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The Firm Coca Cola, Case Study Example

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Case Study

The firm Coca Cola has been an American brand leader since 1902 when it became an international company.  In the year 1929, it had become a true multi-national company with a geographical distribution in some 76 countries. Robert Goizueto became the CEO of the Company in 1981 and he was instrumental in changing the globalization strategy. He moved towards emphasis of the brand leaders of the company like that of diet coke, cherry coke etc. He pushed the company to that of a global leader in the drinks and beverages sector. He centred the HQ in Atlanta in the USA and he built in economies of scale in the company e.g. using common advertising messages and logo throughout the global empire. This streamlining by the CEO created market advantage by giving coke a common image world-wide and acceptance of quality of the product despite where you lived. In addition, it reduced unnecessary costs and kept the business on a solid financial footing.

The new CEO coming into the firm, Douglas Daft, moved from this strategy because the common global strategy was becoming unworkable in the current global market place. He recognised that there need to be more local authority and management in the countries where the firm operated.  He laid off some 6000 people in the Head Office. Despite initial success, the initial growth that was expected was not achieved.

The leader between Goizueto and Daft was Douglas Ivester. He adopted a sort of middle position between the two and looked towards leveraging ideas across different countries including local franchises. They equally built strategic alliances that enabled market penetration into countries like Japan and China. The emergence of new nations like China that operate on the exterior of international law may cause Coca Cola to re-examine their future strategy if China copies the product and tries to become an international competitor by offering a similar product under Chinese ownership.

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