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MNG3702 Assignment 1 (COMPLETE ANSWERS) Semester 2 2026 - DUE August 2026; 100% Correct solutions and explanations.

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MNG3702 Assignment 1 (COMPLETE ANSWERS) Semester 2 2026 - DUE August 2026; 100% Correct solutions and explanations. The Coca-Cola Company is one of the most recognisable consumer businesses in the world. Founded in 1886 in Atlanta, it has evolved from a single-product company into a global beverage enterprise offering sparkling soft drinks, water, juice, sports drinks, tea, coffee, and energy beverages. In its 2025 annual report, the company described its purpose as "to refresh the world and make a difference". A framework for its direction was also outlined around three ideas: Loved Brands, Done Sustainably, and For a Better Shared Future Together. These ideas suggest that the business views growth as something that must be based on more than just strong brands and sales, but also on relevance, responsible operating practices, and long-term relationships with its markets and communities. The business model of Coca-Cola combines global coordination with extensive local execution. It's a company that operates through two main lines of activity: in concentrate operations, it sells beverage concentrates, syrups and related inputs to authorised bottling partners; in finished product operations, it sells certain beverages directly to retailers or through distributors and wholesalers. Such an arrangement allows the parent company to focus on brand ownership, product development, portfolio choices, marketing direction and strategic oversight, while bottlers take responsibility for much of the manufacturing, packaging, distribution and day-to-day market presence. In the 2025 annual report the company reported five major operating segments: EMEA, Latin America, North America, Asia Pacific and Bottling Investments. Those segments, however, do not operate in isolation; the company emphasised that they are connected in ways that allow knowledge, capability and selected innovations to move across the system more quickly. That model adopted by Coca-Cola gives considerable reach, but in reality it also makes the business complicated to steer. The company then has to coordinate people, brands, partners, suppliers, customers, and public institutions across very different settings. In its annual report, it identifies a number of risks that could influence the company's performance including competition, changes in consumer preferences, economic strain, inflationary costs, disruptions in supply, public health concerns, cyber threats, environmental pressure, and the possibility that third-party partners will not deliver on their promises. The company's strength therefore lies not only in what strategy it chooses, but in how consistently it can translate that strategy into action across a large and demanding system. Due to its combination of opportunity and complexity, South Africa provides a particularly valuable setting for exploring these issues. According to the Coca-Cola system in South Africa, in 2024, it generated R51,2 billion in value-added economic activity, supported more than 87,000 jobs, and sourced R25,6 billion in goods and services from local suppliers. These figures show the significance of the business in the local economy. The company's footprint extends well beyond branded beverages to agriculture, packaging, logistics, retail trade, employment, and small businesses. Therefore, the decisions Coca-Cola takes in South Africa have economic and social consequences not only for the company. In addition, the company announced a planned investment of R17,5 billion until 2030, which underscores their longer-term commitment to the country. A significant part of the investment, according to the announcement, is intended to expand the company's production capabilities, enhance distribution capabilities, and accelerate innovation across all of the value chain's components. As a result, this proves that management still views South Africa as a strategic market, even if there are concerns about affordability, tighter public scrutiny, and operational challenges within the nation. As part of the decision, it is also reflected in the belief that more disciplined execution and stronger local capability can support the company's long-term competitiveness. Coca-Cola Beverages South Africa (CCBSA), the company's primary authorised bottler, handles most of this local execution on behalf of the company. With 11 manufacturing plants located in six provinces, Coca-Cola Beverages Africa has 11 manufacturing plants that serve more than 107,500 retail outlets. The plant employs 5,550 people, which accounts for over half of the company's total volume. In South African public communications, the business emphasizes affordability, customer partnerships, route-to-market reach and ability to introduce product variants and categories that are appropriate for the local market. The success of the strategy depends on a number of ordinary, but important decisions: the effectiveness at which plants run, the availability of stock, whenever and wherever it is needed, the efficiency with which routes are managed, the manner in which retailers are served, as well as the price points that are appropriate for different consumers. One of the most visible aspects of Coca-Cola's strategic story is its

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, MNG3702 Assignment 1 (COMPLETE ANSWERS)
Semester 2 2026 - DUE August 2026; 100% Correct
solutions and explanations.
Question 1

Absorptive Capacity of The Coca-Cola Company

Absorptive capacity refers to an organisation's ability to identify and acquire valuable
external knowledge, assimilate and understand that knowledge, transform it by
combining it with existing knowledge, and exploit it effectively to improve organisational
performance, innovation, and competitive advantage (Cohen & Levinthal, 1990; Zahra &
George, 2002).

The Coca-Cola Company demonstrates a strong absorptive capacity through the
following four dimensions:

1. Acquisition

Acquisition is the organisation's ability to identify and obtain valuable knowledge from
external sources.

Coca-Cola demonstrates this capability by continuously monitoring changes in consumer
preferences, government regulations, environmental trends, and technological
developments across global markets. In South Africa, the company has recognised
changing consumer demand following the introduction of the Health Promotion Levy
(sugar tax), environmental sustainability expectations, and water scarcity challenges. It
also acquires knowledge through partnerships with organisations such as PETCO,
Collect-a-Can, and The Glass Recycling Company, which provide expertise in recycling
and circular economy initiatives.

2. Assimilation

Assimilation refers to the organisation's ability to analyse, interpret, and understand the
knowledge it has acquired.

Coca-Cola effectively assimilates external information by evaluating market trends,
regulatory developments, environmental data, and customer feedback across its global
operating segments. Information gathered from different regions is shared throughout the
Coca-Cola system, enabling management and bottling partners to understand emerging
risks and opportunities. This allows the company to coordinate strategic decisions across
its worldwide operations while remaining responsive to local market conditions.

Connected book
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Tersia Botha, Peet Venter Practising Strategy
Publisher: 2019 ISBN: 9781485125150 Edition: 2

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