Coca Cola is one of the leading manufacturers of carbonated drinks. It has remained on the top position for decades. However, the carbon drinks industry is changing continuously and Coca Cola as a company has been able to implement changes in its organization through its effective leaders and managers with the help of strategic management (Coca Cola, 2011).
Strategic management has been defined as the highest level of managerial activity. It is mostly undertaken by chief executive officer of a firm which is Coca Cola here, after the approval from board of directors. The key stages of strategic management are divided into six stages. The first stage is that the manager will assess the current position of the company in relation to the market along with its competitors and external environment. Coca Cola’s current position in the market is good but with a high existing competition from its competitors like as Pepsi Cola Company. It has been observed that those decisions that ignore the observation of where the business currently stands are mostly inappropriate or ineffective. The second key stage is that after assessing the company’s current position, its vision, objectives and mission are set. All three can be relatively new if the company has completely changed its direction or is planning to undergo a change. The third stage is taking long term decisions that will go along with the objectives that had been set. Coordinating and integrating different functions, activities and behaviors of different functional areas is the fourth stage of strategic management. Strategic decisions are mostly cross functional. Hence, all departments must work together to implement the decisions successfully. An example is when the Coca Cola decides to extend one of its product’s life like as Diet Coke. For this extension strategy, it will need input from finance, marketing and operations management. Allocating resources to make the decisions work, is the fifth stage and one of the most important stages. Strategies require that resources must be provided on time and in adequate amounts so that decisions can work. The last stage is assessing success and evaluating the overall performance of the business and the progress that it is making towards its objectives (May, 2010)
A leader is a person who influences people to achieve certain goals. He is the one person who sets a clear direction for his employees and comes up with new visions when situation demands it. Certain qualities are said to make a person an effective leader. One of these is the natural ability and the desire to succeed. Being creative and thinking beyond the obvious is also included in the list along with being multi talented so as to cater to different problems. Last but not the least is having a penetrating mind so that the problem itself is recognized rather than the unnecessary details (Moniz, 2008).
Leadership comes in various forms in a business. A manager, directors, supervisors and worker’s representatives, all need to have good leadership qualities so as to lead people properly and succeed in their goals and tasks (Moniz, 2008). This is one of the most important assets of Coca Cola as a company since its senior department has all the qualities of being an effective leader for the company to maintain its leading position (Coca Cola, 2011)
These days’ indirect leadership has also gained a lot of importance. These are those leaders that are not elected or recognized by the company but still they have such charm and aura that employees listen to them and carry out their orders. These are those leaders whom employees consider one of their own; hence the sense of relating to such leaders increases. For a company’s benefit like as a multinational company like Coca Cola, the managers and supervisors should work alongside these informal leaders and keep the employees happy (Stimpson, 2002).
Leaders today in companies like as Coca Cola have to take up many different roles to ensure that they are working effectively. If a leader is only performing one role, and neglecting the others, he will not be able to brand himself as being an effective leader and manager. Some of the roles that a leader can take up to ensure effectiveness in him and in his organization are as following:
Interpersonal roles: these roles are focused to deal with and motivate employees at all levels of organization. They concerned with relationships with others and are related to human skills. In the interpersonal roles, three distinct roles are seen.
Figurehead role: this is defined as being a representative leader of the organization and under this managers undertake duties of social or legal nature. Like as Coca cola that works actively for corporate social responsibility.
Leader: this particular role is very crucial for any organization to thrive. If a manager lacks leadership qualities, he will not be able to keep employees motivated and engaged in their work. Leaders have been seen to make changes that have amazed people throughout the world since they have the respect and full attention of their workers.
Liaison: this role is the one where a manager keeps in touch with managers of other branch and divisions which is essential for a company like coca cola that has operations worldwide.
Informational roles: According to Barrett (2006). under this role a manager acts as a source, receiver and transmitter of information.
Monitor: through this data which is relevant to the business operations is collected.
Disseminator: by adopting the role of a disseminator, a manager is able to transfer information from internal and external sources to the desired people within the organization for completion of a task.
Spokesperson: information regarding the company and its operations is communicated to stake holders and external groups.
Decisional roles: this is an important role that a manager has to accept. Under this role, a manager makes decisions regarding key factors of organization and allocates resources to meet organizations objectives.
Entrepreneur: under this role, new opportunities are sought to develop the business like as finding new markets for their products. Coca cola has operations from dense cities in China to sparse villages in Africa
Disturbance handler: this is an important role. If a manger is able to perform this role well, he is able to respond to the changing environment to reduce risks for the company and assume accountability when hostile factors rise.
Resource allocator: a manager through this role is able to allocate resources efficiently. Not only are the financial resources allocated properly, but also the human and physical resources of the company.
Negotiator: a manger by being a negotiator is able to represent his organization to external forces like as government and peer groups.
There are four leadership styles that have been observed in leaders. Autocratic or authoritarian leaders take decisions them self. They do not seek advice from their employees and neither do they engage employees in decision making process. This type of style makes the workers used to employers taking decision and hence their motivation levels tend to be very low due to which the leader has to keep a check on them from time to time. However, when staff wants to contribute and accept responsibility, this style de motivates them and decisions made are likely to not benefit the employees (Stimpson, 2002). This type of leadership style is mostly adopted in police and defense force where quick decisions are required to be made. Hence, a company like Coca Cola should avoid using this leadership style, since it has operations worldwide and employs over 139, 600 employees worldwide (Coca Cola, 2011). If it adopts such a leadership style, it will de motivate employees. However, when important and quick decisions are to be made that do not require employees’ inputs, it can adopt this style of leadership temporarily. For example, when a political disturbance causes serious damage to operations of Coca Cola in that country, it has to make a quick decision whether to close its operation temporarily there or continue operating. Discussing with employees will only waste time in such a case.
Democratic leadership style is the most common type of leadership style that exists in world today. This is the leadership style that encourages two way communications where workers are given the chance to voice up their opinions during decision making process. This is most likely to be effective in organizations that want workers to give them responses or in companies which demands new way of thinking, hence making staff input valuable (Dyer and Dyer, 2007). Hence, this leadership style is the most suitable for Coca cola to adopt. For situations like as changing a certain safety policy, this style can be adopted where employees are asked to vote in favor or against the change.
Apart from autocratic and democratic leadership styles, other styles include paternalistic style and laissez-faire style. Paternalistic style is the one where the leader acts as a parent and does what he thinks is the best for his employees. The leader does engage employees in decision making but in the end, he is the one who makes the final decision. Coca Cola Company can adopt this leadership style but only at certain occasions and not permanently. Laissez- faire leadership style on the other hand gives full control over to its employees. Employees are allowed to make all decisions and they have all the power (Stimpson, 2002). The problem with this type of leadership is that it leaves the employees on the hinges; mostly employees have no idea what they have to do and how to perform a task. They feel de motivated with the lack of support from their supervisors and dissatisfied since their chances of growth in such an atmosphere are very less (Johnson, 2009). Such a leadership style is not acceptable for Coca cola, since it has the objectives and rules and regulations set, that employees are supposed to follow. However, when the company wants to come up with new products to counter the competition, it can give free reign to its scientists, to come up with new flavors or new products.
Fiedler’s Contingency theory is based on whether the leadership style is relationship oriented or task oriented. A relationship oriented leader is the one which is concerned with people whereas; a task oriented leader is the one that is motivated by task accomplishment. Leadership can be analyzed in terms of three elements that is the quality of leader-member relationship, task structure and the position power. Each of these elements can be described as being either favorable or unfavorable for any leader. Combining these three situational elements gives rise to eight situations where situation one is most favorable to the leader since it is the one where the leader-member relations are good, task structure is high and leader position is strong. Situation eight is the most unfavorable where leader-member relations are bad, task structure low and leader position is weak (Fiedler et al 1993).
A task oriented leader excels in highly favorable or highly unfavorable situations. This is because, in a favorable condition, everyone gets along, task is clear and the leader has powers which are all factors where a leader can take charge. On the other hand, if a situation is highly unfavorable, a great deal Hence, when Coca Cola Company is any highly favorable situation like as being a market leader in certain country or any highly unfavorable situation such as problems with trade unions, its senior executives can adopt task oriented leadership (London, 2002).
Relationship oriented leader performs best in situations of intermediate favorability. The reason for this is that in these situations, the leader will be moderately liked, have some power and can supervise jobs that contain some uncertainty. Example where Coca Cola Company can adopt this leadership style is in the case of researchers where the research team does not like the superiors to form the task for them since they prefer to follow their own creative to structure the task (Tichy and Devanna, 1986).
The situational theory of Hersey and Bianchard is based on the importance of the type of employees that an organization has which become the basis for the leader to take up the leadership style accordingly. The telling leadership is the one where the leader has a high concern for production and a low concern for people. This is based on one way communication, where the leader defines the roles of organization. The selling style is the one where there is two way communications but the leader is still providing the directions. The participating style is the one where there is shared decision making about aspects of how a task is accomplished. The last style that is delegating style is the one where the leader is involved but the process and responsibility has been passed on to the workers (Raelin, 2003).
For Coca Cola Company, telling style can be adopted in scenarios where the employees lack specific skills for the required job and are unwilling to take the responsibility. This can happen when the company operates in developing nations where the workers are usually not educated.
Selling style can be adopted by the company where the employees are not willing to take responsibility but are willing to work. This can happen when a major project is in hands that requires a lot of risk. When employees are experienced and are able to perform a task but do not have the confidence, the company should adopt participating style. Whereas, delegating leadership style can be adopted by the company when the employees are experienced as well as confident to do a task. This is suitable when teams are formed for research (Hooper and Potter, 1997).
The skills that are required by leaders of Coca Cola Company are immense since the company is a multinational company with operations all over the world. One of the most important skills is cognitive skills which lay down the foundation of leadership skill requirements. These are those skills that are related to cognitive capacities like as collecting, processing and disseminating information. These skills also include oral communication skills like as speaking to effectively convey their message. Another important part of cognitive skills is to learn and adapt.
Business skills are another set of skills that the leaders of Coca Cola require to keep the company as good as it is right now. These skills are important for managers to make decisions like as allocating equipment, technology and materials. Moreover, it also means managing the human resources, motivating and developing them. Strategic skills are also very important for leaders working in a company like Coca Cola. These are needed to understand the complexity, deal with ambiguity and to effect influence in organization (Perren and Burgoyne, 2001).
Leadership skills are required for long term future planning. This planning for a company like Coca Cola can be that it wants to become more innovative, along with investing in high growth opportunities. This is because a company like Coca Cola Company has immense competition in the market. Innovation can be implemented in the organization if the greater interdependence is created amongst leaders to create effective collaboration across functions that will help in bringing of new products in the market. Moreover, leaders should anticipate capital, space and talent implications of the rapidly expanding portfolio of the company. There should also be increase in leadership involvement across functions in gathering customer insights and translating these ideas into profitable new and innovative products.
For investing in high growth opportunity, the senior management of Coca Cola Company should aim to attract attention to talent development. This will accelerate the acquisition and development of talent for key roles. This is essential since sometimes talent becomes the constraint for growth to become stagnant. Moreover, the company should also increase the number of its leaders per year to a certain amount (Perren and Burgoyne, 2001).
For a company like Coca Cola Company, which has global operations, leaders should be focused on how to manage diversity in the company. This is because; today’s world along with being competitive and complicated has become increasingly diverse. The workplace is not an independent body now; rather it has to deal with the whole world since competition is not only coming from within the country that the organization is set up in, but from every continent. Managers therefore are required to identify how the workplace is changing, evolving and diversifying. However, only identifying is not enough. Rather the managers have to deal with this changing, evolving and diversifying workplace in the best possible way. Hence, the managers today should have the skills to deal in a multi cultural workplace. For this the leaders should have the good interpersonal skills to understand the employees and make them understand the tasks. They should also have good relationship oriented skills to manage the human resource properly along with having the democratic style to encourage two way communication and increasing delegations and teams in the workplace (Raelin, 2003).