People know Coca-Cola as a global brand. However, when the company entered the Indian market in the mid- 1990s, it was the company’s second try. Coca-Cola had operated there from 1950 until 1977, when it left with other Western firms in reaction to a law requiring foreign businesses to have Indian partners. A decade and a half later, the government relaxed restrictions on foreign companies, and the enormous population and economic growth lured Coca-Cola back. Now India has become one of the company’s top 10 markets. Coca-Cola reentered India by purchasing the brands and distribution system of an Indian soft-drink company. Despite this advantage, the return brought challenges. Employee turnover was high until Coca-Cola improved hiring and training. To build stronger business relations, it identified local sources for its materials and invested in farms selling key ingredients. It learned about its customers— for example, that young Indians are heavy users of mobile devices and that the small stores where most people shop have poor electric service and need help keeping drinks cold. The solution: company-provided, solar-powered coolers. Other problems have been more difficult to solve. Farmers are pushing back against efforts to open a new bottling plant. They also grumble that Coke is using too much water, causing shortages. Indeed, the water supply in India has decreased dramatically, although the farmers themselves may be contributing to the problem. Whatever the cause, the government is restricting water use and the locations of bottling plants.

1. Based on the description in the case, is Coca-Cola Company a domestic, international, multinational, or transnational organization? Why?

2. How can an understanding of India’s culture help a Coca-Cola manager succeed there?

3. Besides the measures described, what else can Coca-Cola do to maintain ethical conduct in the countries where it operates?