Coca-Cola Beverages Pakistan: Operation Management Analysis

Ayesha Majid
Ayesha MajidStudent à Lahore School of Economics
Ameen Abdullah
Aniqa Gohar
Ayesha Majid
Maaz Junaid Khan
• Assembly lines all over the world, operations
management is crucial to this company
• The Coca-Cola Company, which has its
headquarters in Atlanta, Georgia, is an
American multinational beverage corporation,
• Manufacturer, retailer, and marketer of
nonalcoholic beverage concentrates and syrups
• Has been in business for 125 years, employs
139,600 people, and sells 1.6 billion beverages
each day in more than 200 countries
• Coca-Cola soon after the
country’s independence in 1947
stepped into Pakistan in 1953
• Currently, Coca-Cola beverages
are produced and sold in
Pakistan via the company’s own
bottling plants which operate
under Coca-Cola Beverages
Pakistan Ltd.
• The Company produces and
sells concentrates, beverage
bases and syrups to bottling
operations, owns the brands
and is responsible for consumer
brand marketing initiatives.
• Their bottling partners manufacture, package,
merchandise and distribute the final branded
beverages to their customers and vending
partners, who then sell their products to consumers
“Our vision serves as the framework for our
Roadmap and guides every aspect of our
business by describing what we need to
accomplish in order to continue achieving
sustainable, quality growth.”
• People: Be a great place to work where people are
inspired to be the best they can be.
• Portfolio: Bring to the world a portfolio of quality
beverage brands that anticipate and satisfy people's
desires and needs.
• Partners: Nurture a winning network of customers and
suppliers, together we create mutual, enduring value.
• Planet: Be a responsible citizen that makes a
difference by helping build and support sustainable
communities.
• Profit: Maximize long-term return to shareowners
while being mindful of our overall responsibilities.
• Productivity: Be a highly effective, lean and fast-
moving organization.
• “Our Roadmap starts with our
mission, which is enduring. It
declares our purpose as a
company and serves as the
standard against which we
weigh our actions and
decisions.”
• To refresh the world...
• To inspire moments of
optimism and happiness...
• To create value and make a
difference
Coca-Cola Beverages Pakistan: Operation Management Analysis
Ingredients
brought to the
plant
Preform
prepared
Preform
blown to
bottle
Bottle filled
with the
beverage
prepared
Bottle sealed
with closure
Laser
inspection for
quantity
Labeling of
bottles
Encoding
Bottles
grouped in
form of cases
Plastic
wrapping:shri
nkage and
cooling
Cases packed
together
Moved to
warehouse
Product
collected by
distributors
Continuous flow
5 plants
Each line produces a maximum of
140000 cases of beverages in a day
For every change in beverage the
equipment is cleaned (4-6 hours)
CBPL
Manufactures,
Packages,
Merchandises and distributes the produced
branded beverages
Develop customer base,
Market investment,
Order collection,
Delivery goods
Cash collection
 The Coca-Cola System
 CCBPL responsible for developing local
networks, so that the end-product reaches the
consumer in its best quality
 Differentiation Strategy
 Strong image as ecofriendly and socially
responsible company
 Strategic Focus
1. Driving growth and profit revenue
2. Investing in brand and business
3. Continuously increase efficiency
4. Refocus on core business model
• Supply chain is critical to Coke’s operations
• Efficiency is deeply embedded in the supply chain
model
• In each assembly line, there is one supervisor and 6-7
workers working for 8 hours a day
• From Pre-form of bottle to the plastic packing sheet
wrapped around the crates, supply chain team is
responsible what amount of supply they hold
• The plant has 2-3 suppliers of every raw material
• They only hold raw materials for 2-3 days and inventory is
restocked every day
– Coca cola does not hold large inventory of raw materials
• In case of any problem, production lines can be run for 1
extra day and workers are assigned lines and paid double
the wages
• Their main raw material supply includes
– Sugar
– Co2 gas
– Plastic sheet
– Resin
– Tags
– Crown
– Bottle cap
• Other than supply of raw materials, Rani Juice is
also being supplied from abroad, along with the
cans for other beverages
• Coca Cola also has an Operational Excellence
(OE) program strategy for different problems
that occur in Supply chain management and
inventory management.
• OE is the combo of Mean, Six Sigma and Best
practices.
• As this plant is more of capital intensive than labor
intensive, Coca Cola outsource their manufacturing of
preform
• Coca cola provides third party plants with their Cola for
filling
• Coca-Cola Pakistan outsource its cans’ filling, which also
known as Toll filling
• They are outsourcing 250 ml and 350 ml cans from third
party and being filled in Sialkot and Karachi
– Total demand for cans is low and the machine used to fill
these cans is very expensive
• Coca cola has recently introduced a Juice named Cappy
and is being outsourced to a third Party in Karachi
• Immense emphasis on quality management
– Stringent regulations
– Only products conforming to those regulations are deemed
marketable
– Rest are wasted and the plastic recycled
• Quality control department inspects the quality of
incoming materials as well as the final product being sent
out for distribution
• Conducts unannounced audits of the facilities to ensure
effective product safety and quality standards are being
followed at all times
• QM department consists of ten individuals responsible to
check the quality of the raw materials brought to the plant
– The materials are thoroughly inspected and ensured they
comply with Coke’s standards
– In case of any defects - strict actions are taken and defected
materials are disposed-off
• Optimizing its efficiency, Coke has reduced the number of
scientists per line from two per line to one per two lines
– Right pH
– Ingredients in perfect proportions
• Line engineers ensure that line is producing quality
products meeting all quality criteria
• Integrated quality management technology in their
production lines
• Each preform, syrup, labels, and the final bottle passes
through a series of lasers which tests its quality
– Bottles/preform that fail are immediately disposed-off and
recycled
– Any bottle filled too much or too little - the cola is drained
and the bottle is crushed and recycled
• Coke has rigorous quality, environment and occupational
safety & health requirements
• These requirements are developed to exceed ISO 9001, ISO
22000 standards
• Standardized operating and safety requirements program
called KORE
– Defines the policies, standards and requirements for
managing safety and quality throughout their operations
• KORE requires all Coke’s manufacturing and distribution
facilities strictly follow British Standard Occupational Health
and Safety Assessment Series 18001
– A world renowned framework for effective occupational
health and safety management
• Factory hygiene is maintained according to the Pakistan
Food Authority
• Most important out of ten critical decisions for operations
management Coca Cola:
– Managing quality
– Layout strategy
– Supply chain management
– Inventory management
• Production is heavily dependent on automated machinery,
competent maintenance criterion and team are of vital
importance
– Machines are always working efficiently and without fault
– Any Faults are fixed quickly to minimize hindrance in production
– Lahore plant in running 24 hours a day and 7 days a week to cater to
local demand and of neighboring cities
• Requires 3-4 hours of cleaning and switching from one flavor
to another, line efficiency is critically important
– Little room for time lags to avoid production halts
• Producing different flavors simultaneously on dedicated lines
could reduce the lag time and ensure continuous production
• Since many processes are outsourced, supply chain
management is critical
• As Coke operates its inventory management as per Just-In-
Time and only holds raw materials for 1 extra days’ worth of
production so delivery of preform, syrup and other ingredients
has to be on time and without disruption
– Constantly updating its forecasts as per changing demands
Coca-Cola Beverages Pakistan: Operation Management Analysis
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Coca-Cola Beverages Pakistan: Operation Management Analysis

  • 1. Ameen Abdullah Aniqa Gohar Ayesha Majid Maaz Junaid Khan
  • 2. • Assembly lines all over the world, operations management is crucial to this company • The Coca-Cola Company, which has its headquarters in Atlanta, Georgia, is an American multinational beverage corporation,
  • 3. • Manufacturer, retailer, and marketer of nonalcoholic beverage concentrates and syrups • Has been in business for 125 years, employs 139,600 people, and sells 1.6 billion beverages each day in more than 200 countries
  • 4. • Coca-Cola soon after the country’s independence in 1947 stepped into Pakistan in 1953 • Currently, Coca-Cola beverages are produced and sold in Pakistan via the company’s own bottling plants which operate under Coca-Cola Beverages Pakistan Ltd. • The Company produces and sells concentrates, beverage bases and syrups to bottling operations, owns the brands and is responsible for consumer brand marketing initiatives.
  • 5. • Their bottling partners manufacture, package, merchandise and distribute the final branded beverages to their customers and vending partners, who then sell their products to consumers
  • 6. “Our vision serves as the framework for our Roadmap and guides every aspect of our business by describing what we need to accomplish in order to continue achieving sustainable, quality growth.”
  • 7. • People: Be a great place to work where people are inspired to be the best they can be. • Portfolio: Bring to the world a portfolio of quality beverage brands that anticipate and satisfy people's desires and needs. • Partners: Nurture a winning network of customers and suppliers, together we create mutual, enduring value. • Planet: Be a responsible citizen that makes a difference by helping build and support sustainable communities. • Profit: Maximize long-term return to shareowners while being mindful of our overall responsibilities. • Productivity: Be a highly effective, lean and fast- moving organization.
  • 8. • “Our Roadmap starts with our mission, which is enduring. It declares our purpose as a company and serves as the standard against which we weigh our actions and decisions.” • To refresh the world... • To inspire moments of optimism and happiness... • To create value and make a difference
  • 10. Ingredients brought to the plant Preform prepared Preform blown to bottle Bottle filled with the beverage prepared Bottle sealed with closure Laser inspection for quantity Labeling of bottles Encoding Bottles grouped in form of cases Plastic wrapping:shri nkage and cooling Cases packed together Moved to warehouse Product collected by distributors
  • 11. Continuous flow 5 plants Each line produces a maximum of 140000 cases of beverages in a day For every change in beverage the equipment is cleaned (4-6 hours)
  • 12. CBPL Manufactures, Packages, Merchandises and distributes the produced branded beverages Develop customer base, Market investment, Order collection, Delivery goods Cash collection
  • 13.  The Coca-Cola System  CCBPL responsible for developing local networks, so that the end-product reaches the consumer in its best quality
  • 14.  Differentiation Strategy  Strong image as ecofriendly and socially responsible company  Strategic Focus 1. Driving growth and profit revenue 2. Investing in brand and business 3. Continuously increase efficiency 4. Refocus on core business model
  • 15. • Supply chain is critical to Coke’s operations • Efficiency is deeply embedded in the supply chain model • In each assembly line, there is one supervisor and 6-7 workers working for 8 hours a day • From Pre-form of bottle to the plastic packing sheet wrapped around the crates, supply chain team is responsible what amount of supply they hold • The plant has 2-3 suppliers of every raw material
  • 16. • They only hold raw materials for 2-3 days and inventory is restocked every day – Coca cola does not hold large inventory of raw materials • In case of any problem, production lines can be run for 1 extra day and workers are assigned lines and paid double the wages • Their main raw material supply includes – Sugar – Co2 gas – Plastic sheet – Resin – Tags – Crown – Bottle cap
  • 17. • Other than supply of raw materials, Rani Juice is also being supplied from abroad, along with the cans for other beverages • Coca Cola also has an Operational Excellence (OE) program strategy for different problems that occur in Supply chain management and inventory management. • OE is the combo of Mean, Six Sigma and Best practices.
  • 18. • As this plant is more of capital intensive than labor intensive, Coca Cola outsource their manufacturing of preform • Coca cola provides third party plants with their Cola for filling • Coca-Cola Pakistan outsource its cans’ filling, which also known as Toll filling • They are outsourcing 250 ml and 350 ml cans from third party and being filled in Sialkot and Karachi – Total demand for cans is low and the machine used to fill these cans is very expensive • Coca cola has recently introduced a Juice named Cappy and is being outsourced to a third Party in Karachi
  • 19. • Immense emphasis on quality management – Stringent regulations – Only products conforming to those regulations are deemed marketable – Rest are wasted and the plastic recycled • Quality control department inspects the quality of incoming materials as well as the final product being sent out for distribution • Conducts unannounced audits of the facilities to ensure effective product safety and quality standards are being followed at all times
  • 20. • QM department consists of ten individuals responsible to check the quality of the raw materials brought to the plant – The materials are thoroughly inspected and ensured they comply with Coke’s standards – In case of any defects - strict actions are taken and defected materials are disposed-off • Optimizing its efficiency, Coke has reduced the number of scientists per line from two per line to one per two lines – Right pH – Ingredients in perfect proportions • Line engineers ensure that line is producing quality products meeting all quality criteria
  • 21. • Integrated quality management technology in their production lines • Each preform, syrup, labels, and the final bottle passes through a series of lasers which tests its quality – Bottles/preform that fail are immediately disposed-off and recycled – Any bottle filled too much or too little - the cola is drained and the bottle is crushed and recycled • Coke has rigorous quality, environment and occupational safety & health requirements • These requirements are developed to exceed ISO 9001, ISO 22000 standards
  • 22. • Standardized operating and safety requirements program called KORE – Defines the policies, standards and requirements for managing safety and quality throughout their operations • KORE requires all Coke’s manufacturing and distribution facilities strictly follow British Standard Occupational Health and Safety Assessment Series 18001 – A world renowned framework for effective occupational health and safety management • Factory hygiene is maintained according to the Pakistan Food Authority
  • 23. • Most important out of ten critical decisions for operations management Coca Cola: – Managing quality – Layout strategy – Supply chain management – Inventory management • Production is heavily dependent on automated machinery, competent maintenance criterion and team are of vital importance – Machines are always working efficiently and without fault – Any Faults are fixed quickly to minimize hindrance in production – Lahore plant in running 24 hours a day and 7 days a week to cater to local demand and of neighboring cities
  • 24. • Requires 3-4 hours of cleaning and switching from one flavor to another, line efficiency is critically important – Little room for time lags to avoid production halts • Producing different flavors simultaneously on dedicated lines could reduce the lag time and ensure continuous production • Since many processes are outsourced, supply chain management is critical • As Coke operates its inventory management as per Just-In- Time and only holds raw materials for 1 extra days’ worth of production so delivery of preform, syrup and other ingredients has to be on time and without disruption – Constantly updating its forecasts as per changing demands

Notes de l'éditeur

  1. Technical expertise and R&D provided by international Coca Cola Head Office CCBPL is licensed only to bottle the final syrup, packaging & labeling and distribute the product locally
  2. Plant Bottle