Organization’s international operations are shaped by industry pressure for local responsiveness and industry pressure for global integration. Operating in foreign country necessities certain requirements and developments to ensure the business continues with it mission. Industry pressure for local responsiveness refers to local requirements from the society (consumers) and the government that shape company’s products and operations in a country. Industry pressure for global integration is the pressure that the company faces in the global arena in order to maintain competitiveness.1
Coca Cola is a multinational Company that manufactures non-alcoholic drinks. The drinks are distributed throughout the world market by licensed bottling company. The company has changed its products and operations in the recent years as a responsive to industry pressure. The company coco cola drink is a leading brand in Australian market.
This paper outlines how Coca Cola Company is responding to pressure from both local responsiveness and global integration. The paper will also use examples in the local market of how Coca Cola Company is responding and international responses in order to remain the market leader in the non alcoholic drinks in the world market
Industry Pressure for Local Responsiveness
Coca Cola Company manufactures drinks for human consumption. Human beings are dynamic and keep on evolving from time to time. When other factors change in the society, people change their behavior in consuming specific products. For instance, level of education and level of income change individuals existing lifestyles and consequently change their consumption habits . For survival and improvement purposes, Coca Cola Company have to respond accordingly to local consumers and the government to ensure that it operations and products are not coherent with the domestic market.2
The following are responses that the coca cola company is doing to manage industry pressure from local responsiveness;
Product differentiations: Coca Cola has continually introduced differentiated coke products that are tailored for specific segments in the Australia market. It has introduced coke zero and coke diet and still maintained the classic coke drink. The coke zero is meant for the increasing health conscious individuals in the market who suffer obesity. Coke diet is for the market segments who want drinks that have specific diet requirement.
1 Peter G.P. Walters, Paul Whitla and Howard Davies, "Global Strategy In The International Advertising Industry" (2008) 17 International Business Review.
2 Peter J. Buckley, "Business History And International Business" (2009) 51 Business History.
Product substitution: The Company has recently and increasingly produced new drinks to market. This has been as a result of industry pressure from the local consumers who need substitute drinks. The company recently introduced bottle water in Australian market to act as a substitute to it products.
Increasing cost of recycling: The Company has been facing legal charges on issues of recycling where the local government require them to recycle it by products. The company has responded by increasing its investment in recycling project to ensure that it within the environmental requirements of the government.
Industry Pressure for Global Integration
Coca Cola Company operates on international standards and face competitions from several companies. The company has to respond accordingly to ensure that the industry pressure for global integration does not slow down or dismantle its objectives. Due to technological advancement the company has continuously changed to maintain competitiveness in the industry .4
.The following are the responses that the company has done to manage industrial pressure for global integration;
Cost reduction: The Company has improved efficiency and effectiveness in production by adopting technology in the process to reduce cost of production. All companies in the industry are striving to produce at the least possible cost so that it can offer drinks to the global market at a competitive prices.
Production in large scale: Coca cola has increased its production per time. This response is aimed at ensuring that the company benefit from economies of scale. This minimizes the cost that the company incurs in manufacturing, processing and transportation. Due to industry pressure to sell products at competitive prices, the company has to operate in large scale in order to be able to compete successfully.
Healthy products: The global market is evolving to consume products that are healthy to their bodies. Consumers have been changing their lifestyle to be health conscious of the product they consume. This has resulted to companies in the food and drinks industries to change products. Coca cola Company has responded to producing products that are healthy to ensure that it survives in the market competitively in the 21st century. 3
3 Claude Cellich, "Dynamics Of Successful International Business Negotiations" (1994) 3 International Business Review.
4 Yadong Luo, Entry And Cooperative Strategies In International Business Expansion (Quorum, 1st ed, 1999).
From the discussion above, it can be summarized that international business cannot remain static to industry pressure and has to keep responding in order to survive. Therefore it important that an international business keeps trends in both the local market and global arena
Buckley, Peter J., "Business History And International Business" (2009) 51 Business History
Cellich, Claude, "Dynamics Of Successful International Business Negotiations" (1994) 3 International Business Review
Company, Our et al, Coca-Cola Journey Homepage (2016) The Coca-Cola Company
Eliasson, Gunnar, "Global Economic Intergration And Regional Attractors Of Competence" (2003) 10 Industry & Innovation
Luo, Yadong, Entry And Cooperative Strategies In International Business Expansion (Quorum, 1st ed, 1999)
Walters, Peter G.P., Paul Whitla and Howard Davies, "Global Strategy In The International Advertising Industry" (2008) 17 International Business Review