Running Head: OPERATIONS AND SUPPLY CHAIN MANAGEMENT – COCA – COLA

Operations and Supply Chain Management – Coca – Cola

Student Name

Institution Affiliation
OPERATIONS AND SUPPLY CHAIN MANAGEMENT – COCA – COLA 2

Table of Contents

1.0 Abstract.....................................................................................................................................3

2.0 Introduction...............................................................................................................................4

3.0 Topic Statement.........................................................................................................................4

4.0 Methodology..............................................................................................................................5

5.0 Results.......................................................................................................................................5

5.1 Flow Chart.............................................................................................................................5

5.2 Ingredients.............................................................................................................................6

5.3 Packaging..............................................................................................................................6

5.4 Manufacturing.......................................................................................................................6

5.5 Distribution............................................................................................................................7

5.6 Refrigeration..........................................................................................................................7

5.7 Consumption & Recycling.....................................................................................................7

5.8 Analysis of Model..................................................................................................................8

6.0 Discussion.................................................................................................................................8

7.0 Recommendation.......................................................................................................................9

7.1 Recommendation on Improving One Part of Process.............................................................9

7.2 Justifying Recommendation Qualitatively.............................................................................9

7.3 Justification based on Theory of Constraints.......................................................................10

7.4 Flow Chart Including Proposed Changes.............................................................................10

8.0 Conclusion...............................................................................................................................11

9.0 References...............................................................................................................................12
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1.0 Abstract

The objective of this research is to analyze the supply chain of the coca coal company and

determine whether there are nay deficiencies in the system as implemented. The analysis

process requires the application of different theories that include the game theory, incentive

theory, and constraints theory. Applying these theories to the process ensures that the

recommended solutions are in line with the company’s mission and vision. The research

methodologies employed are both quantitative and qualitative. The paper provides a topic

sentence that helps in identifying the context of the research and thus the general process of

the supply chain. The results emanating from the methodologies section provide one with a

set of ideas and strategies to address the issue identified. A discussion of the aforementioned

issues should enhance the feasibility of the strategies identified as the solution to the

determined issues. Applying these strategies ensures that the final objective of resolving the

issues associated with the supply chain is achievable and thus improves the effectiveness of

the system.
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2.0 Introduction

Coca-Cola is the largest carbonated beverage company in the world. The company has

several other brands under its wing which includes other carbonated beverages plus other

products. The company’s main mission is to refresh the world while providing tis clients with

inspiration that allows them to create a difference in their lives. The company’s mission also

incorporates creating moments of inspiration which result in happiness among its clients. The

company’s vision is one of providing people with a fantastic working experience, presenting

the world with top notch quality portfolio, enhancing a network of effective partners,

maximizing returns to shareholders, and implementing sustainable projects as a goal towards

responsibility to the environment (Hafezalkotob & Ghezavati, 2015). It is through the

company’s vision and mission that Coca-Cola hopes to maintain a winning record in

comparison to its competitors. The company fosters leadership, collaboration, Integrity,

Accountability, passion, diversity, and quality.

3.0 Topic Statement

The context of the research lies in Coca-Cola’s supply chain. The research provides one

with a general understanding of the processes involved in the supply of Coca-Cola to the

consumer. This research delves into the individual steps involved in the development of the

components associated with the development of the drink thus detailing the procedure that

one can take up to ensure the drink is developed as expected and reined. This research also

analyses the processes and thus identifies any steps that can be altered to improve the supply

chain. The importance of this analysis is that it helps one identify the weaknesses of such

systems and thus increases one’s knowledge with regards to improving the functionality of a

supply chain. Such a skill is essential operations and supply chain management.
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4.0 Methodology

The research methodology employed with regards to Coca-Cola’s operations and supply

chain is game theory. The application of game theory allocates logic to the strategies

employed in the management of the system and thus helps in identifying any weaknesses that

could be associated with particular section of the system. The theory identifies the individual

conflicts that cause issues in the provision of the final system. The justification for this

research method, which is quantitative, lies in the realization that identifying the origin of

zero sum games within the system can help in identifying origins of weakness and thus help

in determining the best solutions that could help turn around the effectiveness of the company

with regards to delivering the final product in time. Incentive theory has also been

implemented in the research methodology, which is a qualitative strategy. This theory helps

in identifying the reasoning behind the selection of different strategies in the implementation

of supply chain management system.

5.0 Results

5.1 Flow Chart

Ingredients Packaging Manufacturing

Consumption & Recycling Refrigeration Distribution

Fig 1: Coca Cola’s Supply Chain Management Flow

The figure above illustrates the stages associated with the development of all the

elements associated with the beverage Coca-Cola and the steps taken with the aim of

delivering the final product to the consumer.

OPERATIONS AND SUPPLY CHAIN MANAGEMENT – COCA – COLA 6

5.2 Ingredients

The technology employed in the ingredients stage is the basic farm technology.

Depending on the scale of one’s farm, some of the technology may include high end tractors.

Other farms have been found to employ the use of small planes associated with the

application of pesticides (Hafezalkotob & Ghezavati, 2015). Bigger farm have also employed

irrigation systems. The type of worker associated with this step is typically a farmer, while

the action done in this step is basically farming.

5.3 Packaging

Coca-Cola is renowned for its capacity to ensure that the products ingredients are kept

a secret. The packaging stage is associated with the packaging of the ingredients into a

formula that can be distributed to its manufacturer. Dues to the company’s protocols and

secrecy, it is very difficult to determine the technology employed in the packaging of coca

coal’s formulae (Hafezalkotob & Ghezavati, 2015). The employees working in the packaging

plants are also secretive thus maintaining the company’s hold on its market niche.

5.4 Manufacturing

Manufacturing with regards to coca cola refers to the goals associated with the

development of the final product and packaging it into the bottles that have become well

known and associated with coca cola. The technology used for this step includes water

filtering and disinfection systems that remove impurities from water (Hafezalkotob &

Ghezavati, 2015). This water is combined with sugar and the concentrate that was previously

packaged at the parent company. Other technologies employed are systems that subject the

syrup to high pressure carbon dioxide. Automated machinery and conveyer belts are also to

be found in a manufacturing plant. Individuals specialized with these technologies are to be

found working in the company as mentioned.

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5.5 Distribution

The distribution method employed by the company depends on the locale of the

distribution strategy as well as the consumption rate. For instance, third world countries have

been known to employ the use of trucks, pick-ups, and other non-conventional modes of

distribution. However, developed countries will have formal distribution systems. The bottom

line of the distribution is efficiency with regards to meeting the demand of the consumer

(Hafezalkotob & Ghezavati, 2015). The type of worker normally associated with distribution

is the driver and the personnel who load and offload the product.

5.6 Refrigeration

This stage of the supply chain is associated with the retailers and sellers. The main

reason for refrigeration is so that the drink can have that chilling effect that helps in

quenching the thirst of coca cola consumers. The chilling effect also helps in reducing the

heat as experienced by the consumer (Hafezalkotob & Ghezavati, 2015). The technology

associated with this stage is the refrigerator while sales persons work at the retail stores and

shops thus representing the type of worker to be expected.

5.7 Consumption & Recycling

The final step in the supply chain is the consumption and recycling of the final

product. A customer purchasing the final product is expected to recycle both glass bottles

and plastic bottles. The company has liaised with distributors to allow for the return of the

containers used to deliver the final product (Hafezalkotob & Ghezavati, 2015). The simple

procedure to subsidizing one’s future purchase of the product ensures that the client has an

incentive to recycle the used product. The technologies employed in the distribution of the

products are also used in the recycling process.

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5.8 Analysis of Model

According to Hafezalkotob & Ghezavati (2015), the time taken at individual stages of the

supply chain can be represented as a percentage of the total average time take by the whole

chain. The ingredients take up 17% of the time, packaging taking up 8%, manufacturing 47%,

distribution 8%, and refrigeration 20%. Consumption and recycling isn’t factored into the

time taken by the system because it doesn’t affect the cycles to a larger extent. Applying the

game theory to these statistics, it is clear to see that the system develops a zero sum game

with regards to the manufacturing stage choke point (Türkay, Saraçoğlu, & Arslan, 2016).

6.0 Discussion

It has been found that according to the incentive theory, there is clear incentive to

alleviate time wastage at the manufacturing stage of the supply chain. According to the

incentive theory, logic dictates that one has the incentive to ensure that productivity at a

particular stage is achieved with regards to the achievement of the optimum capacity of the

said stage. Coca Cola has the incentive to reduce the amount of time spent in the

identification of the time required and spent in the development of the final product. A

reduction of this time can also increase turnaround and thus increase returns on investment

(Cannella et al., 2017).

However, it is also important to point out that the time taken for the development of

strategies and goals at individual stages could not be representative of the actual time needed

for a stage in question. For instance, the strategies employed at manufacturing have been

found to be labor intensive even with the incorporation of machinery. Therefore, logic

dictates that the time taken for such a stage could be considerably higher in comparison to

other stops in the supply chain (Türkay, Saraçoğlu, & Arslan, 2016). Therefore, whatever

strategy that should be employed in the resolution of this problem should put into

consideration the labor intensity of that said stage.

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The theory of incentives as well as the theory of constraints provides one with an

understanding of the issue associated with the manufacturing level of the system. The system

points to a capacity analysis with regards to the time spent in relation to the total time spent in

the stages of the supply chain. While the company has an incentive to reduce the time spent at

each stage, it is important to ensure that each stage has its own optimum production time

achieved while avoiding bottlenecks associated with stages that take more time during

production than normal.

7.0 Recommendation

7.1 Recommendation on Improving One Part of Process

The recommendation for a reduction in the time spent in the manufacturing of a

product includes an increase in the number of manufacturing plants that develop the final

product. The parent company can subsidize the franchising companies because the costs

associated with the development of the final product are far much higher than most normal

companies can afford to input (Xiang, 2014).

7.2 Justifying Recommendation Qualitatively

The incentive theory is the qualitative representation of the justification that can be

associated with the reduction of time spent in the production of the final product. Reducing

the amount of time spent at the manufacturing stage ensures that the final product reaches the

consumer in a shorter period of time which could translate into an increase in income

especially during the periods of high demand (Xiang, 2014). While there will always be a

stage in the supply chain with a ho9gher representation with regards to time spent in the

production of the final product, implementing this recommendation should increase the

effectiveness of the system.

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7.3 Justification based on Theory of Constraints

According to the theory of constraints, any bottle neck is a limiting factor of a given

system. It has been identified that more time is spent at the manufacturing stage of the

aforementioned systems. This theory justifies the need for a solution that will eradicate the

constraint in question. Therefore, it is essential that the company in question implements the

solution presented which in turn will reduce the instance of the lost time. A capacity analysis

of the stage may show that there is no logical way of reducing the time, but one can

compensate by increasing the number of manufacturing plants that would help reduce the

time by a third as shown in the proposed flow chart in the next page.

7.4 Flow Chart Including Proposed Changes

Ingredients

Packaging

Manufacturing Manufacturing Manufacturing

Distribution

Refrigeration

Consumption & Recycling

Fig 2: A flow chart representing a breakdown of the manufacturing stage with the aim of

eradicating the time bottle neck.

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8.0 Conclusion

The findings of this paper show that coca cola employs a supply chain and operations

management strategy that considers the optimum operating capacity of each individual stage.

However, the manufacturing stage has been found to take up more time than is acceptable for

a system that should deliver optimum performance. The implementation of the identified

solutions should increase the returns of the company by eradicating a bottleneck that would

limit the company’s capacity to finance the needs of client whenever there is a pike in

demand. Future research should go into the identification of ways in which the company can

fully automate the production of the product with the aim of increasing the productivity of the

company in question.
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9.0 References

Cannella, S., González-Ramírez, R. G., Dominguez, R., López-Campos, M. A., & Miranda,

P. A. (2017). Modelling and Simulation in Operations and Complex Supply

Chains. Mathematical Problems In Engineering, 1-3. doi:10.1155/2017/8062958

Hafezalkotob, A., & Ghezavati, V. R. (2015). Distribution network design of a decentralized

supply chain with fuzzy committed distributors. Journal Of Intelligent & Fuzzy

Systems, 29(2), 803-815. doi:10.3233/IFS-151580

Türkay, M., Saraçoğlu, Ö., & Arslan, M. C. (2016). Sustainability in Supply Chain

Management: Aggregate Planning from Sustainability Perspective. Plos ONE, 11(1),

1-18. doi:10.1371/journal.pone.0147502

Xiang, L. (2014). Operations Management of Logistics and Supply Chain: Issues and

Directions. Discrete Dynamics In Nature & Society, 1-7. doi:10.1155/2014/701938