The Coca-Cola is an American based company that specifically operates in the non-alcoholic beverages section. It manufactures, retails and does the marketing of the different kinds of non-alcoholic beverages. The Coca-Cola Ltd. Company is widely known for its flagship product Coca-Cola; however, it has various other products as well under its name. The company’s stock is also listed in the New York Stock Exchange (NYSE). It has a long history of acquisitions, which helped the company approach differently to the different market. One of the biggest acquisitions was when the company did acquire the Thums Up an Indian cola brand in the year 1993. The acquisition actually provided a strong hold to the company in the vast Indian market. In the year 1982, Coca-Cola purchased Columbia Pictures for $692 million. It then sold it to the Sony for a whopping $3 billion in the year 1989 (Yadav, Stapleton & Van Wassenhove, 2013).
The supply chain management is a process that actually involves the different kinds of activities to fulfil the request and demand of customers. A request or demand is processed through various stages such as inbound logistics, manufacturing, outbound logistics, sales & marketing and supply to end users (Priem & Swink, 2012). The supply chain management is given a high importance in the Coca-Cola Company. It is important for them to minimize the adverse effects of manufacturing on the environmental aspects and enhance the sustainability of the value chain. They want to lead the supply chain function in relation to the cost efficiency and the customer service. This is for such facts they believe in delivering the quality performance and making investments on advanced technologies to optimize the supply chain infrastructure (Dauvergne & Lister, 2012).
The main purpose of this assignment is to investigate the supply chain operation of the Coca-Cola Company. In addition to this, the paper would also educate its readers on the compatibility of the supply chain in respect to the contemporary literature on the supply chain management.
Supply chain needs certain strategies to add values to its operation. Value chain depends on various factors such as quality suppliers for getting quality raw materials, effective logistic companies for a timely delivery of products and effective marketing communication modes to attract a huge customer base. The combination of several supplies chain processes and its efficient delivery make things work for both the companies and the customers. This would not be wrong to say that a company, which has high control on its supply chain process and has strategies to add values to the different interrelated activities, would have competitive edge over its competitors (Wisner, Tan & Leong, 2014). Coca-Cola is one of few companies that have efficient and innovative skills to manage the supply chain. Following are the stages that are involved in the supply chain management of Coca-Cola (Barkay, 2013):
In the supply chain management, it is very necessary that the company use utmost strategies to enhance its competitiveness. Coca-Cola Company does use some innovative strategies to enhance its dominion in the market. Information flow system has high importance in enhancing the capability of supply chain. Nevertheless, information flow system needs to be of utmost quality in order to become more responsive to the customer’s requirement. It helps in many other aspects as well such as for reducing the expenditure costs, in enhancing the customer service and in making a proper utilization of workforces (Rushton, Croucher & Baker, 2014). In the Coca-Cola Company, the utilization of information flow system is done under the influence of technological advancement. The information flow system mainly includes a proper integration of supply chain members for the company. The high use of technology in the supply chain management is widely prevalent. They use it to provide the information regarding required tasks such as the required materials and the workforces. The information flow system has helped them perform better in many countries. The use of innovation in the supply chain management is a key to success after crossing all the barriers that had ruined many companies in the past (Stadtler, 2015). Nevertheless, Walmart is another such company that has resolved the complexity of supply chain process into its favour. The use of innovation with the help of information technology has benefitted the Coca-Cola Company in numerous ways such as the follows (Parmar et al., 2014):
The contemporary literature on the supply chain management has added another very important asset, which is of high demand in the modern market. The demand is because of various reasons such as the rising awareness of customers for pollution free environment and the rising focus of local governments on the environmental benefits across the globe. This has raised questions for the sustainability of different business (Chan & Wang, 2012). On a same note, the rising awareness towards an environment friendly approach has caught the beverage industry under strict scrutiny of various local governments across the globe. The rising cases of obesity have questioned the high presence of sugar present in beverages. However, Coca-Cola has responded to the rising urgency by considering some changes in its supply chain management. Coke has gone up against its practices to show its sustainability spirit. It has made some future goals for its organizational practices. The Coca-Cola Company would now release water to the maximum possibilities. The Coca-Cola Company would consider reducing its carbon footprint in developed countries. The company would also try to recover the packaging to reuse it and avoid the wastages that also cause carbon emission in the environment. The company has already initiated some strategies in the way of sustainable production. The use of innovation has helped the company in producing PlantBottle, which has 30% of the plant materials in it. It is recyclable. This is done to enhance the environmental values in its production. In addition to this, company has also considered Truvia with Cargill to replace the sugar content in the product as much possible. The Coca-Cola Company has efficiently posed some strategically sound options to enhance its environmental values and to attract more customers with green supply chain management (Forbes.com, 2017).
The suppliers are one of the most vital aspects of a supply chain management. It is very difficult to find quality suppliers at every place. Some countries have high bargaining power of suppliers in some industries such as Munich has high bargaining power of suppliers, which is why Airlines companies in the city are forced to spend high on their employees (Betten & Aylward, 2016). Cost effective manufacturing is of utmost requirement, which helps to offer cheaper prices to the customers. Nevertheless, it is always a challenge for companies to find their choice of suppliers. Despite the cost effectiveness, quality assurance is another important asset of supply chain that ensures a quality production. Coca-Cola is a very reputable and grand multinational company, which has maintained its supremacy despite a stiff challenge from Pepsi in some parts of world. It has a different approach for its supply chain management. The Coca-Cola Company has a direct control on its suppliers, which means that the company can get the desired materials from its suppliers. This also means that there would not be any shortage of materials for the company. The company has also its control over its bottling partners those who supply the bottles or cans to the company. Nonetheless, the Coca-Cola Company manufactures the syrup or the liquid part only, which is then filled up in the bottles and the cans provided by its suppliers for bottlers. They have some other suppliers as well. They show their concerns for the minority groups and the women. The Coca-Cola Company do purchase services and goods from some minority companies. With the help of such initiatives, they actually support the minority groups. The company provides them an opportunity to earn some business. They are also getting supplies of goods and services from some women run small enterprises. These kinds of approaches have actually helped the Coca-Cola Company go community oriented where they are supporting the different kinds of communities by means of providing business to them. The suppliers are highly assessed by the company under the guidelines of highest standards of business conduct, which is to provide utmost support to the environmental related works of the company. They are highly instructed to supply only those materials that are good for the environmental values. The supplied materials are then sent to the manufacturing centre where syrups are manufactured (Dorfman et al., 2012). The manufactured syrups are then filled up in the bottlers or the cans provided by its suppliers. The ready products are then sent to its warehouses from where the products then reach to the end customers through various means such as through the retailers. The process of supply chain is not any different from other multinational companies but the use of innovation is something that places them in the list of rare companies, which have reduced the complexities of the supply chain. The high investments of the Coca-Cola Company on the technological advancements have given them a robust control on their innovative works. The use of technology has actually helped the company in having a control on the flow of information, which is very important for a timely response to the customer’s requirement and the reduction of manufacturing costs by avoiding the wastages of raw materials. The wastages generally happen when there is no such tracking of required materials. However, Coca-Cola has its utmost control on the management of required materials (Zhu, Sarkis & Lai, 2012).
Very few brands are there that have the same global presence as the Coca-Cola Company has. Additionally, numbers of such companies are even lesser that have solutions to the complex management of supply chain. The company has its presence in the entire world except the two locations such as the North Korea and Cuba. Such a footprint is a valid proof in support of the fact that the company has a high-class control on the supply chain management (Powell & Gard, 2015). They have leadership franchise on to their credit, which takes care of the bottling requirements of the company. Some of the following unique strategies have helped the company in attaining a position, which is rarest in Universe:
Diverse beliefs are something that has contributed in the success of the company. As a company, Coca-Cola has always adjusted its strategies with the customer’s requirement. This has provided enormous growth potential to the company. Coca-Cola has believed in hiring capable and innovative talents to enhance the efficiency level of its supply chain. They bring diversity in their talent pool by giving preferences to the women employees as well (Rani et al., 2012). They support their strategy by showing the importance of diverse skills, which would well be served by ignoring the physical differences over the skills.
The Coca-Cola Company recognizes the importance of being competent with the changing nature of supply chain. The advent of globalization has made the global supply chain more complex. Very few companies do have the answers to the changing environment and the new challenges; however, the Coca-Cola Company rightly answers the created urgency with its innovative thoughts and technological advancements. One of the innovative approaches that the company adopts is the execution of a session with the suppliers to educate them on the requirements of the Coca-Cola Company. This is also done to strengthen the bound with its suppliers, which would actually help the company in getting quality materials. The company has superior supplier relationship managing events that occur on a quarterly basis with major vendors. These kinds of session are generally executed to review the performance of every major supplier. This is also done to understand the issues if there is any. These are some strategies, which provide a strong control to the Coca-Cola Company on its suppliers (Lambert & Schwieterman, 2012).
The Coca-Cola Company has some other unique strategies that have helped the company in having a dominion control on its supply chain. The company has formed a Global supply Chain Council, which takes care of all the supply chain related issues. It has a vast network coverage that has potentials in it to benefit its global suppliers. The different suppliers such as those who supply raw materials to the company and those who supply bottlers to the company can ask any of their queries from the specially formed Global supply Chain Council. They get answers for their queries in just few minutes. The Coca-Cola Company is capable of being with the pace of the demands that the contemporary customers generate. The contemporary customer’s demands are getting changed rapidly, which is why it becomes necessary for the companies that they are flexible with the customer’s requirement. The Coca-Cola Company has rightly succeeded in doing the same with the help of its supreme control over its suppliers. The technological advancements that the company use in its supply chain process and the innovative ideas that bring simplicity in the highly complex supply chain are the two core factors that help it cross any barrier in their way to success (Yadav, Stapleton & Van Wassenhove, 2013).
Conclusion
The Coca-Cola Company has mastered the complexity of supply chain management, which is a rare feat to achieve. The company with its ability to adjust with the changing behaviour of customers has also responded to the highly rising requirements of green supply chain management. The innovative thoughts and the technological advancements have helped the company in attaining a feat, which is never true for most of the companies. However, the company lacks in its strategies towards the partnership collaboration with traditional restaurants, which is very effective for an incrementing business revenues. The company has collaborated with some biggies like McDonald’s and KFC. However, it has not yet considered some traditional restaurants in different countries.
Collaborating with some traditional restaurants in different parts of world would definitely help the company reach to a large customer base on the most occasions. This might increase the sales for the company. The collaboration with the different traditional restaurants is safe as well. This is an undeniable fact that the Coca-Cola Company has captured a huge customer base across the globe. However, this is undeniable as well that they considered the collaborative relations with the fast-food biggies such as McDonald’s and KFC. It means that the company is in regular hunt to enhance its customer base. Nonetheless, the recommended option can effectively enhance the customer base by bringing the product close to the traditional values of different regions.
References
Barkay, T. (2013). When business and community meet: A case study of Coca-Cola. Critical Sociology, 39(2), 277-293.
Betten, D. N., & Aylward, T. V. (2016). Structural changes in the European Airline industry (Master’s thesis, BI Norwegian Business School).
Businesscasestudies.co.uk (2017). A story of global success – Who dares wins – success through intelligent risk – Coca-Cola Great Britain | Coca-Cola Great Britain case studies and information | Business Case Studies. [online] Businesscasestudies.co.uk. Available at: https://businesscasestudies.co.uk/coca-cola-great-britain/who-dares-wins-success-through-intelligent-risk/a-story-of-global-success.html [Accessed 8 Jul. 2017].
Chan, H. K., He, H., & Wang, W. Y. (2012). Green marketing and its impact on supply chain management in industrial markets. Industrial Marketing Management, 41(4), 557-562.
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Forbes.com. (2017). Forbes Welcome. [online] Available at: https://www.forbes.com/2010/01/29/muhtar-kent-coca-cola-leadership-citizenship-sustainability.html [Accessed 4 Jul. 2017].
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Parmar, R., Mackenzie, I., Cohn, D., & Gann, D. (2014). The new patterns of innovation. Harvard Business Review, 92(1), 2.
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Rani, B., Maheshwari, R., Garg, A., & Prasad, M. (2012). Bottled water–A global market overview. Bull. Environ. Pharmacol. Life Sci, 1(6), 01-04.
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