Case Study Description of Coca-Cola FEMSA's Contribution to Peace
In 2003, the FEMSA Corporation -a Mexican company- acquired 100% of the shares of the largest franchise of the Coca-Cola system in Latin America (PANAMCO), and placed itself at the lead of the sales of carbonated beverages and other soft drinks in different countries of South America, including Colombia, which had been struggling with armed groups since the 1970s. This case explores how Coca-Cola FEMSA included different initiatives in its sustainability strategy, aimed at supporting the process of peaceful demobilization that would be carried out by the Alta Consejeria para la Reintegracion (ACR, High-Council for Reintegration) of the Colombian Government. As part of this disarmament process, the ACR offered the demobilized combatants (former combatants that had decided to lay down their arms peacefully and turn themselves in to the proper authorities) different options for social reintegration, such as financing for starting new businesses and connections with companies that could provide jobs, among other things, which were also shared with the business sector to see how it could help support the process. By August 2011, Coca-Cola FEMSA had already been collaborating with the Colombian Government for a little over three years, and had diversified its initiatives to support not only the former combatants, but also the soldiers, victims and general public affected by the conflict. Despite these multiple efforts, however, the actual impact of the company's actions on the solution of the problem of reintegrating more than 50,000 demobilized combatants was still negligible. Therefore, the ACR requested greater commitment from the company in the form of a massive campaign to broadcast the initiatives, in an attempt to motivate and increase the number of participating companies.
Authors :: Rosa Amelia Gonzalez, Francisco Layrisse, Gerardo Lozano
Swot Analysis of "Coca-Cola FEMSA's Contribution to Peace" written by Rosa Amelia Gonzalez, Francisco Layrisse, Gerardo Lozano includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Combatants Acr facing as an external strategic factors. Some of the topics covered in Coca-Cola FEMSA's Contribution to Peace case study are - Strategic Management Strategies, Sustainability and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Coca-Cola FEMSA's Contribution to Peace casestudy better are - – increasing energy prices, technology disruption, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, banking and financial system is disrupted by Bitcoin and other crypto currencies,
talent flight as more people leaving formal jobs, wage bills are increasing, etc
Introduction to SWOT Analysis of Coca-Cola FEMSA's Contribution to Peace
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Coca-Cola FEMSA's Contribution to Peace case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Combatants Acr, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Combatants Acr operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Coca-Cola FEMSA's Contribution to Peace can be done for the following purposes –
1. Strategic planning using facts provided in Coca-Cola FEMSA's Contribution to Peace case study
2. Improving business portfolio management of Combatants Acr
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Combatants Acr
Strengths Coca-Cola FEMSA's Contribution to Peace | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Combatants Acr in Coca-Cola FEMSA's Contribution to Peace Harvard Business Review case study are -
Training and development
– Combatants Acr has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Coca-Cola FEMSA's Contribution to Peace Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Analytics focus
– Combatants Acr is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Rosa Amelia Gonzalez, Francisco Layrisse, Gerardo Lozano can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
High switching costs
– The high switching costs that Combatants Acr has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Ability to recruit top talent
– Combatants Acr is one of the leading recruiters in the industry. Managers in the Coca-Cola FEMSA's Contribution to Peace are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Combatants Acr has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Combatants Acr has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Low bargaining power of suppliers
– Suppliers of Combatants Acr in the sector have low bargaining power. Coca-Cola FEMSA's Contribution to Peace has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Combatants Acr to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Combatants Acr
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Combatants Acr does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Combatants Acr in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Combatants Acr is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Strategy & Execution field
– Combatants Acr is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Combatants Acr in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Combatants Acr has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Combatants Acr to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Combatants Acr is present in almost all the verticals within the industry. This has provided firm in Coca-Cola FEMSA's Contribution to Peace case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Weaknesses Coca-Cola FEMSA's Contribution to Peace | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Coca-Cola FEMSA's Contribution to Peace are -
Lack of clear differentiation of Combatants Acr products
– To increase the profitability and margins on the products, Combatants Acr needs to provide more differentiated products than what it is currently offering in the marketplace.
Need for greater diversity
– Combatants Acr has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Coca-Cola FEMSA's Contribution to Peace HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Combatants Acr has relatively successful track record of launching new products.
Skills based hiring
– The stress on hiring functional specialists at Combatants Acr has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Combatants Acr is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Coca-Cola FEMSA's Contribution to Peace can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Combatants Acr has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Low market penetration in new markets
– Outside its home market of Combatants Acr, firm in the HBR case study Coca-Cola FEMSA's Contribution to Peace needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As Coca-Cola FEMSA's Contribution to Peace HBR case study mentions - Combatants Acr takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
No frontier risks strategy
– After analyzing the HBR case study Coca-Cola FEMSA's Contribution to Peace, it seems that company is thinking about the frontier risks that can impact Strategy & Execution strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High bargaining power of channel partners
– Because of the regulatory requirements, Rosa Amelia Gonzalez, Francisco Layrisse, Gerardo Lozano suggests that, Combatants Acr is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Coca-Cola FEMSA's Contribution to Peace, in the dynamic environment Combatants Acr has struggled to respond to the nimble upstart competition. Combatants Acr has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Coca-Cola FEMSA's Contribution to Peace | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Coca-Cola FEMSA's Contribution to Peace are -
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Combatants Acr can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Combatants Acr can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Coca-Cola FEMSA's Contribution to Peace, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Combatants Acr can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Loyalty marketing
– Combatants Acr has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Buying journey improvements
– Combatants Acr can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Coca-Cola FEMSA's Contribution to Peace suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Combatants Acr in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Combatants Acr can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Combatants Acr can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Combatants Acr in the consumer business. Now Combatants Acr can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Combatants Acr has opened avenues for new revenue streams for the organization in the industry. This can help Combatants Acr to build a more holistic ecosystem as suggested in the Coca-Cola FEMSA's Contribution to Peace case study. Combatants Acr can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Combatants Acr can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Combatants Acr can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Combatants Acr can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Combatants Acr to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Combatants Acr to hire the very best people irrespective of their geographical location.
Threats Coca-Cola FEMSA's Contribution to Peace External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Coca-Cola FEMSA's Contribution to Peace are -
Technology acceleration in Forth Industrial Revolution
– Combatants Acr has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Combatants Acr needs to keep up with the evolution of technology in the Strategy & Execution sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Combatants Acr with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Combatants Acr needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Combatants Acr will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Stagnating economy with rate increase
– Combatants Acr can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Combatants Acr in the Strategy & Execution sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Combatants Acr in the Strategy & Execution industry. The Strategy & Execution industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Regulatory challenges
– Combatants Acr needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Strategy & Execution industry regulations.
Shortening product life cycle
– it is one of the major threat that Combatants Acr is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Combatants Acr can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Combatants Acr can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Coca-Cola FEMSA's Contribution to Peace .
Weighted SWOT Analysis of Coca-Cola FEMSA's Contribution to Peace Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Coca-Cola FEMSA's Contribution to Peace needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Coca-Cola FEMSA's Contribution to Peace is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Coca-Cola FEMSA's Contribution to Peace is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Coca-Cola FEMSA's Contribution to Peace is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Combatants Acr needs to make to build a sustainable competitive advantage.
