This article makes me think about all the other big companies that are also highly inefficient and are also damaging the world. Coke and Pepsi are huge firms and with their immense power and distribution, their model can easily go unnoticed. Generating a million bottles and cans worldwide that are going to end up laying around is not good, and should change. At the same time, I can understand them not wanting or thinking about changing that due to their success. People are still going to buy their products. I know Coke and Pepsi encourage recycling, but I think they could do a lot more. More campaigning for that is necessary and not just a tiny recycling logo at the bottom of every bottle.
There is no doubt that companies such as Coca-Cola and Pepsi have glaring inefficiencies in the way that they have produced and distributed their product. As times change it seems that the business models also call for some alteration. However, with the success and pure dominance that these two companies have in the soft drink industry there is no reason for them to change right now. Even though the world landscape may be changing and their inefficiencies will be more apparent in the future, their success right now is indisputable.
Regardless of company inefficiencies, both of these firms have been global powers since their inceptions. Changing their business model would involve putting them at some market risk, and this probably operates under the colloquial logic of "If aint broke..don't fix it". Yes, by today's standards their business model may be archaic in structure, and largely cost inefficient--But it won't change while these two firms remain atop their entire industry.
The message of this article reminds me of a concept that I'm studying in another class called marginal thinking, which addresses the pitfalls of not considering the full cost of not changing your business model as things change because it's not cost effective on the marginal scale. Here's a great quote that is relevant:
"If you need a machine and don't buy it, then you will ultimately find that you have paid for it and don't have it." - Henry Ford
More on this topic if you're interested. http://hbswk.hbs.edu/item/7007.html?wknews=05092012
This article makes me think about all the other big companies that are also highly inefficient and are also damaging the world. Coke and Pepsi are huge firms and with their immense power and distribution, their model can easily go unnoticed. Generating a million bottles and cans worldwide that are going to end up laying around is not good, and should change. At the same time, I can understand them not wanting or thinking about changing that due to their success. People are still going to buy their products. I know Coke and Pepsi encourage recycling, but I think they could do a lot more. More campaigning for that is necessary and not just a tiny recycling logo at the bottom of every bottle.
ReplyDeleteThere is no doubt that companies such as Coca-Cola and Pepsi have glaring inefficiencies in the way that they have produced and distributed their product. As times change it seems that the business models also call for some alteration. However, with the success and pure dominance that these two companies have in the soft drink industry there is no reason for them to change right now. Even though the world landscape may be changing and their inefficiencies will be more apparent in the future, their success right now is indisputable.
ReplyDeleteRegardless of company inefficiencies, both of these firms have been global powers since their inceptions. Changing their business model would involve putting them at some market risk, and this probably operates under the colloquial logic of "If aint broke..don't fix it". Yes, by today's standards their business model may be archaic in structure, and largely cost inefficient--But it won't change while these two firms remain atop their entire industry.
ReplyDeleteThe message of this article reminds me of a concept that I'm studying in another class called marginal thinking, which addresses the pitfalls of not considering the full cost of not changing your business model as things change because it's not cost effective on the marginal scale. Here's a great quote that is relevant:
ReplyDelete"If you need a machine and don't buy it, then you will ultimately find that you have paid for it and don't have it." - Henry Ford
More on this topic if you're interested. http://hbswk.hbs.edu/item/7007.html?wknews=05092012