Executive Summary

The Coca Cola Company was founded in 1886 and operates with more than 500 brands & 3,300
beverage products in 200 countries & markets. The Coca Cola Company believes that its strengths
are in its ability to reach globally and also have a local presence at the same time. The objective of this
report is to examine Coca Cola's Sales and Operations Planning (S&OP) that aligns the different
functions of the business while managing supply and demand and helping to achieve organizational
goals and business functions in the organization. The report also includes various strategies that the
company follows and the key factors they focus on to achieve them.

Here, the operational performance of the company is assessed and evaluated and the need for
continuous performance improvement measures taken by the company is also studied. The concept
and application of JIT , Lean MRP collaboration of operational planning and scheduling with the
suppliers is taken into consideration so as to achieve the cost reduction and enhance efficiency.
Through this report, we also tried to find out the latest technologies that can be implemented to
enhance the operational planning and scheduling in the company.
 Introduction

The Coca-Cola s the world’s largest beverage company and one of the leading companies n soft
drinks ndustry. Coca-Cola was established n May 1886 n Atlanta, Georgia, by a pharmacist
Dr.John Pemberton. Coca-Cola s famed as a leading marketers and producer among other soft
drinks company. Consumption rate per day of Coca-Cola on worldwide s being ncrease
continuously. Coca-Cola became a most valuable brands n 2017, based on brand value made 69.73
billion US dollars. This company s not a kind of company to enjoy past their magnificence, nstead
they took new challenges and new strategy and constantly make new markets and keep mprove
market share. Coca-Cola also famed as a world’s largest syrups and concentration of soft drinks
producer and their distributer.

Five soft drinks brand of Coca-Cola company are Coca-Cola, Fanta, Sprite and Diet Coke. And all
other 500 brands of Coca-Cola are available n more than 200 countries. By being a largest
company n soft drinks, Coca-Cola has put more mportant on their operation process and make sure
production capacity meet their demand. Coca-Cola achieved the position of highest number of
sales of soft drinks n most countries. By their operation strategy and marketing strategy Coca-Cola
became a valuable brand n customer mind, easy cognization s the valuable example for this.
According to survey, 95% of the world’s population are able to dentify their symbol s white logo
with distinctive red. To maintain customer loyalty and brand value, Coca-Cola ensure that
purchasing and utilization of raw materials are affectively.

Coke Zero sugar s driving Coca-Cola’s revenue (Oct 18,2019). Coke Zero would healthier option
for consumer that led to rise 2.5% premarketing trading. Coca-Cola achieved its revenue $9.5
billion more than their expected rate. Net income of Coke s increased from $1.8 billion to $2.6
billion within a year. Organic revenue grew by 5 %, helped by higher prices and customers buying
more expensive drinks. Recently n U.S Soda consumption has declined, Coke focused on Coke
zero sugar drink with smaller packaging, this helped to Coca-Cola drive their sales.
 Objectives and Operational planning of Coca-Cola

The main objectives of Coca-Cola Company are to be recognized internationally as a company that
conducts business responsibly and ethically, and to drive sustainable growth in tomorrow’s world.
The company periodically updates and evaluates its business plans and results in order to improve its
profitability and assess its competitive market position.

According to the Coca-Cola Company’s mission statement and 2020 Vision, some of its goals
include_ Diversification of portfolio through innovations and partnerships, keeping consumer
demands in mind, Focus on environment friendly bottling production and enforce sustainability,
Increase profit by cutting down costs through productive and efficient production facilities.

The main focus of Coca-Cola's Sales and Operations Planning Process is to maintain and improve
accuracy of forecast along with proactive business planning, customer order management, master
scheduling and comprehensive weekly forecasting. The monthly S&OP involves making
recommendations on the business plan, operating plan and inventory backlog for each product
category. Current data from middle and senior management's recent forecasts and recommendations
are used to make decisions. This typically involves a monthly five-step process consisting of: data
collection and review, demand planning, supply planning, executives and partner’s meeting,
monitoring and managing demand and supply in a product family and level of volume. S&OP
integrates and reconciles other independent but related business processes, including strategic
planning, sales and marketing planning, comprehensive demand forecasting, customer order
management, financial planning, master production scheduling, logistics resource planning, and
rough capacity planning. The estimated demand data will be updated in Coca-Cola's monthly S&OP
cycle based on the criteria of Coca-Cola divisions and this data will be revised over the next two
weeks as the actual results occur.

Key Strategic Objectives:

Increasing revenue streams from all fronts
To achieve its goal of doubling sales in 10 years, Coca-Cola needs to sell its products in new
geographic areas and broaden the portfolio to suit the changing tastes and habits of the customer. The
company also needs to increase revenue in developing markets while retaining its current market
share in the developed world.
Diversification
The company relies on carbonated beverages heavily for the revenues. This means that the business
needs to increase recognition and sales of other beverages as customer tastes shift, such as bottled
water, coffee, ready-to-drink tea, and even Asian specialty drinks. In addition to this, Coca-Cola will
continue to strengthen its brand loyalty, creativity and grow into other product categories in the
beverage industry in order to retain its revenue share in the competitive market.

Diet products v/s standard variants

When customers have rising health concerns, such as problems of obesity, it results in lower demand
for regular cola. Therefore, it is necessary to reduce the amount of sugar in daily soft drinks
accordingly. Although this problem was effectively resolved by the launch of the diet cola, the
growing demand and sales of diet drinks cannibalized regular cola sales. The company needs to find
a way to maintain its sales while expecting changes in consumer preference.

Acquisition targets in developed markets

With the strong penetration power in the established soft drinks industry, revenue growth from
secondary markets or new markets can be produced by Coca-Cola. However, due to market
consolidation, an acquisition option is limited in developed markets; making large acquisitions
difficult in all markets for the company.

Key Driving Forces

The company's first driving force is the
demand from the consumer. If there is no
market, this means that the customer will
no longer want the commodity. Therefore,
one of the main driving forces for Coca
Cola is customer demand.

The second is that of innovation.

Nowadays, in an ever-changing market,
businesses have to survive and grow. They
need to systematically develop and deliver
new goods to accomplish the growth. Coca-Cola has already shifted from a single core product to a
complete beverage company as the industry is constantly changing. This was a major change because
their past success was based on having one successful core product. Coca-Cola currently sells about
400 different products in the beverage industry and still dominates it.

Globalization is the third driving force. Current big businesses are taking place globally, and Coca-
Cola is no exception. Technology is constantly changing industry, making it more possible and
competitive for companies to extend their operations internationally and reach all types of
international markets around the world. Coca-Cola is taking advantage of the large revenue
opportunities made possible by participating in a global market and now offers products in 200
countries around the world. The key to Coca-Cola's recent success can be attributed to pricing power
and expanding into attractive new beverage categories.

Evaluation of Operational Performance

Objectives of Operational performance are improvement of performance of the particular area and
try to meet corporate strategy. For the evaluation of operational performance of Coca- cola can be
divided into various sector:

Infrastructure optimization: To adapt with product portfolio by changing customer demand

Cock has improved their production capacity. They added production streamline with existing
infrastructure. This helped to meet demand from various markets. For customer requirements they
improve service offering and by reducing cost created customer value.

Leveraging Technology: Operations of back office finance and human resources from their head
office to their shared business service organization(BSO) in 2018 focused to gain efficiencies to
their back-office operations. Robotic Process Automation Programme (RPA) was the innovation
idea implemented in their operations. RPA consist of set of programme software that helped to
increase level of compliance, execution of basic task, improvement of entire business process and
achieved cost efficiencies.

Cash generation: Continues of business activities keep generate strong cash flow on entire entity,
$370 million is the amount of free cash flow in 2018. This amount is slightly low when compared
to previous record. In 2018 Net Operating cash decreased by 7 million compared to previous year,
because increased profitability by supporting inventory materials to produce new products.

Smarter procurement and joint initiatives: Coca-Cola focused on digitizing their procurement
process/operations. This helps to reduce transactional cost and increase speed to reach market, as
well as simplify entire procurement process for employee. So, they implemented in 2018 online
platform to check and manage variance in commodity rates. Optimization of packaging reduced
their plastic usage and increased the amount of recycled PET. As a result, saving 220 tons of
polypropylene per year.

Sustainable resources: Coca Cola system has set of principle to protecting the environment,
workplace rights and upholding human. This helped create sustainable communities. This also
called Coca-Cola’s Sustainable agriculture guiding principle, which is give instruction to supplier
to give agricultural ingrediencies. Purchased 64% of the key commodities are certified in 2018.

Water stewardship in the supply chain: Water is primary ingrediencies of Cock. Coca-Cola
ensured the quality of water for health of people and ecosystem. Water stewardship established to
save and use wastewater and overcome the water challenges. This plan helped them to reduce
water intensity by 22% in 2018 compared to 2010.

Application of JIT

i Coke found itself competing globally with other soft drink manufacturers, most notably Pepsi Cola.
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i Manufacturers investigated ways to provide low cost and high quality products while maintaining
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i high customer service levels. To accomplish these goals, Coca Cola implemented just-in-time (JIT)
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i and total quality management (TQM) strategies to improve quality, manufacturing efficiency, and
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i delivery times. To minimize disruptions to manufacturing because of schedule or production

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i problems related to safety stock, organizations began to see the value in strategic and cooperative
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i supplier-buyer customer relations through the use of JIT and TQM.

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Application of MRP

The advent of material requirements planning (MRP) systems and manufacturing resource
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i planning (MRPII) systems along with improved computer capabilities provided organizations like
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i Coca Cola the ability to track inventory accurately. As a result, reduction of inventories such as new
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i and used bottles, sugar, syrup, and other ingredients occurs along with improvements in
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i communication indicating when further requirements are necessary.

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In various ways operational planning and scheduling collaborated and integrate with the
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i suppliers to achieve the cost reduction and enhance efficiency. Supplier of raw materials
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i digitally connected to Coca-Cola system. It helps to reduce transactional cost and increase speed
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i to reach market, as well as simplify entire procurement process for employee. So, they
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i implemented online platforming 2018 to check and manage variance in resources rates.
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i Optimization of packaging reduced their plastic usage and increased the amount of recycled PET.
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i As a result, saving 220 tons of polypropylene per year. As we all know water is primary
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i ingrediencies of Coca-Cola. Supplier of water has merged with Coca-Cola system to improve
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i efficiency of operation and cost reduction by water stewardship in operation process. Water
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i stewardship is therefore a high priority throughout the Coca -Cola System. In addition to
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i reducing our use of water, they treat 100% of the waste water from our operations, replenish the
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i water used and help communities with their water challenges. They have success reducing our
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i water intensity, achieving a cumulative reduction of 22% vs. 2010 by the end of 2018.
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Latest technologies n Operational Planning

Digital evolution: Technology is changing the way consumers interact with the world and brands,
with smartphones now at the forefront of everyday activities. Easy access to information allows
customers to screen information about goods and compare prices or quality of products. Online
shopping is growing as customers are more comfortable with e-commerce technology and delivery
processes. This platform opens up several new buying opportunities, making it possible for
customers to be involved 24/7. Social media influences views of markets and brands, and micro-
influencers gain credibility when it comes to selling products and services.

Coca Cola is active in e-commerce through different channels, using a cooperative approach with its
clients and investing in new training. In 2018, their investments were accelerated in connected
coolers with three major goals: increasing efficiency of sales force through automation; optimizing
cooler placement and gathering traffic pattern data to customize activations; and drive sales of
applications by proximity marketing. They have launched their web-based customer site, offering a
24/7 online shopping network. They are pursuing these opportunities responsibly, with a greater
focus on privacy and data protection. There was a 26 percent increase in e-commerce compared to
2017, ahead of the market trend.

Coca-Cola has a clear data-driven approach, and also have invested resources in research and
development fields such as artificial intelligence (AI). The organization also capitalizes on AI bots–
the technology behind "virtual assistants" such as Siri and Alexa– and developing AI assistants for
vending machines. For example, by asking the machine to mix their favorite blend exactly to their
taste, these will allow users to personalize their experience. In different scenarios, the AI also allows
the vending machines to behave differently.

In a number of its bottling plants around the world, Coca-Cola is also exploring the concept of
Augmented Reality (AR). This system includes using glasses or a headset that overlays computer
graphics in addition to what the consumer in the real world is looking at. It means that technicians
could see machine details that they are repairing or maintaining and get help in diagnosing and fixing
technical problems. Such device can also be used to test and treat issues in devices and dispensers
located in remote places.
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Scribd. (2014). Report on Cocacola SCM | Coca Cola | Soft Drink. [online]

Coca-colajourney. (2020). Innovation: The Drivers and Hurdles. [online]