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The Coca.Cola Company is a total beverage company with 86,200 employees woridwide and more than 500 brands in more than 200 countries and territorles, its product portfollo inchudes well known beverage brands such as Fanta, Schweppes, Dasani, Minute Maid, Smartwater, and Sprite. Like other major beverage companies, Coca cola has felt the effects of deciining soda sales as consumers. become more heaith-conscious. This, palred with the sudden impoct of the COVID-19 pandemic, has hurt the soda glant For many years, consumers have become better educated about the hatmfil effects of sugar. Conisumers have turned to diet and sugar free beverages such as sparkling woter, which has negatively affected sales of soda and luice. Coca Cola has tesponded by reformutating nearly 1,000 beveroges to reduce added sugat, focusing on low and no-sugar options, and introducing smalier pack sites. Adfitionally, the compary introduced SmartLabel OR codes on 40 percent of is labeis to provide consumers with mote dctailed information about each beverage beyond the traditional nutrition facts parel The company's gradual decline in soda sales wos marked by a sharp decine in overail sales as a result of the global pandemic. A significant Figi portion of Coca Cola's saies come from theasers, restaurants, and sporting events, which were closed or under reduced operations for the duration of the COVIO-19 pandemic. In response to siow sales, which were accelerated by the pandemic, Coca Cola eliminated several brands to silm down its portfolio, lncluding Tob, Zico, and Odwalla. The changes are part of a brodder strategy to reinforce Coca-Cota's leadership in five product categorles that the company believes have the strongest consumer opportunitiesi Coca-Cola; sparkding flovors; hydration, sports, coffee, and tea, nutrition. juice, milk, and plant; and emerging categories, Coca-Cola recognizes that the market is fast changing and expects this shift will drive futare growan. Along with eliminating underperforming brands, Coca Cola announced plans to restructure the company and focus its drink portfollo on latger and more popular brands. The compary is building a networked global organization and will create now operating units focused on regional and locai execution that wil wotk ciosely with five matketing category leadership teams that span the giobe to rapidiy seale ideas. To heip streamine the organization, nine new divisions wilt replace 17 bosiness units and wil focus on scaling new proclucts faster while eliminating the duplication of organtotion, nine new divisions will replace 17 business units and will focus on scallng new products fauter while eliminaning the dupheation of resources. In a colporate press release. Coke's chalman and CEO James Quincey sald. "Wye harre been on a multi year journey bo bransform dur organitation. The changes in ous operating model wil shif oue maketing to drive more growth and put ekecution eloser to eustartiers and consumers while priontiring a porttolio of strong brands ard a disciplined irinovation famework" the structure as supported by the contipary/s newty created patform Servlces organization, which is a unh dedicated to efficiency and making the moat of cokes 9 lobat sealn- fhe unit wit taciale data management consumer analylics, and e-commerce and will work in partnerahp with bottiers As a resuit of the structural changes, Coca-Cola reabocated peoqle and resources, inclucing voluntary and involuntary reductioris in eithiloyees its voluntary program. Which includes a separation packinge for eligible employees, will be aftered to 4,000 employees in the United States. Canada. and Puerto Rico. The company hopes voluntary separation will reduce the number of irwoluntary liryoffi. The compuny?s sevenance prograrms are. expected to incur expenses ranging from $350 million to $550 milison 42 Critical Thinking Questions 1. What factors have contributed to decilining sales for Coca-Cola? 2. How will a new organlzational structure beneft Coca Cola? 3. How does the restructuring affect Coca Cola employees
