Final Operation Management Project

8/6/2019 Final Operation Management Project

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06/06/2011

Presented by:Asia Shoukat(L1s10mbex0027)Ayesha Sadia(L1s10mbex0017)Nabeeha Raza(L1s10mbex0008)Rizwan Ellah ()Hafiz Shahzad(L1s10mbex0003)

Presented To: Mr. Marrif Sohail

OPERATIONMANAGEMENT Coca cola


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Operation Management

Contents

ACKNOWLEDGEMENT ................................................................................................. 4

COMPANY PROFILE ...................................................................................................... 5

1)MISSION ............................................................................................................... 5

HISTORY ..................................................................................................................... 6

OPERATING STRUCTURE ............................................................................................. 7

MANAGEMENT ............................................................................................................ 7

MARKET SHARE ........................................................................................................... 8

GLOBAL MARKET SHARE ............................................................................................. 8

PRODUCTS ............................................................................................................... 10

STRATEGIC PLANNING .............................................................................................. 11DESIGN .................................................................................................................... 12

FACILITIES LAYOUT ................................................................................................... 13

Objectives ............................................................................................................. 14

Types of layouts

............................................................................................................................ 14

Process Layout .................................................................................................. 15

Product Layout .................................................................................................. 15

Fixed-Position Layout ........................................................................................ 15Combination Layouts ......................................................................................... 15

Cellular Layout ................................................................................................... 15

Ingredient Delivery ................................................................................................ 15

Washing and Rinsing ............................................................................................. 16

Mixing and blending .............................................................................................. 16

Filling ..................................................................................................................... 17

Capping ................................................................................................................. 17

Labeling ................................................................................................................. 18

Coding ................................................................................................................... 18

Inspection .............................................................................................................. 19

Packaging .............................................................................................................. 19

Warehousing and Delivery .................................................................................... 19

Delivery to Agents and Machines .......................................................................... 20

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CONCLUSION ............................................................................................................ 20

REFERENCES ............................................................................................................. 21

APPENDIX ................................................................................................................. 22

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ACKNOWLEDGEMENT

This report has been prepared with a specific purpose in mind. It outlines the history

and current scenario of the Coca-Cola Company globally and locally. The first part ofthe study takes us through the present state of affairs of the beverage industry andCoca-Cola Company globally.

We think if any of us honestly reflects on who we are, how we got here, what we

think we might do well, and so forth, we discover a debt to others that spans written

history. The work of some unknown person makes our lives easier every day. We

believe it's appropriate to acknowledge all of these unknown persons; but it is also

necessary to acknowledge those people we know have directly shaped our lives and

our work.

First of all we would like to thank our teacher Mr. MAARIF.SOHAIL for their

guidance throughout the semester.

Then we would like to thank our friend and our group co-operation providing us the

information that was required for completion of this project.

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COMPANY PROFILE

Coca-Cola is the world's leading beverage company. The company is the world's

leading manufacturer, marketer, and distributor of nonalcoholic beverage

concentrates and syrups, used to produce nearly 500 beverage brands.

The company makes and distributes sodas, waters, fruit juice, teas and coffees

and energy drinks. Through the world's largest beverage distribution system,

consumers in more than 200 countries drink the company's beverages with over

1.6 billion servings each day.

Major brands include Coke, Diet Coke, Sprite, Bacardi, A&W, Minute Maid,

Dasani, Nestea, PowerAde, Vitamin Water, Simply and Georgia Coffee.

In 2010, revenues were $35.1 billion and net income was $11.8 billion.

Worldwide volume increased 5%.

The company acquired the North American operations of Coca-Cola Enterprises

in 2010, its largest bottler's, for $12.3 billion in cash and assumption of debt.

1)MISSIONOur 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.2) VISION

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

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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.

HISTORY

Coca-Cola Enterprises, established in 1986, is a young company by the

standards of the Coca-Cola system. Yet each of its franchises has a strong

heritage in the traditions of Coca-Cola that is the foundation for this

Company.

The Coca-Cola Company traces its beginning to 1886, when an Atlanta

pharmacist, Dr. John Pemberton, began to produce Coca-Cola syrup for sale

in fountain drinks. However the bottling business began in 1899 when twoChattanooga businessmen, Benjamin F. Thomas and Joseph B. Whitehead,

secured the exclusive rights to bottle and sell Coca-Cola for most of the

United States from The Coca-Cola Company.

The Coca-Cola bottling system continued to operate as independent, local

businesses until the early 1980s when bottling franchises began to

consolidate. In 1986, The Coca-Cola Company merged some of its company-

owned operations with two large ownership groups that were for sale, the

John T. Lupton franchises and BCI Holding Corporation's bottling holdings, to

form Coca-Cola Enterprises Inc. The Company offered its stock to the public

on November 21, 1986, at a split-adjusted price of $5.50 a share. On anannual basis, total unit case sales were 880,000 in 1986.

In December 1991, a merger between Coca-Cola Enterprises and the

Johnston Coca-Cola Bottling Group, Inc. (Johnston) created a larger, stronger

Company, again helping accelerate bottler consolidation. As part of the

merger, the senior management team of Johnston assumed responsibility

for managing the Company, and began a dramatic, successful restructuring

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in 1992.Unit case sales had climbed to 1.4 billion, and total revenues were

$5 billion

OPERATING STRUCTURE

MANAGEMENTThe hierarchy of Coca Cola Company is as follows.

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V P , C u s to m e r

D e v e lo p m e n t

(N ita P e n n a rd t)

O P E R A T IO N S

(G le n n G e m m ill)F IN A N C E

(M a tt H o ffe r)

H R

(S to rm y B ro w n)

S A L E S

(C h ri s tin e D o d g e )

S p e c ia liz e d

S a le s T ea m s

C u st o m e r

S e rv ice

W o rk fo rc e

D e ve lo p m e n t

C u s to m e r A ctio n C e n

A n n a p o lis

(M a r ia K lu g )

S al e s

O p e ra tio n s

T ra in in g &

C o m m un ic a tio n

Q ua lity

A ssu ra nc e

W o rk fo rce

O pt im iza t io n

C u st o m e r

S u p p o rt

( B o b C a n in o )


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MARKET SHARE

Being the biggest company in the soft drink industry, Coca Cola enjoys the

largest market share. This company controls about 59% of the world market.

GLOBAL MARKET SHARE

The following table can show the worldwide operating segments.

Unit case growthNon-

alcoholic

Drink

All commercial

Beverages

10 yearcompound

annual growth

5-year compoundannual growth 2001 annualgrowth 2002 2002

Compa

ny

Industr

y

Compa

ny

Industr

y

Compa

ny

Industr

y

Company

share

Compa

ny

share

Compa

ny per

capita

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Chairman

Board of

governors

Vice Chairman and chief

operating officer

Executive Vice

Presidents

Senior Vice Presidents

Vice Presidents


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Income

6% 5% 5% 5% 4% 4% 18% 9% 70

This shows that the market of the company is geographically vast and it is

controlling it with great success. In 2002, the company grew their carbonated soft-

drink business by nearly 250 million unit cases and generated record volumes.

Because carbonated soft drinks are the largest growth segment within the

nonalcoholic ready-to-drink beverage category measured by volume, that is why

they are focusing more on this and they are continually increasing the pace

because they know that accelerating this pace is crucial to their future success.

Thus they are increasing their market day by day. The operation income earned by

Coca Cola Company can be illustrated by the following pie chart.

This strategy has worked a lot and it has helped them to become the Worlds

leading Soft Drink Company. The global unit sale of the Coca Cola Company is

increasing from the last ten years. The data of the global unit sale of the Coca Cola

Company can be represented by following chart.

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(Figure)

0

2

4

6

8

10

12

1971 1981 1991 2002

unit sale in billions

So there is positive growth in the market of the Coca Cola Company. There is a worldwide volume increase by 4%

with strong international growth of 5%. This is only due to the innovative marketing programmers, which has

deepened the relationship of the customers and Coca Cola. The financial health and success of their bottling

partners is a critical component of The Coca-Cola Company's ability to build and

deliver leading brands.

In 2002, the company had worked with their bottlers to turn good intentions into

reality by improving the system economics. The results in 2002 reflect this steadily

improving and mutually constructive relationship between the Company and their

bottling partners. The main reason behind this relationship is to continue realizing

shared opportunities for growth, with closer coordination of operations including

customer relationships, logistics and production.

PRODUCTS

There are different brands of the Coca Cola Company, which are currently in use

throughout the world. This company not only deals in the carbonated drinks but alsoother drinks. While launching its product, the marketing team considers the culture

of the country.

Major brands of coca cola

Coke

Sprite

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Fanta

Diet coke

Coke classic

STRATEGIC PLANNING

In the year 2002, the company had a great success, as the strategy worked which

resulted in making Coca Cola Company the worlds leading company. In 2001,

company accomplished the crust of its strategy as

Worldwide volume increased by 4 percent with strong international growth of 5

percent and clear signs that our North American business is growing solidly and

predictable.

Earnings per share grew by 82 percent, as we delivered on our commitment tocreate volume growth while aggressivelyReturn on common equity grew from 23 percent in 2000 to 38 percent this year.Return on capital increased from 16 percent in 2000 to 27 percent in 2001.

The company has generated free cash flow of $3.1 billion, up from $2.8 billion in2000, a clear indication of its underlying financial strength.

The strategy for the future of the company is very straightforward. The marketing

strategyfor the year 2002 is as follows,

Accelerate carbonated soft-drink growth, led by Coca-Cola.

Selectively broaden the family of beverage brands to drive profitable growth.

Grow system profitability and capability together with our bottling partners.

Serve customers with creativity and consistency to generate growth acrossall channels.

Direct investments to highest potential areas across markets.

Drive efficiency and cost-effectiveness everywhere.

Currently John Farrell is vice president for strategic planning for the coca-cola

company. he leads the development of the overall strategy of the company along

with the global planning process. the strategic planning of coca-cola is to reexamine

their strategic models, based upon carbonated soft drinks (cola, lemon-lime and

orange) and move to new beverage categories. Also be able to renovate bottling to

make it flexible enough to provide manufacturing and sales distribution of all new

products.

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These are the major issues to consider when assessing this stock, according to analysts:

Key Positive Arguments Key Negative Arguments

Lower Interest Expense and CostControl Aid Margins: The decreasinginterest expense has offset the recentincrease in operating costs. Coca-ColaEnterprises prefers to maintain its costdiscipline.

Increasing Commodity Costs: Increasing

commodity costs, including PET (plastic forbottles) resin costs, are negatively impactingCCEs margins and earnings.

Restructuring Savings: Therestructuring initiatives undertaken by theCompany are expected to enhancesignificantly its operating profit growth.

Severe Competition: Higher growth and superior margins are being achieved byPepsi in non-carb categories, which mayplace CCE at a disadvantage.

Strong Cash Flow: The Companygenerates a strong cash flow and Coca-Cola Enterprises is financially wellleveraged.

Capital Intensive: The bottling business is capital intensive.

DESIGN

Pallet Design (decoration) is one of the most creative ways of highlighting the secondary placement andattracting customers for your products.You can choose from various types and options, and the best solution according to your specifications will beprepared by our sales representatives.

Suitable combination to boost the campaign impact:- Floor Graphic- Standing Frame

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- Leaflets- Banner

Coke bottles aims to transform the structure of the product to cubic bottled drinks,

allowing a significant gain in storage space and efficiency for recycling. The bottle

would be made of 100% sugar cane by products, and collapses 66% smaller than its

original size. An interesting and innovative idea.

Be that as it may, redesigning iconic items such as the Coke bottle can be risky

business, in terms of the products market place. Products and their design take on

a relationship quality in peoples lives. Many consumers have difficulties dealing

with a shift in a products appearance, even if there is no other change.

With this said, it would be a huge gesture on Cokes behalf to implement a much

needed change to our global situation regarding the use of plastic bottles. And

really, eventually people will get over it.

FACILITIES LAYOUT

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They established main plant at Dasna at Ghaziabad. Dasna is the largestmanufacturing facility to coke in India and covers an areas 80 acres. The plant

manufactures more than 2 million units a day during peak season which extends

from March Sept.

Objectives

1) To study and understand the process of layout selection and different types

of layouts.

2) To observe the layout of a manufacturing unit and understand its working

Types of layouts

Process Layout

Product Layout

Fixed Layout

Hybrid/ Combination Layout

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Cellular Layout

Process Layout

Process layouts are found primarily in job shops, or firms that produce

customized, low-volume products that may require different processing

requirements and sequences of operations.

Product Layout

Product layouts are found in flow shops (repetitive assembly and process or

continuous flow industries). Flow shops produce high-volume, highly

standardized products that require highly standardized, repetitive processes

Fixed-Position Layout

A fixed-position layout is appropriate for a product that is too large or too

heavy to move. For example, battleships are not produced on an assembly

line.

Combination Layouts

Many situations call for a mixture of the three main layout types. These

mixtures are commonly called combination or hybrid layouts.

Cellular Layout

Cmachines are grouped according to the process requirements for a set of

similar items (part families) that require similar processing. ellular

manufacturing is a type of layout where

Ingredient Delivery

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Sweetener

Secret Formula

CO2 Formula

Water

Materials

Washing and Rinsing

Washing

Rinsing

Sanitization

Hydro wash

Mixing and blending

H20 and Sugar

Secret Formula

H20 and Syrup

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CO2 Adding

Filling

Once all the ingredients have been mixed and blended and the bottles have been

cleaned and sanitized, every thing is ready to start filling. This is a surprisingly

complex process requiring accuracy at each step.

Capping

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Once filled, bottles are then capped.

Coke uses different caps for different bottles glass bottles are topped with ametal crown

"PET BOTTLES" are stopped with a plastic screw-top.

Labeling

Then they move on to be labeling

A special machine dispenses labels from large rollers, cuts them and place on

the bottles.

Coding

The bottle is now ready to be coded. Each one of Cokes beverages is markedwith a special code that identifies specific information about it.

These codes identify the date, time, batch no. and the MRP

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Inspection

Coca-Cola inspects bottles at many points during the process.

With refillable bottles, when they are first brought into the plant They are washed and again after they are filled

After filling, each plant sample bottles are analyzed in its lab to ensurequality is up to standards.

Packaging

Final inspection,Packaging

Warehousing and Delivery

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Maintain beverages

Delivery on time

Delivery to Agents and Machines

CONCLUSION

Coca Cola products can be found practically anywhere in the world, such as on

the tables of people in Tanzania, one of the poorest countries, and on the tables

of the wealthiest people in the United States, where the company was founded.

The success of this worldwide organization can be attributed to more than just

its flavorful beverages.

The Coca-Cola Company exists to benefit and refresh everyone it touches. The

company is the world's leading manufacturer, marketer, and distributor ofnonalcoholic beverage concentrates and syrups, used to produce nearly four

hundred beverage brands.

The Coca Cola Company has come a long way from selling a few servings of

carbonated beverages in a pharmacy, to an international scale business. The

company has accomplished that objective thanks to dedicated people who have

collaborated through the years with the mission to attain high quality standards.

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Their product line has grown with the approach of cultural appreciation and

understanding, which has been a key factor in the introduction of the products in

over 200 countries. Coca Colas commitment to remain at the forefront of the

changing social values in developing their marketing strategy has proven to their

advantage. Undoubtedly The Coca Cola Company has developed all the

elements necessary to run a multi-million, worldwide enterprise and refreshes all

the people that come in contact with their products.

REFERENCEShttp://www.scribd.com/doc/16945054/marketing-plan-of-coca-cola

http://www.scribd.com/doc/19336990/Plant-Lay-Out-of-Coca-Cola-Co

http://finapps.forbes.com/finapps/BuyHoldSellAnalysis.do?tkr=CCE

http://pos-media.eu/products-services/point-of-sale/pallet-design

http://www.scribd.com/doc/36461844/Final-Report-on-Coca-cola

www.thecoca-colacompany.com

www.news.bbc.co.uk

www.india-server.com

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http://www.scribd.com/doc/19336990/Plant-Lay-Out-of-Coca-Cola-Cohttp://finapps.forbes.com/finapps/BuyHoldSellAnalysis.do?tkr=CCEhttp://pos-media.eu/products-services/point-of-sale/pallet-designhttp://www.scribd.com/doc/36461844/Final-Report-on-Coca-colahttp://www.thecoca-colacompany.com/http://www.news.bbc.co.uk/http://www.india-server.com/http://www.scribd.com/doc/19336990/Plant-Lay-Out-of-Coca-Cola-Cohttp://finapps.forbes.com/finapps/BuyHoldSellAnalysis.do?tkr=CCEhttp://pos-media.eu/products-services/point-of-sale/pallet-designhttp://www.scribd.com/doc/36461844/Final-Report-on-Coca-colahttp://www.thecoca-colacompany.com/http://www.news.bbc.co.uk/http://www.india-server.com/


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www.magindia.com

www.coca-colaindia.com

www.wikiinvest.com

www.open2.net

APPENDIX

QUANTITY PREFERENCE:

From Fig 2.13, we infer that about 47% of respondents prefer to purchase PET bottle of Coca-

Cola Products. About 27% prefer to purchase glass bottles, 19% prefer Can of 300ml and only

8% prefer 1 & 2 litre bottles of Coca-Cola.

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http://www.magindia.com/http://www.coca-colaindia.com/http://www.wikiinvest.com/http://www.open2.net/http://www.magindia.com/http://www.coca-colaindia.com/http://www.wikiinvest.com/http://www.open2.net/


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Fig 2.14

Fig 2.15

BRANDING & PRICING:

From Fig 2.14, it is concluded that respondents find Coca-Cola products better than that of Pepsi

products. About 62% respondents said that they find Coca-cola products better than Pepsi and

only 38% supported Pepsi products.

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From Fig 2.15, we infer that about 62% of the respondent considers the pricing of Coca-Cola

much more reliable than that of Pepsi. About 38% respondents think that Pepsi have better

pricing than that of Coca-Cola.

Fig 2.16

Fig 2.17

QUALITY & TASTE:

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From Fig 2.16 & 2.17, its clear that Coca-Cola products have better taste and quality than that of

Pepsi. About 73% respondents consider that Coca-Cola products have very good quality and

taste. 27% respondents consider Pepsi products have better taste and quality.

Fig 2.18

Fig 2.19

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Jo chaho ho jaye coca-

cola enjoy

Final Operation Management Project

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