. Due to this the top level
management has the duty of setting the goals and objectives of the company. Planning is also
done by the upper level managers.

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10.1.1 Strategic Goals

In most of the companies the strategic goals are made for long term but Coca-Cola Company’s
goals are set for only three years, they change their strategies after every three years. The goals
are set by the Managing Directors of the company after getting the clearance from the
headquarters. Every year in the annual meeting they have a review of their strategy to make sure
they are moving with the changing environment in the market.

The following are the strategic goals of Coca-Cola Company:

 To continue to be an organization providing the quality products to the valuable

customers.
 To select and retain the professional people for the organization.
 To project an outstanding corporate image.
 To satisfy the customer through extra ordinary service and an excellent service
 A along with the complete tactical and operational support.” (The Coca-Cola
Company, 2014).

10.1.2 Tactic Goals

Tactic goals are set at the end of the year at annual basis. The top level management decides
these goals with the consultation of the lower level employees. The following are the tactic goals
of the company:

 To increase the revenues by 20% as compared to last year.

 To increase the total retail customers by around 10%
 To increase the market share by 5%
 To reactivate the discontinued customers by 30%” (The Coca-Cola Company,
2014).

10.1.3 Operational Goals

The operational goals are also set by the Managing Director of the company. Before
implementing these goals the manager consult them with lower level employees and after

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convincing them they implement the goals officially. In this type of goals the company uses
Management by objectives (MBO). Every employee assigned is told about what the organization
is expecting from him/her and then his evaluation is done on the basis of organization’s rules and
regulations (The Coca-Cola Company, 2014).

10.1.4 Decision Making

Decision making process is centralized in the company. The classical model is used, the top level
managers take their time in making the decisions and all the possible alternatives are kept in
mind before going for the rationally economic solution.

The top level managers don’t consult with any employee in case of programmed decision
making. The ordinary routine decisions are made by the line managers of the middle level
management after getting the permission from the general manager.

The following are the decisions which are taken by the top level of management in the Coca-
Cola Company:

 The package positioning

 Trade discounts
 Advertisements
 Price reductions
 Distribution.”

In recruitment of new employees the top level management approves the vacancies and the
Human Capital Department is asked to conduct a written test such kind of tests are conducted for
the employees of lower level. The prospective applicants are shot listed through the interview
process. After taking the interview of the applicant the operation manager and the general
manager make the final decision of selection of the employee (The Coca-Cola Company, 2014).

10.2 Organizing

Organizing is the second management function. The following steps are taken by the Coca-Cola
Company in organizing their goals and objectives:

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 Departmentalization
 Work Specialization
 Delegation and Accountability
 Resource Allocation
 Organizing the Human Resources

All the steps are discussed below in detail:

10.2.1 Departmentalization
On the basis of functional approach the Coca-Cola Company is divided into different
departments. Grouping of employees is done on the basis of their common skills and work
activities. Such kind of approach helps the company in solving their problems and it also make
the less the need of training the employees specially. The general manger is head of all the
departments all the department have to report to the general manager in the Coca-Cola Company.
There are five major departments in the company which are as follow:

 Production Department
 Industrial Relations Department
 Sales and Marketing Department
 Human Capital Department
 Finance Department

Production Department: This department looks around all the production of the company. All
plants in the country are in under its control.

Industrial Relation Department: This department deals with the problems of the employees.
The department listen the problems of the employees and send them to the high authorities for
settling them up and stop them from becoming a hurdle in the work progress of the company.

Sales and Marketing department: This department makes sure that the product is easily
available in the market for the customers to buy and deals with the issues of advertisement,
promotion, and distribution of the product.

Human Capital Department: This department takes care of the efficient workers of the
company, they select some efficient workers of in the company recommend their names for

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promotion in job so that the workers remain happy and don’t leave the company. Management
level employees are dealt by the department.

Finance Department: The department is concerned with cost and price of the products
produced by the company. It also tackles with import related issues of the company. Finance
department is assisted by the sales and marketing department in making invoices and payroll
entries (The Coca-Cola Company, 2014).

10.2.2 Work Specialization

There is a high percentage of work specialization in the Coca-Cola Company because every
manager is appointed in the function in which he is expert so there is no boredom or monotony.
All the promotions of the employees are based on their performances. No favoritism is allowed
in the company (The Coca-Cola Company, 2014).

10.2.3 Delegation and Accountability

There is a high percentage of delegation in the company. The work is done with proper authority
and responsibility. Every manager is made accountable for the actions of his subordinates. All
the subordinates are guided very keenly by their respective managers at the time of
accomplishing some goal. Keeping the delegation process on the other side the managers also
motivate their subordinates to boost up their energy and make them more effective by using
different methods. They make their subordinated think that they have to give their best to their
managers which increases their performance, quality of work and satisfaction of the customers
(The Coca-Cola Company, 2014).

10.2.4 Resource Allocation

When the issue of resource allocation comes into action the Coca-Cola Company has given the
authority to managers to use the resources of the company where ever and whenever they are
needed. Only they are required to get the approval from the manager if those assets belong to his
department. The resources can be capital, labor, machinery or anything else (The Coca-Cola
Company, 2014).

10.2.5 Organizing the Human Resources

The company does the recruitment process when there is a position empty and the recruitment is
always done on permanent basis in Coca-Cola Company.

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Recruitment is done when the manger needs the employee under him and he send the request to
the general manager and after the approval of the general manager the request is sent to the
Human Resource Department.

In Coca-Cola firstly all the vacancies are announced within the organization so that if there is
someone who can fulfill the requirements can get him/herself promoted or can refer someone of
his relative to join if he is capable of that job. If there are no suitable persons than the company
searches its bank where there are huge amount of application of the applicants. If there also they
find no person suitable for the job then at last they give the advertisement in the newspaper etc.
(The Coca-Cola Company, 2014).

10.3 Leading

The third management function is “leading”. The following major steps are taken by the Coca-
Cola Company in the leading function:

 Motivation
 Communication
 Corporate Culture

10.3.1 Motivation
Coca-Cola Company gives high attention to the motivation of the employees. Promotions of
hardworking employees are a part of the company’s policy. Promotions of employees are done
on the performance basis which is a great motivation for the employee that higher his
performance there is more chance of his promotion.

Beside from promotion strategy the Coca-Cola Company also uses the compensation strategy to
motivate the employee; Coca-Cola is paying industrial average in compensation. Not only this
different campaigns and competitions between the employees itself are also used to motivate the
employees.

Managers play a very important role in the motivation of the employees in Coca-Cola Company.
They help them in all their problems either they are personnel or professional. They give them
feedback on their performance which makes the employee feel good. Working environment and

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a challenging milestone are a major factor in employee motivation in the company (The Coca-
Cola Company, 2014).

10.3.2 Communication
There is an open environment in the Coca-Cola Company which allows the employees to
communicate with each other and it allows the information to flow inside the company and
discourages the barriers between members to share information. Before making the decisions the
top level managers discuss it with the middle level managers and before decision making it is
shared till the end of the hierarchy. The Coca-Cola Company allows the employees that anyone
of them can meet the general manager if he/she is facing any kind of difficulty.

Interdepartmental communication is done in the form of formal and informal manners. To get the
feedback of the employees and get the view of the employee about the manager the grapevine is
used (The Coca-Cola Company, 2014).

10.3.3 Corporate Culture

The top management of the Coca-Cola tries to follow the prescribed culture of the organization.
Coca-Cola has formal and documented values that are communicated to all the employees. The
top level manager acts as role models to make sure that the rules and regulations are been applied
in the company and closely administrator review their employee’s behavior.

10.4 Controlling

The last and the most crucial function of management are “Controlling”. In this function the
company evaluates that either they have achieved the goals which they had set before. If the
answer is “yes” then the employees and managers are rewarded with bonuses and other ways and
vice versa. In the following we’ll come to know that how the Coca-Cola Company performs its
controlling function?

10.4.1 Sales Person’s Reporting System

Sales person had to report to the market developer area every day about his activities. He give
him record of the per day sales and he can get any kind of assistance by the area market
developer anytime on any matter.

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Attendance of the sales person is taken with the punch card system, with the help of which the
entry and exit time of the sales person is recorded.

Every sales person is given a route card in which there are details of the visit of the outlets, how
much time he spent on the outlets, number of sales made on the outlets, the time taken during
travelling from one outlet to the other, name of the loader and sales person and the entry and exit
time of the vehicle.

Apart from this the sales person is also given a forum to fill up for the orders of the next day to
be loaded in the truck. This makes the managers know that how much sales of which brand and
the size of the product are been done by the sales person. The information is useful for the
human resource department because they have to evaluate the total performance and calculate
the total salary of the sales person (The Coca-Cola Company, 2014).

10.4.2 Sales Person Evaluating System

Evaluation of all the sales person is done on quarterly basis. Evaluation helps in the promotion of
the people to higher levels in the organization. The evaluation is a great motivator for the sales
person because due to this he works hard to get promotion or at least the monetary reward.
Monetary rewards are not only given to the best sales person, they are also given to the best
market developer and the best sales manager of the year.

Performance development plan is kept as base to evaluate the performance of the employee. The
measurement of performance is done on the basis of achievement of targets which were set and
communicated at the start of the year in front of each sales manager, each quarter to market
developer and monthly to ever salesperson.

This performance develop plan evaluates the sales made by the salespersons on the basis of call
slips, route calls, call completion, effective and productive call, attendance of the salespersons,
growth in sales done by the sales man, market development and the punctuality of the sales
person (The Coca-Cola Company, 2014).

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Reference
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The Coca-Cola Company: (April, 2009). Code of Conduct: Acting with Integrity Around the
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Wikipedia. (2014). Organizational culture. Retrieved on 17 July, 2014 from

http://en.wikipedia.org/wiki/Organizational_culture

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