Public Issues of Tobacco and the Performance-Expectations Gap in Coca-Cola Company

Banning smoking in public place

Part-A

Question 1: Describe the “performance-expectations gap” evident in this case – what were the stakeholders’ concerns and how did their expectations differ from the company’s performance?

Ans. “Performance-expectation gap” means gap between stakeholder’s expectation and corporate performance. In other words stakeholders expecting such performance from businesses and if it is not achieved by business than gap between performance and expectation occurred. This is the responsibility of company to identify their stakeholders who influence organization and who are influenced by the organization. And after manage all things for all stakeholders. Public, manager, employees, customers they all are stakeholders and this is company responsibility that try managing balance between stakeholder’s expectations and performance of company. In this case expectations of the Stakeholders of the coca cola company were not matched because of environmental issues. Their product needs more water and world leader united state also warns about shortage of water and they are also facing problem of fresh water for their production.     They are using water for their production because of this in some places where their bottling plants are situated feces the problem of underwater level problem on of the example is the bottling plant which was situated in India. This is a public issue and all stakeholders are concern about this situation. Every stakeholder has some expectations from their companies, but coca cola did not meet the stakeholder’s expectations when this incident of depletion of water in India’s coca cola plant was in limelight in public.

After this incident coca cola company again in limelight of media because coca cola uses some dangerous pesticide for their production. So stakeholder’s expectations were more from coca cola but unfortunately they were not able to fulfill those. Stakeholder’s expectations differ because they expect that coca cola provide safe product and not use much water for their products.

Question 2 : If you applied the strategic radar screens model to this case, which of the eight environments would be most significant? Support your position.

Ans. The eight strategic radar screens are the customer, legal, political, social, competitor, and economic, technological and geophysical environments. For any company all of these screens are important. But in this case these environments would apply geophysical, social, customer and legal environment. For this case geophysical environment is more suitable because of the public and stakeholders are concern about the company’s contaminated production and decrease in water level. The company also faced some problems of political and legal environment, some government and political entities had taken legal actions against the company.

Controls on tobacco advertising and corporate sponsorship

Question 3: In your opinion, did TCCC respond appropriately to this public issue? Why or Why not?

Ans. Coca cola took a initiative steps to solving this public issue by using this approach. Because they want to build good relation with their internal and external stakeholders. Because without stakeholders support company will be out from business race. The company showing concern for nature and give commitment that they will return to nature and community an amount of water to what it is used. It would do this  by cleaning, recycling water ,less usage of water and started some projects for promoting save water. And the evidence shows that they have planned to made improvements and made substantial progress towards meeting its commitments.

Part-B

Tobacco: Tobacco is prepared from the leaves of the plant by curing them. And the name of the plant is tobacco. Tobacco is a risk factor for health because of tobacco many people suffer from heart, liver, lungs, cancer disease. In this assignment, I am going to explain some public issues of tobacco like the banning of smoking in public places, controls on tobacco advertising and corporate sponsorship.

Question 1:Introduction:Tobacco is a big issue in our society. According to me, the government should ban smoking in public place and secondly this created serious negative health consequences issues for smokers as well as other people.

1.Banning smoking in public place: Well, smoking should be banned in public place because it is not good for society and also for health.

1. Public smoking ban defends  non-smoker’s health: It is proved in science that tobacco products are dangerous for health and it creates cancer, heart problems, lungs disease and so on .Smoking also harms non-smokers health. People who breathe in the smoke have health issues and this smoking called passive smoking. In one research it is clearly shown that partners of smokers have more possibility of lung cancer even if they are non-smokers. Approximately every year 80000 people in EU die because of passive smoking.

2. Ban will cause people to smoke less overall: A ban on smoking in public place is also good for the health of smokers because they would be forced less smoke while they are at work or outside the home. Their consumption of tobacco will decline.

3. Businesses should comply fines and penalties in favour of banning smoking: Businesses should implement some fines and penalty on workers who smoke at workplaces. Because every good solution always comes with lots of difficulties and some people do not care about these changes. So if business put fines on smokers it will automatically decline. In research, it clearly shows that people who work in these businesses their consumption of cigarette decreases in meantime.

Stakeholders

4. Younger generation: When people smoke in public place sometimes younger generation is encouraged to smoke because they adapt those things easily which are happening around them?

2. Controls on tobacco advertising and corporate sponsorship: It is important to control on tobacco advertisement if we want to save our future generation health. Tobacco industry has legal rights (TAPS) to promote their product by advertisement in different ways like newspapers, TV advertisement, through films, discount or gift coupons, distribution of free samples and now a day’s most popular way internet. TAPS Tobacco advertisement and promotion any type of commercial communication used for direct and indirect advertisement of tobacco. Research evidence proves that there is a direct relation between tobacco advertisement and usage of tobacco, especially in the youth.

Tobacco industry uses powerful communication channel for their product promotion internet, they post their product campaign around sports and music events on facebook, twitter, instagram and so on. Many tobacco industries sponsor many events for their promotion these all things should be banned under TAPS. A study conducted that most of the youngsters are influenced by celerity’s lifestyle and they are exposed tobacco use in films. So, tobacco advertisement and promotion misled our youth and adult generation.
Different stakeholders who get influenced and who influenced this decision:

Stakeholders: A stakeholder is an individual or group, who can influence and influenced by the achievement of an organization’s purpose. The first step in every business is to identify the stakeholders that influence the corporation and that are influenced by the corporation. There are two type of stakeholders primary and secondary.

Primary: Primary stakeholders are directly involved in business.

Secondary:  These are those stakeholders who are engaged in company activities but indirectly.

Primary stakeholders in this case:

1.Owners
2.Directors
3.Empolyees
4.Customers or consumers

Secondary stakeholders in this case:

1.Creditors and lenders
2.Suppliers
3.Service professionals
4.Dealers,Distributors and Franchisees
5.Society
6.Competitors
7.Non government organization
8.Media
9.Governemnt

Primary stakeholders and their roles:

1.Owners: Owners are those persons who are shareholders and invested in the form of equity or shares. Influence of these shareholders is varied from business to business. Individual shareholder has minimal influence on business but if there are lots of shareholders who are invested in business they easily influence business or business decision. In this case, they get affected if government ban TAPS and smoking at a public place. Because of banning at a public place people consume less tobacco and if selling decline than their profit automatically decline.

2.Directors: Directors are elected by shareholders. Directors can be from inside and outside from the corporation for representing shareholders interest. Usually, these are directors managers, executives and owner of the corporation and outside are customers, suppliers, lenders or government and so on. If the majority of Board of directors are insiders from management then their influence on a corporation is substantial. Director’s role is to evaluate present and future opportunities, measure risks in the external and internal environment, review companies goals and so on.

3.Employee: Employees are the individual who works for the corporation. Employees divided into different categories managers who manage the business at management level, workers who are involved in manufacturing, production or servicing task, professionals like lawyers, professors, accountant, engineer an so on. Employees are very important part of any corporation. They influence company when they depend on something to change and they also get influenced by the company when they implement something. If smoking banned at public place employees influenced with this because demand for tobacco products decline due to this production will also decline if it will happen than tobacco industry do not need employees more productive.

4.Consumers: Consumers or customers are very important for any company because they are the source of revenue for the corporation and it is corporate responsibility to handle them carefully. Their role is very important in the market. They are influenced in monopoly market but in another market in some situation their demand influence market supply.

Secondary stakeholders and their roles:

1.Creditors and lenders: Some individual lends their money to the corporation for long terms by purchasing bonds or debentures while others give money on short-term basis as trade creditors. These stakeholders have substantial influence. Lenders and creditors can claim on the assets of a corporation if it goes bankrupt.

2.Suppliers: Supplier is those who provide raw material, component parts or finished materials used in manufacturing of goods and providing services. Supplier Influence Corporation if they have only one supplier for their products than they give attention to the supplier. But if the corporation has alternative options for their supplier than corporation influence suppliers. If tobacco gets banned than supplier would more be effected.

3.Service professionals: Professionals are not employees but they provide their services to the corporation in return of fee or service charges. Incorporation lawyers, accountant and engineer are professionals who give advice and they influence business in terms of their advice. Their services are very expensive.

4.Dealers, Distributors and Franchisees: Corporation gives permission to the other corporation to distribute their products to customers. Example: wholesalers, automobile industry and so on. And some corporation allows other corporation to sell their products by franchising system. In both cases there is an agreement between both parties for distribution and franchise. And influence depends on the complexity of agreement.

5.Society: Society represents the general public and their views. It difficult to determine their views and expectations. Because of this, it is difficult to know that they get influenced or not.

6.Competitors: Competitors are those who are producing same products. In competitors we include not only existing competitors, also future potential competitors.

7.Non-government organization: NGOs are not included in the public and private sector. They are working on the social issues like if activities of any corporation harm the society in any mean values like environmental issues, women’s , smoking and so on.

8.Media: Media covers all information related to business. Businesses use media most of the time for product advertisement. But sometimes media expose negative impacts of products. So, yes media influences business at sometimes.

9.Government: Government plays a most important role in any business. And government influence business and in this case,  if people stop smoking in public place than government definitely get influenced or affected. Because tobacco industries are paying taxes to the government, so it is a source of revenue of government. And on the other hand side government formed with politician group and civil servants and these,  both groups influence the business.

Question 2. What does this mean to my family?

Ans: Well, I am Non-smoker so my relation with tobacco industry as a part of society. According to me, prospect smoking should be banned in our society.If someone wants to smoke they can smoke at their home but not in public place. Non-smokers choose to breathe in other people’s smoke. And because of this also passive smokers also suffering from lung cancer, shortening their lives by an average of 10 years and so on.

Example: It is my personal experience one of my friend has skin allergy with smoking. She gets rashes on her skin just because of smoke (cigarette smoke) and she is taking meditation. And she is also afraid to go out where people smoke a lot.

So, if it will ban in public places people who have an allergy and other problem can move easily any ever without any tension. This is a burning issue in some countries that’s why they banned prohibited smoking at public places. As a stakeholder, yes it should be banned and TAPS also stop the promotion of tobacco industry because at some point it is not ethical to earn the profit by destroying countries future.

Question 3. What does this mean to my company?:

Ans:  Every business establishes for earning profit same imply on the tobacco industry. Businessmen earn a profit by selling it. Well, as a tobacco industry executive it is a dilemma for me to saying that it is right or wrong. Because it is a public issue and yes ethically it is wrong to serve tobacco because it harms the society. But from the executive’s point of view, it is important to earn the profit as well as without harming society. Tobacco industry management takes some steps to manage the public issue on the basis of the perspective of above answer.  Its management duty to manage their stakeholders and try to satisfy them.

Management will try to manage this public issue by these steps:

1.Schools interventions: Youngsters are the most affected group of society from tobacco use. So, management first approach school programmers, they will organize training and awareness sections for students that they will not influence by their peer who smokes around them.

2. Increasing the price of cigarettes: Increase the price of cigarettes, because if the price will go up then demand for the same product will automatically decline. It will help to reduce the number of young consumers.

3.Media: TAPS normally use media for promotion and advertisement but now they use mass media for the anti-smoking purpose. Media channels use for controlling smoking by advertisements in films, daily soaps and so on.

4.Restrict the purchase of cigarette: Cigarette stores do not sell their products to minors. The Government should implement some laws in this regard like fines, penalties and so on. The Industry should provide their products for distribution to some of the tobacco sellers. Like government should create different shops who just sell tobacco products for ensuring that no minor purchasing tobacco and also set a limit for purchase on the day basis.

Question  4. What does this mean to my country?

Ans: Smoking is a very serious issue in society because not only smokers get affected but also other people are suffering. So, the government is one of the important stakeholders of the tobacco industry. Government playing a very important role in this issue because the government of the people, by the people , for the people and if they are tolerating the smokers than its government duty to take action. Moreover, government is made by a politician so they are responsible for better future.

Roles of government in banning tobacco in public place:

1.Implement policies: The Government should implement laws and regulations for controlling smoking in public place. Some kind of fine policies for smoking in public place and also reward policy for those who inform the government that people are smoking in public area.

2.Department for controlling: Create new department who will check that no minor will consume tobacco product if they will find any seller who is selling tobacco to minor will pay fine and also get prison. Government should announce that selling tobacco products to minors is offence and illegal.And fix purchase limit for each person on the day basis.

3.The Campaign in schools and colleges: Awareness programmes in schools and colleges for creating more awareness about the long run losses of consuming tobacco. And not get influenced by celebrity try to convince them they are just playing their character in movies.

4.Ban on the advertisement of tobacco products: Stop promotion activities of tobacco. Because advertisement is the easiest and fasted way to influence anybody.

However, with these steps of government tobacco industry definitely, get affected and influenced.

Influence on industry:

Decline in profit: If the government will ban advertisement than the industry face difficult situation and their profit will decline because their sell will decline.
Decline selling: If the government will fix the limit for purchasing tobacco products then their selling will automatically decrease and if it will be banned in public place their consumption will decrease again which effect selling and profit.
Influence on the public:
Health issues will reduce: Non-smokers will be happy with these decisions. And there are fewer chances of serious health issues after this.
Reduce consumption: Smokers habits may be changed because of less consumption of smoking.
Youngsters are safe: To some extent, they are safe from smoking.

Question 5. Media impact and their role in this issue?

Ans. Media is playing very powerful and an outstanding role in creating and shaping of public opinion and strengthening of society. Media plays a very strong role in this issue, it promotes and discourages tobacco use among youth. Tobacco industry uses media for their product promotion through internet, television, newspaper, magazines and so on.

1.Internet: Now, the internet is very potential media to sell and promote tobacco. There are different websites for promoting and selling tobacco products. This is cheap and easiest way to sell and promote products. Buyers also leave reviews about products indirectly these reviews are the part of the advertisement.

2. Resaerch on YouTube about tobacco: On Youtube people easily assess any videos. The result of some studies shows that 70% people search on you tube about pro-smoking. Pro-smoking means those contents which include reviews, footage of tobacco events, images of smoking people and so on. People influenced by these things

3.Movies and television: In movies and television celebrities smoke and taking tobacco products. Youngsters get affected by their lifestyle they try to adapt their personalities. They start smoking because their favourite star or celebrity taking tobacco.

Media have a power to change the prospect of people thinking and shaping their views according to their choice.

Same applies on media’s role in tobacco industry if they present tobacco as a part of our lifestyle people will get influenced and they will start to adopt this lifestyle.

Tobacco industry uses media communication for promotion and advertisement of products. Industry sponsor media communications through different events and programmes for their product launch, for promotion, for free samples, distributing discount coupons and so on.

The tobacco industry also sponsors government, they give charities or donations to government and in return government supports their products in the form of promotion and advertisement in different political events, parties and so on.