2. Coke’s strategy and structure before Daft Leadership
- The structure was more centralized in the model of command and control with all the instructions and decisions, Atlanta - ‘Concentrate on Concentrate’ strategy - the high cost operations (trucks purchases, product delivery, and execution of local marketing) is left to worldwide bottlers. - Consolidation of the vast bottling network into 10 anchors bottlers. - Strategy, expansion of market share (Global presence) and increased sales ‘400 servings of coke’ - Aggressive marketing drive
- Coke had a very powerful global presence
- The distribution strategy of consolidating bottlers enabled Coke to have an effective distribution markets in a vast market without taking any financial risks. - Transferring the financial risks to bottling companies, Coke had a little effect in the event of a financial crisis e.g. currency devaluation/ economic downturn.
- Initial focus was clear, and the environment was simple and stable thus with command and control enabled growth - The ‘Concentrate on concentrate’ strategy led to giving production rights without giving intellectual property
- As a result of the vertical hierarchal management, there was Slow reaction to situations, decision making leading to huge opportunity costs - The centralized system led to lack of consciousness to the changes in the regional market trends and consumer preferences - Quest for global presence, led to neglect in some important functions like quality control (standardized operations), inefficient internal communication and conflict with regional authorities (government). - Aggressive marketing initiative led to cultural insensitivity - By Transferring high operation cost activity to bottlers, thus bearing the brunt of any economic downturn, the good working relationship with the bottlers was risked.
3. Analysis of...