PROJECT REPORT

International Human Resource Management

Submitted by:
SYEDA MARYAM SHAKIR

UM-E-KALSOOM

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Table of contents

Introduction……………………………………………………………………………………………………………………. 3

Mission……………………………………………………………………………………………………………………………. 3

Vision………………………………………………………………………………………………………………………………. 3

Values……………………………………………………………………………………………………………………………… 3

Goals……………………………………………………………………………………………………………………………….. 3

Culture…………………………………………………………………………………………………………………………….. 4

Structure………………………………………………………………………………………………………………………….. 4

Strategy……………………………………………………………………………………………………………………………. 5

Management style……………………………………………………………………………………………………………. 7

IHRM policies and practices………………………………………………………………………………………………. 9

PART II

Acquisition…………………………………………………………………………………………………………………………………… 11

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Introduction
Coca Cola was invested in May 1886 by Dr. John S. Pemberton in Atlanta, Georgia. Currently,
its operations are in more than 200 countries, and with diverse work force of approximately
55,000 employees. The home country of Coca Cola is USA. There are seven main regions where
Coca Cola operates in as the following:

North America, Africa, Asia, Europe, Eurasia, Middle East, Latin America. Each region has
divided into countries and each country has its own structure the following figure explains the
structure of Coca Cola in Great Britain.

The Coca Cola Company Mission

Our mission is:

 To refresh the world in mind, body and spirit

 To inspire moments of optimism and happiness through our brands and actions
 To create value and make a difference.

VISION

Coca Cola’s vision statement is “inspiring each other to be the best we can be by providing a
great place to work.”

Core Values
Our values serve as a compass for our actions and describe how we behave in the world.

 Leadership: The courage to shape a better future

 Collaboration: Leverage collective genius
 Integrity: Be real
 Accountability: If it is to be, it's up to me
 Passion: Committed in heart and mind
 Diversity: As inclusive as our brands
 Quality: What we do, we do well

The Coca Cola Company goals

To achieve our mission, we have developed a set of goals, which we will work with our bottlers
to deliver:

People: Inspiring each other to be the best we can be by providing a great place to work

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Portfolio: Offering the world a portfolio of drinks brands that anticipate and satisfy people's
desires and needs

Partners: Nurturing a winning network of partners and building mutual loyalty

Planet: Being a responsible global citizen that makes a difference by helping to build
and support sustainable communities

Profit: Maximizing long-term return to shareholders, while being mindful of our overall
responsibilities

Productivity: Being a highly effective, lean and fast-moving organization.

Culture of Coca Cola

The culture of the Coca Cola Company is mission driven. Friendly and innovative. Monthly
leadership team meeting, Weekly departmental team meetings, Monthly employee team briefing
sessions, Surveys to monitor employee views and feelings. Coca cola focus on team work;
encourage employees to participate different ideas. Coca cola have open communication
channels. Coco Cola’s culture is strong because of their key values are deeply held widely
shared, employees accept the organizations key values and greater their commitment to those
value so culture becomes stronger and stronger.

Structure
Currently approximately 98,400 employees worked, each branch has 5 top level managers. CEO
is a member of senior leadership team, these 4 people answer directly to CEO.

The Coca-Cola Company’s organizational structure consists of a board of directors, elected by

the shareholders, that has final decision-making power in the running of the company. Members
of senior management and a number of standing committees carry out the decisions of the board
of directors.

The board of directors of the Coca-Cola Company is answerable only to the shareholders. The
board's responsibility includes the selection and oversight of senior management, including the
chief executive officer and the vice CEO

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Strategy
On a wider scale, Coca Cola introduced five strategic actions to achieve its goals which are as
follows:

1. Market segmentation

Market segmentation is a strategic method to divide the market based on volume and
capacity of buyers and using appropriate methods to maximize sales and thereby, earning
profits from each segment. Coca Cola used this technique to segment the market according to
emerging markets, developing markets and developed markets since every country in the 200
plus countries play a crucial role in the growth. In emerging markets, the primary focus was
on increasing the sales volume rather than profits so that it increased its customer domains
and make a strong foundation for future business. This was made possible by selling
beverages at economical rates so that higher no. of masses can enjoy it. In developing
markets, a balance was made between volume sold and pricing, whereas, in developed
countries the focus was more on profit making by offering more small packages and
premium packages like glass and aluminum bottles.

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2. Brand establishment and Customer relationship

Brand establishment becomes vital while expanding an organization’s portfolio. Consumers tend
to trust a branded product and often spend an extra penny upon it rather than choosing an
unheard product. Brand name is also viewed as a status quo in developed markets. Coca Cola
made a right decision to invest in developing the brand value by improving and modernizing the
advertisements by investing over $250 million. These ads focused on creating an impact upon
people and changed the perspective of Coca Cola from an occasional drink to an integral part of
people’s life.

3. Increasing financial efficiency

For any business, the ultimate goal is to have maximum returns for the investments with
maximum productivity. In order to achieve this, financial efficiency plays an important role.
Coca Cola made efforts to achieve financial flexibility by implementing a solution known as
zero-based work. Wherein annual budget is revised from zero and must be justified annually at
the end rather than simply carrying over at levels established in the previous years..

4. Increasing process efficiency

An organization can be termed to be fully efficient when its process time is minimized without
affecting the quality. Process time plays an important role when the demand is suddenly
increased. Inefficient pre-planning and process planning will lead to disruption in supply of high
demands. In a continuous evolving market with highly volatile consumer demands both in
quantity and preferences, innovative supply chain markets, speed, precision and empowered
employees decide the winner. Coca Cola took steps to reshape their business processes and
searched for redundant areas. It removed a layer of functional management and connected our
regional business units directly to headquarters. Further investigation led to removal of process
roadblocks and barriers which finally made it faster, smarter and more efficient. Focus was also
made to interact more with employees to make work a fun-filled, exciting and career fulfilling
environment. Employees were motivated to nourish curiosity, learning, innovation and growth.

5. Focusing core competencies and business models

Coca Cola has developed a business model with portfolio including more than 500 brands
ranging from sparkling beverages to value-added dairy and many more. Over a billion dollars
annually are generated together by few of these in retail sales. It has managed to gather a variety
of consumers thereby generating profits from all segments irrespective of market conditions. Its
primary core competency has been the ability to manage a huge system of independent bottling
partners and also acquiring a number of bottlers under its own. The primary aim has been to
improve performance of bottling partners by increasing productivity, performance, optimizing
manufacturing and distribution systems and finally refranchising the independence of bottling
territories. All this effort finally creates value for retail and restaurant customers.

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Management Styles
A management style is an overall method of leadership used by the manager. The success that
the management team at Coca-Cola has in motivating its employees to meet their objectives is
based on the management style they adopt. There are three main management styles democratic,
autocratic and the laissez-faire style.

The Coca-Cola Company uses the following management styles, but each one in different
departments. There are three main types of management styles used in businesses:

 Democratic

The democratic leadership style consists of the leader, sharing the decision making abilities with
the group members by promoting the interests of the group members and by practicing social
equality.

This emphasizes on group agreements to generate new ideas. There are two types of democratic
management styles; democratic and consultative democratic. Democratic is where all the
managers, junior managers and employees are involved in the ideas and final decision process.
Out of all the workers, no-one has a higher level than the others in this management style.

Democratic style is the management style that Coca-Cola adopts. This sort of management style
involves empowerment. In this management style individuals and teams are given
responsibilities and decisions to make, usually within a given framework. If anything wrong
happens then the individuals and teams are then held responsible for the decisions that are
chosen. With this type of management style it allows the manager to feel comfortable with other
people in the organization making some of the decisions. Democratic managers will often want
feedback from their employees on decisions being made. Democratic leaders listen and act on
the opinions of the group. This type of management is good as it makes the employees happy and
productivity is high. This is a very good method because employee's thoughts and suggestions
are listened to by the business. This makes the employees seem as if they are respected and that
their thoughts are valid.

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  Autocratic

The authoritarian leadership style or autocratic leader keeps strict, close control over the
followers by keeping close regulation of the policies and procedures given to the followers. To
keep main emphasis on the distinction of the authoritarian leader and their followers, these types
of the leaders make sure to only create a distinct professional relationship.

Where the leader makes all the decisions, there is no negotiation and is very prescriptive and
there is little job satisfaction. However, the job gets done quickly and there is less conflict
between different ideas. This style is hardly used among the company as they believe that the
lack of input could lead to poor results. Autocratic does save a lot of time as quick decisions can
be made and there is no time wasted on discussion resulting in the business saving time and
money.

On the factory floor at Coca-Cola, there is an autocratic system of management where the
employees are controlled by the managers and follow their procedures.

 Laissez-faire management style

The Coca-Cola Company has a culture that is run in the laissez-faire style meaning the ‘hands
off’ approach. The laissez faire style is sometimes described as the "hands off" leadership style
because the leader delegates tasks to their followers, while providing little or no direction to the
followers.
If the workers are meeting their Key Business Indicators, then the managers and the directors of
the company take this relaxed style of coordinating their business. They have a vision to ‘refresh
everyone everyday ’and the values ‘to take pride in their work , to be honest , fair and
determined to win and have a passion for their actions’.

Yes, there is a relationship between company’s strategy and its structure and culture along with
the management style. Cola Cola’s management use three management style as we explained
above, their management style changed according to situation. At factory floor they use
autocratic style to manage the employees and otherwise they use democratic style which
associates with company’s friendly culture.
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IHRM policies and practices of Coca Cola Company
Local Human Resource Management practices are different of international Human Resource
Practices, because the core different in the organizational structure. The structure of a
Multinational organization as Coca Cola should be different of another American local
organization. These differences come from the significant role and senior strategies of the
company. This should cause some significant change in the HR practices and functions.

Since Coca Cola is a company operates its business around a huge number of countries around
the world it began to respond to both of local and international needs. Environment, culture and
political differences exist from a region to another.

Globalization is the most important factor of the multinational enterprises phenomenon. Coca
Cola one of the American companies became a multinational company to take the benefits of
new markets and to minimize the labor costs. Haile (2002) mentioned that Bernadin and Russell
(1998) and Robbins (1997) all stated that Coca-Cola and Pepsi receive more than half of their
revenues from operations outside the United States. These reasons and more encourage the
company to operate its business outside the boundaries. While the company started its operations
outside USA it considered the environmental, cultural and political change. Also it considered
the differences among the multinational employees. Therefore it started to find the methods and
the practices which help to avoid any obstacles since the IHRM has new concepts were
developed internationally. As a core point, the international human resource practices should be
aligned with the predefined strategic business goals.

IHRM concepts in Coca Cola’s practices and reasons to transfer employees to the host countries

Staff selection, international assignments, international training and development, international

compensation, and IHRM in the host Country context are some key concepts of the international
practices which Coca Cola’s HRM is responsible to deal with. And it is important to know the
reason of transferring people from a region to another among Coca Cola parent company, host
countries and subsidiaries.

The reason of sending staff for international assignment in Coca Cola is to achieve three major
goals within short and long terms: to fill positions, develop the management and to fulfill Coca
Cola’s development.

Selecting staff for global assignments in Coca Cola

Hartono argued that studies explained that selecting employees for global tasks to achieve
international specific jobs is difficult. Also wrong selection may lead to significant problems.
Therefore Coca Cola developed its own system for careful selecting employees, in this system
the company determines carefully the appropriate persons for each assignment.

In Coca Cola they always give enough time to assess employees they wish to go for an
international assignment.

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  First step is to receive applications from the employees who find that he is qualified for
the task. Then conduct five hours assessment for all the applicants to identify the
following nine skills:

1. Organizing and planning

2. Perception and analysis

3. Decision making

4. Oral communication

5. Decisiveness

6. Adaptability

7. Interpersonal skills

8. Written communication

9. Perseverance

 Second step is to determine the best applicants who have succeed in the first assessment
and ask them to return next day for the organizational orientation, also there is three days
of training for the line managers who are responsible for this selection.
 In Coca Cola usually the third step is an interview to select one of three applicants to do
the international assignment.

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Part II

Acquisitions

The company has a long history of acquisitions. Coca-Cola acquired Minute Maid in 1960 and in
1982, it acquired the movie studio Columbia Pictures for $692 million but Columbia was sold
to Sony for $3 billion in 1989. It acquired the Indian cola brand Thums Up in 1993, and Barq's in
1995. In 2001, it acquired the Odwalla brand of fruit juices, smoothies, and bars for
$181 million. In 2007, it acquired Fuze Beverage from founder Lance Collins and Castanea
Partners for an estimated $250 million.
The company's 2009 bid to buy Chinese juice maker Huiyuan Juice Group ended when China
rejected its $2.4 billion bid, on the grounds the resulting company would be a virtual
monopoly. Nationalism was also thought to be a reason for aborting the deal.
In 2011, it acquired the remaining stake in Honest Tea, having bought a 40% stake in 2008 for
$43m. In 2013, it finalized its purchase of ZICO, a coconut water company. In August 2014, it
acquired a 16.7% (currently 18.5% due to stock buy backs) stake in Monster Beverage for $2.15
billion with an option to increase it to 25%, as part of a long-term strategic partnership that
includes marketing and distribution alliance, and product line swap. In 2015, the company took a
minority stake ownership in the cold pressed juice manufacturer, Suja Life LLC.In December
2016, it bought many of the former SABMiller's Coca-Cola operations. The Coca-Cola
Company owns a 68.3% stake in Coca-Cola Bottlers Africa. Coca-Cola Bottlers Africa's
headquarters located in Port Elizabeth South Africa.
In 2017, The Coca-Cola Company acquired Mexican sparkling water brand Topo Chico.
On August 31, 2018, it agreed to acquire Costa Coffee from Whitbread for £3.9bn. The
acquisition closed on 3 January 2019.
The Coca-Cola Company acquired a 40% stake in Chi Ltd on January 30, 2016. The Coca-Cola
Company acquired the remaining 60% stake in Chi Ltd on January 30, 2019.
During August 2018 The Coca-Cola Company acquired Moxie for an undisclosed amount.
On September 19, 2018 The Coca-Cola Company acquired Organic & Raw Trading Co. Pty Ltd
the manufacturer of MOJO Kombucha in Willunga, Australia.
On August 14, 2018 The Coca-Cola Company announced a minority interest in Body Armor.
On October 5, 2018 The Coca-Cola Company acquired a 22.5% stake in MADE Group from
Luke Marget, Matt Dennis and Brad Wilson the company's 3 founders. The Coca-Cola Company
owns a 30.8% stake in Coca-Cola Amatil ltd, therefore The Coca-Cola Company owns a further
6.93% stake in MADE Group through its ownership stake in Coca-Cola Amatil ltd.

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