Question
When considering possible future global water shortages in the context of manufacturing cola drinks, to Coca Cola this factor would be which of the following? A weakness in the micro-environment A threat from the micro-environment A threat from the macro-environment A weakness in the macro-environment
Answer
4.7
(145 Votes)
Eloise
Master · Tutor for 5 years
Answer
C
Explanation
This question requires us to identify the classification of a potential water shortage as a factor influencing Coca Cola's business. The terms 'micro-environment' and 'macro-environment' are typically used in context of a PESTLE analysis (Political, Economic, Social, Technological, Legal, Environmental), an analytical tool used in strategic planning. The micro-environment revolves around the internal issues controllable by a company, examples might include personnel or company culture. The macro-environment, on the other hand, is far reaching and largely uncontrollable because it encompasses wider social, economic, and political factors. In this context, shortage of essential resources like water is an environmental issue that ranges beyond a company's control, thus it's a factor of the macro-environment. Such challenges being external may poses potential harm in operations and qualifies as a "threat". Film producers often classify weaknesses and threats using the mnemonic set: Strengths, Weaknesses, Opportunities, and Threats, (SWOT analysis), to avail strategic decision making and to improve their company's running.