Introduction
This case study provides an overview of Coca-Cola’s operational management techniques, which have been improved via the use of lean manufacturing (Jones, 2017). In particular, because of its durability, years of deployment, and complexity, Coca-Cola company supply chain management system is being scrutinized in detail. Several significant portions of the text are devoted to the Company’s supply chain, asset management system, critical activities in the production model, critical analysis of operations, and the implementation of a lean approach in operations management. The supply chain management model used by Coca-Cola, which is explained more below, is a critical component of the Company’s operations management process.
Design, manufacture, and setup of lean manufacturing
When it comes to implementing the lean supply chain management strategy, it is essential to remember the fact that theproducts and services’movementwithin the value chain system of a company should be as quick and efficient asposible. Thus, this statement implies that the Company’s system should be constructed to a level where by it requires a minimum amount of time, resources and efforts to be viable for better performance (Bondeson&Liss, 2016). To do this, it is necessary to ensure that everything moves as smoothly and evenly as possible through the production system. Numerous businesses that operate under the principles of this paradigm use techniques of regulating their production systems that are logical and disciplined in nature. The whole concept of the Company is to deliver the most amount of value to the customer as feasible.
The lean method has the potential to increase Coca-Cola’s production by shortening lead times and increasing profitability (Milewski, 2022). An increase in productivity might be accomplished by reducing waste and any other inefficiencieswhich are likely to occurwhen the bottler and the retailer phases related to supply chain management system interacts, which is now under investigation within the Company. The combination of this factor with the excellent quality of the Company’s goods results into maximumefficiency and profitable organization. Different investigations have demonstrated that organizations that use these types of management methods are more maintainable than their traditional counterparts because of their minimal wastage and flexibility to adapt to future business issues than their conventional counterparts.
Effectiveness of lean and quality techniques
A fundamental concept of the lean approach is that three categories of processes describe supply chain management. If these three types of processes exist, then lean principles may be successfully applied (Dawood, Elsayed, Rahaman, & Karthikeyan, 2017). The first of them consists of a collection of practices that provide value to the entire customer interaction. Coca-Cola’s manufacturing system, for example, is dependent on timely distribution since it adds value to the product in the eyes of its customers, making it a crucial component. The use of lean strategy is often used to target similar operations in order to maximize value generation while also reducing waste.
In addition, the other group of activities that define the supply chain system, on the other hand, give little direct value to consumers; yet, these activities are critical to the general health of the ecosystem as a whole (White, 2020). Management duties and other administration-related activities are necessary to ensure the smooth operation of the supply chain management process,yet, they result to no direct benefit towards the consumers. Supply chain procedures that provide almost little value to the system as a whole fall into the last category because they bring little or no value to the system. They are sometimes referred to as wasteful activities, and as a result of their detrimental effect on the environment, they are frequently targeted for eradication or reform by policymakers.
Role of lean in waste management
Different techniques for influencing supply chain management systems are available under the lean-approach. Furthermore, due to their skills when ensuring creation of process mapping outputs that are critical in detecting waste sectors, these tools are critical components of Coca-Cola’s supply chain management system (SCMS) (Samuel, Oyawale, &Fayomi, 2019). Supply chain managers may benefit from the lean method because of its value stream analytical skills, which can assist them in identifying the most significant and vital areas of operations management that need assistance.
The lean method might also benefit Coca-Cola’s supply management system by enabling the Company to adapt the market swings more quickly in the future (Milewski, 2022). As a result, this will result in the realization of enhancedincorporation of supply chain operations between merchants and bottlers. Additionally, shorter lead times might be obtained throughout the supply phase, which would benefit all parties involved. In general, these data imply that the lean manufacturing system has the potential to increase the efficiency and operational activities of Coca-Cola company by reducing waste and increasing the general efficiency of the Company’s process of production. Through this, the firm resources would be working in unison towards the increase of value while simultaneously reducing expenses. Because of this, Coca-Cola must be able to negotiate current supply management standards while also mitigating related risks if it increases productivity to its maximum potential.
Lean manufacturing relationship with industry 4.0
Lean concepts, with their emphasis on cost reduction, attention to waste removal, and dependence on allowing customer expectations drive operations, have played a key role in increasing efficiency across enterprises. Despite the fact that lean began in the manufacturing industry, its essential ideas can be found in a wide range of organizations and are used in a variety of ways. Lean may be implemented in every area since it takes a data-driven approach to decision-making, with an emphasis on tracing down and eliminating fundamental causes. Lean is often regarded as the most effective method of detecting underlying problems and emphasizing continual development.
It has been many decades since lean concepts have been used in a manufacturing setting, even while the fundamental concept of eliminating waste and increasing efficiency existed long before the name “lean” was invented. However, lean as we know it today has evolved into a set of concepts that have completely revolutionized the industrial industry. Industry 4.0 digital and physical technologies, on the other hand, have made it feasible in recent years to achieve unprecedented levels of speed, cohesiveness, flexibility, and automation that have fundamentally revolutionized the way that manufacturing is conducted. Manufacturing and other industries will benefit from advancements in robots, materials, and artificial intelligence in the near future.
Digital lean is not a new set of lean principles in and of itself; rather, it is an enhancement of existing lean concepts in order to make their use more effective. In contrast to traditional systems of record, such as enterprise resource planning, which often report on operations in terms of their influence on company and plant financials, many digital lean systems of innovation offer thorough information on all parts of a process. Digital lean makes use of Industry 4.0 and other digital technologies in order to deliver more accurate, precise, and timely information regarding operational processes and procedures. The implementation of lean principles not only facilitates the realization of these concepts, but it also boosts the effect of core lean technologies such as kanban, which we shall explore later. As a result of the increased availability of high-frequency data from Industry 4.0 technologies, along with increasing computing capacity, new analytics and insights have been developed that were almost impossible to get just a few years earlier.
A manufacturer who relentlessly focuses on eliminating waste and continuously improving the manufacturing process while armed only with traditional tools, such as kaizen, can make significant progress initially, but the productivity increases that result from this approach are typically modest in the long run.
As a result of digital lean, the manufacturer can build on its lean foundation while also leveraging new technologies, such as machine learning and predictive maintenance, to solve previously unsolvable business problems and unlock previously unreachable productivity frontiers, thereby increasing overall productivity.
People will need to learn new ways of working, behaving, and making decisions as a result of digital lean transformation efforts. Consider the following questions: Does the plant’s leadership ensure that improvements are sustained, or is this a constant battle. Is it possible that the operators are averse to changing the way they’ve been operating for years, if not decades. Will the operators and executives rely more on the data or on their own personal experience. Has a change management program been established to lead the transition, or will one be required. The answers to these questions concerning a target plant or line should assist in determining where to begin digital lean initiatives in that plant or line.
While buy-in from official leadership is critical, buy-in from those who wield informal power is just as crucial to the success of the initiative. Spend some time on the shop floor if you’re working in a manufacturing setting to get some insight. Identify those who have an impact on you—those who give solutions to difficult problems and who are always eager to provide a helping hand when the going gets tough. While these influencers may not have official authority, they do have a great deal of informal authority and reputation, which may be even more potent than formal authority in certain cases. Obtaining the support of these significant people who wield authority and respect among their peers would almost certainly legitimize the tool or effort and increase the chance of its success, according to research.
Supply chains and manufacturing processes that are connected, digital, and automated will be in high demand as solutions throughout the CPG industry in 2021. Over 80% of our worldwide Consumer Products, Food & Beverage clients have requested some part of AWS supply chain and manufacturing solutions, according to AWS statistics. A digital copy of a real industrial asset that collects data from the equipment via the use of sensors. The digital twin, which is hosted in the cloud, provides the current state of the associated physical asset. The approach enables mechanics who are working on physical equipment to grasp the current state of the machinery… (for example, to detect damaged parts or performance deficiencies).
A production facility that is equipped with technology that allow information to be shared smoothly between humans, machines, and sensors. It might take place inside a single plant or across a number of sites at the same time. Workers may use the insights gained from the connected factory to make better choices that will enhance operations, quality, performance, and profitability. Computer algorithms that replicate human intellect in order to actively observe the environment, evaluate and interpret data, and make educated judgments are called artificial intelligence. In the manufacturing industry, examples of artificial intelligence include dynamic and efficient production scheduling, as well as predictive analytics to identify equipment faults before they occur.
In this industrial plant, sensors on machines are linked to the internet through a wireless network. The Internet of Things is the term used to describe these internet-based sensors (IoT). The sensors provide binary data to an Industrial Internet of Things (IIoT) analytics platform, which employs artificial intelligence and machine learning to produce decision insights and recommendations. The automation of old manufacturing and industrial operations via the use of new smart technology is referred to as the “fourth industrial revolution” in certain circles. Increasingly, manufacturers are equipping their manufacturing equipment with machine-to-machine (M2M) communications systems and Internet of Things sensors in order to automate processes and implement self-monitoring solutions, which allow smart machines to analyze and diagnose issues without the need for human intervention.
A component of artificial intelligence and machine learning that teaches computers to recognize and comprehend digital pictures captured by cameras and videos. Machines can effectively detect and categorize items using artificial intelligence and machine learning techniques, allowing them to deliver insights and actions based on the photos. A linked, tailored, and near-real-time dashboard of operational data and events from throughout the supply chain is available to all users. The ability to comprehend, prioritize, and handle operational concerns in real time is often associated with supply chain visibility, and it allows manufacturers to do so more effectively.
Conclusion
It has been decided to publish this report in order to offer an overview of Coca-Cola’s operational management methods. The Company’s supply chain management system, which is one of the most extensive and well-tested in the worldwide food and beverage business, has received particular attention throughout the assessment process. As stated in this paper, the firm’s manufacturing method is straightforward since it entails the formulation of a single recipe for syrup development by the Company’s Atlanta-based parent company, which is then distributed to bottlers all over the globe after being refined. These distributors are responsible for marketing the product in various countries throughout the world, and by doing so, they are able to exert significant influence over wide areas of the market on behalf of the parent corporation. Because it encourages resource mobilization for the aim of increasing productivity, the lean method may prove to be a beneficial tool for addressing inefficiencies connected with the manufacturing process chain.
References
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Dawood, S., Elsayed, E. A., Rahaman, A., & Karthikeyan, R. (2017). Role of Lean Manufacturing Tools in Soft Drink Company. International Journal of Mechanical Engineering, 1-7.
Jones, L. G. (2017). The Sustainability of Lean Manufacturing as a Competitive. 5-20.
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Milewski, D. (2022). Managerial and Economical Aspects of the Just-In-Time System “Lean Management in the Time of Pandemic”. Sustainability, 1-19.
Rajasekar, A., & Aashirvad, G. (2020). A study on total quality management in Coca-Cola Company. 2844-2845.
Sadraoui, T., Afef, A., & Fayza, J. (2017). Six Sigma: A new practice for reducing water consumption within Coca Cola industry. International Journal of Six Sigma and Competitive Advantage 6(1) , 53-76.
Samuel, A. U., Oyawale, F., & Fayomi, O. S. (2019). Effects of Waste Management in Beverage. Journal of Physics: Conference Series, 1-10.
White, G. (2020). From factory to fridge: Inside Coca-Cola’s supply chain. Retrieved from https://manufacturingdigital.com/lean-manufacturing/factory-fridge-inside-coca-colas-supply-chain.
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