Coca Cola’s Products
Coca Cola was introduced in UK in the year 1900. It was brought to the land by Charles Candler, son of the founder of Coca Cola on his visit to London. Hence, it was first sold in UK on 31st August, 1900 and from that time; it has been transacting its business operations in UK. It has its headquarters at London (The Coca-Cola Company, 2017).So, in this essay, the various aspects of its global operations management shall be analyzed and relevant theories applicable to the case study of Coca –Cola shall be discussed.
Coca Cola is the most famous and bestselling nonalcoholic beverage brand in the world. It sells about 4000 drinks through 500 various brands. Out of those 21 generate around $1 Billion retail sales. It is the owner of top five nonalcoholic beverages which are famous all over the world- Diet Coke, Fanta, Coca –Cola and Sprite. It manufactures and disseminates its drinks through bottling plants which are managed and regulated by its own personnel and distributors. It also transacts its commercial operations through its bottling partners, retailers and distributors. Its distribution and manufacturing framework makes up the greatest distribution system at the international level.
Some of its products include Coke which is the most famous and likable drink all over the world. Around 90% of the people identify its logo from all around the world. Another famous product is Diet Coke which is also known as Coca Cola Light. Sprite is one of the famous lemon flavored drink in the world (Staff, 2017).
Coca Cola Zero Sugar is yet another sugar free drink available for health conscious people .Fanta comprises of soda which comes in many flavors of fruit such as orange, cherry, lemon , mango etc. Apart from drinks, it also manufactures purified water .Dasani; Smart Water and Ciel are its bottled water brands.
Apart from this, it also manufactures juices. Minute Maid, Simply Orange and Del Valle are some of its juice brands which are sold in some part of the world or another.
Its power drinks and non-soda brands include Powerade, Odwalla and Vitaminwater. It also deals in wide variety of tea drinks which include Honest Tea and Fuze Beverage (The Coca-Cola Company, 2017).
It qualifies and wins its orders in the market place through its largest framework of bottling partners. These are not owned by the company instead Coca Cola supplies, its ingredients and sell syrups and concentrates to them. It retains its brand and executes its branding and marketing by through its sales and marketing department.
Distribution and Manufacturing Framework
Coca Cola FEMSA is the largest and independent bottling partner of the company in the world. Coca Cola owns 28% shares in it. The European partners of Coca Cola are the greatest independent bottling partners in terms of revenue. Coca Cola Hellenic is yet another bottling partner of the company which serves around a population of 600 million.
Apart from these partners, the marketing and branding strategies of the company assist it in winning the orders from the marketplace. It focuses on investing in its brand and business. It invests in marketing strategies and targets on better marketing of its various brands. It has spent a lot of money on the media advertising thereby utilizing the money in making ads which have a stronger and everlasting influence on the audience.
It has also invested in expanding its beverage portfolio. It has endeavored to improve its position in the energy drinks category and has launched its global marketing campaign which supports its entire Coca Cola trademark.
The strategy of the company is to focus on increasing volume and keeping the beverages affordable by strengthening the possibility of the success for the future. In a developed market like UK, the company targets upon price mix. It has focused upon improving its profits by offering its products in small packing and providing premium packages such as glass and aluminum canes and containers (Coca-Cola Hellenic, 2011).
Coca Cola has applied some of the strategies of operations management to justify its competitive edge in the market. It is working towards shifting to Just- in- Time inventory system. The canners and bottlers of the company process vast quantities of supplies per week. Since receiving the raw materials and distributing the finished products comprise of a multifaceted sequence of actions, so the solution to ensure that the inputs arrive “just- in- time “ is that they can be converted into finished products just in time so that the needs of the retailers can be fulfilled (The Coca-Cola Company ,2016).
The packagers are engaged in supply chain networks and other outlets to make sure that this procedure is conducted smoothly. The canners and bottlers must make sure that they do not manufacture large piles of canes which are kept to be sold and at the same time they must make sure that they do not make late deliveries to the clients. They make use of latest information technology which figures out the total demand required by Coca Cola UK.
Bottling Partners
The bottlers and canners work closely with the company and its suppliers so that smooth running supply chain can be conducted and the consumers are always with an arm reach and there is always a smooth supply of the goods of the company.
Another approach of operations management adopted by Coca Cola UK is Total Quality Management (TQM). TQM is the approach adopted by the company for the improvement and flexibility in the operations of the enterprise so that the requirements of the consumers and the other stakeholders of the firm are fulfilled. It involves the entire firm, each department and individual personnel at each level of the company. TQM can be seen as pyramid which states the five components comprising of chain consumer suppliers, managerial obligations, and statistical tool for control of activity, quality systems and common work.
TQM of Coca Cola UK is comprised of environmental management systems and it has been attained the TQM program known as The Coca Cola Quality System (TCCQS). It includes environmental management systems and the business features in the form of quality of the product, packaging quality, safety and loss prevention, up gradation of the process capability and satisfaction of the consumers (Karanja, 2015).
The Quality Management System of Coca Cola UK promotes the adoption of principles of growth process, their application and introducing improvements in the effectiveness of quality management.
Coca Cola has also implemented the Advanced Inventory Management (AIM) technology to enhance greater flexibility in stock and warehouse management. The company is implementing AIM which will assist it in optimizing the operations of the warehouse so that the warehouse processes can be determined and the physical aspects of stock management can be aligned in order to achieve better efficiency ( Shen et al., 2016).
With the help of AIM, the company is able to provide real time management of warehouse operations, an enhancement in the supply chain responsiveness and extending the traditional inventory management techniques. Through AIM, the company is able to regulate the inventory management processes in a better way by using techniques such as bar code scanners and radio frequency mechanisms and user definable put away and picking algorithms. Thus AIM shall provide a mechanism which is driven by information not materials. AIM shall facilitate and efficiently remove the layers of software, hardware and labor dedicated warehousing systems (Linnander et al., 2017).
In this regard, the key theoretical concepts of Global Operations Management comprises of reconfigurable manufacturing systems , six sigma, lean manufacturing and business process redesign (BPR). Reconfigurable manufacturing systems are formulated to incorporate the change in structure and the components of hardware and software. It allows the company to rapidly adjust its capability according to which its production can be continued and it can function efficiently in response to the market or the internal system changes.
Marketing and Branding Strategies
These systems are designed to manufacture different products in the shortest possible time in the least cost without compromising with the quality. Reconfigurablity being the main feature is the capability to rearrange and transform the manufacturing elements which are aimed to adjust the processes of the company to the changing environment and the technological changes. It is a manufacturing system in which the various products are categorized by families. They are comprised of like products which correspond to one configuration of RMS (Voss, Johnson and Godsell, 2015).
Six sigma is a principle which focuses on maintaining quality. It is a highly disciplined procedure which assists on targeting the development and delivering of the products and services. The aim of this process is to remove waste and efficiency, which in result enhances the satisfaction of the consumers through delivering the products which are as per their expectations. It is a technology which is driven by data and requires accurate data for the analysis of the process (Chopra and Meindl, 2015).
It is a principle which is driven by business. It is multi-dimensional structural approach which aims at reducing the defects, costs of production, variability of processes, improving the processes, satisfaction of consumers and profits . Sigma is a statistical term which measures the deviation of a given process from the set targets of the company. Six Sigma measures the defects in a given process to find out the methods to remove them so that the manufacturing system gets close to zero defects.
Lean Manufacturing is a systematic method used for minimization of the waste in a manufacturing system. It is conducted without sacrificing the productivity. It also considers the waste created through overburden and imbalance of workloads. It is aimed at value additions in the processes of manufacturing (Patel, 2017).
In lean manufacturing, 8 types of wastes are identified. Seven wastes are aimed at the production processes while the eighth one is concerned with the capability of the management to use the skills of the personnel to achieve the aims of the organization. The eight wastes of lean manufacturing include defects. They may include wastages such as scraps, products requiring rework and the assemblies which are missing the details (David, 2014).
The second type of waste is overproduction which occurs when more products are produced than required by the consumers. The third type of waste is excess processing. The products are required to be remanufactured or repaired so that the needs of the consumers can be satisfied. Examples are repairing, remanufacturing and over processing (Sohrabi et al., 2016).
Theoretical Concepts of Global Operations Management
The forth waste is related to inventory. It is considered as waste as it is being valued at its cost. The time for which it is held in the stock, it loses its profitability because of its opportunity cost .
The fifth waste is waiting. It refers to the time for which the product waits to be processed up to the next stage. The sixth waste pertains to motion. Due to the transportation of the product from one place to another, no value addition is done in its cost. The seventh waste is unutilized talent of the employees. If the employee is purposelessly moving the raw material from one place to another, it is considered as a wastage of time and efforts of the employee. The last wastage is related to transportation. Until the value additions are done in the product during its shipping , it is considered as a wasteful activity (Bromiley and Rau, 2016) .
Business Process Redesign refers to the business management strategy which is focused on the analysis and the design of business processes and workflows. It is targeted to assist the organizations to reconsider their works so that the consumer’s services can be improved along with the cutting of operational costs so that the company can become world class competitor. It helps the company to restructure their processes by targeting their ground up design of the business processes (Asgari et al., 2016).
The theory of operations management which can be applied to the case study of Coca Cola UK a is Business Process Redesign. Through its vast and efficient business process redesign systems, it is able to supply its products from the factory to the shelves of the supermarkets within 48 hours. The company continuously looks for investments to improve the efficiency of its processes. It has opened autonomous storage and retrieval systems at its distribution centers. The new amenity is formulated to hold and move the pallets of bottles and cans thereby enabling the company to fulfill the needs of its consumers and to maximize the space used in trucks to store the cargo. The company has also implemented new and innovative technologies such as Bluetooth beacon technology and 3D printing (Ritzman et al., 2015).
As per White (2015) the company has always inculcated sustainability and efficiency in its manufacturing processes. It has recently introduced a combined heat and power system in its factories which is expected to save 1500 tons of CO2 per year. It will help the company to decrease its carbon usage by 23% as compared to the years following 2007.
Reconfigurable Manufacturing Systems
It has appointed a strong logistic team of 166 people which provide the operational support for seven days in a week and 365 days in a year in order to ensure the full availability of the products at the retail outlets throughout the year.
It has adapted and redesigned its structures to the changing technologies. After the delivery of the products at the retail outlets, the company makes sure that the bottles find their way to reach the consumers. For this, the marketing department of the company makes sure that the in store marketing strategies make Coca Cola an easier product to be found by the consumers (Reid and Sanders,2016) .
The company makes sure that it communicates with the retail partners for analyzing the impact of the smallest changes such as weather conditions on the behavior of the consumers. So it has designed its production mechanisms in such a way that they allow the retailers to increase or decrease their capability so that the demands of the consumers can be met .They can adjust their sales and marketing processes as per the demands of the consumers (Majukwa and Haddud, 2016).
The company has adapted itself to remain closer to its consumers by promoting closer collaboration in order to ensure that the desired products are delivered as per the need of the consumers, at the desired time and ways in which they want the products to be delivered. In the year 2012, there was a job swap amongst the employees of Coca Cola and Tesco. It had a great benefit to the company as it not only provided value additions to the careers of the employees but also provided an efficient means to share knowledge and business insights. It also helps in streamlining the strategies and evaluating plans to drive the sales of the company (Bromiley and Rau, 2016).
According to Hussein et al., (2013) Business Process Reengineering (BPR) is an approach in which the processes are evaluated to maximize the potential of the organization. Coca Cola UK needs to abandon the traditional approach and adopt new principles of BPR. In order to successfully implement BPR, the accuracy in the representation and the analysis of the business processes are the crucial elements. The company has implemented the BPR for the objectives of communication, evaluation and regulation.
In the context of communication, comprehending the business processes may be necessary for implementing the BPR model. The process designers need to explain the current and improved procedures which are agree upon representation and sharing of knowledge of the business procedures along with the other stakeholders (Stevenson, 2015).
Six Sigma
As per the failure of BPR can be tracked due to ineffective communication. In this context, assessment and evaluation of the existing processes is another cause for implementing the BPR model. Most of the currently used BPR models by the company have certain limitations by the sense that only single process are considered separately and the improvements are allowed within that single process . It does not consider the changes on the other procedures within the business. So, in any of the BPR projects, it is crucial to gain the understanding of how the processes in the company are interrelated prior to focusing on one of them to be restructured. Most of currently applied models of BPR, most of them are based upon the experience of the BPR practitioner. Little attention is paid to the analysis of environment of the organization( Simon et al., 2015).
Most of the BPR models applied by the company are based on how the business processes are transformed and how the organization should adapt itself to change instead of evaluating the present practices and applying the successful current practical experiences in order to better achieve the objectives of the company. Furthermore, there is a need for an cohesive, holistic and individualistic view of the organization (Slack, Jones and Johnston, 2016).
Most of the current models of BPR focus on organizational processes without paying much attention to the accountabilities of the employees who initiate these activities which comprise of the conducted processes. Most of the models which are applied on the processes of the company are deficient and can be applied partially. Some of the models fail to identify the importance of judgmental phase of the reengineering project of the company. The BPR models adopted by the company are not dynamic in nature and are used as a black and white approach by the company (Li, 2014).
Hence this essay can be concluded on the note that operations management is the administration of the productive resources or production systems of the company. It also deals with the design and the management of the products, procedures, supply chains and services of the company. It takes into account the acquisition, evaluation and use of resources which are used utilized by the firm in order to deliver the goods and services according to the needs of the consumers. So, the components of operations management of Coca Cola UK include the plant layout and structure, selection of equipment and their replacement and its project management methods.
Lean Manufacturing
References
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