MANUFACTURING ORGANIZATION DESIGN & CONTROL

Identification of Coca Colas Organizational Environment

By: Ivana Dione / 4175 Thomas Bagus Budi Prakoso / 5268

ATMAJAYA YOGYAKARTA UNIVERSITY INDUSTRIAL TECHNOLOGY FACULTY INDUSTRIAL ENGINEERING INTERNATIONAL CLASS 2010

Coca Cola Bottling Indonesia OverviewThe Coca Cola Bottling Indonesia is the leading manufacturers and distributors of soft drink in Indonesia under the license of The Coca Cola Company. The Coca Cola Bottling Indonesia is a trade name and is made up of joint venture company formed by local companies, owned by independent businessmen, and Coca Cola Amatil Limited, which is one of the largest manufacturers and distributors Coca Cola products in the world. The company produce and distribute Coca Cola products to over 400,000 outlets through more than 120 Sales Center. They also employ approximately 9,000 employees. Their main products are such as Coca Cola, Sprite, Fanta, and Frestea, are produce in their factory all over Indonesia. They not only produce soft drinks, but also tea, isotonic drinks, and mineral water. The products that Coca Cola Bottling Indonesia produces are Coca Cola, Diet Coke, Coke Zero, Sprite, Sprite Zero, Fanta, Fanta Vitamin C, Schweppes, A&W, Frestea, Frestea Green, Frestea Green My Body, AdeS mineral water, Powerade Isotonik, and Minute Maid Pulpy Orange. Because Coca Cola is a large company, it also has a wide scope of organizational environment, which is give us many topics and ideas to discuss and to gain more acknowledgement about identifying the environment of a company or an organization.

COCA COLA ORGANIZATIONAL ENVIRONMENT

Sometimes, there occurs some conflicts among the stakeholders of a company because each stage and part of the stakeholders have different concerns and objectives. Therefore, we will explain each stages and each part of the Coca Colas organizational environment.

The Internal Stakeholders of Coca Cola Company

The main attributes in internal environment include, efficiency in the production process through management skills and effective communication channel among all members of the internal stakeholders. To effectively control and monitoring the internal environment, the Coca Cola Company must conduct continual appraisals of the businesses operations and readily act upon any factors that causing inefficiencies in any phase of the production and consumer process. 1. Shareholders They concern on earning profits. 2. Board of Directors (Management) They have concern to keep the labor and material cost down, so, they can keep the production cost low. 3. Employees While the employees want to have raises and increased benefits from the company.

The External Stakeholders of Coca Cola Company1. Customers The customers of Coca Cola are, individual consumers, food stores, and other retail outlets. Customers have influence in demand, complaints, and trust, which must be consider by the company, because the customers taking the most important role in company performance. 2. Suppliers The supplier of Coca Cola for example are Nutrasweet as the producer of aspartame which is one of the ingredients in their product, Stepan Company as the authorized company to process and import coca plant which we know is the main ingredient in Coke, the packaging company, the local raw materials suppliers, the machinery company, etc. As supplier, they have objective to gain more revenues by charging higher price to their customers. They also taking important part for the progress of a company, so the management must able to build an effectively and efficiently comunications with them in order to establish a good supply chain for the company. 3. Competitors The first competitor of Coca Cola is Pepsi Cola, followed by 7Up (Seven Up), and other soft drinks products. The presence of the competitors of a company can bring a good impact for the company itself, this condition will make the company more

innovative. 4. Strategic partners Coca Cola have several strategic partners, such as McDonalds, Pizza Hut, and the other restaurants in Indonesia. These strategic partners taking role in the products marketing of Coca Cola. 5. Government Several government policies that have impact directly to the Coca Cola company are BPOM (Food & Drugs Supervision Agency in Indonesia) registration, Environmental Protection Agency, Labor Law, regulations for beverages manufacturers, etc. 6. Media The function of media is for advertising. Advertisment is not only via the paper and television media, but also can be done via some events. The advertising media of Coca Cola is print / paper media in magazines, newspapers, etc.; television media which sometimes the advertising is a collaboration with popular artist in their market segment and adjust the advertising with the public holiday in Indonesia.; international events and foundations, such as become the sponsor of Olympics and WWF. 7. Local Communities The local communities have concern with the environmental issues and labor standards. The example of local communities are, labor union, Green Peace, WALHI, etc.

The General Environment of Coca Cola Company1. Technological Variables Some technological variables that we can identify in Coca Cola are: The effectiveness of companys advertising, marketing, and promotional programs. The company use the new technology of internet and television to make their product more attractive, therefore they can socialize their products to their costumers more effectively and efficiently. The introduction of slimmer can and plastic bottle in order to make their products is easier to carry. Using newer machinery technology for production.

2. Political Variables

Some variables of this sector, such as: Changes in tax rates and regulations Political problems and conditions, l. e.: Century case Changes in the government regulations Indonesia governement plan to have a global trading with China The rise in private healthcare and privatisations under Conservative governments. 3. Economical Variables The global economy crisis that happen last year, inevitably also give impact to the Coca Cola company. Day by day, the purchasing power of Indonesia people is decreased because of the difficult economy situation in Indonesia. It makes them not buy this kind of products which is expensive for them. A recession creating increased activity at the lower ends of product price ranges. Rate of interest rises depressing business and causing redundancies and lower spending levels 4. Social Variables The changing attitudes and lifestyles Indonesian people. Many Indonesia citizens getting aware about health issues. This condition force the beverage manufacturers like Coca Cola to produce dietary products, mineral water, and also isotonic waters. The increasing number of women going out to work, for example, led to the need for time-saving products for the home. Source: http://www.coca-colabottling.co.id/