.

Operations Strategy and

competitiveness of CEYLON
BISCUITS LIMITED.

National Institute Of Business Management

Operation Management
ADBM 202
31st Of August 2017

ADBM-SAT-16.5P
 Abstract……………………………………………………………………….

 Introduction to The Ceylon Biscuits Limited……………………………

 Company Aims & values……………………………………………………

 Operation Decision……………………………………………………………

 Decisions made to determine the organization's overall direction……………

 Competitive dimensions in Operation Management……………………………………………………

 Order Winners, Orders Qualifiers & Customer

Value................................................................................

 CBL Company Competitor Priorities……………………………………

 Company SWOT Analysis…………………………………………………………………….

 Conclusion…………………………………….

 References……………………………………………………………………
ACKNOWLEDGEMENT
The success and final outcome of this assignment required a lot of guidance and assistance
from many people and us extremely fortunate to have got this all along the completion of our
assignment work. Whatever we have done is only due to such guidance and assistance and we
would not forget to thank them. I respect and thank Mr.H.H.L.Amarasinghe for giving we an
opportunity to do this assignment work and providing us all support and guidance which made
us complete the assignment on time, we extremely grateful to him for providing such a nice
support and guidance.

We are really grateful because we managed to complete this assignment within the time given
by Mr.Amarasinghe.This assignment cannot be completed without the effort and co-operation
from our group members.

ABSTRACT

Introduction
The operations management is very important part of the company to deliver the products to
the customers. The operations management deals from raw materials, product manufacturing
and m sales and distribution. An effective operations management can lead the companies to
success. At the same if there any problems in the operations management, it could severely
impact the performance of the company and sales as well. In recent years Operation
Management became central part of the organizational strategic management. The strategic
operational management links with various components of management to achieve the
company’s goals and targets resulting the financial gains.
Business Strategy / Corporate Strategy is the direction an organization takes with the objective
of achieving business success in the long term. corporate strategy is well integrated with other
parts of business. Finance, Marketing, and Operations. Overall company strategic planning
leads for the success of business.

A focus has been made on the different components regarding the operational management. We
applied these principles to case study of Ceylon Biscuits Limited company.

Introduction To The Ceylon Biscuits Limited.

Ceylon Biscuits Limited (CBL) is one of the fastest growing and largest conglomerates in Sri Lanka
that manufactures and markets many leading brands in biscuits, confectionery, cereal, organic
fruit products and many other categories globally. Recognized as a technology and innovation
led producer, CBL caters to a large overseas market and has a global presence across all
continents.
With over 40 years of experience, innovation, technology and quality are the guiding
principles behind everything we do in achieving our vision of becoming the No.1 biscuit,
chocolate and confectionary manufacturer and marketer in Asia, while developing a global
presence and recognition.

CBL’s daily routine encompasses core values that resonate across the company, including the
Board of Directors. Our principles help keep the strong bonds between employees and help in
strategic decision making in directing CBL towards success through good management and
innovation.

COMPANY AIM & VALUE

“AIM
“Expanding without boundaries - Management driven with a conscient
i o u s n e s s approach”
Values
“A better tomorrow for future generations”

 Motivated by passion for perfection.

 Tradition, innovation and creativity are the most valuable assets.

 Offering customers products that contribute to health , vitality, happiness and satisfaction as a cooperate social responsibility

 CBL’s greatest strength is their employees; their development within the company and cementing
the oneness of the “Munchee Family” values and ambitions.
 Operations Decisions

• decisions made • Decisions made • Decisions made

by low level
Strategic

Operational Planning and Control Level

to determine by management

Tactical
the to achieve goals manegement to
organization's and objectives run the
overall direction business
• how to efficiently and
• how the product efficiently smoothly
be made shedule labour
• where the and ma • what jobs we
facility is located • how many require to plan
• how much workers • how to assign
capacity required the tasks
required • how to plan the • how to decide
• when to we add working hours job priorities.
more capacity.

CBL consisted of group of companies specializing for different products.

CBL FOODS INTERNATIONAL (PVT) LTD

Manufacturing chocolates, cakes, biscuits, wafers and jelly, the company owns a 200,000 square foot
state-of-the-art facility. Located in Habarakada - Homagama Rd. this manufactures and markets many
leading brands in biscuits, confectionery, cereal, organic fruit products and many other categories
globally. Recognized as a technology and innovation led producer, CBL caters to a large overseas market
and has a global presence across all continents.

CBL NATURAL FOODS (PVT) LTD

An export oriented company that produces and markets natural & certified organic fruit products, cashew
nuts and coconut products. Located in Heenetiyana. Specializing in the production of Natural Foods,
exporting fruit, coconut, cashew and spice products – worldwide and sourcing organically grown produce
from the network of farmers in Sri Lanka.
CONVENIENCE FOODS (LANKA) PLC
Sri Lanka’s pioneer and the largest manufacturer of textured soya nuggets & producers of a range of jelly crystals,
instant soup mixes and snacks. Located in Dehiwala-Mount Lavinia

PLENTY FOODS (PVT) LIMITED

Manufacturers of Sri Lanka’s most consumed cereal product and herbal porridges made from 100% locally sourced raw
material.Located in Rathmalana.

CBL EXPORTS (PVT) LTD

A state-of-the-art manufacturing facility, this company was established at Seethawaka Export Processing Zone
with the aim of catering to the ever growing global market.

CBL BANGLADESH (PVT) LTD

Ceylon Biscuits Bangladesh (Pvt) Ltd, a wholly owned enterprise of Ceylon Biscuits Limited was inaugurated in
2014. This is the first Sri Lankan owned confectionery Company in Bangladesh producing quality Biscuits, Wafers and
Chocolate coated biscuits for the large consumer base of the country.
CBL AGROPROCESSORS (PVT) LTD
CBL Agro processors (Private) Limited was inaugurated in 2012 to source locally produced raw materials
for the Food Processing Industry especially to the needs of the CBL Group. Located in Badulla-Karametiya-
Andaulpotha Road

CBL COCOS (PVT) LTD

CBL Cocos is one of Sri Lanka's largest and fully equipped producers of desiccated coconut and value added products.
The state of the art facility is on par with global factory capability and technology backed by qualified, trained and
professional staff.

CBL GLOBAL FOODS (PVT) LTD

CBL Global Foods Limited is a fully integrated company home to an advanced UHT aseptic filling plant comprising a
sophisticated steam infusion and downstream homogenization process. The in-house laboratory constantly conducts
R&D of customised coconut milk and water based products.

Operations Strategy

Operations Strategy is A plan specifying how an organization will allocate resources in order
to support infrastructure and production. An operations strategy is typically driven by the
overall business strategy of the organization, and is designed to maximize the effectiveness of
production and support elements while minimizing costs.

Processes in service operations include manufacturing, packaging, storing, transportation etc.

decisions made to determine the organization's overall direction

 Making good, thorough, or careful use of resources; not under- or over-consuming. Making
good use of time or energy.
 linking strategic goals and objectives to tactical goals and objectives.
 develop with the foresight of specific operational objectives, such as market share, return on
investments, earnings, and cash flow
 built with the goal of profitability through processes
 expanding the business to international markets and broading the customer base.
Strategy
Strategic management provides overall direction to the enterprise. Strategy formulation requires
examining where the company is now, deciding where it should go, and determining how to get
it there. Strategic assessment involves situation analysis, self-evaluation, and competitor analysis,
both internal and external, micro-environmental and macro-environmental.

Qualities and Achievements of CBL In the Industry

Most of the productsof CBL today enjoy the coverted position of being market
leader in their respective category in Sri Lanka. Ceylon Biscuits Limited was founded in 1968
to manufacture high-protein biscuits to supplement mid-day meals for school children under a
joint programme of Care Organization, USA and the Sri Lankan Government. The success story
was the company’s dedication to high quality standards, constant innovation of the product
line, aggressive marketing and high focus on research and development. CBL markets its
prime product – biscuits, under the brand name Munchee. Dominate market leader,
of the biscuit industry in Sri Lanka, with a market share in excess of 50%.
Munchee is an award winning food brand. They have received National Quality Awards 2005,
Product Band of the year for consecutive four years, Brand of the year for consecutive two
years, National Award for Export Excellence. Munchee products are backed by many local and
international quality yand standard certifications such as SLS 251 product.

 Certification, ISO 9001:2000, Quality Management System

 Certification, ISO 14,001:2004 Environmental Management System

 Certification and HACCP Food Safety Management Certification.

Competitive dimensions in Operation Management

The major competitive dimensions that form the competitive position include following:

• Price : make the product or deliver the service cheap.

Within every industry, there is usually a segment of the market that buys solely on the basis of low cost. To successfully
compete in this niche, CBL low-cost producer, but even does not always guarantee profitability and success.

As CBL consists of huge variety of items, it enables the customer to select range of products according to their budget.

As there are lot competitors the industry they always try to give the maximum chance to the customer.

Furthermore, they have lots of strategic and tactical moments to attract the customer from the competitor. CBL offer
lots of promotions, discounts for potential customer who is willing to buy lots of products from them.

Eg; Discounts and Promotions at Supermarkets

New Product Pricing Strategies

There are two types of pricings in this strategy. One is Market Skimming price and other one

being Market Penetration. The Former one is mostly used in highly innovative and high end

products with lower volume. This is not suitable in the company that we are focusing on. i.e.

CBL. The later one is more preferred as CBL product range has higher number of units with

lower margin. Furthermore the large scale production gives the CBL in deciding economies

of scale factor to utilize the pricing.

Therefore whenever a product is about to released, CBL closely look in to the competitors‟

pricing strategies and come up with the best possible low cost integration to capture the

market. This penetration would thrive the production process and CBL could utilize this to

make use of economies of scale.

Product Mix Pricing Strategies

Product line pricing – In this method the product pricing is carried out through the product

line of the company. Since CBL has a wide range of product line this method gives a way of

efficiently carry out the pricing mechanism. What they do is identifying the cost differences

the products, customer evaluations of different features and competitors‟ price.

Price Adjustment Strategies

Allowance pricing – This type of pricing strategy can be seen in intermediaries related

markets. Likewise, as CBL operates in a market where intermediaries are involved, this type
of pricing reduces the listed price. i.e. Promotional allowances

International Pricing As Munchee exports biscuits the pricing differs with a country‟s
export trade and their cost at exporting

As Munchee exports biscuits the pricing differs with a country’s export trade and their cost at exporting.
• Quality: make a great product and deliver a great service.it should not only to the individual customer
, but also for retailers, agents , other related bodies.
There are two characteristics of a product or service that define quality: design and process quality.
- Design quality relates to the set of features the product contains. This relates directly to the design
of the product. CBL always provide the product with a pleasant, innovate, neat and even total packing of the
food item is neat, tide and it is according to the standards.
Eg; Munchee Super Cream Cracker
- Process quality is critical because it relates directly to the reliability the product. customers want
products without defects. Thus, the goal of process quality is to produce defect-free products and services.
When it comes to CBL products the materials used are well qualified. And the other supporting food substances
used are well mixed and evenly spread.
Eg; Munchee Chocolate Puff.
• Delivery speed: make the product or deliver the service quickly
. CBL distributes their variety of items all over sri lanka and also enjoys an international reach with distribution. CBL
Distributes their variety of items all over Srilanka and also enjoys an international reach with distribution channels
with 32 Countries, spreading over virtually every continent, the company manufactures over 70000 mt of biscuits
annually catering to local and overseas markets
Their delivery quicker than its competitors. During the emergency situations like flood they have distributed the
items to the customer at a very high delivery speed. They coordinated with aid providing intuitions and distribute
their products using different delivery modes such as Land , Air, Water Etc.

• Delivery reliability: deliver it when promised

For CBL there are lot of instances where there have to release mass amount of stock, Eg; Festival Seasons, Emergency
Situations etc. they should provide the requested (Pre or Immediate) products as promised. This ensure the connection
between the manufacturer and the customer strong.
• Coping with changes in demand: changed its volume according to the market.
When demand is strong and increasing, costs are continuously reduced due to economies of scale, and investments in
new technologies can be easily justified.
When demand decreases may require many difficult decisions about laying off employees and related reductions in
assets. The ability to effectively deal with dynamic market demand over the long term is an essential element of
operations strategy. CBL has taken measures to undergo in such scenarios. CBL Stands in the top level of Biscuits and
other products as the pioneer in the industry.
• Flexibility and new product introduction speed: change the product , introducing new products.
Flexibility refers to the ability of a company to offer a wide variety of products to its customers. An important element
of this ability to offer different products is the time required for a company to develop a new product and to convert
its processes to offer the new product. CBL has taken measures to look what customer want and match accordingly to
their preference. Being the pioneer in the industry it had been an important fact for them to come to that position.
CBL has very good research and development department which undergoes with ample of experiments and researches.
they use latest technology and methods to deliver a quality product to the customer. They carry out different strategies
and operations to always be a pop up factor/character in the market.

• Other product –specific criteria

- Technical liaison and support.
- Meeting a launch date
- Supplier after-sale support.
- Environmental impact.
- Other dimensions
Order Winners, Orders Qualifiers & Customer Value
Customers make their purchasing decision emotionally and logically on a perception of money. The
unconscious mind communicates the decision to the conscious mind which looks for reasons to
rationalize the decision.These decisions are based on customer value attributes like performance,
availability, price and attractiveness of design which reflect both the needs and wants of the customer
and their underlying motivations are bought for prestige because of the desire of the buyer to feel good
about themselves, to show off their success and to stand out as different.

These customer value attributes fall into two major categories – order winners and order qualifiers.

Order winners provide reasons why customers should choose business, product and service. In contrast,
failure to meet the minimum standards. CBL has been an order qualifier compared to other competitors.
Order qualifiers provide reasons why customers will reject or ignore the business, product or service.
According to the focus we did regarding CBL there we haven’t found much order qualifiers.

CBL has focused on 4 Ps and Product, Price, Place Promotion and gives away a good customer service.
CBL focus on produce right product for the target markets which included Sri Lankan and foreign
customers. Useful measures have to specify the level of analysis (national, industry, firm or product)
and encompass competitive performance, its sustainability through the generation of competitive
potential and the management of the competitive process. The interrelationship between these three
key elements are also important in a dynamic context. Product mix of CBL can be described as a
collection of width, length and depth Munchee produces in different sizes to fit the purpose of buyers
such as personal consumption and party needs This is mainly due to survive in the long term, profit
maximization with return on investment, to uplift the market share through various types of pricing,
identify the cash flow, maintain the product‟s quality, place an image and especially to retain the
acquired customer bases and to relationship building. For an example, with the company‟s image on the
stall, CBL offers small Munchee savoury biscuit packets for very low price where even a small boy could
afford to buy. And the same products are packaged in Tins and packets in large volume in the perception
of Hospitality for high price. This leads to a perception the Munchee is way near anytime to any set of
customers.

CBL COMPANY COMPITITORS PRIORITIES

CBL COMPANY is a Sri Lankan food manufacturer the maker of Munchee biscuits and it is one of the oldest biscuits
manufacturers in Srilanka.

There are so many competitors to CBL company, such as

 GGP Inc company

 SIMON PROPERTY GROUP

 THE MACHERICH COMPANY

When it comes to explain resources availability of CBL group, over 2000 work force is employed by the
group in there, Pannipitiya, Ranala, Minuwangoda, Ratmalana and Kandy factories. Land area
of Pannipitiya plant was fully filled with plant buildings and no further building expansion is possible
there. CBL got the competitive advantage in the aspects to manufacturing convenience, distribution,
storage. It enables to give away an efficient and outstanding service to the customer enhancing the
quality standards.

CBL Company strategy is a short or long term plan of action of an organization designed to achieve a
particular goal or set of goals or objectives. It states how their business should be conducted to achieve
its goals, meet the expectations of its customers, and sustain a competitive advantage in the
marketplace.

There are few competitive priorities, such as

 Developing and Implementing Effective Strategies

 Maintaining good clients/customers
 Meeting the challenges of increased competition in the business environment.
 Keeping up with technology advances.
 Learning to do more with less.
 Staying ahead of competitors.
 Keeping an eye on the future

An organization\business must carefully choose its competitive priorities based on the business
competitive strategies.

The three generic strategies are alternative, viable approaches to dealing with the competitive forces.

Here we have mentioned 9 competitive priorities that are grouped into 4 competitive capabilities
dimensions in CBL Company:

A- Cost 1.Low-cost operation

B- Quality 2. Top Quality

 3- Consistent Quality

C- Time 4- Delivery Speed

5- On-Time Delivery

6- Development Speed

D- Flexibility 7- Customization

8- Variety

9- Volume Flexibility

The business strategies may change over period of time and hence corresponding competitive priorities

Company SWOT Analysis.

 More than 48 years of experience in Manufacturing filed – Driven by their passion for
perfection, many of CBL brands are market leaders in Sri Lanka.
 Technical and managerial expertise.
 Extensive training program for staff at all levels.
 Increase in the export levels - CBL’s export quality food products have been marketed
around the world through a solid network of international partners.

 Market leader - Fuelled by innovation and driven by quality, CBL’s product portfolio delights
consumers around the world.

 Brand loyalty.
 Strong distribution channel – If you are a recognized distributor in your country, we invite
you to join our well established network.
 Specialized in food industry.

 Low labour productivity - responsibility to uplift the quality of life of their employees by
contributing their healthy body and alert mind.
 Use of preservative of concern.
 Relatively static market growth.
 Expensive brand maintenance.
 High cost of product.
 Lead times on products.
 Lack of communication between the various organizational system.
 High cost of labours.
 Absence of important skills.

 Threats posed by competitors or other competing industries and markets.

 Threats posed by conditions pertaining to customer finances – are customers in good
shape or is the market suffering.
 External market threats that are outside the company’s and market’s control.
 Unstable economy.
 Changing customer tasted.
 Increase of Taxes and revenue.
 Changing government politics.

 Growing population in the country - currently biscuits and other manufacturing items are
distributing 55 countries.
 Consumer brand - high quality suppliers of raw and food packaging material. As the
market leader in Sri Lanka, Ceylon Biscuits Limited, expects nothing but the best.
 Demand for high quality.
 New production - Now CBL group introducing 70 Biscuits items and Natural & organic fruit
products.
 Technology – Currently their using robot systems
 Increase selling quantities.
 Introduce buying & selling product range.
 Product diversification.
 Reduce distribution cost.
 Improve efficiency in collection
 Meet the productivity measurement to improve effectiveness & efficiency.
 Use advertising tools to communicate the product Quality & safety to all internal & external
customers.
 Conducting awareness programs for customers & consumer group.
 Conclusion

The purpose of this investigation was to identify the knowledge we have gained the classroom. We have
received lots of information through internal bodies in CBL and also through internet. This focus on
research we did is regarding the operation strategy and competitiveness.

• We had deeply discussed about Operations Decisions, Operational Planning and Control Level,
Group of companies, Operations Strategy decisions made to determine the organization's
overall direction, Qualities and Achievements, Competitive dimensions in Operation
Management, Order Winners, Orders Qualifiers & Customer Value, CBL COMPANY competitor
priorities. This case study will be helpful for the company to enrich their product and services
standards, and will be helpful in strategic, tactical and Operational Planning and Control Level.

REFERENCES
 B e s t e r f i e l d H . D , B e s t e r f i e l d M . C , e t . a l , ( 2 0 0 4 ) , Total Quality Management,
1stEdition, Pearson Education Publication.
 Company Hand Book
 http://www.muncheelk.com/csr
 exports.cblf@cbllk.com
 http://www.cblnaturalfood.com/
 (2017, 08 23). Operations: Methods of Production. Retrieved from
 https://www.tutor2u.net/business/reference/operations-methods-of-production-overview
 http://www.tandfonline.com/doi/abs/10.1080/0267257X.1988.9964068
 http://www.differentiateyourbusiness.co.uk/order-winners-and-qualifiers
 http://www.cblnaturalfoods.com