CASE STUDY – INTRODUCTION TO HR STRATEGY

SYNOPSIS OF GLOBAL HUMAN RESOURCE MANAGEMENT AT COCA COLA

The Coca Cola Company is one of the most successful MNCs. The company however, like to
think of itself as a multi-local company. The philosophy is best summarized by the Phrase
"Think Global Act Local".

Coca Cola manages its global operations through 25 operating divisions.

The Corporate HR function is charged with providing the glue that binds these various
divisions into the Coca Cola family. The Corporate HR function achieves this in two main
ways. First, by propagating a common human resources philosophy within the company.

Second, by developing a group internationally minded mid level executives for future senior
management responsibilities.

The Corporate HR group sees its mission as one developing and providing the
underlying philosophy around which the local businesses can develop their own HR
practices. For example, rather than have a standard salary policy for all its international
operations, Coca Cola has a salary philosophy; the total compensation package should be
competitive with the best companies in the local market.

Twice a year the Corporate HR group conducts a 2-week of HRM orientation sessions for the
HR staff from each of its operating divisions to give them an overview of the company's HR
philosophy and talk about how local businesses can translate it into customized HR policies.

Coca Cola believes in information sharing, for instance a problem in Brazil division could
be a learning experience to improvise in Australia operations. The sessions provide a
medium through which HR professionals can communicate and learn from each other,
which facilitates the rapid transfer of innovative and valuable HR tools from region to
region.
As much as possible, Coca Cola tries to staff its operations with local personnel. To quote
one senior executive "we strive to have limited numbers of international people in the field
because generally the local people are better equipped to do business at their home
locations"
However expatriates are needed in the system for two main reasons, one is to fill a need for
a specific set of skills that might not exist at a particular location.

For example, when Coca Cola started its operations in Eastern Europe, it had to bring in an
expat from Chicago, who was a polish descent to fill the position of finance controller.

The second reason for using expatriates is to improve the employees own skill base.
Coca Cola believes that because it is a global company with several bottling and distribution
partners, senior managers should have international exposure. The company also tries to
build a cadre of internationally minded executives from which the future senior managers of
Coca Cola would be drawn.

QUESTIONS:

1. What will you consider is the strategic role of the HR function at Coca Cola?

2. What is the company’s staffing strategy for managerial positions?

Ethnocentric, Polycentric, Regiocentric or Geocentric?

Dr. Jeff Bassay

Facilitator: 0244822855