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Management Principles

Management Principles (Universiti Tunku Abdul Rahman)

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Appendix I

UNIVERSITI TUNKU ABDUL RAHMAN

FACULTY OF BUSINESS AND FINANCE (FBF)

ACADEMIC YEAR: 2020/2021
MAY 2020 TRIMESTER
UBMM1013/UKMM1013 MANAGEMENT PRINCIPLES

INDIVIDUAL PROJECT COVER SHEET

Programme details

Programme : Bachelor of Business Administration (HONS)

Year and Trimester of study : Year 1 Semester 1

Tutorial Group : T10

Lecturer’s Name : Puan. Azeyan Binti Awee

Tutor’s Name : Cik. Norharyani Binti Adrus

Assignment Details

Company Name : The Coca Cola Company

Due Date : Week 9, 14th Aug 2020 (Friday), before 12 pm.

Important Note : Submission of assignment is the responsibility of the students.

Students’ Details

No. Name Student ID No. Programme

1. Chiew Jia Hong 18ABB02948 BBA

Assignment Overall Marks (50 Marks): Marks.

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Appendix II
UNIVERSITI TUNKU ABDUL RAHMAN

FACULTY OF BUSINESS AND FINANCE (FBF)

ACADEMIC YEAR: 2020/2021
MAY 2020 TRIMESTER
UBMM1013/UKMM1013 MANAGEMENT PRINCIPLES

MARKING SCHEME FOR INDIVIDUAL PROJECT

Section Assessment Marks Marks

Allocation Awarded
1 Introduction 10
 Present a brief background of the selected company including
their mission, vision, objectives, etc
2 Contents 30

Example items that should be discussed with your selected

company include:
 Company management functions : Planning,
Organizing, Leading and Controlling (POLC)
 Organization structure and culture
 Leadership style and motivational style
 Human Resource Management Practices
 Change and Innovation process

3 Findings 30

Provide critical review of the company by answering the

questions:
 Who is/are the Top Leader(s) of the company, and under
what circumstances did they become leader?
 What issues did they face?
 What are the major strengths of the company?
 In what ways did Planning, Organizing, Leading &
Controlling contribute to the company’s success (or
failure)?
 What was the most important thing leading to that success
(or failure)?
 What do you see as major challenges facing this company
in the next five years?

4 Conclusion 20
What are your conclusions about the company management based
on your research?
5 Quality of the written assignment 10
 Format, layout, idea flow, language and proper citations and
APA format references.

TOTAL MARKS 100 marks

TOTAL MARKS FOR COURSEWORK 50 marks

Comments:

Name of marker: Signature of marker: Date:

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1.1 Company Background

John Pemberton had launched Coca Cola in the 1800s. Recipe for coca-cola formed at the Eagle drugs and chemicals
company, a pharmacy in Columbus, Georgia. It was originally named French coca wine from Pemberton. Through great
success, he may have been a Mariani wine, Italian source for coca wine. In 1886, in Atlanta, Fulton County, by banning
legislation, Pemberton responded to produced coca-cola, which is basically a non-alcoholic variant of French coca-cola
wines. The first sales were on May 8th, 1886 at Jacob’s Atlanta Pharmacy. They had priced it for five cents per glass in
Atlanta and they were not mixing with water, so the test was very good. It was named the French wine coca of Pemberton
and it was marketed as an energy drink and help those people from cold as a medicine. It used to sell at soda fountains in the
United States. The company’s starting year sales were very low, just about nine drinks a day and Dr. Pemberton feels he did
not earn any money with the drink. So, he made a decision to sell his company to Asa g. Candler and he died in 1888. Coca-
cola was first sold in Atlanta with bottles after six years on 12 March 1894. In 1915, Alexander Samuelson created a bottle
for the Coca Cola Company which became a standard bottle for Coca Cola and it shipped in cans after 61 years later in
1955. The Coca-Cola Company is the manufacture of condensed syrup, which is sold by the Coca-Cola franchise to various
bottling plants around the world. Coca-Cola bottler, the jurisdiction of an exclusive deal with the company, produces
finished cans and bottles of distilled filtered water mixed with sweeteners. Coca-Cola will sell their merchandise through
bottling to restaurants, food service distributors, and retail outlets. Coca-Cola sponsored the major games in 2018, and Coca
Cola Facebook page has more than twenty two million fans around the world. Coca Cola became a billion dollar company
in 2009, and the entire North American bottling business was purchased by Coca Cola Company in 2010. In 2011, Coca
Cola Company celebrates its 125 years anniversary.

1.2 Company’s Mission

Mission statements explain an organization can become better in a period. The Coca-Cola Company has mission
which are: To refresh the world, To inspire moments of happiness and optimism, To create value and make a
difference.

1.3 Company’s Vision

The Coca-Cola Company’s vision are love brands, done sustain-ably, for a better shared future. And its vision is
to craft the brands and choice of drinks that people love, to refresh them in body & spirit. And done in ways that create a
more sustainable business and better shared future that makes a difference in people’s lives, communities and our planet.

1.4 Company’s Objectives

2

The Coca-Cola Company’s major objectives are to be recognized internationally as a company that carries out
corporate and ethical responsibilities, and to increase sustainable development to work in the world. It forms the foundation
in the decision-making cycle for business by having these objectives.

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2.1 Company Management Function

Coca-Cola Company’s top management is involved in formulating longer-term strategies for five years, as
well as short-term planning for the next year or so. The premise behind this kind of planning is to have a long-term
strategic cision as well as a versatile and agile approach to adjust according to the external environment’s imperatives. In
addition to this strategic planning, its top management frequently undertakes operational preparation in conjunction with the
middle management, who in turn acts on the salespersons’ input in the ground. Coca-Cola’s planning includes setting goals
for all workers at all levels that are checked on a regular basis for either performance or failure to achieve goals, feedback is
received from supervisors and workers who have failed to reach the objectives for the same reasons. It is then integrated into
the decision making process so that the strategy for the upcoming tear can resolve and correct the shortcomings as well as
set new goals taking these factors into account.
An example of how Coca-Cola preparation works can be taken from this year’s aim for managers to raise revenue by
20% over last year’s target and raise the overall consumer base by 10%. It is also the micro-level planning which can be
seen by the targets of that market share ranging from 5 to 30% for middle management in the different markets in which it
operates. Besides, there are organizational goals that are set for the salespersons on the ground, and that relates to the point
of sale and the other front end supply chain interfacing positions to actualize collaboration and cooperation between
suppliers, retailers, bottlers, and distributors.
Coca-Cola promotes the decentralization by managing itself within the centralization framework. It ensures the
company is split into regions and regional areas in which it works while the corporate headquarters maintains the overall
decision-making process. Then, these regional divisions are divided into functional departments which in their case
comprise the departments of Sales and Marketing, Production, Industrial Relations, and Human Resources.
The point to understanding the coordinating role at Coca-Cola is to realize that there is grouping of workers
with specific skills and common work functions. This helps the organization eliminate redundancies in problem-solving
processes as well as conferring on all levels a certain functional flexibility.
In fact, Coca-Cola’s organizing feature meets the standard control cycle of no more than five direct reporters, which
ensures that no worker has more than five people reporting to him or her. It must be noted that in the case of managers and
functional heads reporting to the other divisional heads in addition to the country heads, there is also cross-functional
reporting. In addition, a high degree of autonomy is provided to managers at all levels that encourages them to act according
to particular local needs.
The organizational structure is such that redundant layers in the hierarchy are removed and the straight ad dotted line
reporting layers ensure that information passes through the organization without clogging the organizational arteries due to
bureaucratic mindsets as well as contact gaps blockages.

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For each country or region, the complete responsibility lies with the country or regional head, as well as the top
management under him or her also report to the global functional heads. Furthermore, the roles and responsibilities are
clearly established, which ensures responsibility is taken care of as is the transparency factor.
While Coca-Cola is structured around regional regions, and also the different departments within each region, the
organization stresses the importance of the leadership style at both global and local levels. This ensures that top employees,
department heads, and Country Heads, are free to agree on the best approaches for their regions in the different markets in
which the company operates as long as they adhere to the global standards and culture that permeate the organization. Under
centralization, this decentralization is the trait of the global approach mentioned in the thesis.
Apart from that, Coca-Cola’s management appears to believe in a representative democracy and free market
approach to leadership that is essential given the sector in which it would be highly reliant on the macro-level mission and
vision statements to be converted into micro-level operation.
The General Manager is usually at the top of the local structure, which in effect reports to the Head of the
government. Such general managers have other management supervisors like those mentioned for this article who listed
how the company performs functional leadership based on micro-level operating on the details of the situation.
These managers’ management styles often imitate the salespersons’ incentive-based method for actualizing peak
performance. Through this system, the salespersons are provided with monetary and non-monetary rewards to inspire them
and help them meet or even surpass their sales targets.
The monetary rewards include wage hikes, bonuses, and commissions depending on the achieved revenue, while the
non-monetary incentives include coupons for the worker and his or her close family for holidays, insurance, and discounted
holiday packages.
For Coca-Cola, the controlling role is achieved by regular evaluations of the results of managers and
salespersons. To this end, the core of the company’s governing feature is an appraisal framework focused on an objective
assessment of whether the person being evaluated has achieved his or her goals.
While managerial success goes beyond target assessment and enforcement as managers usually perform certain
functions such as people management and strategic planning, salespeople are evaluated based on the reporting system of the
Sales Person and the Sales Person’s evaluation system.
The former monitors the salesperson’s actions regularly while the latter is performed in conjunction with the
appraisal process and the results of which are used to evaluate promotions, rewards, and other benefits. Typically, the
assessment period is a year for sales managers, while it is a quarterly cycle for business development positions and a
monthly cycle for sales managers.

2.2 Organizational structure and culture of The Coca-Cola Company

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Structuring an organization requires not only the management of internal ties but also external relations. The Coca-
Cola Company has established well-structured partnerships with several external bottling partners including. The
company’s primary sector is the manufacture and sale of concentrates and syrup of drinks, as well as some finished drinks
into bottling and canning. Usually, concentrates and syrups are marketed to bottling partners allowed to produce, make, and
market branded products. The corporate system of The Coca-Cola Company and bottling partner is called “the Coca-Cola
system”. The Coca-Cola Company’s partnership with its bottlers is a primary of power worldwide. The company is working
with them to guarantee that concentrates and syrups are turned into completed drinks that are manufactured and sold with
unrivaled quality and service to customers across the globe.
Not only is a structure but also a culture in any organization. “Culture” defines the traditional way an organization,
including cultural habits and relationships. Essential elements of Coca-Cola Great Britain’s culture ( which represents
The Coca-Cola Company’s overall ) include a focus on teamwork and motivation. Coca-Cola Great Britain finds its
workers to be the most significant asset. Motivated workers provide the engine driving growth in the business. This helps
people to feel respected by grouping people into teams. They are motivated to share ideas to a team, and to be creative. They
are allowed to share their opinion if they believe like it should be done better.
Coca-Cola Great Britain is able to rely on a high-quality workforce by building a fun, creative community that helps
it retain brand supremacy in Great Britain and any other market it performs in. Trust is at the center of any partnership,
because it is the trust of buyers that the business can offer the high quality of service and care for their needs.

2.3 Leadership and Motivational style of The Coca-Cola Company

Strategic thinking and tireless, persistent execution can not be a substitute for a successful leader style. There can be
no substitute for recruiting and keeping the very best people to lead and for them to create a competitive environment. And
there can be no more critical job than successfully interacting with your clients and with all the main shake holders. It is
accomplished by Coca-Cola implementing a simple and convincing vision, aligning their strategy behind it, implementing
and transmitting goals all the time.
The management team’s performance in motivating its workers to reach their goals is dependent on their leadership
style. There are two major styles that are democratic and autocratic. The style of democratic leadership consists of the
leader, exchanging decision-making skills with group members while upholding group members’ interests, and maintaining
social equality. The autocratic leadership style retains strict control out over followers by strictly controlling the policies and
procedures provided to the followers.To highlight the difference between the authoritarian leader and his supporters, these
types of leaders ensure that only a specific professional relationship is established.
Coca-Cola is one of the industries which is the most popular beverage all around the world. They have to have a nice
way of inspiring their workers in any productive company nowadays. “ One of their ways to motivate workers in Coca-Cola

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is through employee job results, and if the employee is hard to work, the organization will encourage them by enhancing and
granting their job opportunities. These strategies can play a key role in developing a work environment were not only
commitment but also accomplishment can be enhanced.” (Armstrong, M, 2009).
Awarding and job opportunities will inspire employees so that they can improve their team spirit, organization skills,
decision-making, staff-to-staff contact, and gain even more engagement and inspiration from the organization. There are
currently about 160 brands of beverages in 200 countries, with a global market share of 48%. This is because the company
must train its employees, so it is difficult to develop manufacturing quality and create new flavors of Coca-Cola. Coca-Cola
also trains its staff and teaches workers various skills and information about the concept of production, because the Coca-
Cola Company pay attention to new ideas and also encourages its employees to accept creative concepts from different
perspectives.
The Coca-Cola Company used the ERG Theory of Motivation since there are a lot of motivation theories.
Clayton Alderfer developed this theory from Abraham Maslow’s Hierarchy of Needs where he revised it. Three critical
elements that constitute Alderman’s theory of ERG: The first part focuses on the company requirements for existence; the
second part discusses the company’s needs for relatedness; and the last part touches upon this company’s needs for
development. The Coca-Cola Company remember that workers deserve to be happy within the organization they work in.
So, the company has several different systems in place to help with this process. For example, The Coca-Cola Company
provides cultural awareness campaign and staff forums; these forums are made up of employees who have common interests
or experiences. In these forums, the individuals provide each other with both personal and professional development. The
Coca-Cola Company motivates its workers regularly with bonuses and work respects. In fact, its consumer quality is
accomplished.

2.4 Human Resource Practices of The Coca-Cola Company

Those multinational enterprises include The Coca-Cola Company have to send its worker on foreign assignments.
For these situations, administrators of human resources are having trouble in several ways, often with catastrophic
consequences. There may be several explanations for this, but one could be the reason why HR managers send their workers
to work internationally without ensuring better training or a “transitional” stage for some time. In this period, human
resource managers should provide some kinds of advice and critical management skills, and tackle strategies in different
scenarios along with the foreign policies of HR and business.
Nowadays, the human resource managers of The Coca-Cola Company are to provide an employee with unique
comparison skills and necessary skills to be effective in international employment. They follow both the normal method
and a practical version. HR managers take good care when carrying out the selection, managing performance, and giving
training. For instance, when Coca-Cola Company assigning an employee as a sales manager or delegate to India, they prefer
to choose an Indian employee or who recognizes Indian culture is better because he or she can perform much better in their

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familiar place than other new places. In that place which is a valuable part of the Coca-Cola Company, they will easily
adapt. When a company hires a new employee who is unfamiliar to this culture, it will directly impact an employee’s result,
as well as needing additional preparation and more expertise that would be costly for HR managers.
The position of HR managers is very critical when choosing an employee for their company who needs to function
in various cultural environments. There should have been a good reason and not just to accidentally select a candidate for
that position. To choose an employee who works to the local culture or the foreign cultural environment, HR managers must
establish a specific procedure. HR managers need to find for all of the candidate’s unique core competencies to choose the
correct person. So, they can find a suitable candidate who has the opportunity to go abroad with his talents. The Coca-Cola
Company has potential rivals like Pepsi and other international cold drinks. So it is important to promote an employee who
has the experience and expertise to keep those people. The experience obtains by an employee from overseas is more useful
rather than learning within the home country as they have an opportunity to work in a different country.

2.5 Change and Innovation Process of The Coca-Cola Company

The center of everything Coca-Cola did is innovation. Behind their 3,000 juices, sports drinks, waters, energy
beverages, and sparkling drinks, innovation is the power force. This is the incentive behind their environmentally
sustainable temperature control and packaging equipment. Innovation is what helps Coca-Cola Company’s leading-edge
marketing attach every day with customers around the world. That keeps them thirsting for success is innovation.
Dr. John Pemberton, a pharmacist from Atlanta, Georgia, invented Coca-Cola in May 1886. He made up the recipe
in a pot in his garden. Asa Candler, who bought the rights of the beverage after the death of Pemberton and starts to engage
The Coca-Cola Company. Coke had expanded to every US state in three years. The first bottling plant opened in 1989,
allowing Coke to be sold more widely. The bottle contoured copyright had been designed to clearly differentiate from its
competitors in 1916. The number of countries with bottling operations had almost doubled at the end of the 1960s. Its range
of production began to differentiate as Coca-Cola had expanded.
Coca-Cola is the world’s best selling soft drink. 43% of the revenue that Coca-Cola earned from Mexico, Brazil,
China, and Japan. Followed by 37% and 20% from the rest of the world and the United States. The organization also has the
right to about 400 brands of drinks including the Coca-Cola trademark and Diet Coke soft drinks. Besides, The Coca-Cola
Company faces a lot the competing brands on the market such as Redbull, Mountain Dew, and Pepsi.

3.1 Top Leader of The Coca-Cola Company

Muhtar Kent is CEO of The Coca-Cola Company and Chairman of the Board. In 1978, he joined The Coca-Cola
Company in Atlanta and has held several positions in marketing functions during his career. He was appointed director-
general of Coca-Cola Turkey and Central Asia in 1985. He served as the president of the East-Central Europe Division of
the organization from 1989 to 1995 as well as Senior Vice President of Coca-Cola International, with responsibilities for 23

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countries. Mr. Kent operated as Coca-Cola Amatil-Europe’s Managing Director between 1995 and 1998, managing bottling
business in 12 countries.

3.2 Issues Faced by The Coca-Cola Company

One of the issues faces by Coca-Cola is the wellness and health trend. The Coca-Cola Company’s merchandise is
known as high sugar and harmful for our health. Indian reported that Coca-Cola products contain pesticides that present a
dangerous health risk. Such advertising can cause serious harm to the company in worldwide and growing markets,
particularly with increased customer awareness, and a lot of public health issues. Nowadays, many people care about their
health problems such as habits, behaviors, and social trends. Consumer perception of health and obesity problems is
considered a huge challenge for the carbonated beverages sector and a big challenge for The Coca-Cola Company. A
significant number of carbonated drinks buyers change their decision to healthier drinks and choose more low-calorie
drinks, sports drinks, juice, and bottled water. So why this phenomenon become so prevalent in the beverage market? A
report in the medical journal “The Lancet in 2001” showed that the incidence of obesity of a child rises substantially with
the volume of sugar-sweetened carbonated drinks that he takes in. So, soft drinks are related to increase levels of blood
sugar and insulin in the body according to the European Journal of Cancer Prevention. In fact, soft drinks produce high-
fructose corn syrup involved in the increase in obesity and diabetes.
The other issue is its main competitor. Pepsi is the main competitor of Coca-Cola. In the beverage market, both of
them represent the most hated enemies. There are other competitors but none such as Coca-Cola and Pepsi have managed to
penetrate the market. The rivalry between the two brands consists of producing new carbonated and non-carbonated product
varieties and expand sales and market share.

3.3 Major Strength of The Coca-Cola Company

There is three major strengths of The Coca-Cola Company which are brand awareness, dominant market share,
and greatest customer loyalty. The Coca-Cola Company is one of the world’s most commonly known companies in the
soft drinks market. There are two major players in this soda competitive market, Coca-Cola being one while Pepsi is the
other. It means Coca-Cola maintains its place as the clear-cut leader in the highest post. Coca-Cola has the edge here
although both organizations are actively jockeying for greater market share. The beverage company also retains main loyal
customers, as many consumers who consider themselves fans of which product and do not want to change to the other
brands.
Next, Coca-Cola has the highest market share compare to Pepsi as the only two major soft drink producers in the
beverage industry. Because Coca-Cola has the greatest development factors which are Coke, Sprite, Fanta, Limca, Diet
Coke, and Maaza. Besides, Coca-Cola is regarded as one of the most emotionally related brands in the US. This powerful
brand is connected to “happiness” and has high customer loyal. Customers may recognize their specific taste easily. It is
difficult for them to find their substitutes. In addition, Coca-Cola and Fanta gain a bigger fan base in the market than other

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beverage brands.

3.4 The important things that lead The Coca-Cola Company to success
Coca-Cola began with a new recipe that has been evaluated by the public. Pemberton sent his nephew, Lewis
Newman to a nearby pharmacy with samples of his recipe, where people gathered to drink these early versions of beverages.
Newman conveyed suggestions about the specific concoctions to his uncle, and Pemberton had a formula that was special
and adapted to the taste of the customers at the end of the year. The original formula is still locked up in a basement in
Atlanta. In 1903, cocaine was taken off from Coke. Many small changes have been made over the past century, but the
formula remained essentially unchanged after the 1985 “New Coke” tragedy. This decision improved the scale of the
company, as it was not wasting time trying to adapt the taste to local markets around the world.
Its logo uses an infinite font. The bookkeeper of Pemberton, Frank Mason Robinson, has decided that the logo of
Coca-Cola should be written in the Spencerian script I=used by the accountants because it would distinguish it from its
competing companies. In 1923, the company standardized the logo, formula, and agreed to uncouth the core logo so
packaging could adapt to the times. This resulted in a logo that has been impressed on the minds of people around the world
for more than 100 years.
For 70 years, it had kept the stock price fixed. The Coca-Cola Company implemented a strategy that is very
popular today for tech start-ups, which is by offering their customers to have free service fees at the beginning and then
charge them a higher price when the consumers have become hooked with their products and services. Before using
networking effects became a common procedure, Coca-Cola used a similar scale strategy in US, and then across the world.
A coke bottle only cost five cents from 1886 to 1959.

3.5 Major Challenges will be faced in the next five years

Since 1886, Coca-Cola had converted from non-alcoholic drinks to soft drinks. The Coca-Cola Company faces a big
challenge which is sugar for many years. Research shows that if we drink a can of Coca-Cola everyday, it could gain our
weight of more than 6.5 kg every year if we do not stop this habit. Every Coca-Cola Company’s product contains not less
than 40g of sugar per can and the 600ml bottle contains 60g of sugar. To put in another way, a can of Coca-Cola or Sprite
includes around 10 teaspoons of sugar and around 15 teaspoons of sugar for a 600ml bottle. The World Health Organization
recommends that soft drinks are part of the obesity problem. Coca-Cola Company has kept up with the trend and invent a
new flavor named Coke Zero. Although Coke Zero is a soft drink with lesser sugar compares with normal Coke, it still bad
for our health. After that, Coca-Cola Company invents another product named Coke No Sugar. This product totally does not
contain any sugar. But these brand new soft drinks contain caffeine include Coke Zero even though the quantity of caffeine
is similar. If The Coca-Cola Company can solve these problems, its market share will exceed Pepsi within five years.

4. Conclusion

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In conclusion, workplace health and a sustainable environment should be continued at The Coca-Cola Company
because employees also such an asset of a company. The innovative concept and the plan help the business expand. Coca-
Cola has created the entire vital component for the long-term expansion of its sector. A reward system is an important tool
for motivating workers in an evolving organization’s climate. Coca-Cola should implement a reward system for its workers
so that productivity and profits can improve. However, the system may be financial or non-financial, the organization must
offer equal importance to all employees at all rates. To keep workers committed to corporate objectives, reward system must
be efficient. Apart from that, the training and development system must be used to support their employees’ careers at the
top to the bottom level. The Coca-Cola Company needs to announce certain money for purposes of training and
development.

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