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Read the case study below and answer the questions that follow.Coca Cola Coca-Cola is the most popular soft drink in the world.It’s sold almost everywhere, and its brand name is known in mostlanguages. The Coca-Cola Company (TCCC) manufactures and sells notonly Coca-Cola itself, but also a wide range of other beverages,like Fanta, Sprite, water, juices, and energy drinks. The brandowes its success primarily to the product itself as well as itsiconic marketing campaigns that position Coke as a drink with a funand active lifestyle. But there’s one factor a person might misswhen explaining the wildly successful product: the Coca-Cola supplychain is one of the most wide-reaching, seamless operations in theworld. The History of Coca-Cola’s Success and ManufacturingMilestones Before we start talking about the Coca-Cola supplychain, let’s take a look at the key milestones in the history ofthis legendary drink. • In 1886, Dr John Pemberton, a pharmacist inAtlanta, invented a flavoured syrup mixed with carbonated water. Atthose times, there was a belief that carbonated water had a goodimpact on health, so Coca-Cola was actually sold as a medicine atsoda fountains. • In 1888, Dr Pemberton sold his business toAtlanta businessman, Asa G. Candler., who expanded the beveragesales to soda fountains beyond Atlanta. • In 1894, JosephBiedenharn was the first to start selling Coca-Cola in bottles. •In 1899, three enterprising businessmen in Tennessee got exclusiverights to bottle and sell Coca-Cola, thus starting the company’sworldwide bottling system. • In 1929, the first Coca-Cola slogan,“The Pause That Refreshes,” appeared in the Saturday Evening Post •In 1977, the contoured Coca-Cola bottle was trademarked, and thefirst marketing efforts were made, which then turned Coca-Cola intothe world’s most well-known beverage brand. Coca-Cola Supply Chain:What Makes It So Remarkable? Coca Cola’s VP of Customer LogisticsWendy Manning once said the company is able to deliver a drink froma factory to a local store within 48 hours. The secret behind thisimpressive figure is local sourcing, meaning that most of thedrinks are manufactured directly in the country where they aresold. Coca-Cola has more than 900 bottling and manufacturingfacilities across the world, and its factories have some of theworld’s fastest production lines. It’s not just about the sheernumber of facilities, though. These are other things thatcontribute to Coca-Cola’s supply chain: 1. Innovation Coca-ColaEnterprises seamlessly integrates modern technologies into itssupply chain. For example, it uses 3D printing to manufacturebottles and cans for its drinks. 2. People Coca-Cola’s logisticsteam consists of more than 100 people who ensure the safe journeyof each bottle from factory to fridge. 3. Long-term relationshipswith retail partners Over the past few decades, Coca-Cola hasproven to be one of the most valuable and reliable suppliers forits retail partners. One example is that the company has beengrowing together with McDonald’s since 1955. 4. Supplierrelationship management program Helen Davis, VP of Coca-Cola SupplyChain in the US, conducts supplier innovation days. During theseevents, the company’s procurement and marketing teams present thecompany’s market needs while the suppliers also present their ownlatest innovations. The program also involves quarterly meetingswith key suppliers, where a mutual performance review takes place.5. Strict quality control Coca-Cola has strict quality requirementson its manufacturing practices. For example, Coca-Cola HBC, abottling franchise partner of Coca-Cola Enterprises, requiresquality, environment, and health safety certifications from itssuppliers. 6. Global Supply Chain Council The beverage giantestablished the Global Supply Chain Council, which consists ofsubcommittees that focus on adhering to established Coca-Colasupply chain strategy. The Council has its own centralized portalwhere the employees and supply chain participants share theirexperiences and best practices. 7. Close collaboration withbottlers The Coca-Cola Company provides a standard set ofguidelines for all of its bottling partners and suppliers. As aresult, most of the strategic decisions are centralised. Theheadquarters controls most of the bottling partner’s operations, soeach bottling partner services the respective geographical areathrough a head office. The bottler’s office works in tightcollaboration with a regional office under the direct supervisionof The Coca-Cola Export Corporation (TCCEC). The bottler’s headoffice connects the production plant with different distributionand sales centres across the world, forming a coherent supplychain. All of these aspects make Coca-Cola supply chain managementone of a kind. Coca-Cola Supply Chain: How It Works In a nutshell,Coca-Cola beverages go through the following destinations in theirjourney: Manufacturer • Distributor • Retailer • Consumer Now let’stake a closer look at this journey. The typical workflow withinCoca-Cola supply chain: • The Coca-Cola Company headquarters inAtlanta manufacture the concentrated syrup and sell it to Coca-ColaEnterprises (CCE) or another bottling partner, which is responsiblefor selling the product in North America and Canada. • The bottlingpartner sends it to a manufacturing facility, which mixes the syrupwith other ingredients, such as filtered water and sweeteners.After that, the bottler packages the final product and distributesit to retail partners (stores, restaurants, vending machines) • TheCoca-Cola Export Corporation (TCCEC) partners with local bottlersacross the world and distributes the drink to the correspondinglocal markets. Coca-Cola Logistics Logistics is an integral part ofany supply chain, and Coca-Cola’s logistics expertise definitelycontributes to its supply chain success. Here are some of thelogistics-related best practices implemented by Coca-Cola: •Manufacturing products on a more frequent basis, e.g. once a week •Implementing weekly meetings between the teams worldwide • Movingthe production plants closer to customers • Introducing dailyinteraction between the main sites • Introducing seamless processesthat are shared between all supply chain participants. Does Coke’sSupply Chain Management Inspire You? Coca-Cola’s manufacturing andsupply chain management have inspired a lot of other businesses tobe better. But businesses today can scale growth at a much fasterrate than one could back in the early 1990s thanks to new softwareand automation techniques. The takeaway here should be that theprinciples Coca-Cola grew from still apply, even if the technologythat facilitated that growth is outmoded
QUESTION FOUR [25] With companies looking to focus on theirstrengths, outsourcing has grown in recent history. Coca-Cola isfacing a dilemma to outsource or offshore their delivery service.Provide a detailed report on the concept of outsourcing andoffshoring at Coca-Cola and identify which concept is most suitablefor Coca-Cola. Substantiate your answer with examples.