COCA COLA

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Welcome to my Coca Cola MindMap!

In 2018, Coca Cola had the highest brand value of the most valuable non-alcoholic beverage brands worldwide; it is also one of the brands that I engage with on a daily basis and therefore felt it appropriate to analyse for this project.

KEY TAKEAWAYS AND TRIPLE A

Coca Cola has implemented and deployed several strategies in creating innovative products, enhancing customer experience and improving efficiency throughout their operations around the world. I will now present you with my Key Takeaways through the Triple A Supply Chain.

ALIGNMENT Coca Cola's Supplier Guiding Principles ensures that all of their partners align not only culturally but logistically - therefore maximising supply chain performance.

ADAPTABILITY: Building up a diverse supplier network builds adaptability to the various supply chains, as it allows Coca Cola to deal with any shocks due to expansive networks

AGILITY: Agility is built in through mechanisms that continually match supply and demand such as the app. Additionally, having a wide supplier network with local operations first minimises the chance that something goes wrong, but also allows for backup in case of any shocks.

MASS CUSTOMISATION

Mass Customisation at Coca Cola both enhances the customer experience by making consumers feel more connected to the brand and product; as well as giving Coca Cola access to a wealth of customer data regarding preferences, locations, consumption patterns etc. that they can then use to further enhance customer experience and bring out new products in the future.

SHARE A COKE

The Share A Coke campaign is a key example of Coca Cola employing mass customisation. There are two facets to deploying this campaign; there is the generic printing that happens in the factories and these Share A Coke products are then sold in stores, but part of their marketing campaign is to print the names on the products on site - customers can choose how to personalise their Coke.

FREE STYLE MACHINE

You may have seen Coca Coca's FreeStyle machine in Five Guys - it's a fountain dispenser with which a customer can choose not just between typical Coca Cola products such as Coke and Diet Coke but between more than 150 choices. This is an example of mass customisation, as the same consumer interface is used across all machines, and all Coca-Cola Freestyle machines use micro-dosing technology - but the customers are able to customise which drinks they want themselves.

The next generation of the Coca-Cola Freestyle fountain dispenser

will be Bluetooth-enabled, which means Freestyle mobile app users can automatically create custom mixes, discover nutrition information and more.

FREESTYLE MIXING

CUSTOMER EXPERIENCE MANAGEMENT

SIP AND SCAN

Coca-Cola also is using digital technology to create new consumer experiences via innovative programs like SIP&SCAN. Consumers unlock experiences and prizes by scanning icons on Coke packages with their smartphones and it allows them to connect personally with Coke through a digital experience.

WATCH VIDEO FROM 1:22

SMART LABEL

Coca Cola recently partnered with GMA to roll out SmartLabels on all of their products; customers are able to scan a QR code to find out additional information about nutrition, allergies etc that otherwise doesn't fit on a normal label. This is in line with customer experience improvement, as it coincides with current health trends and concerns regarding GMOs, and people who just want to live a healthier lifestyle and therefore be well informed.

OPERATIONAL INNOVATION

Coca Cola's Recent Innovations

Coca Cola operates in over 200 countries; it's a product that we all see in some form whenever we travel, so a key question arises with how do they manage over 500 products globally?

MATCHING SUPPLY AND DEMAND

Coca Cola segments its supply chains in order to better match demand. The key reason for this is that each locality has different needs and customer preferences which then requires a different supply chain; for example an area that requires refrigerated distribution, has very different supply chain than an ambient type of product. Segmentation allows Coca-Cola to understand and implement best practices and meet its customers’ requirements in relation to their individual portfolios.

Coke’s new mobile app allows proprietors to send order requests to local distributors, who then bid on the deal. A price is then promised along with a certain time frame for delivery, ranging from 45 minutes to 4 hours, compared to two or three days by traditional methods.

Coca-Cola works with its customers in what it calls “brand, pack, price, channel architecture,” determining what packages to order, what equipment to use and what service requirements will deliver the picture of success the client has in mind. “How you serve a hypermarket such as Carrefour or Wal-Mart is quite different to how you service a mom and pop in a rural area,” Buffington says. “Our supply chain starts at the shelf, and with customer service design, that is how we’re demand-driven. Planning supply is driven by forecasted customer demand input, seasonality and also by promotions or changes in merchandising in the store.”

TOTAL QUALITY MANAGEMENT

Coca Cola’s Company Global Product Quality Index rating has consistently reached 95 since 2010 and one of they key reasons behind this is Total Quality Management through their integrated quality management program called the Coca-Cola Operating Requirements (KORE).

• Unannounced audits throughout operations ensure that everything is in compliance with KORE.
• The Supplier Management Program minimizes or eliminates risks that could potentially cause issues with continuity of supply
• Ensure suppliers are recognized Global Food Safety Initiative (GFSI) standard.
• All ingredients are carefully inspected for safety and quality and come from reliable, trusted sources
• Local laws and regulations are followed where Coca Cola makes and sells their products 

SUSTAINABILITY

Cold-drink equipment efforts have focused on ways to increase energy efficiency and decrease climate impacts associated with vending machines, coolers and fountain dispensers.

Now less materials are used in packaging to make packages lighter; increased recycled materials, supplier collaboration to accelerate PlantBottle packaging. 

SUSTAINABLE PACKAGING

PLANT BOTTLE PACKAGING

Coca Cola is not only making more sustainable packaging, but they are reconfigurations their supply chain to accommodate these changes

Coca Cola's suppliers must adhere to Supplier Guiding Principles that ensure a sustainable supply chain by means of:

1. Freedom of association and collective bargaining 
2. Prohibit child labor
3. Prohibit forced labor and abuse of labor
4. Eliminate discrimination
5. Work hours and wages
6. Provide a safe and healthy workplace
7. Protect the environment
8. Business integrity
9. Grievance procedure and remedy
10. Management systems for ensuring lawful compliance and respect for all human rights

We can see here that according to McKinsey, having sustainability built into the operations of a company is imperative to growth.

Although Coca Cola aims to have 98% of their suppliers to be in accordance with principles; there is a significant barrier that comes with ensuring this, particularly for such a global company like Coca Cola with hundreds of suppliers in countries with varying cultures, priorities, and infrastructures that can result in asymmetric efforts. Furthermore, since Coca Cola only makes the core syrup and concentrates for their products, they have extremely limited face time when it comes to all of their additional suppliers.

FRANCHISE MODEL

A franchise model is generally associated with restaurants, for example, Starbucks, McDonalds, Dominos etc. However, Coca Cola also has one.

The Coca Cola Company manufactures the syrup concentrate themselves; they then sell it to bottlers around the world--(275 independent businesses with over 900 facilities) who manufacture, package and distribute the finished product to vending partners, who then sell the finished products to consumers.

With this franchising model, Coca Cola avoids the costs normally associated with manufacturing, storage, and distribution; and are instead able to fully focus on branding and innovating the core products. It allows Coca Cola to be distributed all around the world and build up its portfolio and brand recognition, without taking on extensive capital costs.

LOCAL SOURCING OF SUPPLIERS KEEPS THE SUPPLY CHAIN SHORT AND FAST - HELPS TO KEEP UP WITH DEMAND

FROM FACTORY TO SUPERMARKET IN 48 HOURS

CCE OPENED AN AUTOMATIC STORAGE AND RETRIEVAL SYSTEM AT DISTRIBUTION CENTRE IN THE NETHERLANDS - INCREASED EFFICIENCY AND INCREASED CAPACITY UTILISATION IN TRUCKS

STRONG LOGISTICS TEAMS AND OPERATIONAL SUPPORT TO ENSURE ON-SHELF AVAILABILITY

Coca Cola HELLENIC BOTTLING COMPANY

LOCAL SOURCING OF SUPPLIERS KEEPS THE SUPPLY CHAIN SHORT AND FAST - HELPS TO KEEP UP WITH DEMAND

SUPPLIERS

As explained in this video, Coca Cola aims to work with incredibly diverse suppliers around the world throughout their supply chain; due to the highly international nature of Coca Cola with its presence in several countries, creating synergies and capitalising on diversity is both important as well as beneficial. Having diverse suppliers "improves the bottom line, encourages healthy competition between suppliers, induces innovations and opens up new supply chains for Coca Cola".

Coca Cola further trains and gives their suppliers the tools and capabilities they need to be competitive and improve their operational efficiencies.