The success and excellence of any organization entirely rely on the competence of its top executives. It, therefore, follows that good leadership in an organization is inevitable. The leaders who are the senior managers are tasked with the responsibility to make most of the decisions through policy formulation and oversee the implementation of the policies within the organization. They control and direct the daily operations of the organization alongside defining the leadership structure of the organization. Organizations in the contemporary world face many challenges due to changes brought about by technological advancement, stiff competition, rapid changes in the markets and change in customer taste among other problems. For organizations to adequately address this challenges that they face in the contemporary world, they will need a modern leadership style that will complement its initial leadership strategies. It might entail the redefinition of their leadership style to a structure that will address the current problems that they face. The following paper seeks to investigate a significant challenge that the coca cola company faced in the recent years due to change in customer taste and preference, how its leadership dealt with the problem and suggestions on how to handle such issues in the future. The proposals and recommendations will heavily borrow from the leadership theories learned during the entire degree program and those learned through private research on the internet and relevant books and journals on leadership.
The Coca-Cola company is arguably the number one beverage company in the world. The multinational beverage company has its headquarter in Atlanta, Georgia which is also the founder's home. The primary stakeholders in the company encapsulate owners, different governments that it submits tax to, thousands of employees, suppliers, the communities within which the bottling factories are situated and the millions of customers around the world. The company is listed on the New York Stock Exchange hence it is owned by thousands of people. For so many years, the company has dominated the market for non-alcoholic drinks warding off fierce rivals such as Pepsi, Red Bull among other small companies. However, Pepsi remains the most active competitor of the Coca-Cola, the two companies together claim the most significant share of the soft drinks market around the world. Excellent leadership skills of the top management of the organization have enabled it to be successful in the market and gain loyalty amongst its customers. The organization is considered one of the top brands in the world, thanks to its excellent leadership and marketing strategies. At the core of the organization's code of ethics is integrity and honesty, all employees are expected to read and understand the company's code of ethics. The mission and vision statement of the Coca-Cola company is available to the public and is as stated below.
- To refresh the world in mind, body, and spirit
- To inspire moments of optimism and happiness through our brands and actions
- To create value and make a difference. (Staff, 2018)
People: Inspiring each other to be the best we can be by providing a great place to work
Portfolio: Offering the world a collection of drinks brands that anticipate and satisfy people's desires and needs
Partners: Nurturing a winning network of partners and building mutual loyalty
Planet: Being a responsible global citizen that makes a difference by helping to build and support sustainable communities
Profit: Maximizing long-term return to shareholders, while being mindful of our overall responsibilities
Productivity: Being a highly effective, lean and fast-moving organization. (Staff, 2018)
Despite having a strong brand, excellent marketing strategy, and able leadership, the company has faced a decline in consumption of its products in the recent past. Statistics show that more people, especially in Northern America, have reduced the intake of coca cola drinks. The consumption of the company's beverages has always been on the increase since 1989 up to 1998. From 1999 onwards, the use of the organization's soft drinks has been declining significantly. The graph below displays the consumption trend of soft drinks in the united states from 1987 to 2015.
From 1987 to 2015, the world population has been steadily increasing with the number of births exceeding the number of deaths every year. The rule of thumb will dictate that the consumption of any commodity should also be on the rise due to increase in demand created by the rise in the number of potential customers. However, the trend exhibited on the graph above is a massive decline in the consumption of soft drinks every subsequent year as from 1998. The pattern is one that frustrates the organization's leadership since if the trend continues, then the company's future is at stake. The consumption of Coca-Cola soda dropped by one percent from 2015 to 2016. The reason for the decline of the use of the beverages has not been due to the organization's fault but as a result of health concerns.
In the last ten years, the leadership of the organization has listed obesity as one of the biggest threat to the profitability of the organization. The organization has poured millions of dollars in lobbying, marketing strategy, and research. The dominant approach taken by the organization to deal with the problem is countering of the defamatory reports with other reports. The organization's leadership knows the impact that health professionals and researchers have on the general public concerning health. Most of the stories published on websites and journals advising people against the consumption of sugary drinks exceptionally soda were researched and compiled by health professionals; this made it very easy for people to believe them and stop the intake of such beverages. The Coca-Cola organization knew that the only way to counter this belief is by appealing to the same authority. The company decided to sponsor research on the matter which was then compiled and published by medical professionals on clinic websites. However, the trend of the reports was clear and dissociated the intake of sugary drinks from being the cause of obesity and other lifestyle diseases such as diabetes. Most of the stories that were sponsored by the company associated obesity with lifestyle problems such as lack of practice and the smoking of tobacco. The probability of such reports to dissociate obesity with sugary drinks was always above 80 percent. In 2015, Mayon Clinic published a story in which they argued in defense of the soft drinks. Global Energy Balance Network is also among the organizations that seemed to follow the same suit. The report advised individuals that they did not have to worry about the kind of drink they take, what matters according to the story is the activity that people engage in. Individuals were advised to be more active for it is the best way to deal with the problem of obesity. Such trends seemed misleading that professional nutrition journals demanded to know the sponsors of such reports before giving the green light to their publication.
In my opinion, the organization did not respond to the problem appropriately, and I believe they should have done better. Coca-Cola company is one of the biggest company in the world regarding resources and brand. It is also expected that they have the best and most talented employees due to their ability to offer excellent salary and remuneration. It, therefore, implies that they should have highly skilled and competent leaders. It is so unfortunate that the company leadership is now dedicated to solving a problem that it should have fixed more than 20 years ago. From the graph above it is clear that the problem started roughly around 1999, good leaders are forward-looking, it is therefore expected that the organization's leaders should have foreseen the problem before it happened. Good leaders should be able to predict the unthinkable and anticipate a problem even when in the eyes of ordinary employees, the organization is facing no impending danger.
After critical analysis and evaluation of how the leadership of the organization dealt with the problem, then relating with the knowledge gained in my four-year course and intensive research on the internet, I would suggest that the organization should have dealt with the problem in the following manner. The suggestion is not a replacement but meant to compliment the already laid strategic plans. The first step should be a reevaluation of the methods that the organization was previously using. The ways that did not work should be abandoned entirely. Some of the things that the company ought not to have done are the financing of health professionals and researchers to counter the allegations made against the company. The countering of the information seems like a desperate move that sounds like the last kicks of a dying horse, and it does not help the situation. In fact, when it is revealed to the public that research reports that dissociated obesity with sugary and sweetened drinks were funded by the company, it will vindicate the initial allegations. As stated earlier, the ethics code of the organization can be summarized by integrity and honesty; the revelation that the company is not honest and genuine in their deals will further dent their profitability and worsened the situation. It is therefore expected that the leaders should have first carried out their investigation into the issue instead of blindly responding to it. Private research should be carried out to find out the risk of taking such drinks if the report shows that the allegations were malicious and aimed at spoiling the reputation of the company's brand, then the organization through its legal department should file a lawsuit against those propagating such allegations. The move will help keep such claims and defamatory reports at bay in future. If their research vindicates the initial claims, the organization should stick to their ethical code that entails honesty and integrity. Acceptance of their mistakes will show empathy in their leadership, and it will show that they adhere to their ethics codes hence win loyalty among customers.
Future leaders can learn from the mistakes committed by the leadership of the Coca-Cola organization in dealing with the challenge. They can incorporate the lessons learned in their strategic management plan. They should realize that they are living in a highly dynamic and unpredictable environment where the probability of the unthinkable happening is very high. They should never allow being drunk by the success of the organization but instead, come up with creative measures that will enable them to deal with any impending danger.
For the leaders to be more effective in future, there are some quality leadership skills that they ought to have. Awareness is one of the qualities that great leaders should have. The leaders should take advantage of the authority they have and the resources availed to carry on proper research and understand the problem before trying to solve it. Creativity and innovativeness is another essential quality that great leaders should have to respond to the question appropriately. They should realize they exist in an era in which they have to embrace technology and other modern forms of solving challenges that their organizations face. Networking and connectivity are also inevitable since the whole is greater than the sum of its parts. However brilliant and smart the leaders are, at some point they will have to sacrifice their ego and be good team players. Being a team player will help them take advantage of collective intelligence which will help them make the right decision decisions that...
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