BUS 5116- 01: OPERATIONS MANAGEMENT

INSTRUCTOR: FAROOKH SHAIKH

GROUP ACTIVITY

GROUP 0013B

GROUP MEMBERS SECTION DONE

1. ANNE OGOLLO PROCESS TECHNOLOGY

2. OMAR ATTEYAH MARKET AND CONSUMER

3. MINA FAHIM PROCESS TYPE

4. MICHAEL DAVID LAYOUT TYPE & FACILITY LOCATION

5. RIANIE LANZA PRODUCT PROCESS DESIGN

6. TOMOYO KAWAMURA WORK AND JOB DESIGN

PROVIDE A DETAILED ANSWER TO THE FOLLOWING QUESTIONS

For the purposes of our group project, carbonated drinks are our selected products.

1. MARKET AND CUSTOMER

The estimated market value for carbonated drinks in the USA is calculated based on retail sales

or the end consumer volume of sales, however, the total revenue of this sector in the USA which

includes applicable tax is $91 billion in 2019 while the sales growth was 1.5% between 2015 and

2019 (Carbonated Soft Drinks in the United States of America (USA) -Market Summary,

Competitive Analysis, and, Forecast to 2024, 2021).

Based on the annual sales growth of 1.6% each year, the total volume of revenue is expected to

reach $101.3 billion in 2024 and $102.92 billion in 2025 consecutively.

a) Trends in the Carbonated drinks market.

We have noticed that sales growth in such a sector is less than expected, people avoid gaining

extra weight and consuming more sugar, hence if we take one can of carbonated soft drink then

we get an average of 180 calories in this can. “A 12-ounce can of soda has between about 125

and 180 calories. All of those come from sugar” (Mikstas,2021) , that number of calories gives a

bad nutrition reputation for carbonated drinks.

b) Health Factor.

Health factors are playing a significant role in the sales growth of carbonated drinks, there

are some side effects of consuming carbonated drinks:

- Regular and diet carbonated soft drinks can harm the teeth.
 - People who are drinking carbonated drinks tend to consume less fruit and drink less fruit

juice. (Science Direct, n.d.)

- Carbonated Drinks may reduce bone strength.

c) Carbonated Drinks Image.

Many people have linked Carbonated soft drinks with obesity, almost 36.50% of adult Americans

are suffering from obesity and 17% of the children are suffering from the same problem. “ The

evidence base linking Sugar Sweetened beverages (SSBs) with obesity and overweight in

children and adults has grown substantially in the past 3 years” (Cohut, 2018), however people’s

perception automatically linked obesity with carbonated soft drinks and this is of course backed

by the several research and study which have been conducted in this regard.

d) Taste

Carbonation adds a better taste to the drink. Taste wise is highly desired and attractive. “When

the bottle is opened, the carbon dioxide gas reacts with water to form carbonic acid. This reaction

gives the drink a light acidity” (McLafferty, 2014). The light acidity and bubbling-up water give

a special taste to the carbonated drinks and beverage

2. PROCESS TYPE

a) Clarifying the water

The quality of water is crucial to the success of a soft drink. Impurities, such as suspended

particles, organic matter, and bacteria, may degrade taste and color. They are generally removed

through the traditional process of a series of coagulation, filtration, and chlorination. Coagulation

involves mixing a gelatinous precipitate, or floc (ferric sulfate or aluminum sulfate), into the

water. The floc absorbs suspended particles, making them larger and more easily trapped by
filters. During the clarification process, alkalinity must be adjusted with an addition of lime to

reach the desired pH level.

b) Filtering, sterilizing and de-chlorinating the water

The clarified water is poured through a sand filter to remove fine particles of floc. The water

passes through a layer of sand and courser beds of gravel to capture the particles.

Sterilization is necessary to destroy bacteria and organic compounds that might spoil the water's

taste or color. The water is pumped into a storage tank and is dosed with a small amount of free

chlorine. The chlorinated water remains in the storage Soft Drink tank for about two hours until

the reaction is complete.

Next, an activated carbon filter dechlorinates the water and removes residual organic matter,

much like the sand filter. A vacuum pump de-aerates the water before it passes into a dosing

station.

c) Mixing the ingredients

The dissolved sugar and flavor concentrates are pumped into the dosing station in a

predetermined sequence according to their compatibility. The ingredients are conveyed into

batch tanks where they are carefully mixed; too much agitation can cause unwanted aeration. The

syrup may be sterilized while in the tanks, using ultraviolet radiation or flash pasteurization,

which involves quickly heating and cooling the mixture. Fruit-based syrups generally must be

pasteurized.
The water and syrup are carefully combined by sophisticated machines, called proportions,

which regulate the flow rates and ratios of the liquids. The vessels are pressurized with carbon

dioxide to prevent aeration of the mixture.

d) Carbonating the beverage

Carbonation is generally added to the finished product, though it may be mixed into the water at

an earlier stage. The temperature of the liquid must be carefully controlled since carbon dioxide

solubility increases as the liquid temperature decreases. Many carbonators are equipped with

their own cooling systems. The amount of carbon dioxide pressure used depends on the type of

soft drink. For instance, fruit drinks require far less carbonation than mixer drinks, such as

tonics, which are meant to be diluted with other liquids. The beverage is slightly over-pressured

with carbon dioxide to facilitate the movement into storage tanks and ultimately to the filler

machine.

e) Filling and packaging

The finished product is transferred into bottles or cans at extremely high flow rates. The

containers are immediately sealed with pressure-resistant closures, either tinplate or steel crowns

with corrugated edges, twist-offs, or pull tabs.

Because soft drinks are generally cooled during the manufacturing process, they must be brought

to room temperature before labeling to prevent condensation from ruining the labels. This is

usually achieved by spraying the containers with warm water and drying them. Labels are then

affixed to bottles to provide information about the brand, ingredients, shelf life, and safe use of

the product. Most labels are made of paper though some are made of plastic film. Cans are

generally pre-printed with product information before the filling stage.

Finally, containers are packed into cartons or trays which are then shipped in larger pallets or

crates to distributors.

3. LAYOUT TYPE AND FACILITY LOCATION

a) Layout: In this section, we would be talking about the product layout, which is preferred. This

layout system enables machines and auxiliary services to be located according to the process

Product Labeling Bottle Capping

Blending section washing and Machine
Filling section
the sequence which goes as illustrated below:

Final packaging
Warehouse section Coding section
4. section

b) Facility Location

Now we will talk about plant location. According to (BrainKart, 2022) an ideal location is where

the cost of the product is kept low, with a large market share, lesser risk, and maximum social

gain. In effect, we have chosen Tarrytown, NY which is a bit remote but located near the

Governor Mario M. Cuomo Bridge which easily connects to New York, Connecticut, and New

Jersey. This was chosen because it provides a more affordable land space for the plant and we

have easy access to major markets.

And for the distribution cost according to (Travelmath, 2022) we would be needing about

13USD worth of gas each for New York, Connecticut and New Jersey which gives an average of

1,170 USD gas cost per month.

For labor cost, we would need an average of 3 men to handle each section of the production line

plus truck drivers; we would pay an average salary of 2,500 USD per month which gives an

average wage cost of 62,500 USD per month

Lastly, for the energy cost, which we will mostly rely on electricity and the average cost of

electricity according to (P3costanalysts, 2022) in the US is about 5,370 USD. So that will be our

projected cost of energy.

4. PROCESS TECHNOLOGY

With reference to the selection of adequate process technology for our selected product,

carbonated drinks, it is paramount to incorporate TPP innovation extensively. This combines

technological product and process innovation. Our selected product brags of high consumer

preference, mainly because of its bottled nature making it easier for consumption.

Process technology is this regard is a complex affair comprising of (Food Processing, 2008):

 Raw materials

 Mixing technology

 Carbonating technology

 Heating technology

 Sterilizing and disinfecting procedures

 Precise and reliable machinery

 Efficient space-saving designs

All the listed process technologies listed above are combined to improve the quality of the final

product (Food Processing, 2008).

a) Our Technology: Takes a holistic approach by incorporating the automation of all the

processes involved in processing the drink. The production process is therefore integrated

into a plant concept. The machinery we seek to employ aims at creating our physical

product (Mueller, 2019).

b) Our Production Scale Model:

An aseptic manufacturing process: We aim to bottle our drinks in aseptic bottles; this extends the

product’s shelf life and protects the products against harmful bacteria and microorganisms. The

process involves the construction of automated cleaning processes (Food Processing, 2008). This

includes using sterile filters, water treatment systems, and aseptic valve technologies. Water

treatment can include deionization, demineralization, softening, and filtration. This gets rid of

any harmful materials present in the water. Cleaning in place (CIP) and Sterilization in Place

(SIP) processes are a good example of automated cleaning and disinfecting processes that can be

used (Pharmaceutical Online, n.d.).

Mixing: The components of the drinks are mixed prior to bottling. They include sugar, flavor,

syrup, and dissolved carbon dioxide. The mixing also balanced the water to finished products

ratio (Food Processing, 2008). This process can be automated by the use of electronic recipe

management in the syrup room. A three-component mixer can also be used for this process.

Thermal preservation: Involves the preservation of the drink under a gentle heating process,

usually under the temperature between 70-80 degrees Celsius for a short period of time. It

eliminates microorganisms and inactivates the enzymes (Food Processing, 2008).

Designing process: This is pegged on the versatility of our drink, the requisite quality

management, and the level of automation of the processes. In this sector, we aim to design a

solution towards using a single contact for the design job while simultaneously using

components from different manufacturers (Food Processing, 2008).

Hopefully, with this elaborate plan for our product manufacturing process, we hope to achieve

higher output operations.

5. PRODUCT PROCESS DESIGN

According to Dan (2022), the design process is a methodology aimed at a solution-based

approach to solving problems. It is a brainstorming session that is non-linear and iterative in

nature. This process consists of 4 stages that are not necessarily sequential (James, 2011)

a) Idea generation

This stage involves user-centric research designed to empathize with potential consumers to

yield perceptivity to users’ needs. Our research must be impartial, setting aside personal

assumptions to develop an equipped human-centered design process. In Essence, granted the

competitive nature of the beverage industry, Research and Development must be strategic in

detecting beverage innovation. Below are a few arduous undertakings that would require R&D

for our carbonated product.

Soda Taxes. According to Urban Institute (2021), a soda tax is a “per ounce” excise tax

imposed on sweetened beverages with sugar in the US. Many localities levy this tax as

sweetened beverages seem to contribute the most to obesity. As a result, R&D can be utilized to

source and recreate carbonated products with lower-sugar qualities or synthetic sugar that

promotes lower caloric contents.

 Health and Fitness. Providing healthier beverage choices can promote option appeal.

R&D could depict whether consumers want low-calorie options, or lower chemical contents and

higher fruit (natural) contents.

Waste Management. R&D can explore state laws on beverage-manufacturing companies

as it relates to waste control requirements and fees. This could provide insight into how much

waste control will cost the company deeming it feasible or infeasible.

Sustainability. Consumerism is shifting into an environmentally conscious movement.

R&D can determine how recycled plastics or bottles can be sourced and what recycling methods

can be incorporated into the production. Environmentally safe sourcing and manufacturing

measures can be determined through this approach.

Competitors. We can learn a lot more from the beverage industry.

b) Feasibility Study

The purpose of the feasibility study is to move the hypothetical Carbonated Beverage concept

into an empirical concept.

Market Analysis. The Market analysis researches the state of the carbonated beverage

industry through data-collection methods. Statistic developers, such as Statista, can be utilized to

learn key details as that of the Global beverage market volume from 2009 to 2018 which

suggested that the global market value for carbonated beverages witnessed an increase of more

than 300 million liters in sales (Statista Research Department, 2018). Focus groups and survey

assessments can be applied to determine revenue projection, emerging trends, and market

optimization strategies
 Economic Analysis. The Economic Analysis considers production and delivery cost

along with all other overhead fees that would indicate a feasible project. For instance, Grand

View Research through R&D submitted that the market size for carbonated beverages was

valued at 406.89 billion USD in 2019 and is expected to grow at a compound annual growth rate

of 5.1% between 2020 to 2027 with empirical consideration for the bargaining power of

suppliers.

c) Preliminary Design

Advancing to the preliminary design means gathering details from R&D, the Market Analysis,

and Economic Analysis, and considering all that is feasible to create a Beverage. This is an

execution stage that considers what the economic analysis interpreted as feasible throughout the

production stage and advancing into the delivery stage. This ideation stage will focus on all the

challenges uncovered from the design process and identify solutions to create a product. This is

the most innovative stage.

d) Final Design

This is the stimulation stage, the prototype as they call it. The final design is a mere polish of the

preliminary design. An inexpensive version of the preliminary design is sent to retail stores and

focus groups for what is considered a trial and error. Consumers (currently considered test

subjects) will be given an option to provide their feedback for further consideration and

adjustments.

6. WORK AND JOB DESIGN

There are two types of job and work design: the behavioral aspect of job design and the physical

aspect of job design (James, 2011). These factors are

- Skill Variety (SV): the extent to which the job uses different abilities and skills.

- Task Identity (TI): the extent to which the job involves clearly definable tasks.

- Task Significance (TS): The degree to which the job has an impact on others.

- Autonomy (AU): the degree to which the worker has choice or discretion over the job

- Feedback (FB): the extent to which the worker is informed about the results of the job.

The factors are used to evaluate the impact of the job on the worker's performance. Each element

is rated on a 7-point scale and can be used to calculate the motivating potential score (MPS)

using the following formula

MPS=((SV+TI+TS)/3) x AU x FB

This equation is based on the fact that

- SV, TI, and TS can be complementary

- The sum of SV, TI, and TS has the same impact on MPS as AU, FB

- If AU and FB are close to zero, the MPS score will be very small which implies that the MPS

score is very small.

In addition, it is necessary to consider the physical aspect of job design to make it easier for

employees to work. These factors are,

- The placement, size, weight, and conduit of machines

- The setting of the work environment, including noise, light intensity, temperature, and

humidity.

The optimization of these elements is the key to the success of the employee's job.

The effectiveness of the behavioral aspect of job design and the physical aspect of job design can

be evaluated by quantitatively measuring job performance. The measurement follows Frederick

Taylor's Scientific Management method (Frederick Taylor and Scientific Management. n.d.). The

measurement methods include:

- Time Study: to measure the time required for a specific task that is repeated.

- Predetermined motion times: establish standard times for the elemental movements of a task,

such as moving or lifting.

- Work Sampling: to measure and visualize the breakdown of work time.

The job design approach is a method for improving work efficiency. This approach includes the

following:

- Job simplification: a method to increase efficiency by simplifying jobs.

- Job rotation, job enlargement, and job enrichment: a method to rotate a worker to another job,

to enable him/her to do other jobs at the same level, or to do jobs at different levels.

- Empowerment: methods that give jobs independence and empower them to do their jobs better.

- Autonomous work teams: a method of creating groups to increase work efficiency through

cross-stimulation.
- High-performance work systems: giving employees the authority to make decisions,

encouraging self-improvement, and stimulating motivation to improve performance.

The process of producing carbonated beverages in a factory consists of the following steps (Soft

Drink Processing Application, n.d.).

- Sugar Syrup Clarification

- Water Microbial Stabilization

- Carbonation

- Bottle Blower and Bottle Washer

- Bottle Filler

All processes are carried out in the factory, mainly by machines. The employee's tasks include

machine operation and monitoring, quality control, inventory control of raw materials and

products, and logistics arrangements. In the case of this type of work, autonomy is important as a

behavioral aspect of job design. It is difficult to gain a sense of autonomy by simply carrying out

routine tasks according to procedures, and one means of gaining a sense of autonomy is through

improvement activities (Kaizen) (Daniel, 2021). From personal experience, improvement

activities can give a sense of autonomy and also a sense of solidarity in the workplace.

In the physical aspect of job design, we expect high machine noise in a carbonated beverage

production plant (Kangiken, 2012). Therefore, it is necessary to take measures such as using

machines that generate less noise and providing earplugs so as not to reduce employee

performance.
Job rotation, job enlargement, and job enrichment are effective job design approaches to improve

work efficiency. Job enlargement involves the gradual training of employees to be able to

perform different tasks at the same level, and appropriate job rotation based on the employee's

wishes can be expected to maintain and improve employee performance. In addition, employees

with high skills and enthusiasm can be given leadership roles in the field as job enrichment, and

by giving them a certain level of authority, we would like to make them feel a sense of autonomy

and aim to improve their motivation and performance.

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