External Environment, Strategy, Mission, and Objectives

Freshman (College 1st year) ・Business ・Harvard ・7 Sources

To generate profit for its owners, a business entity must have a clear set of missions, strategies and goals to be met (Kaplan, 2015). The company is ideal for analyzing the outside environment and the factors that present the company with opportunities and threats. The report concludes with a conclusion which shows the key results.

Coca-Cola Company's context and background

A company needs a clear mission statement that both inspires its staff and informs customers of the company. Coca-cola acknowledges that the world is changing and that it should look ahead for it to follow the trends and strengths that will shape its future in the beverage sector. While setting it vision 2020, the company took a note that it must work together with other stakeholders for them to win together.


Vision is the dream of the company; it communicates what the company believes to be an ideal condition for the enterprise (Chun and Davies, 2001). A company prepares a mission statement after the vision in the action planning process (Lewis, 2005). The work of Darbi (2012) indicates that the mission statement of an organization describes what the group is going to do and the reason for doing it. Coca-cola has set its missions that declare its purpose as a community (Karnani, 2014). It aspires to refresh the world, inspire moments of optimism and happiness as well as create value and make a difference. Its mission is concise, outcome oriented and inclusive


The plans explain how the initiative of a company is to be reached (Hawthorne, 2015). Procedures provide information and enhance the skills of the employees, and it also improves service delivery and support to the customers. The Coca-Cola Corporation is founded on four strategic pillars namely workplace, partners, communities and marketplace (Coca-cola company, 2017) The company has developed a wide variety of strategies that includes people from different backgrounds that includes the customers, staff, and suppliers. These people come from various sectors of the community and should be accommodated by the company.


The goals indicate how the mission will be achieved. It shows how much of what will be accomplished by when. Coca-cola Company intends to invest more of its marketing dollar to build awareness of its low and no-sugar drinks (Staude, 2015). The company aims at reducing sugar in more than five hundred of the drinks it offers to the customers around the globe. Coca-cola has indicated that it has already achieved a 30% low or no sugar beverages category that cover more than thirty-nine thousand drinks (Coke Stories, 2017).
Coca-cola Company is a multinational business entity with its presence in almost all countries in the world. For it to remain in the market and meet the needs of its huge clients base, the company has stipulated clear and precise mission, visions and strategies. The strategic plan of the business ensures that the employees, customers, and suppliers are catered for and that they feel like part of the enterprise. Coca-cola is founded on the values of offering high-quality products and diversification of its operations and products. It has implemented its strategies aimed at improving the quality and tastes of the beverages. In 2009, the company became the first beverage corporation to commit to front-of-package calorie labeling globally.

External Analysis

Their environment greatly influences business entities, and they face changes every day. The external environment is composed of all outside factors that impact the operations of business. An entity should act or react to keep up its flows of services. Five factors affect the microenvironment of a company; they include suppliers, financiers, public perception, marketing intermediaries and customers. The macro-environment is composed of factors such as economic, socio-cultural, political, legal, technical and environmental considerations (Morschett, Schramm-Klein, and Zentes, 2015). The coca-cola company follows strict regulations when serving its clients with the beverages and uses the best technology available.

PEST Analysis

It covers Political, Economic, Social and Technological factors (Chhabra and Kiran, 2015).
Political Analysis; The government regulates the manufacturing procedures of the products of coca-cola company. The Food and Drugs Administration (FDA) regulates the non-alcoholic beverages, and failure to meet the regulations invites sanctions in the form of the excellent. The company is also subjected to the Occupational Safety and Health Act, and the international laws apply to the enterprise. The Foreign government set their rules and regulations that have an effect on the sale of the coca-cola products. Changes in legislation and regulation in accounting standards and taxations affect the operations of the company. Other political factors that influence the functioning of the company includes shifts in a non-alcoholic business era that is characterized by competitive products and pricing policies (Hastings and Domegan, 2013). The political condition in international market also plays a role in determining the products sold. Countries may be experiencing civil conflict or government changes that restrict relocation of capital across borders and this effect operations of the company. Coca-Cola relies on economic and political conditions such as stability of the state for it to penetrate a new market.
Economic: The loan's interest rates affect the company returns because it reduces the profit. In 2001, a recession forced the government of the United States to take aggressive actions to turn around the economy in the following year. Coca-cola decided to take a low-cost loan in 2001 to fund its growth in 2002.
Social: Coca-cola is affected by the increase in preference of healthy lifestyles of the people in the United States. There is a concern by the customers about nutrition, and the customers are becoming choosy (Medina Munro and Belanger, 2017). This trend is affecting the non-alcoholic beverages sector by increasing the demand for healthier drinks. In the international markets, the company distributes the majority of its products in civilized countries. In Japan, the company has created thirty alternative flavors to appeal to its clients.
Technological: The advancement of technology has been experienced across all sectors in the world. Coca-cola Company has employed technology in advertising its products. The corporation to market and promote the products of the company uses website. The company is utilizing the packaging if the products in plastic bottles and cans which has increased the sales because they are portable (Gupta, 2013). Coca-cola is continuously advancing its equipment and is introducing new ones designed to increase production volumes. Coca-Cola Enterprise has set ultra modern factories in Britain to ensure speedy delivery of products.


Coca-cola Company has a large advertising and marketing budgets that enable it to market its products globally (Hassan, Amos and Abubakar, 2014). The firm is the largest beverage producer in the world, and its brand is well known. Its global presence is beneficial has it has helped it during the introduction of new products in the market. The company brand has increased customer loyalty over the years. Through marketing and advertisement, the company informs its customers about features of the products such as Coke, Fanta, and Sprite among others. Advertising is increasing sales since the customers are informed about the brand features.
The Coca-Cola Company boasts of diversified and extensive product portfolio. Coca-Cola Company has its presence in more than two hundred states where it offers over five hundred brands beverage consumers. Coca-cola sells diet and regular drinks, juices, tea, coffee and energy drinks and sodas such as Fanta, coke, and sprite among others.


Coca-cola Company is facing a threat from direct and indirect competitors. The coffee product of Coca-Cola is facing competition from Starbucks and Costa Coffee. The companies are doing favorably while since they do not offer carbonated drinks. The demand for healthier and less sugary product is a causing the company to lose share of its market to rivals such as Real, Tropicana and Red Bull. Soda products are facing stiff competition from Pepsi. The company is confronted with a challenge of sourcing raw material, water. Coca-Cola has been blamed for using a large amount of water whose scarcity is on the rise. Climate change is causing the decrease in water levels; the water sourcing is a headache to the company. Due to water rationing experiences the company is facing revenues downfall.


Coca-cola Company operates in over two hundred states where external environments are diverse. It aims at meeting its visions and objectives by laying down strategies to be followed. A political environment where the company has set base directly affects its operation. The functioning of the enterprise is also influenced by economic, social and technology that determine the advertisement and marketing of its brands. The strength of the company is its budget allocation to advertising and marketing its products. The threat facing the company is a shortage of water that is its raw material and stiff competition from rivals.


Due to the various challenges and risk, the Coca-Cola Company has faced it demands elaborate action plan to deal with them. Water issues are expected to persist for long due to climatic changes and global warming. The steps that must be taken by the company to address the issue of water, which is the heart of its business. The competition for water remains high since it is demanded by industries and for domestic use. It is also upon request by the farmers to grow agricultural products. The company should protect water sources at the community level and its factories. Being responsible to the community where it has the factories is essential to ensure harmony between the company and the society. Coca-cola company should engage in educating the people on the complexities of water used for irrigation, energy production, and industrial use.
Freshwater stress and challenges continue to grow due to increase in populations and industrial growth. Coca-cola should focus its water stewardship effort on regions that it can have the greatest impact. This is to be achieved by efficient use of water, managing wastewater by recycling as well as storing water. The company should collaborate with the governments of the countries where it has plants and the communities in that region to assess, understand and determine the long-term solutions (Foster, 2014). The implementation of the plan should take place across its sectors of production and ensure that it replenish the water it takes from the community and nature. Reaching the affected community by offering them with water reduces conflict and criticism that may exist about the exploitation of natural resources at the expense of the citizens. There is need to protect the ecosystem and communities that have a right to clean water. Coca-Cola should engage in proper sanitation process and disposal of its waste to ensure that the water is not contaminated.
Collaborating with partners who are concerned about the welfare of the people and need for conserving the environment for clean water by the company is a step toward solving water problems. Holding meetings and another informal session with the member of the society sheds light to the company on what it should do to improve water management. Harvesting and storing rainwater is an effective way of collecting water for domestic and industrial use. Coca-Cola company should collect, treat and use rain water. In its collaborating meetings with others stakeholders, the company should formulate a policy aimed at ensuring that there is minimum wastage of water at domestic, industrial and agricultural levels of production. The public-private initiative can be employed to assist the manufacturers and community on water sustainability program. Coca-Cola should establish a control officers charged with overseeing practical application and implementation of the plan. The officers should execute the strategy and report its progress to the management.


Chhabra, S. and Kiran, R., 2015. An Empirical Analysis of Total Factor Productivity in Food and Beverage Sector. Productivity, 56(2), p.121.
Chun, R. and Davies, G., 2001. E-reputation: The role of mission and vision statements in positioning strategy. The Journal of Brand Management, 8(4), pp.315-333.
Coca-cola, Company. (2017). Strategic Pillars. [online] The Coca-Cola Company. Available at: http://www.coca-colacompany.com/our-company/diversity/strategic-pillars [Accessed 4 Apr. 2017].
Darbi, W.P.K., 2012. Of mission and vision statements and their potential impact on employee behaviour and attitudes: The case of a public but profit-oriented tertiary institution. International Journal of Business and Social Science, 3(14).
Foster, R.J., 2014. Corporations as Partners:“Connected Capitalism” and The Coca‐Cola Company. PoLAR: Political and Legal Anthropology Review, 37(2), pp.246-258.
Gupta, A., 2013. Environmental and pest analysis: An approach to external business environment. Merit Research Journal of Art, Social Science and Humanities, 1(2), pp.013-017.
Hassan, D.N., Amos, A.A. and Abubakar, O.A., 2014. An evaluation of marketing strategies undertaken by Coca Cola Company as a multinational corporation in Nigeria. Journal of Business and Management, 3(2), pp.5-10.
Hastings, G. and Domegan, C., 2013. Social marketing: From tunes to symphonies. Routledge.
Hawthorne, M., 2015. The purpose of mission and vision statements in strategic planning. Chron. Demand Media. Web, 5.
Kaplan, J., 2015. Coca-Cola hits water target five years early.
Karnani, A., 2014. Corporate social responsibility does not avert the tragedy of the commons. Case study: Coca-Cola India. Economics, Management, and Financial Markets, 9(3), pp.11-23.
Lewis, C., 2005. Mission and vision statements. The Times, p.5.
Medina Munro, M. and Belanger, C., 2017. Analyzing external environment factors affecting social enterprise development. Social Enterprise Journal,13(1).
Morschett, D., Schramm-Klein, H. and Zentes, J., 2015. Strategic international management. Springer.
Staude, G.E., 2015. Coca-Cola Sabco-A Case Study in Distribution to the “Main Market” in South Africa. In Proceedings of the 1996 Multicultural Marketing Conference (pp. 178-183). Springer International Publishing.
Stories, Coke (2017). Stories. [online] Coke’s Way Forward: New Business Strategy to Focus on Choice, Convenience and the Consumer http://www.coca-colacompany.com/stories/cokes-way-forward-new-business-strategy-to-focus-on-choice-convenience-and-the-consumer [Accessed 4 Apr. 2017].

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