ORGANIZATIONAL STRUCTURE OF COCA COLA

Submited to:

Madam Farah Naz Naqvi

Submited by: Azra Manzoor
6/15/2011

ORGANIZATIONAL STRUCTURE OF COCA COLA

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ORGANIZATIONAL STRUCTURE OF COCA COLA

Jun. 15

Introduction
Founded in 1886, the Coca-Cola Company is the worlds leading manufacturer, marketer, and distributor of non-alcoholic beverage concentrates and syrups. The companys corporate headquarters are in Atlanta, with local operations in over 200 countries around the world. Although Coca-Cola was first created in the United States, it quickly became popular wherever it went. Today, Coca-Cola has a portfolio of more than 3,300+ beverages. Coca-Cola has 92,800 Employees worldwide. The real reason we are a truly global company is that our products meet the varied taste preferences of consumers everywhere. Now today Coca-Cola serving 1.6billions People daily. In Pakistan Coca-Cola started his business with the name of Coca-Cola Beverages Pakistan Ltd. (CCBPL) manufactures and distributes beverages. The company was incorporated in 1953 and is based in Karachi, Pakistan. The Coca-Cola Company began operating in Pakistan in 1953; Fanta and Sprite are the brands with whom Coca-Cola is operating in Pakistan. The Coca-Cola System in Pakistan operates through eight bottlers, four of which are majority-owned by Coca-Cola Beverages Pakistan Limited (CCBPL). The CCBPL plants are in Karachi, Hyderabad, Sialkot, Gujranwala, Faisalabad, Rahim-Yar-Khan, Multan and Lahore. The Coca-Cola System in Pakistan serves 70,000+ customers/retail outlets. The Coca-Cola System in Pakistan has nearly 3,000+ people working constantly for the company. During the last two years, The Coca-Cola Company in Pakistan has invested over $130 million (U.S) and coke has successfully provided 57 years of dedicated service to its customers in Pakistan. Since the beginning of Coke Company the firm has been continuously changing its slogans and that is a very creative idea to get the attention of the customers.

History
In May, 1886, Coca Cola was invented by Doctor John Pemberton a pharmacist from Atlanta, Georgia. John Pemberton concocted the Coca Cola formula in a three legged brass kettle in his backyard. The name was a suggestion given by

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John Pemberton's bookkeeper Frank Robinson. Being a bookkeeper, Frank Robinson also had excellent penmanship. It was he who first scripted "Coca Cola" into the flowing letters which has become the famous logo of today. The soft drink was first sold to the public at the soda fountain in Jacob's Pharmacy in Atlanta on May 8, 1886. About nine servings of the soft drink were sold each day. Sales for that first year added up to a total of about $50. The funny thing was that it cost John Pemberton over $70 in expanses, so the first year of sales were a loss. Dr. Pemberton never realized the potential of the beverage he created. He gradually sold portions of his business to various partners and, just prior to his death in 1888, sold his remaining interest in Coca-Cola to As a G. Candler, an entrepreneur from Atlanta. By the year 1891, Mr. Candler proceeded to buy additional rights and acquire complete ownership and control of the Coca-Cola business. Within four years, his merchandising flair had helped expand consumption of Coca-Cola to every state and territory after which he liquidated his pharmaceutical business and focused his full attention on the soft drink. With his brother, John S. Candler, John Pembertons former partner Frank Robinson and two other associates, Mr. Candler formed a Georgia corporation named the Coca-Cola Company. The trademark Coca-Cola, used in the marketplace since 1886, was registered in the United States Patent Office on January 31, 1893. On April 23, 1985, the trade secret "New Coke" formula was released. Today, products of the Coca Cola Company are consumed at the rate of more than one billion drinks per day. Today CCBPL is operated directly under the supervision of the Coca-Cola International based in Atlanta Georgia State-USA .It owns 8 plants all around in Pakistan. Coca Cola Company offers the brand range as Coca Cola, Diet Coke, Fanta, Sprite and Kinley water in Pakistan.

Vision Statement
Our vision guides every aspect of our business by describing what we need to accomplish in Order to continue achieving sustainable growth. People: Be a great place to work where people are inspired to be the best they can be.

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Portfolio: Bring to the world a portfolio of quality beverage brands that anticipate and satisfy people's desires and needs. Partners: Nurture a winning network of customers and suppliers, together we create mutual, enduring value. Planet: Be a responsible citizen that makes a difference by helping build and support sustainable communities. Profit: Maximize long-term return to shareowners while being mindful of our overall responsibilities. Productivity: Be a highly effective, lean and fast-moving organization.

Mission
Our Roadmap starts with our mission, which is enduring. It declares our purpose as a company and serves as the standard against which we weigh our actions and decisions. a. To refresh the world b. To inspire moments of optimism and happiness c. To create value and make a difference.

Organizational structure
Muhtar Kent, president, Coca-Cola International, said the organization is designed to spur growth in the rapidly developing markets of the East, South Asia and Pacific Rim Group, while providing focus on critical markets in China, Japan, Russia and Europe. "The organizational structure for Coca-Cola International should reflect our Manifesto for Growth in action and be supportive and consistent with our highest

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priority - which is on-the-ground execution," said Kent. "This structure - and its exemplary leadership team - enables us to focus on driving profit for the Company by meeting the needs of our customers and consumers, while ensuring the Coca-Cola system earns its rightful recognition as one of the world's most respected coca colas Mission Statement

Work specialization:
The work specialization in Coca-Cola is high. The work is assigned to the related and specialized persons. There is no flexibility in work specialization. Division of labor Subdivision of work into separate jobs assigned to different specialist people Potentially increases work efficiency Necessary as company grows and work becomes more complex strategic business units of Coca-Cola.

Departmentalization
Every organization is made up of different departments, each of these departments help Coca Cola achieve their objectives. As Coca Cola is a large multinational company, the amounts of departments are huge. Each country has their own Head Office and departments. Coca Cola is geographically split into five geographic operating segments, also known as strategic business units (SBU's). The six SBU's are North America, Africa, Asia, Europe, Middle East and finally Latin America. If all departments perform in the correct way then that will continue the success of Coca Cola. There are 6 functional departments within Coca Cola, these are: Marketing Finance

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Packaging Sales Research and development Administration

MARKETING DEPARTMENT Departmentalization in Coca-Cola is high. There are separate departments for each type of work. The Coca Cola marketing department develops core strategies for company brands to ensure that all communication is consistent in every market. With this cohesive effort, the Coca-Cola system maximizes its resources for market leadership and profitable growth. The marketing departments are responsible for marketing the products and advertising the products and promoting the products. If all these departments perform their duty firmly then the objectives of The Coca-Cola Company will meets. FINANCE DEPARTMENT The finance department of the Coca Cola Company is responsible for financial record keeping. This involves keeping records of money received and paid out. The financial records will be used to produce the annual reports for the shareholders so that they can see the company performance. The Finance department is also responsible for the management accounts of the business like marketing etc. The Coca-Cola Company finance department is also responsible for making budget of the company and for each department like marketing department or research and development department. They will also be involved in the planning process like taking over or any major decision. PACKAGING DEPARTMENT The packaging department of Coca-Cola Company is responsible for the packaging of the products. They have to make the packaging attractive so that that product meets the eyes of the consumers. Bringing new products package is their responsibility. It works with the companies bottling partners to produce an attractive combination.

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SALES DEPARTMENT The sales department of the Coca Cola Company is to coordinate the selling program. They also have to make the distribution methods, etc. Also, decide how much to sell and how much to store in the warehouse and to choose the transporting method which is the most cost efficient and the quickest way. RESEARCH AND DEVELOPMENT DEPARTMENT This department has their budget given by the finance department and their responsibility is to investigate new products. They work closely with marketing by looking at marketing research findings. They have to bring new products in the market for the change because the consumer cannot stick with the same old products. If necessary then they also have to improve the quality of the products. The Coca-Cola Company research department has done a lot of research and recently they have launched many new products like Diet coke with lemon, Fanta Tropical, Minute maids, Fanta raspberry, Fanta blue berry etc ADMINISTRATION DEPARTMENT This department is essential for keeping the business going. They act as a help support of the company, it is not the central purpose the business but every business organization would need this department. Most businesses rely on administration to be organized. They deal with enquiries, give messages produce documents and give information to any customer. The complaints that this department will get would be transferred to the research and development department to make the product better or fix the problem that the consumer is having. These departments are the most important department of The Coca-Cola Company because they helps the company to meets the objectives of The CocaCola Company i.e. surviving, customer satisfaction and make more profits. As I said that the help desk department satisfies the customer by providing the information they needs and taking the complaints and passing to the research and development departments who improves the products.

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Chain of command
We were unable to obtain exactly how many levels there are in the organization, however according to an organization chart found on the companys website (located in the appendices) there are at least five levels. We were not able to find information on the structure of the regional operating groups. There is clear chain of command in coca cola. Each person is responsible to report to only one person. There is clear chain of command to coordinate the work. Forms of work coordination Informal communication sharing information High media-richness Important in teams Formal hierarchy Direct supervision Common in larger firms Problems - costly, slow, less popular with young staff Standardization Formal instructions Clear goals/outputs Training/skills

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Managing Director

Chief operating officer (sales)

Director operation

Director operation

Quality control manage rr

Sales and marketing managers

HR Managers

Distribution andlogistics manager

Accounts manager

Productio n manger

Assistant manager

Regional Sales manager M Sales manager anager anager M Marketing devl opment officer anager lopment officer Sale&marketing officer Driver

Executive manager Senior officer

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The Coca-Cola Company currently employs approximately 94,8 00 employees. According to a general organizational chart obtained from the companys website, there are more than 5 hierarchical levels at the corporate level. F or example: the head of the Canadian division reports to the president and COO of the North American Group. That president reports to the CO, who reports to the Office of the General Counsel. The General Counsel then reports to the CEO. It is fair to assume that there are at least a few more steps in the hierarchy at the local level

MD

HR manager

marketing manager

FInance manager

Quality manager

productio n manager Front line manager

Admin manager

Front line manager

Front line manager

Front line manager

Front line manager

Front line manager

workers

workers

workers

workers

workers

workers

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Organizational Chart HR\IR Department

HR Manager

Asst. manager HR/IR

IR Officer

Admin.Exuctive

HR Officer

HR Exuctive

Admin. Officer

Drivers

Garden's

Office Boy

Organizational Chart Quality Control Department:

Quality Control Manger

QC Officer

Ast. Manager Quality Control

Quality Control Executive

QC Officer

Lab Officer

Ast. QC Officer

Lab Assistant

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Span of control
Due to its tall structure, the organization has experienced communication problems. One of the problems discovered through a survey, was that the people and the company lacked clear goals. Tall hierarchies also cause motivation problems, which is why the organization is attempting to get employees more engaged. The increased usefulness of the companys intranet will greatly increase the communication between every level of employees, and allow upper management to effectively communicate to the front line employees. Based on information from Report 2006 this span of control seems somewhat slim for the CEO of such a large organization. The CEO is also a member of the senior leadership Team. This team consists of each head of the eight operating groups aforementioned, and also has other top executives in areas like innovation and technology and marketing. Although there are only six people that answer directly to the CEO, the CEO is able to receive input from a wide variety of divisions because of this leadership team. The Coca-Cola Company currently employs approximately 94,8 00 employees. According to the Span of control in coca cola is narrow. There are less no of employees under a manager that he can control effectively and efficiently. Number of people directly reporting to the next level Assumes coordination through direct supervision Wider span of control possible when used with other coordinating methods Subordinates tasks are similar Tasks are routine Flatter structures require wider span (if same number of people in the firm)

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The decentralization of Coca-Cola

The Coca-Cola Company realizes that it needs to be able to meet the ever changing demands of its customers. This is why the company pushed towards decentralization in the Nineties, and even more so recently. The organization has two operating groups called Bottling Investments and Corporate. There are also operating groups divided by different regions such as: Africa, Eurasia, European Union, Latin America, North America, and pacific. Each of these divisions is again divided into geographic regions. By allowing decisions to be made on a more local level, the organization can quickly respond to changing market demands and higher-level management can focus more on long-term Planning. Certain divisions of the company, such as finance, human resources, innovation, marketing, and strategy and planning are centrally located within the corporate division of the company. Some of these functions take place at lower levels in each of the regions of the company; however, most decisions are made at the top of the hierarchy. For example, in 2002 the decision to sponsor the World Cup was done at the corporate level. Corporate headquarters, however, allowed the local divisions to make the advertising decisions. This allowed each division to specifically design commercials and ads that would appeal to the local market. Coca-Cola decentralized its organizational structure by cutting half of the staff at its Atlanta headquarters and moving the regional chieftains closer to their local markets. In India, decision making has been moved further down to different areas of that diverse country. Forces for decentralization Centralization: Organizational crises Management desire for control increase consistency, reduce costs

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Decentralizations Complexity-size, diversity Desire for empowerment moved further down to different areas of that diverse country

Formulization
It is important that each function of the company is able to share up-to-date information quickly with each other. T he organization seems to be doing an excellent job of balancing standardization and mutual adjustment. The Code of conduct for the organization is a Guide book for how every employee should act. Should an employee act improperly, they are subject to disciplinary actions. Due to the changes implemented by Isdell, mutual adjustment has started to play a larger role in the organization. Employees feel mo re engaged and turnover has been reduced. Isdells changes have led to increased growth rates for the organization, and return on equity for stockholders went from a negative return to a 20 Percent return. There is high formalization in coca cola. The employees behavior is guided by rules and regulations.

Conclusion
This balance is essential, because it allows employees some flexibility, but also gives the organization some predictability. The Coca-Cola Companys structure is a hybrid of both mechanistic and organic models. The focal point of T he Coca-Cola Company is on responsiveness. T he complex integrating mechanisms previously discussed are characteristic of an organic structure. The surveys and interviews used by the company allowed information to flow from the bottom-up, and the intranet allows for information to be exchanged laterally. The surveys have also caused The Coca-Cola Company to pursue simplification and standardization. Centralization and high standardization are associated with a mechanistic structure.

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The blending of both types of structures seems to be ideal for the organization. Flexibility is essential when trying to appeal to such a vast number of independent markets, however, highs standardization is important to remain efficient in production. The use of complex integrating mechanisms allows for easier coordination for the global company. Centralization keeps organizational choices aligned with organizational goals. Now that information in the company is flowing in every direction, upper -management will have access to information more quickly, adding to the organizations flexibility and responsiveness. T he recent shift towards a more decentralized and organic structure corresponds with the uncertainty of the Organizations environment. So the structure of coca cola is mechanistic. The organization is tightly controlled.