Thursday, February 27, 2025

Heroes of Lean Manufacturing

 



https://www.wearekms.com/blog/2018/10/19/key-figures-in-the-history-of-lean

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Saturday, February 22, 2025

Industrial Engineering Operations Research (IEOR) - Optimization - Online Course Module Lessons


Module  of Industrial Engineering ONLINE Course 

Modules


IEOR -Application of OR to optimize every operation in process chart.

IEOR - Industrial Engineering Operations Research - Optimization - Optimizing Production, Inspection,  Handling, Stocking and Planning Operations.
Online Course Module Lessons.




Previous Module - Productivity Management. Lessons 336 - 367


371. Operations Research - An Efficiency Improvement Tool for Industrial Engineers

372. PRINCIPLES AND APPLICATIONS OF OPERATIONS RESEARCH
(from the perspective of an industrial engineer)
(From Maynard's Industrial Engineering Handbook, 5th Edition, pp. 11.27-11.44)
Jayant Rajgopal (From Rajgopal's website)
http://www.pitt.edu/~jrclass/or/or-intro.html

373. Engineering Optimization - Introduction

374. Single Variable Optimization - Engineering Problems

375. Multi-Variable Optimization - Engineering Problems

376. Constrained Optimization - Engineering Applications

377







Crankshaft - Engineering Optimization - Bibliography


Optimization - Minimization of Resources Used in Big Data Storage and Analysis


Engineering Optimization - Courses and Resources

What is mathematical programming?
http://coral.ie.lehigh.edu/~ted/files/ie316/lectures/Lecture1.pdf

Examples of Mathematical Programming.
http://coral.ie.lehigh.edu/~ted/files/ie316/lectures/Lecture2.pdf



Simplex Method
http://mat.gsia.cmu.edu/classes/QUANT/NOTES/chap7.pdf

Transportation Problem
http://orms.pef.czu.cz/text/transProblem.html

Queing Models
http://orms.pef.czu.cz/text/QueTeory/QueuingModels.html

Simulation

http://orms.pef.czu.cz/text/NolinearProgramming/simulation.html


An Overview of Optimization Techniques for CNC Milling Machine
https://www.alliedjournals.com/download_data/IJEMS_V1IS50005.pdf

New Technology and Optimization of Mobile Phone Battery
https://theseus.fi/bitstream/handle/10024/110646/Liu%20Jian_Zhang%20Yixian.pdf?sequence=1

Combustion Optimization in PF Boilers
http://www.eecpowerindia.com/codelibrary/ckeditor/ckfinder/userfiles/files/Session%201%20Combustion%20and%20Optimisation%20in%20coal%20fired%20boilers_KBP_17_09_2013.pdf

Application of Optimization Techniques in the Power System Control
https://uni-obuda.hu/journal/Kadar_43.pdf

More cases to illustrate the application in each operation of the process chart will be collected.


Overview of injection molding process optimization technology

Optimal inspection strategy for a multi-stage production process using simulation optimization.

Optimization of material handling in production by G Ioannou · 2004


Optimization designed to optimize surgery scheduling for a hospital system.

Ud.  2.7.2022, 16.3.2022, 9.2.2022  4.2.2022
Pub 30.5.2021















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Friday, February 21, 2025

Method Study - Ralph M. Barnes - Important Points of Various Chapters - Book Seventh Edition






Book: Motion and Time Study: Design and Measurement of Work, Ralph M. Barnes





Ralph Barnes and H.B. Maynard are contemporaries and both have synthesized the existing industrial engineering literature of the period 1930 to 1940 in the books published by them. Both have indicated the full scope of industrial engineering (machine effort, human effort). Barnes focused on detailed study and improvement of operator method. He discussed equipment related issues relevant for the manipulation by the operator only.

This point needs to be emphasized again that industrial engineering has to primarily examine and improve engineering elements of engineering systems to increase productivity (example - collect for corochuck). Engineering is the provision of engines to provide additional power and advantage to persons. Operators run the equipment and tools used in engineering systems and therefore industrial engineers focus on improvement of human effort also to assure productivity of the system. Industrial engineering is better explained as engineering-system efficiency (productivity)   engineering and human effort efficiency (productivity) engineering.

Chapter 1. Productivity

Productivity Definitions

The ratio of output to some or all of the resources used to produce the output.

Labor productivity
Capital productivity
Material productivity

Barnes has indicated that productivity of three important resources used in production or engineering systems is important. Labor, capital and material are the three important resources. For increasing the productivity of labor, motion and time study are used. It is important to specifically highlight that Barnes' book is on "Motion and Time Study" only. It does not cover full industrial engineering. But Barnes clearly stated the importance of capital productivity that is machine productivity and material productivity. Cycle time reduction that reduces inventory in the system fall in the area of material productivity or more appropriately as material flow productivity. 

Productivity Index

Calculated by US Bureau of Labor Statistics for the entire economy as well as parts of the economy

An input-output model of the firm is given in  Figure 1.

Eli Lilly has century long record of productivity improvement

Technological innovation

Productivity increases by technological innovations - Example Dial telephone, farm machinery, computers.

Examples Texas instruments and Hewlett Packard were also given.

Measurement of Individual Worker Productivity

Standard Time

Actual output * Standard time per unit/Hours of effort  = productivity index

Motion and Time Study for Increasing Labor Productivity



Chapter 2  Definition and Scope of Motion and Time Study


Some have suggested that the term methods engineering, work design, work study, or job design should be used in place of motion and time study, and it may be that eventually these terms will come into wider use. There is however, at the present time a trend toward making work methods design synonymous with motion study and work measurement synonymous with time study. Therefore motion and time study and work methods design and work measurement will be used interchangeably in this book.

Motion Study or Work Methods Design (Barnes equates Motion Study to Work methods design)

1. Developing the Preferred Method.
2. Standardizing the Operation - Written Standard Practice
3. Determining the Time Standard - Work Measurement
4. Training the Operator


3 Patterns in which Motion and Time Study is used

A.  By industrial engineers - staff specialists - Originated in 1880s - Taylor and Gilbreth advocated involving operators and taking their feedback after they use the new method.
B.  Also used by Managers and Line Supervisors -Introduced in 1930s (Alan Mogensen - Work simplification workshops)
C. Also used by workers themselves in teams or groups - Came into use in 1950s


Chapter 3. History of Motion and Time Study


Taylor's Use of Time Study

Time study was initially started by F.W. Taylor in 1881 in the machine shop of the Midvale Steel Company. (Detailed note by F.W. Taylor).

Taylor was a pioneer in applying the systematic approach to that phase of industry which intimately affects the worker. He understood that he was dealing with a human problem as well as with materials and machines, and he approached the human side of his investigations with an understanding of its psychological aspects.

Human Effort Industrial Engineering - 


Barnes wrote, "So great has been Taylor's contribution to the whole problem of effective utilization of human effort in industry that we can profit from a review of some of his work in this field."



Taylor's Principles of Management

Taylor's Investigation of Shoveling

Taylor found that shovelers were lifting loads of 3.5 pounds when handling rice coal and up to 38 pounds to the shovel when moving ore. Taylor's experiments showed that with a load of 21.5 pounds on the shovel, a man could handle a maximum tonnage of material in a day.

The Beginning of Motion Study

In 1885, Gilbreth, as a young man of seventeen, entered the employ of a building contractor. Gilbreth observed that brick layers were using different set of motions and some set of motions were more productive. Gilbreth developed interest in developing more productive motion sets and methods in bricklaying.  He invented a scaffold which could quickly and easily raised as the wall height is increasing due to construction. The scaffold on which the bricklayer is standing has a bench for holding the bricks and mortar at convenient height. The bricks were placed in an orderly manner by a helper. With such improvements, the motions to be made by a bricklayer were reduced to 4.5 from the earlier 18, The average bricks laid increased to 350 per man per hour from the old rate of 120 bricks  per man per hour.

Industrial Engineering is System Efficiency Engineering and Human Effort Engineering. - Narayana Rao


Chapter 4. General Problem Solving Process


1. Problem Definition

Example: A farm plants peas in 7000 acres each year from early March to the the first of April. Harvesting is a problem and  the harvesting crew works round the clock and still cannot harvest all the acres. Dr. C.W. Thornthwaite, climatologist for the farm attacked the problem from planting side. He scheduled planting in such a way that a definite number of acres are ready for harvesting every day during the harvesting season and hence there was no confusion and overload on the harvesting team. The problem could have been tackled from the side of harvesting also. But this solution is more ideal according to the author.

2. Analysis of the Problem

The author highlights that some time certain restrictions are told by the persons who are using the current process. They need to be examined carefully. He gives the example of citrus fruit packing. They were packed in wooden crates wrapped in tissue paper with the assumption that they need ventilation. But now they are packed in cardboard cartons without any ventilation. Hence the earlier assumption was not correct.

3. Search for Possible Solutions
Study of texts, handbooks, magazines, technical brochures of various companies, search of relevant websites.

The author gives two examples of new technology to support the idea that search for possible solution should extent to new technologies.

Examples one is an electronic thermometer. The thermometer has a probe onto which a disposable probe is placed and inserted under the patient's tongue. In the 15 to 25 second, the digital reading will come. As a disposable probe is used, there is no possibility of infection spreading to other patients and also the thermometer need not be sterilized. There is no danger of patients biting the thermometer also.

Second example is related to special polypropelene foam material developed by Dupont.

Creative thinking by individuals and groups to be employed.


4. Evaluation of Alternatives

Role of Engineering Economics in Evaluation of Alternatives

In certain types of problems, evaluation would center around the total capital that would be invested in each of the several proposed methods, expected life of the equipment, scrap value and annual operating cost. From these economic or cost figures, the rate of return on the investment per year is calculated.  Direct labor required for each of the proposals need to be worked out. Predetermined motion time systems (MTM) could be used for this purpose. But to visualize the motions to be made by the operators, mock-ups of jigs and fixture may have to be made. Some companies have special laboratories and workshops for such projects.


5. Recommendation for Action

Chapter 5. Work Methods Design - The Broad View


The over-all process of putting a new product into production

1. Planning
2. Pre-production
3. Production

Planning

Six basic planning functions

1. Design of the product
2. Design of process
3. Design of Operator work method
4. Design of  tools, jigs and fixture
5. Design of plant layout
6. Determination of standard time

Preproduction

Resources are acquired and installed and trial runs are made.

Production

The production system is producing as per market requirement or demand.

Two attention areas of Method study person.

1. Preventing the method from deteriorating or deviating adversely from the planned methods,
2. Constantly being on the look out for improvement options, and when one is found, putting it into effect. Also the methods have to be periodically subjected to methods improvement study.

An ongoing manufacturing process provides opportunities to improve and redesign operator methods, to eliminate manual tasks, and make the job easier for the worker. New equipment and tools make existing facilities obsolete and provide cost reduction opportunities. New and better materials are developed or become available providing scope for changes in product parts design.

Example given - Elizabeth Arden Inc. lipstick manufacturing process

In the zeroth year or the starting of the study, the units produced per labor hour was 76. By end of 7 years, the productivity increased and the unit produced per labor hour was 179.

Chapter 6. Work Methods Design - Developing A Better Method


Approach for developing the preferred method

1. Eliminate all unnecessary work.
2. Combine operations or elements.
3. Change the sequence of operations
4. Simplify the necessary operation (Operation analysis)


2. Combine operations or elements.
Example given: In a furniture factory, an operator unloaded wooden logs from a truck and loaded them into a molding machine. On the other end, another operator took the moulded item and loaded it into a another truck. In the redesign, another short conveyer brought back the moulded item to the operator who was loading the machine. The truck was partitioned into four comparments and only three were loaded. In the empty compartment the moulded pieces were loaded by the same operator. Thus the operation was completed by only one operator and also the need for another full truck was eliminated,

3. Change the sequence of operations

In one plant small assemblies were made and stored in a stock room. Inspection was done subsequently. This was resulting in certain problems and in the rearrangement inspection was done immediately after the assembly and then only the finished goods were kept in stock for despatch.

4. Simplify the Necessary Operations - Improve the Necessary Operations

After improving the process using three steps of eliminating the operation, combining operations or elements (or even breaking them further), and changing the sequence of operations, the operation itself can be studied in detail to simplify or improve it.  Study of process is the study of overall picture and then smaller details of each step of the process can be attempted.

One of the best ways to do methods improvement is to question every thing about the method. The design of the product itself can be questioned and investigated (product industrial engineering). The equipment and tools are to be investigated and improved. The materials used are to be examined. The working conditions are to be evaluated. The operator method has to be studied and improved.


Barnes was quiet clear that his text is concerned basically with the description of design and improvement of operator work method and measurement of time required to do it.  That is why he has given the following questions as important in investigating the method (operator method).

1. What is done? At this stage of operation analysis, the analyst must first clearly define what is being done.

2. Who does the work? It is directed at the person who is given the work. The further questions are Why this person? Can any body else do it better? Can a less skilled person do this work if some changes can be done?

3. Where is the work done? 

4. When is the work done?

5. How is the work done? Why is it done this way? What are alternatives?  This step requires application of principles of motion economy and careful analysis.




Chapter 7. Process Analysis


Process Chart

Gilbreth Symbols
ASME symbols

Flow Diagrm

Gang Process Chart

Example: Installation of a Pipe Bridge in Procter and Gamble Company

The earlier procedure was to pick up the the bridge with a crane and fasten it in place and then install pipe and conduit in the bridge at a height. The procedure was changed to installing pipe and conduit while the bridge is on the ground and then lifting it to the required height and fastening it.

Chapter 9. Operation Analysis

Full details of Operations Analysis - Book by Maynard and Stegemerten

It is important to the note "Operation Analysis" is a method used by Westinghouse. It is described in detail in a book by Maynard. Barnes included the description of operation analysis in a chapter.

Because Barnes' focus in on operator method, he discusses in detail the operation chart or the left- and right- hand chart.

Operation Chart or the left- and right-hand chart.

Bolt and Washer assembly example


Check Sheet for Operation Analysis was given only briefly.
1. Machine
    A. Setup
    B. Operation
2. Materials
3. Materials Handling - Plant Layout
4. Tools, Jigs and Fixtures
5. Operator
6. Working Conditions


Example: Spraying inside and outside of metal box cover.

Initially one side is painted and the cover is put in an oven and then the other side is painted.

A device was developed that held the cover on two knife points and inside and outside were painted one side first and next side later and then the cover is put in the oven. Production doubled with the same facility.


Even though, the description of problem solving process, and process analysis are given in this note, the main work of Barnes is research on principles of motion economy and he developed a full book on motion and time study.

Ch. 18. Motion Study, Mechanization, and Automation


Work that can be done better and cheaper by machines has to be done by machines only in work systems.

Barnes recommends that industrial engineers develop the automated method for each operation in the process. Further to it, in work systems design, it is recommended that the best manual method or the best combination of manual and machine method be developed and used as a basis for evaluating the automated alternative to do each element or each sub-operation.  - Barnes. [Automation, Low cost automation]

Interesting statements by Google


Google Productivity Engineer: You might love this role if:

You have an unwavering passion for, and focus on, polished products, engineering excellence, and productivity.
You've worked to automate and remove repetitive and manual tasks because inefficiency is one of your least favorite things.

Read to know about Google Engineering Productivity Department
Google Engineering Productivity Department - Evolution of the Department through Automation of Testing. Emergence of Software Engineering Productivity Engineer & Specialist.


Related Information
Methods Design Concept by Sakamoto
https://books.google.co.in/books?id=r0WEDgAAQBAJ&pg=PA377#v=onepage&q&f=true


Ch. 38 Training  the Operator

Training Methods on Simple Operations
Pictorial Instruction Sheets
Training Assembly Operations



Updated on 10.12.2024,  15 August 2021,  6 July 2021
22 June 2020, 9 June 2020, 26 June 2019, 10 August 2015






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Productivity Training by Industrial Engineers


Lesson  360 of  Industrial Engineering ONLINE Course -  Productivity Management Module. 


Industrial Engineers have to be good trainers in machine work and manual work.

Two Related Industrial Engineering Principles

Productivity Methods Training - Principle of Industrial Engineering. Train operators at the motion speed planned and expected.

https://nraoiekc.blogspot.com/2017/07/productivity-methods-training-principle.html

Work Simplification Education and Training to All - Principle of Industrial Engineering


https://nraoiekc.blogspot.com/2017/07/work-simplification-education-and.html


Industrial engineers have to be imparted training skills in the curriculum. They have to redesign processes and they have to impart training to supervisors and workmen in the redesigned processes. They have to ensure as a part of training that supervisors and workmen produce as the speed specified. The ongoing training of the workmen is the responsibility of supervisors. The first time responsibility is that of industrial engineers.

The training by industrial engineers is a neglected topic in IE curriculums. It is a neglected topic in practice also. The failures of IE profession are to a large extent because of their lack of commitment to training foremen and operators till they attain the production rate specified for the redesigned process.


Read Ch.38. Training of Operator in Motion and Time Study Design and Measurement of Work by Ralph Barnes

Training Methods on Simple Operations
Pictorial Instruction Sheets
Training Assembly Operations


Ud. 21.2.2025

Pub. 8.3.2022






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Wednesday, February 19, 2025

March - F.W. Taylor Month of Industrial Engineering and Productivity Management



What is industrial engineering?

Industrial engineering is concerned with improving the productivity of engineering systems and processes. The productivity improvement has to take care of employee comfort and fatigue. So it has human focus and orientation along with engineering orientation. Productivity leads to cost reduction and hence, entrepreneurs and managers can reduce prices and increase revenues and profits. In the process, employees get more income. Hence consumers, employees, entrepreneurs & capitalists and society at large is benefitted by effective industrial engineering practice. Industrial engineers are very important professionals.


Remember F.W. Taylor. Birthday - 20 March 1856.

To be remembered for Productivity Improvement System, Productivity Engineering of Machine Tools, Shop Management, Scientific Management. 


Frederick Taylor's Productivity System for Rapidly Attaining The Maximum Productivity - Part 1

#IndustrialEngineering  #Productivity

https://nraoiekc.blogspot.com/2018/07/frederick-taylors-piece-rate-system.html


Productivity Engineering of Machine Tools and Machining - F.W. Taylor - Part 1

https://nraoiekc.blogspot.com/2020/05/machine-work-study-machine-tool-metal.html


F.W. Taylor - Shop Management - With Appropriate Sections.

https://nraoiekc.blogspot.com/2016/03/fw-taylor-shop-management-with.html


F.W. Taylor Scientific Management - With Appropriate Sections

#FWTaylor

https://nraoiekc.blogspot.com/2016/03/fw-taylor-scientific-management-with.html




Frederick Winslow Taylor - Birthday - 20 March 1856 

F.W. Taylor Industrial Engineering/Productivity Week (14 - 20 March)

Articles Recommended for Reading







Frederick Winslow Taylor (Birthday. 20 March) - A Pioneer Industrial Engineer

https://nraoiekc.blogspot.com/2012/04/frederick-winslow-taylor-pioneer.html


F.W. Taylor - Biography - Some Important Events and Opinions by Others

https://nraoiekc.blogspot.com/2015/06/fw-taylor-biography-book-some-important.html

F.W. Taylor Medal 

The "F.W. Taylor Medal of CIRP" is an award conferred upon younger research workers of outstanding merit who author original scientific research papers on topics falling within the fields of CIRP.

CIRP: THE INTERNATIONAL ACADEMY FOR PRODUCTION ENGINEERING

https://www.cirp.net/about-cirp/history-col-250/internal-regulations/558-ir-art20.html


Recipients of the CIRP Taylor Medal since 1958

https://www.cirp.net/about-cirp/awards.html?id=553








Important Industrial Engineering Contributions.

Notes on Belting, Piece Rate System, Shop Management, Art of Metal Cutting, Scientific Management
https://nraoiekc.blogspot.com/2019/06/taylors-industrial-engineering.html


Productivity Science of Machining - Taylor to Current Times

Productivity science of human effort - Development of Science in Mechanic Arts - F.W. Taylor

Productivity Engineering by F.W. Taylor

Productivity Management - F.W. Taylor

___________________________________________________________

Important Events in Life


Date of Birth: 20th March, 1856
Mr. Taylor was born at Germantown, Philadelphia, on March 20, 1856

Taylor took a home study course to get his college degree in mechanical engineering in 1883 from Stevens Institute of Technology at Hoboken, New Jersey


1905 and 1906
President of ASME
Taylor was President of the American Society of Mechanical Engineers in 1905 and 1906.

1911 -  Tuck School hosted a major conference that helped launch the scientific management movement started by Frederick Winslow Taylor.

Taylor was awarded the honorary degree of Doctor of Science by the University of Pennsylvania. Taylor was made a Professor by the Tuck School of Business at Dartmouth College. He spent some time in teaching and research at this business school.

21st March 1915: F. W. Taylor, Expert in Efficiency, Dies
BY THE NEW YORK TIMES
PHILADELPHIA, March 21--Frederick Winslow Taylor, originator of the modern scientific management movement, died here today from pneumonia. He was 59 years old, and was a former President of the American Society of Mechanical Engineers.
http://www.nytimes.com/learning/general/onthisday/bday/0320.html

About Taylor in ASME Proceedings of 1907
https://babel.hathitrust.org/cgi/pt?id=mdp.39076000032131&view=1up&seq=57&size=150
---------------------------------


Taylor's Industrial Engineering in Taylor's Papers

Notes on Belting, Piece Rate System, Shop Management, Art of Metal Cutting, Scientific Management
https://nraoiekc.blogspot.com/2019/06/taylors-industrial-engineering.html

Taylor's Industrial Engineering in New Framework - Narayana Rao

https://nraoiekc.blogspot.com/2019/07/taylors-industrial-engineering-in-new.html


More Details of his life and contribution to scientific management and industrial engineering

F.W. Taylor - Biography


Contribution of Taylor to Industrial Engineering

F.W. Taylor - Productivity Engineering of Belting - 1893 - Notes on Belting

https://nraoiekc.blogspot.com/2019/02/fw-taylor-productivity-engineering-of.html

Piece Rate System - Elementary Rate Fixing System - Productivity Improvement System - 1895


1. Frederick Taylor's Piece Rate System - Part 1   -   Part 2   -  Part 3 -  Part 4 - Part 5 - Part 6

Shop Management 


1. Definition of Management 

2. Difference in Production Quantity between a first class man and an average man

3. Developing and Employing First Class People in an Organization

4. Confronting Soldiering - Slow Pace of Work

5. Halsey Plan - F.W. Taylor's Comments

6. Task Management

7. Investment for Increasing Productivity or Efficiency

8. Importance of people - organization

9. Modern Engineering and Modern Shop Management

10. Task Management - Starting and Ending Times

11. Task Work - Some More Thoughts

12. Usefulness of Gantt's system

13. Time Study by F.W. Taylor

14. Bicylcle Ball Inspection Case Study

15. Need for Functional Foremanship or Functional Organisation of Foremen

16. Functional Foremanship

17. Production Planning and Control

18. Role of Top Management in Managing Change to High Productive Shop

19. Train Operators in High Productivity One by One and Then in Small Batches

20. Organizing a Small Workshop for High Productivity

21. Introducing Functional Foremanship

22. Personal Relations Between Employers and Employed

23. Don't be in a hurry - It Takes Time to Manage Change

24. Best Practices in Shop Management


Scientific Management - Basis for Industrial Engineering


Basic Principles of Industrial Engineering


1. Develop science for each element of a man - machine system's work related to efficiency and productivity.
2. Engineer methods, processes and operations to use the laws related to the work of machines, man, materials and other resources.
3. Select or assign workmen based on predefined aptitudes for various types of man - machine work.
4. Train workmen, supervisors, and engineers in the new methods, install various modifications related to the machines that include productivity improvement devices and ensure that the expected productivity is realized.
5. Incorporate suggestions of operators, supervisors and engineers in the methods redesign on a continuous basis.
6. Plan and manage productivity at system level.
(The principles were developed on 4 June 2016 (During Birthday break of 2016 - 30 June 2016 to 7 July 2016).

The principles were developed by Narayana Rao based on principles of scientific management by F.W. Taylor)

Principles of Scientific Management


 The managers following scientific management thought do the following things.

First. They develop a science for each element of a man's work, which replaces the old rule-of.-thumb method.

Second. They scientifically select and then train, teach, and develop the workman, whereas in the past he chose his own work and trained himself as best he could.

Third. They heartily cooperate with the men so as to insure all of the work being done in accordance with the principles of the science which has been developed.

Fourth. There is an almost equal division of the work and the responsibility between the management and the workmen. The management take over all work for which they are better fitted than the workmen, while in the past almost all of the work and the greater part of the responsibility were thrown upon the men.
(From THE PRINCIPLES OF SCIENTIFIC MANAGEMENT - F.W.Taylor)

Scientific Management 


1. Importance of National Efficiency

2. Foundation of Scientific Management

3. Soldiering and Its Causes

4. Underlying Philosophy for the Old Systems of Management

5. Scientific Management - Introduction

6. THE PRINCIPLES OF SCIENTIFIC MANAGEMENT

7. Illustrations of Success of Scientific Management - - Pig Iron Handling

8. Background for Development of Scientific Management - -Midvale Steel Company Machine Shop

9. Elaborate Planning Organization - Need and Utility

10. Illustrations of Success of Scientific Management - Bricklaying Improvement by Gilbreth

11. Illustrations of Success of Scientific Management - Bicycle Balls Inspection Example

12. Scientific Management in Machine Shop

13. Development of Science in Mechanic Arts

14. Study of Motives of Men

15. Scientific management in its essence

16. Role of Top Management in Implementing Scientific Management

17. Scientific Management Summarized

Shop Management and Scientific Management

Related Articles



Taylor's Industrial Engineering in New Framework - Narayana Rao

https://nraoiekc.blogspot.com/2019/07/taylors-industrial-engineering-in-new.html

Principles of Scientific Management of F.W. Taylor and Practice Implications

https://www.youtube.com/watch?v=5jru9fo94q4

Industrial Engineers with Birthdays in March

Dasari Amarendra, PGDIE, NITIE


This article has to be included in the IE Newsletter of March Month.


Ud. 19.2.2025
Pub. 20.3.2023
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2 Million Page Views in Blogger Statistics - 20 March 2023 - Industrial Engineering Knowledge Center Blog

19.2.2025

2.68 million now.


10.3.2024

Very happy to notice that in the last year Industrial Engineering Knowledge Center Blog  got  0.276 million page views in blog statistics.


-----------------------------

 2 Million Page View Registered by Industrial Engineering Knowledge Center Blog on 20 March 2023.



Very happy. Blog registered 2 million page views in blogger statistics on 20 March 2023. This gives the confidence that in the next 3 years 100,000 more persons will visit and read articles from the blog. A good audience which will make the effort spent in writing the blog useful to the society.



20 March Birthday of F.W. Taylor







Last 12 months it is 222K hits and 4K comments.


Ud. 10.3.2024

Pub. 20.3.2023

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Success Stories - Industrial Engineering, Productivity Improvement and Productivity Management


Success Stories - Industrial Engineering, Productivity Improvement and Productivity Management

Chapter of Productivity Management in Engineering Organizations - Online Book



Productivity is an area of study and research from time immemorial. Adam Smith started his book "Wealth of Nations" with discussion of productivity only.

F.W. Taylor is credited with developing  theory and practice of productivity improvement and management in the modern era.


Taylor's Success Stories


Bicylcle Ball Inspection Case Study - F.W. Taylor

Illustrations of Success of Scientific Management - Bricklaying Improvement by Gilbreth

Scientific Management, Industrial Engineering and Productivity Improvement in Machine Shop - F.W. Taylor

Illustrations of Success of Scientific Management - Pig Iron Handling - F.W. Taylor



Value Analysis and Engineering - Cost Reduction of Products and Components


Value Analysis and Engineering - Examples by L.D. Miles

Value Engineering - Examples, Cases and Benefits



Productivity Improvement: 850% Increase in Machining Time - Sewtec Automation

Productivity Improvement Case Studies - Bibliography


Industry Wise - Productivity News and Case Study Information


Industrial Engineering and Productivity Management in Various Industries - Index Page


Industry Sectors


Productivity and IE in Automobile Manufacturing

Productivity and Industrial Engineering (IE) in Battery Manufacturing

Productivity and Industrial Engineering in Bicycle Manufacturing

Productivity and Industrial Engineering in Bottled Water Manufacturing

Productivity and IE in Electronic Assembly Manufacturing

Productivity Improvement, Cost Reduction and Industrial Engineering in Mobile Handsets - Phones

Productivity and IE in Pharmaceutical and Medicine Manufacturing

Productivity and IE in Power, Distribution, and Specialty Transformer Manufacturing

Productivity and IE in Ship Building and Repairing

Productivity and Industrial Engineering in Soft Drink Manufacturing



Individual Company Productivity Success Stories

2024

Lean Manufacturing in Productivity Improvement in a Food Company, Peru.
Nanotechnology Perceptions (ISSN 1660-6795)
Vol. 20, S11 (2024)

The objective of the research was to determine the impact of implementing Lean Manufacturing tools on the productivity of the production area in a food company specializing in the manufacture of Andean cookies in the city of Huancayo. To achieve this, the Lean Manufacturing methodology was used, selecting the Kaizen, 5S, TPM (Total Productive Maintenance), Kanban, and Just in Time (JIT) methodologies.
Regarding productivity after the implementation of Lean, a 14.9% increase was recorded.
https://nano-ntp.com/index.php/nano/article/view/1956


Productivity Success Story - Coca Cola

Improving productivity; a description of selected company programs
National Center for Productivity and Quality of Working Life.
[Washington, D.C.] : The Center, 1975.
https://catalog.hathitrust.org/Record/101690317

Industrial Engineering Case Studies - Industrial Engineering ONLINE Course


(C) Narayana Rao K.V.S.S. 2019

12 October 2019


Updated on 19.2.2025, 14.3.2022












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Promoting Productivity Management



Promotion of Productivity Improvement Program


1. Spelling out the goals of the productivity program for the next year and next five years or a five year plan by the CEO

2. Forming a Productivity Steering Committee of Top Executives

3. Demonstrating the commitment to productivity program by the CEO and other top executives


4. Organizing and Reorganizing the Productivity Management Department

5. Declaring the Introduction of Productivity Improvement Program or Yearly Productivity Plan by the CEO.

6. Organizing Grade by Grade Training in Productivity Improvement.

7. Creating Productivity Improvement Circles in each department.

8. Forming cross functional Management Committees

9. Productivity Audits by Various Levels of Management

10. Productivity Rewards at Productivity Case Study Contests and Productivity Review Seminars.

11. Best Practice Identification Workshops

12. Sending Operator Teams and Manager Teams to National and International Teams to present their achievements and learn from other organization achievements.

13. Productivity News Letter Creation and Distribution through print and online channels.

14. Reporting Productivity achievements in Annual reports of the company.



Organizing and Reorganizing the Productivity Management Department


If presently there is no specific department that looks after productivity improvement, the organization has to create one to have systematic productivity improvement program. At the top of the productivity program there can a single manager or a cross functional committee chaired by one of the members of the committee. This department may need to be reorganized periodically to take care of increased responsibility and induction of more people, or reduction of more people, or starting of new sections to take care of new methods and techniques etc.

Productivity Promotion Office


The Need for Productivity Promotion Office


Etzioni’s (1965, 1975) model of organizational change refers to the conforming or nonconforming behavior of various persons in the organization and the expectations and performance goals of those in charge of planning and managing change. The total organization will change when nonconforming person's number approaches zero.  The model identified a sequence of four phases in change: education and promotion; commitment; performance; withdrawal of the special promotion effort as the organization change is completed successfully. The model does not, however, give the duration, and hence timing by which phase succeeds one another.

Japanese quality author, Hitoshi Kume writes that to build or develop a system in which people are proactive towards work improvement to improve output, certain new ways of presenting things are necessary.

1. People have to be presented information that helps in better understanding of the current situation of the organization. People are generally happy with long-surviving routines and do not see waste or the loss caused by them to the organization. Only when the fact that organisation is suffering due to that routine in a big way and there is a way to eliminate that waste through some effort is brought into their consciousness that people start thinking about the issue.  Such an insight sometimes can come to people when they are attending lectures by experts in waste elimination or in implementing some techniques that eliminate that waste, or by listening to success stories told in case study competitions, when visiting plants with best practices or consultant presentations. When the senior managers of the company realize this existence of waste, they can create a promotion team to make all the persons in company become aware of the waste. Productivity promotion has to do this type of promotion.

2. Encouraging operators to come out with improvement suggestions is important for their self development. Both Taylor and Gilbreth, the pioneers of scientific management and industrial engineering emphasized this point. The operators have to first follow the standard method designed as the best method at that point in time by the industrial engineering or scientific managers and then have to keep giving suggestions which will improve the method further. In the early days of scientific management and industrial engineering all those suggestions were referred back to industrial engineers. But in Japanese companies, especially in Toyota Motors, after the second world war, this responsibility of evaluating and accepting the suggestions of operators was given to the supervisors and engineers of the shop. Engineers and supervisors are made responsible for continuous improvement of the processes with the involvement of the operators. Productivity promotion offices of the current day have to take up this self development aspect of productivity improvement  (good process change - kaizen) ideas as an important issues and ask all operators to think all the time to improve the method whenever they get an idea because of their reading, observation, or responding to an issue while working. It is to be stressed that supervisors are always ready to listen to improvement ideas and they have some time set apart for listening to improvement ideas of operators working under them.

3. Productivity promotion office also has to promote among all the supervisors and human relations personnel the idea that apart from doing the job effectively and efficiently and achieving results specified as a standard, a proactive mindset that thinks of more effectiveness and efficiency has to be developed in all operators. Supervisors have to provides the required inputs in creative thinking and provide routines or behavior opportunities and role plays in which creativity is exhibited and thus becomes a habit among operators.

4. Successful productivity improvement effort results in tangible results. Each successful project provides a taste of productivity improvement to the other members of the organization. The success when verified, validated and celebrated develops more operators and supervisors committed to the program. The role of Productivity Promotion Office or Section is to produce this snowballing effect. Productivity is to be promoted for bringing the abilities of people into production projects development and implementation. The chief of productivity promotion office is especially responsible for creating enthusiasm for productivity in the organization.

Productivity promotion office has to specially target persons who are not enthusiastic about productivity improvement at any point in time. Frederick Taylor indicated in 1911 itself, that objective demonstration, and teachers who are capable of the holding the hand of the operator and train him in the new efficient method are necessary for change of the mindset of people who are apprehensive of the new efficient methods. Productivity promotion office has to develop trainers of the new productive method and arrange for demonstration of objective and tangible results from a stream of productivity projects to convert more and more people into active supporters of the productivity program.  The persons working in the productivity promotion office need leadership ability, the ability of influencing people, perseverance to do productivity promotion over long periods of time, and have to be broad-minded and tolerant. They should not short tempered people who get upset with too few converts to productivity projects. The persons of the productivity promotion office have to be full of enthusiasm and belief in the productivity policy announced by the top management.

The Role of the Productivity Promotion Office


1. Acting the secretariat for the CEO and Productivity Steering Committee.

2. Drafting the Productivity Policy

3. Drafting the Productivity Promotion Plans

4. Program of promoting the productivity policy of the organization

5. Establishing the productivity management system

6. Program of promoting productivity circles.

7. Planning productivity training activity.

8. Keeping record of productivity improvement projects and unresolved issues relating to productivity improvement.

9. Planning top management audits of productivity practice.

10. Organizing productivity result sharing seminars, case study sessions, best practice sessions, and celebration events.

11. Compiling annual results of productivity improvement activity and collaborating with financial , cost and management accounting to arrive at financial contribution and capital and revenue expenditure incurred for productivity improvement activities and projects.

12. Preparation of books, articles, magazines and videos.

13. Establishment of a desk for providing productivity related help.

14. Management of productivity initiatives website of the organization.

15. Management of productivity library


Sustaining The Productivity Movement


Productivity promotion activity can be initiated and run successfully for number of years by the active participation of productivity promotion office. But once the promotion activity is reduced and stopped, the productivity improvement may slacken. It is not easy to sustain an activity without the an effort to sustain it. Hence, the productivity promotion section is to be substituted productivity sustenance section. This section has to develop information that reminds all the productivity improvement efforts other organizations and their results and remind the personnel of the organization the need to continuously promote productivity in their departments.

1. Every year the productivity policy management has to take place
2. Cross function committees are to be formed and the chairmen have to be appointed again.
3. Training programs at all levels have to continue as appropriate
4. Productivity circle activity has to continue
5. Top management audits have to take place.
6. Daily work management to achieve productivity has to implemented and practiced.
7. Important productivity breakthroughs have to be publicized.

(C) Narayana Rao K.V.S.S.  2019

Next Chapter
7. Industrial Engineering - Its Role in Productivity Improvement


Ud. 19.2.2025, 11.3.2022
Pub. 12.10.2019
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Tuesday, February 18, 2025

Reconciliation of General Ledger - Productivity Improvement - Coca-Cola - IE Case Study

 


The Challenge

The Global Finance Operations Division (GFO) of The Coca-Cola Company manages more than 50,000 GL accounts. Yet multiple systems and approaches to the reconciliation process created serious challenges for the global company.


The company began its search for a cloud-based, globally accessible reconciliation solution. Blackline solution was selected.


The company created a global business process lead role to drive implementation in all plants.


Reduced number of employees involved in reconciliation by 55%. Previously, the monthly financial close process required the help of 800 employees across shared services, manufacturing plants, and business units. By using BlackLine, The Coca-Cola Company has reduced the number of employees who were involved in manual and routine reconciliations to 360, a 55% reduction.

Saved $0.6 million per year through increased productivity.

https://www.blackline.com/customers/the-coca-cola-company/











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Monday, February 17, 2025

Productivity Success Story - Coca Cola



Coca-Cola


2023





Job Advertisement: Director Supply Chain Planning & Productivity - LATAM

Location: Mexico City, Distrito Federal MX
Job ID: R-86675

Post Date: April 18, 2023


Why be part of Coca-Cola Latin America?

We are accelerating our momentum as the fastest growing consumer goods company in Latin America. People are our focus when we collaborate with our diverse network of locally connected manufacturers and when we return every drop of water we use to communities and nature. We empower our employees to challenge the status quo, make bold recommendations, experiment, and adapt, so we can grow together and make a great business even better.

For over 135 years, we have grown to become the most recognized brand in the world. Today, we have hundreds of brands that continue to grow, such as Fanta, Sprite, Aquarius, Fuze and more!

What we expect from you:

Lead Supply Chain Strategy implementation in Mexico

Lead Strategic Supply Chain Initiative roadmap implementation in Mexico

Lead Strategic Initiative from Business Case Development though Approval and Implementation in Mexico

Lead Cross Functional Processes to ensure Alignment of Operational and Business Plans across functions and partners

Serve as Mexican primary point of contact for Supply Chain Network to share and implement best practices locally

Execute strategic vision of supply chain design and its execution plan, capabilities needed for the present and future business (including technological and digital needs) and expansion of a continuous improvement culture, both internally and towards the System in LATAM

Route to Growth and Profitability: Enabling operational excellence through benchmarking to run the business and promoting value chain changes to elevate System´s performance. Responsible for establishing and drive a productivity projects pipeline for the assigned territory, and as PMO follow-up implementation with the correspondent directors, VPs, project managers on committed projects, timeframe and expected results, providing directions for fast track and assignment of resource. Responsible to lead a productivity culture road map in Mexico including a process scheme for supply chain processes.

Develop and implement performance management system and routines to measure and track productivity initiatives and savings achieved, by working cross-functional with the organization, Bottlers and Suppliers. Responsible for development of a productivity scorecard.

Lead Mexican Contingency and Business Continuity Plans, working in partnership with TI&SC teams (mainly Technical Operations) and commercial teams, sourcing entities, Bottlers and their associations and suppliers.

In partnership with infrastructure teams, deliver efficient capacity ahead of demand solutions in a E2E SC perspective. Run capacity initiatives connected with long-term capacity plan for all categories with bottlers and Supply Chain partners in Mexico.

Lead ES&OP and S&OP and S&OE agendas in partnership with CPS, OU multifunctional teams and Bottlers

Build a local responsive supply chain.

Be part of a multifunctional team responsible for ESG in Mexico

Lead a team of 3 Supply Chain Professionals. Considered as a supply chain expert both internally and externally.

Lead Supply Chain communication with Mexican bottlers, contract manufacturers, suppliers, and other KO Supply Chain teams

Communicates for influence, action, and decision making with Supply Chain and cross functional partners for resource allocation and decisions 

The role frequently deals with situations where bottlers and partners have shared strategic alignment but frequent operational misalignment

Qualification & Requirements 
10 + years of Supply Chain experience with depth in one area of Supply Chain and breadth across multiple supply chain experience. 

Franchise and Operational Leadership experience preferred

Mastery of (required) Supply Chain Planning & supply chain analysis; Product Commercialization; Program Management; franchise leadership; influencing and negotiation; contingency planning and BCP; s&OE, S&OP, E&OP

Broad expertise in (Good to have) Strategy development; Infrastructure planning; strategic sourcing and procurement; Team Leadership; financial analysis & productivity; INTEGRATED MANAGENT SYSTEMS & DiGITAL LITERACY; RTM, NETWORK OPTIMIZATION


Job Advertisement: Senior Product Developer, Productivity & BCP

Location: Shanghai, Shanghai CN
Job ID: R-86716

Post Date: April 7, 2023




Position Overview: 
Independently developing productivity pipeline and BCP coordination on behalf of APAC R&D. Strongly building network with global and OU productivity/BCP community to drive bottom-line savings and guarantee the business continuity.

Function Related Activities/Key Responsibilities: 

• Work with related functions including marketing team and technical team for productivity & BCP, review the project brief and make sure all technical requirements are practicable, and work with project team to manage the risk and give the positive solution.

 

• Manage multi-juice productivity or cross-category realted BCP projects independently based on the accumulated beverage know-how and project skills.

 

• Proactively facilitating ideas for future saving opportunity and promote the feasibility check and commercialization possibilities.

 

• Summarize the R&D achievements in a regular base and motivate APAC R&D productivity champion community for deep sharing and supporting as a whole

 

• Develop and maintain effective working relationships across KO R&D system and related internal and external business functions to support business growth initiatives, with good communication skills.

 

• Continue the stability program to deliver solid results.

• Dedicate to lab work and efficiently input formulation in TCCC proprietary databases, such as PICASSO, technical database, etc.

 

Education Requirements:
 

Food Science and / or Food Engineering is preferred

Functional Skills:  

Good computing skills and be familiar to use Windows and Outlook
Good presentation skills
Excellent English

SAN FRANCISCO—February 21, 2023.
Coca-Cola Initiates use of New AI - The Generative AI
The Coca-Cola Company announced as the first company to engage with the alliance of Bain & OpenAI.
Bain & Company today announced a global services alliance with OpenAI, the research and deployment company behind the AI systems ChatGPT, DALL·E and Codex, which are changing the way people communicate and create.


Coca-Cola Ballina has been recognised by the World Economic Forum


Caoimhe Gordon

January 13 2023 

Coca-Cola Ballina has been recognised by the World Economic Forum as one of the most advanced manufacturing sites in the world.

The Ballina site is Coca-Cola’s largest concentrate manufacturing facility, 


The digital transformation has increased productivity levels by 6.8pc in 3 years, with energy usage also down by 29pc.



Coca-Cola: The people-first story of a digital transformation
July 25, 2022 | Podcast

Boosting productivity by more than 20 percent using Digital Transformation.


Global consumer goods company Coca-Cola has established a digital academy to upskill managers and frontline team leaders across its business operations. In its first year, the academy trained more than 500 people in digital skills using a combination of go-and-see visits, immersive boot camps, and e-learning modules. Graduates of the academy have implemented about 20 digital, automation, and analytics approaches at ten-plus sites in the com­pany’s manufacturing network, boosting productivity and throughput by more than 20 percent.



Coca-Cola Foundation Philippines and the Philippine Sugar Research Institute Foundation (PHILSURIN) entered into an agreement to help boost the productivity of small sugarcane farms and increase the income of sugarcane farmers in Negros.
https://orangemagazine.ph/2023/improving-productivity-and-empowering-farmers-coca-cola-foundation-and-philsurin-solidify-partnership-for-sustainable-production/

How does Coca-Cola implement hybrid working to provide a better workplace? 
https://ones.software/blog/2022/11/29/how-does-coca-cola-implement-hybrid-working-to-provide-a-better-workplace/

Coca-Cola India’s Project Unnati Has Touched the Lives of 3.5 Lakh Plus Farmers Across 12 States in India.
Aiming to positively impact farmers by increasing productivity of fruits, upto 5X by adoption of Good Agricultural Practices (GAPs), leading to enhanced incomes



For Coca-Cola European Partners Deutschland, It’s Easier Digitally With Parsable


2022


2022
Today, the company said its global marketing leaders now “primarily focus on innovation as well as marketing efficiency and effectiveness”. Coca-Cola had been restructuring its leadership team since August 2020 to better “capture growth in the fast-changing marketplace”.
https://www.marketingweek.com/coca-cola-marketing-effectiveness-pandemic-learnings/


02-Aug-2022 — mindset for employee productivity and engagement. Solutions to do it ... Coca-Cola Europacific Partners (CCEP) is the world's largest bottling company.

Dematic World-first Delivers Record Productivity For Coca-Cola

Dematic world-first delivers record productivity for Coca-Cola Coca-Cola Amatil Eastern Creek, Australia Case Study A key element of Coca-Cola Amatil’s award winning supply chain remodelling program, Project Jupiter, was the construction of a new distribution centre (DC) at Eastern Creek to service their 14,000 Route Trade customers from Bega to Coffs Harbour.
https://www.contentree.com/caseStudy/dematic-world-first-delivers-record-productivity-for-coca-cola_207089


2021


Coca-Cola is raising customer satisfaction levels by gaining greater visibility into its transportation operations, an exercise that has helped reduce detention and dwell times and is giving all constituents a better view of where shipments are and when they will arrive. The company is using technology tools from FourKites to achieve the results, a project representatives from both firms discussed during an education session at CSCMP EDGE 2021. Improving visibility throughout the  supply chain can bring strong gains in productivity and efficiency.

IMPLEMENTATION STORY
Coca-Cola Europacific Partners ServiceNow helps make employees’ lives easier at the world’s largest bottling company and increases productivity of employees.

Challenge 
Setting a digital-first, self-service mindset for employee productivity and engagement

Solution
Create a one-stop digital platform to manage all HR processes 
Products  - ServiceNow® HR Service Delivery- ServiceNow® Safe Workplace

1 Million hours of productivity unlocked for employees.
>23K employees use the system
© 2021 ServiceNow, Inc. 

Coca-Cola Andina Builds Data Lake on AWS, Increases Analytics Productivity by 80% for More Data-Driven Decision-Making
2021



2020


15 Dec 2020
Coca-Cola United was challenged to streamline its order and invoicing procedures. It rose to the occasion quickly, using Microsoft Power Automate robotic process automation (RPA). 

The solution was built by the company’s fusion teams of citizen developers and professional developers and its partner, Happiest Minds Technologies. Coca-Cola United started by synchronizing data between the company’s SAP CRM system and Azure SQL using Azure Data Factory. Happiest Minds added the automation, creating a master automated service agent they’ve dubbed “Asa.” Developed on Microsoft Azure and Microsoft Power Platform, Asa consists of several bots and uses Azure Key Vault to help secure and control passwords and other sensitive data.

Power Platform Build Tools for Azure DevOps were used to co-ordinate work between Coca-Cola United and Happiest Minds, making it easier to drive continuous improvement and development across the project. These tools also enabled automation of common build and deployment tasks. “Power Platform and Azure DevOps enabled our citizen developers, pro developers and partner to build as a team – and that accelerated the entire development process,” says Means. 

Now, when a CRM agent enters an order into the CRM system, Asa takes it from there and signs in to the company’s SAP system without human intervention. Asa easily accesses orders, which are now tracked in a Microsoft Azure SQL database rather than in an Excel spreadsheet. Asa reads the database and creates a PO in the company’s SAP system. Asa then submits the order to the supplier’s web application, validates successful entry, monitors the email system for invoice and delivery emails, matches them to the correct order, and then stores the attachments in Azure Blob Storage for future reference. After that, Asa uses form processing in AI Builder to extract information from those email attachments that’s necessary to close the process in the Accounts Payable system, and finally, it releases the invoice and PO from SAP. These steps occur with bots within the Asa bot running in unattended mode, a key capability of Power Automate RPA that takes mundane, tedious tasks from humans and shifts them to bots. With RPA unattended mode, everything is fully automated. After deploying the unattended mode in Azure Virtual Machines, Coca-Cola United can now schedule and trigger events that increase end-to-end automation of high-volume tasks—like its suddenly expanded orders for Freestyle. And because Asa is cloud-based, it can automatically scale to any job and interoperate with any application. Just as importantly, Power Platform and Azure provide a rich set of monitoring and alerting capabilities that facilitate debugging.

The new, simplified process frees the dedicated CRM agent, allowing orders from all channels, such as inbound and outbound call center agents, field service sales representatives at customer sites, and via a customer self-service portal.

28 Aug 2020

The Coca-Cola Company Announces Strategic Steps to Reorganize its Business for Future Growth.


Innovation, marketing efficiency and effectiveness are top priorities for the company. 

The company is building a networked global organization. The company will create new operating units focused on regional and local execution that will work closely with five marketing category leadership teams that span the globe to rapidly scale ideas.

 the company is reinforcing and deepening its leadership in five global categories with the strongest consumer opportunities:

Coca-Cola
Sparkling Flavors
Hydration, Sports, Coffee and Tea
Nutrition, Juice, Milk and Plant
Emerging Categories
The leaders of these categories will work across the networked organization to build the company’s brand portfolio and win in the marketplace. Global category leads will report to Chief Marketing Officer Manolo Arroyo.

Moving forward, the operational side of the business will consist of nine operating units that will sit under four geographical segments, along with Global Ventures and Bottling Investments.

The company’s operating leaders will report to President and Chief Operating Officer Brian Smith.

Platform Services

The company today announced the creation of Platform Services, an organization that will work in service of operating units, categories and functions to create efficiencies and deliver capabilities at scale across the globe. This will include data management, consumer analytics, digital commerce and social/digital hubs.

Platform Services is designed to improve and scale functional expertise and provide consistent service, including for governance and transactional work. This will eliminate duplication of efforts across the company and is built to work in partnership with bottlers.

Platform Services will be led by Senior Vice President and Chief Information and Integrated Services Officer Barry Simpson.


The Challenge
The Global Finance Operations Division (GFO) of The Coca-Cola Company manages more than 50,000 GL accounts. Yet multiple systems and approaches to the reconciliation process created serious challenges for the global company.

The company began its search for a cloud-based, globally accessible reconciliation solution. Blackline solution was selected.

The company created a global business process lead role to drive implementation in all plants.

Reduced number of employees involved in reconciliation by 55%. Previously, the monthly financial close process required the help of 800 employees across shared services, manufacturing plants, and business units. By using BlackLine, The Coca-Cola Company has reduced the number of employees who were involved in manual and routine reconciliations to 360, a 55% reduction.
Saved $0.6 million per year through increased productivity.


2019

Plan to realize cumulative savings of $4.3 billion in 2019.


Productivity  plan performance 2018: This plan  was introduced in 2012 and expanded a couple of times since then to extend up to 2019.

It  focuses on

  • restructuring the Company’s global supply chain; 
  • implementing zero-based work, an evolution of zero-based budget principles, across the organization; streamlining and simplifying the Company’s operating model; and 
  • further driving increased discipline and efficiency in direct marketing investments. 


The new productivity plan has been extended its previous productivity plan to save $3 billion in annual savings by 2019 to achieve an additional incremental savings of about $800 million, bringing its current program to $3.8 billion in productivity savings. If the $500 million of productivity that is planned to  be transferred to Coca-Cola’s bottling partners in 2019, the program extends to $4.3 billion in productivity savings by 2019.
https://www.forbes.com/sites/greatspeculations/2019/02/13/how-much-will-refranchising-boost-coca-colas-margins-in-2018/


HCCB India - PRODUCTS - TECHNOLOGY
18 Jan 2019

Several factories at HCCB use ErgoBloc.  This technology has helped save electricity and water, while increasing speed and maximising output. With ErgoBloc technology, the bottles do not have to be passed through the air conveying rails, and within a block, they reach the filling machine. Subsequently, the filling happens at a much higher temperature (15-17 degrees Celsius) than the earlier process. Thus the product warming process has been eliminated, which saves a good amount of water.

At Hindustan Coca-Cola Beverages, we understand the importance of saving our resources today and consider ourselves responsible for shaping tomorrow. After all, a stitch in time saves nine!
https://www.hccb.in/en/blog/products/technology

Related to Ergobloc

http://kronesservice.com/en/products/references/coca-cola-femsa-ergobloc-l-syrupkitchen.php

https://www.krones.com/en/products/machines/wet-section-block-ergobloc-l.php

https://www.krones.com/en/products/references/first-ergobloc-l-up-and-running.php



Migration of SAP to AWS - Coca Cola Swire - 2019

By migrating our entire IT infrastructure to AWS, we achieved digital transformation of our IT systems, which can serve millions of retail customers or even hundreds of millions of consumers rather than the previous 10,000 sales representatives.
Ke Li
Manager, Cloud Service & IT Operations, Swire Coca-Cola
https://aws.amazon.com/solutions/case-studies/swire-coca-cola/






AI, ML and Data Analytics Use in Coca Cola

How Coca Cola is Leveraging Machine Learning in the Hyper-competitive CPG Industry
2018
https://digital.hbs.edu/platform-rctom/submission/how-coca-cola-is-leveraging-machine-learning-in-the-hyper-competitive-cpg-industry/



The Amazing Ways Coca Cola Uses Artificial Intelligence And Big Data To Drive Success
Sep 18, 2017
https://www.forbes.com/sites/bernardmarr/2017/09/18/the-amazing-ways-coca-cola-uses-artificial-intelligence-ai-and-big-data-to-drive-success/

2015


Coca-Cola’s 2015 Productivity Initiatives: A Closer Look at Costs

By
Sharon Bailey
Nov 27, 2015
https://marketrealist.com/2015/11/coca-colas-2015-productivity-initiatives-closer-look-costs/

21 October 2014
Coca Coal is expanding its current successful productivity program by targeting annualized savings of $3 billion per year by 2019. This productivity program will focus on four key areas:

• Restructuring the Company’s global supply chain, including manufacturing in North America;
• Implementing zero-based budgeting across the organization;
• Streamlining and simplifying its operating model; and
• Driving increased discipline and efficiency in direct marketing investments.


AWS re:Invent 2014
Coca-Cola Migrates to AWS to Achieve 40% Operational Savings
In 2013, Coca-Cola moved hundreds of applications from on-premises data centers to AWS to reduce costs and increase operational efficiencies. In this presentation from re:Invent 2014, Coca-Cola shares many of its cloud best practices, security considerations, helpful tools, and business processes, which helped the company achieve 40 percent operational savings

15 October 2013

During the three and nine months ended September 27, the company recorded charges of $97M and $312M, respectively, related to its productivity and reinvestment program.


The first component of this program is a global productivity initiative focused around four primary areas:

  • global supply chain optimization;
  • global marketing and innovation effectiveness;
  • operating expense leverage and operational excellence; and
  • data and information technology systems standardization.


The second component of its productivity and reinvestment program involves an integration initiative in North America related to  acquisition of Coca-Cola Enterprises' former North America business.

The company has identified incremental synergies in North America, primarily in the area of its North American product supply operations, which will enable the company to better serve customers and consumers.

As a combined productivity and reinvestment program, the company anticipates generating annualized savings of $550M-$650M which will be phased in over time. Coke said it expects to begin fully realizing the annual benefits of these savings in 2015, the final year of the program.
http://finance.yahoo.com/news/coca-cola-sees-annualized-savings-114425655.html

Feb 2012

The company says productivity is a “core pillar” of its “2020 Vision”, which sets out its target to double revenue in the next eight years.
http://www.marketingweek.co.uk/coca-cola-to-reinvest-productivity-savings-into-brand-building-marketing/3033862.article


New PET Bottling Plant at Bidadi, India

Five to six people are operating the line and the plant now produces an average of 720,000 x 600 ml
bottles per day. The new line is performing fully as expected: bringing savings in the consumption of energy and water and producing light-weighted bottles.
The new Sidel's line is  flexible.  HCCBPL is currently bottling products in three different formats: 600ml ('on-the-go' size) at an output of 36,000 bottles per hour, 1250ml at 22,000 bph, and the larger 2000ml at 18,000 bph.
http://www.sidel.com/about-sidel/global-references/coca-cola,-india
http://www.sidel.com/media/2246866/sidel_hindustan_coca_cola_india_flyer_en.pdf


2010
Coca-Cola Supply Chain Management Company (SCMC) is the largest non-carbonated beverages (NCB) manufacturer worldwide. Of their 12 sites across China, 10 of them are implementing TRACC to power their world class operations (WCO) efforts. At the end of 2010, Coca-Cola SCMC built a new plant in Foshan, Guangdong.

Coca-Cola SCMC had made an organisation-wide decision in 2005 to implement WCO across all of its sites.  These plants are progressing well on their journey to world class, with best practices being commonplace. It enables them to send their  new employees on internships at well-developed sites, so these new employees learn best practices from the very beginning.

For new Foshan plant, their main goal was to achieve 90% mechanical efficiency on the pilot line within 90 days of the start-up.

https://traccsolution.com/resources/scmc-startup-success/


2007

MBA Dissertation on Coca Cola Strategy
Dinesh Purvankara
Simon Fraser University

2006 SEC Filing
https://www.sec.gov/Archives/edgar/data/21344/000104746906002588/a2167326z10-k.htm


(C) Narayana Rao K.V.S.S. 2019



Brian Hong
Group Director, Productivity Center of Excellence at The Coca-Cola Company
Greater Atlanta Area

About
Comprehensive Supply Chain, Operational Excellence, and Quality Leader with a history of developing and executing business strategies that enhance network capabilities while reducing total delivered costs. Specializing in addressing and resolving key business challenges such as; variability reduction, productivity improvements, strategic cost reductions, change management, growth through innovation, customer integration, and supplier collaboration.

10+ years of proven high level executive experience achieving and surpassing all expected corporate goals and delivering this in a deadline, cost driven environment. Group Director of Operational and Productivity Center of Excellence, Master's Degree in Business Administration and expertise as Lean Six Sigma Master Black Belt and Business Leader. Additional Core Competencies include:


 Cost Reduction
 Operations Management
 Change Management
 Business Roadmaps for Improvement
 Cost & Benefit Analysis
 Continuous Process Improvement

Employment History



The Coca-Cola Company

Title Group Director, Productivity Center of Excellence
Employed Mar 2016 – Present

Location Greater Atlanta Area

Accountable for developing and executing high-level strategies to deliver sustainable End to End Productivity, Technical Capability, Maintenance Strategy, PMO Governance, and Operational Excellence for The Coca Cola Company North America Supply Chain (CCNA).

 Developed organizational Productivity Framework and Governance to deliver over $180 MM in sustainable productivity over the last three year horizon.
 Strategic oversight for developing overarching Technical Capability and Operational Excellence Programs to enhance organizational capabilities.
 Developed PMO governance model to support CCNA Supply Chain
 Led CCNA Supply Chain engagement in the Business Transformation Office (BTO) to drive sustainable growth and cost management for Coca Cola North America.
 Led the strategic turnaround of two network critical manufacturing locations in customer service and cost.
 Led Maintenance Strategy implementation in Autonomous and Professional Maintenance




Group Director, Operational Excellence Center of Excellence
Dates Employed Apr 2013 – Mar 2016

Location Greater Atlanta Area
Responsible for delivering sustainable network productivity to support growth and cost reductions. Provide technical and leadership guidance within Coca Cola Refreshments and The Coca Cola Company to drive sustainable capability development in cost, quality and service.
 Developed comprehensive Six Sigma DMAIC training and implementation strategy for CCR, The Coca-Cola Company and network. $20 million in value creation and/or cost reductions for The Coca-Cola Company.
 Completed a strategic facility turnaround to support customer service improvements by 80%
 Implemented Operational Excellence processes with a strategic customer resulting in increased Quality and Service leading to a 15 year contractual extension
 Led initiatives valued at $6 million in productivity and/or increased sales while reducing consumer complaints by 80%
see less

Director, Customer Solutions Walmart/Sam's
Dates Employed 2010 – Apr 2013

Location Portland, Oregon Area
Supply chain liaison between the sales organization of Coca Cola Refreshments (CCR) and Walmart/Sam’s. Increasing customer satisfaction and capabilities to reduce the total cost of ownership.

• Facilitated the development of an integrated collaborative customer process with Walmart. Developed an integrated pipeline of initiatives to support a 3 year strategic plan. Recognized as being the only DSD/Merchandising customer for the collaborative process with Walmart.
• Led the strategic prioritization and execution of the collaborative process to optimize the value chain between Walmart and The Coca Cola Company.
• Led process simulation between Walmart and The Coca Cola Company to investigate a $40 million opportunities
• Led CSI initiative to develop cost savings opportunities. Identified over $18 million in cost reductions for The Coca Cola Company
• Led the integrated approach on ASN optimization for Walmart. Integrated external suppliers such as MillerCoors, Dean Foods, Pepsico, Nabisco, Kraft, Kellogg, and Anheuser Busch.

Regional Operational Excellence Director - West
Dates Employed Feb 2007 – 2010
Location Vancouver, WA
Co-developed, directed and administered the company’s continuous improvement approach across multiple business units, twenty manufacturing plants and multiple support functions
 Facilitated the development and implementation of CCNA’s manufacturing productivity programs that generated $32.5MM in productivity
 Delivered 17% improvement in productivity without capital expenditures for CCNA’s thermal platform
 Worked collaboratively with Coca-Cola North America and a strategic supplier to identify root causes of a quality defect. Developed and executed analytics that enabled Supplier Quality to negotiate the recovery of $745K
 Instituted an integrated approach to optimize the production to delivery process, to increase customer satisfaction. Integrated approach utilized a new warehouse layout and production scheduling focused on product flow. Became “best in class performance” for warehouse deliveries as recognized by the Coca Cola Company

Title QA Mananger II
Dates Employed2004 – Feb 2007

LocationPortland, Oregon Area
Led the Quality Function at the Portland manufacturing plant. Managed and developed hourly and salaried personnel to enhance quality systems and processes, which included the integration of Six Sigma methodoligies.

• Developed and executed a competency model to enhance employee engagement and development which is now being utilized by The Coca-Cola Company – Operational Quality.
• Critical team member in identifying and executing on $1.7 million savings opportunity through transportation optimization.


RR Donnelley
Total Duration 5 yrs
Title Senior Supplier Integration Engineer

Dates Employed 2002 – 2004

Guided the development and execution of an integrated collaborative Supplier Management program that encompassed all strategic outsourced suppliers to develop and execute strategic initiatives focused on driving down the total cost of ownership while enhancing revenue growth.

 New product solution collaborating with outsourced suppliers on $20 million customer. Evaluated, developed and mitigated supplier risks in conformance with business objectives and strategies.
 Developed and implemented a Standardized Supplier Scorecard to identify joint opportunities for continuous improvement and reduced cost.
 Critical member in executing supplier development at multiple outsourced suppliers to support the strategic initiative of a $300 MM customer.

Title Quality Assurance Manager
Dates Employed 1999 – 2002
Employment Duration 3 yrs
Managed and developed a 24/7 organization encompassing 6 Process Engineers that were Certified Six Sigma Black Belt, 4 salaried process technicians, and quality inspectors. Led the Quality and Process Improvement functions within a manufacturing environment that generated over $95 million in annual sales.

 Increased customer satisfaction by 20% by aligning customer commitments/expectations with manufacturing performance and capabilities.
 Led cross functional teams to increase raw material utilization - annualized return of $1.4 million.
 Trained and mentored Six Sigma Greenbelts - Annualized savings of $150,000
 Implemented 24/7 inspection process that resulted in $250K in cost avoidance in S&W


https://www.linkedin.com/in/brian-hong-37753ab/

Gustavo Silva - Villalobos
Plant Operations Manager at The Coca-Cola Company
San Francisco Bay Area
https://www.linkedin.com/in/gustavosilva/


Interesting search results for productivity director coca cola

Coca Cola quarter 1 2019 results
https://www.sec.gov/Archives/edgar/data/21344/000002134419000022/a2019q1earningsreleaseex-9.htm

https://www.smartinsights.com/online-brand-strategy/brand-development/coca-colas-creative-genius-what-can-we-learn/



One Company, One Process: An Insight into Coca Cola’s Opex Program - Coca Cola Case Study


While "pockets" of Lean-Six Sigma have existed in their system for decades, a formal, modern, global Operational Excellence journey began nearly 10 years ago. They have experienced several iterations, moving from a manufacturing based Six-Sigma type program to a broader scoped Lean-Six Sigma type program. Ilir Morina, Global Director of Operational Excellence, The Coca Cola Company, explains the company’s Operational Excellence program.
https://www.processexcellencenetwork.com/business-transformation/interviews/one-company-one-process-an-insight-into-coca-cola

Boosting productivity at Coca-Cola’s Wakefield factory
04-Jul-2016
Boosting productivity by improving employee engagement is a four-step process at Coca-Cola European Partners’ (CCEP) Wakefield factory.
In  video interview, Trevor Newman, supply chain operations director at CCEP's Wakefield site, told FoodManufacture.co​.uk ​how he used these four key strategies to lift productivity.
https://www.beveragedaily.com/Article/2016/07/05/Coca-Cola-factory-boss-talks-staff-engagement


Performance Management - the Coca cola perspective by Carmistha Mitra
https://www.slideshare.net/hrtalksblog/performance-management-the-coca-cola-perspective-by-carmistha-mitra


https://www.cio.com/article/3057192/what-is-agile-marketing-and-should-you-be-sprinting-to-it.html
Coca Cola included


2005

Production line turnaround for Coca-Cola bottler in China
production line
Executive Summary
The Coca-Cola Supply Chain Management Company (SCMC) manufactures and supplies non-carbonated drinks for Chinese markets. The Dongguan plant — the focus of this case study — was experiencing challenges on its Krones hot fill line. Read this case study to find out how they turned the line around, achieving improvements in machine efficiency, unplanned downtime, production volume and yield.
Mechanical efficiency (ME) increased by 10%, 16% and 20% (pilot line) on the three production lines in the first year. ME improvements have since been sustained year-on-year. Improvements over the starting baseline are 13%, 17.5%, 37% (pilot line) and 49% (new production line). Unplanned downtime dropped by more than 50% since the project’s inception, while the order fulfilment rate increased from the low 90s to 98%.

Material yields were consistently improving in leaps and bounds reducing the yield losses by between 21% and 79% in the first few years.

Water usage per litre of beverage improved by 49%. Electricity consumption per litre of beverage declined by 35%, while fuel consumption per litre dropped by 41%.

At the time of publishing, the company operated through a supply location network of 11 Coca-Cola bottling plants in China, of which Dongguan plant in Guangdong Province, some three hours’ drive from Hong Kong, was the largest site. It operated four beverage lines with both hot and aseptic filling technology. Dongguan was the first site to implement TRACC best practices at the beginning of 2005.
https://traccsolution.com/resources/production-line/


2005 to 2010 Coca Cola India Story

In 2005, we did a complete assessment of our business, capability and portfolio and set an ambitious vision for the company in India [called “2020 Vision”]. There were changes in the management team. We focused on what we call the “manifesto for growth” and we aligned our system to six P’s — people, portfolio, partners, profit, planet and productivity. This renewed focus helped Coca-Cola India grow its business in a sustainable manner.

https://knowledge.wharton.upenn.edu/article/are-happy-days-here-again-for-coca-cola-india/

2017
Optimisation through automated warehousing at Coca Cola Europe
Posted on 21 Jun 2017
An exclusive look at the creation of a new automated storage and retrieval system at Coca-Cola European Partners Sidcup factory.

A brand new £32m automated storage and retrieval system (ASRS) warehouse.

The 25,000 pallet storage spaces more than trebles the 8,000 previously available onsite. The ASRS building will deliver. It also offers the opportunity to greatly enhance Sidcup’s productivity, efficiency, sustainability and staff skill level.

It’s anticipated that a phased introduction will begin in middle of 2018, with the ASRS fully online by the end of the year.

Digital factory

The significant investment in Sidcup’s automated storage and retrieval system (ASRS) warehouse has a projected payback period of eight years, relatively swift for such a sizeable infrastructure project.

The advanced system is also expected to eliminate over 10,500 vehicle journeys a year, equating to more than 30,000 tonnes of CO2 being saved. - Trevor Stacey, supply chain operations director at CCEP Sidcup.

Some warehouse staff  transition from being predominantly forklift truck drivers to become technicians – more technology-focused roles which requires a higher skill level and even greater personal and team responsibility.

This isn’t a new direction for the business. It’s production line workers have already made a similar transition, with filling line staff conducting less manual-handling tasks and assuming more operator or technician-focused roles.

https://www.themanufacturer.com/articles/supply-chain-optimisation-through-automated-warehousing/

2019

Coca-Cola Supply Chain Firm Expands Blockchain Effort to 70 Partners
Nov 5, 2019



Coke One North America (CONA) says its pilot project with software provider SAP is now set to be expanded from two to 70 of the manufacturers that deliver the 160,000 bottles Coca-Cola shops daily,

The blockchain project promises to improve distribution for the participants, as all  can access a permissioned blockchain containing each others’ orders, capabilities and requirements. For example, if a bottle maker is short of stock for a looming order, the network quickly provides options for filling shortfall. CONA hopes to reduce order reconciliation days from weeks to just days.


The pilot program’s initial positive results are assuring.  CONA has its eyes set on working with commerce giants Walmart and Target as a result, though scaling to work with those firms’ supply chains would be a difficult undertaking, he noted.

With the blockchain, a document flow across the supply chain is created making reconciliation easy and rapid.
https://www.coindesk.com/coca-cola-supply-chain-firm-to-expand-blockchain-effort-to-70-partners


2015

COCA-COLA GERMANY TRANSFORMS VIA EFFICIENCY IMPROVEMENT JOURNEY.

CHALLENGE
The rising pressure to produce products cheaper and shorten lead-times in order to stay competitive, persuaded Coca-Cola Erfrischungsgetränke AG (CCEP Germany) to seek expert help in becoming more efficient.
Coca-Cola desired a single system to collect and analyse data across a line, a factory, and a region to compare and share the same metrics, and to implement the same meeting routines to drive KPIs and actions that address the True Causal Loss of individual production lines.

After facilitating a pilot project in Liederbach in summer 2015, Coca-Cola Germany decided to install LineView™ across 9 of their most significant production sites, totalling more than 24 lines over a period of roughly 2 years. Each line went through the following 4 stages to install and utilise the LineView™ system, and consequently go through an intensive coaching process from one of our OptimumFX Consultants in order to improve efficiencies:
https://lineview.orangesprocket.com/en/customer-stories/case-studies/coca-cola-germany/

WCO journey over the past 10 years - 1 000 manufacturing and supply chain profit improvement projects (PIPs).


“Our WCO journey over the past 10 years has been nothing short of remarkable: We’ve seen savings of just over RMB* 100 million (*Chinese Yuan), and we’ve completed close to 1 000 manufacturing and supply chain profit improvement projects (PIPs). Our Kanban boards have evolved from filling up walls with production statistics to upscale, electronic boards with practical action plans.”

Huang Zhimin, Swire’s Continuous Improvement Manager, Central Service Supply Chain, looks at some digital technologies that supplement CI and structured problem-solving throughout Swire’s end-to-end value chain.
(wco): WORLD CLASS OPERATIONS
https://traccsolution.com/resources/digital-technologies/


 Swire - Denver plant, 4500 pieces of Keystone Direct Drive LED T8 Tubes - $65,000 in annual energy savings

At Denver plant, 4500 pieces of Keystone Direct Drive LED T8 Tubes, specifically KT-LED15T8-48GC-850-D were installed in place of  fluorescent tubes. Swire is projecting $65,000 in annual energy savings, and an additional $33,000 in annual labor savings by upgrading to Keystone DirectDrive LED tubes.

The improved quality of light and the impressive energy savings at the Denver location got the attention of Swire’s corporate headquarters in Draper, Utah. Representatives from the main office visited the Denver facility, and will be making a report to their other bottling plants across the west in an effort to help them achieve similar results.
https://keystonetech.com/casestudy/swire-coca-cola-bottling-plant-boosts-productivity-with-keystone-led-lighting/

https://www.swirecc.com/

Software minimizes production downtime at Coca-Cola plant

In 2004, U.K.-based control and automation specialist M.A.C Solutions (UK) Ltd. was asked by CCE Wakefield to recommend how the plant could improve its existing change management and version control process for industrial programmable control devices.

The CCE Wakefield plant uses a range of programmable control devices, including 93 Siemens S5 PLCs, 11 Siemens S7 PLCs, 20 Allen-Bradley (Rockwell Automation) ControlLogix PLCs, 31 Allen-Bradley SLC500 PLCs, and 26 universal Devices (SCADA InTouch and others).

These PLCs are located on several networks across the site, including a legacy Siemens S5 H1 network, with some PLCs and devices being standalone without any connection to a network.

MDT AutoSave (from United States-based software supplier MDT Software) was selected for implementation. AutoSave is an enterprise source management solution that provides a full suite of tools to protect, save, restore, discover and track changes for industrial programmable devices and documents. The system unifies plant automation software under one common user interface, resulting in a secure, well-documented, controlled environment that significantly reduces the time and effort needed to manage a manual backup system.

Due to a problem with a Siemens S5 PLC controlling  water treatment plant, where all the code was lost in the PLC, therefore stopping all water supplies used in the production process. The archived copy of the water treatment plant PLC code from AutoSave was retrived and checked by  Siemens field PGs and the code was reloaded  locally at the PLC. It was done in only five minutes downtime to Line Four. On another occasion, the main preparation PLC fell over. This time, the code was reloaded over the network from AutoSave – incurring zero downtime.

https://www.reliableplant.com/Read/13811/software-minimizes-production-downtime-at-coca-cola-plant


With over 900 bottling operations globally, how does Coca-Cola keep its water consumption in check? Jeff Seabright, vice president of the Environment for Coca-Cola, talks about how they're using new water filtering and recovery technologies to bring the company's water use down.

This post was originally published on Smartplanet.com

https://www.zdnet.com/article/how-coca-cola-is-reducing-its-water-consumption-1/
Transcript of conference call on Coca-Cola Q1 2007 earnings
Below is the full transcript of the the Coca-Cola Company first quarter 2007 earnings conference call that was held on April 17, 2007 at 8:00 am ET. TCCC executives involved in the conference call included: Ann Taylor - VP, Director, IR Neville Isdell - Chairman, CEO Gary Fayard - EVP, CFO Muhtar Kent - President, COO.

 Coca-Cola Q1 2007 Earnings Call Transcript
April 17, 2007 at 8:00 am ET

 Executives

 Ann Taylor - VP, Director, IR Neville Isdell - Chairman, CEO Gary Fayard - EVP, CFO Muhtar Kent - President, COO

 Analysts

 John Faucher – JP Morgan Bill Pecoriello - Morgan Stanley Robert van Brugge - Sanford Bernstein Bryan Spillane - Banc of America Securities Mark Swartzberg - Stifel Nicolaus Judy Hong - Goldman Sachs Christine Farkas - Merrill Lynch Bonnie Herzog - Citigroup Kaumil Gajrawala - UBS Lauren Torres - HSBC Matthew Riley - Morningstar Ann Gurkin - Davenport

 Presentation

 Operator

 At this time I would like to welcome everyone to the Coca-Cola Company's first quarter 2007 earnings results conference call. I would now like to introduce Ann Taylor, Vice President and Director of Investor Relations.

 Ann Taylor

 Good morning, and thank you for being with us today. I am pleased to be joined by Neville Isdell, our Chairman and Chief Executive Officer; Muhtar Kent, our Chief Operating Officer; and Gary Fayard, our Chief Financial Officer. Following prepared remarks this morning we will turn the call over for your questions.

 Before we get started, I'd like to remind you that this conference call may contain forward-looking statements, including statements concerning long-term earnings objectives and should be considered in conjunction with cautionary statements contained in our earnings release and in the company's most recent SEC report.

 In addition, I would also like to call your attention to the fact that we have posted schedules on our company website at thecocacolacompany.com in the investor section which reconcile our results as reported under generally accepted accounting principles, to certain non-GAAP measures which may be referred to by our senior executives in our discussion this morning, and from time to time in discussing our financial performance. Please look on our website for this information.

 Now let me turn the call over to Neville.

 Neville Isdell

 Thank you, Ann and good morning, everyone. I am going to start this morning with a few brief observations about the quarterly results, and Muhtar will then provide details on operational achievements, and Gary will follow with an overview of the financials and he’s going to give you some additional perspective on the Philippines as well.

 What you see today is a very strong quarter, delivered by a company and a system that has found its footing, regained its focus and come a long way in retooling its operations. While there is much more that we can and will do, the Coca-Cola Company is today proving that we can meet the commitments that we make.

 We said that we would drive growth and profitable brands in packs and channels, and today we are reporting revenue growth of 17% on worldwide unit case volume growth of 6%, our highest quarterly volume growth rate since 2002, while cycling 5% volume growth for the first quarter of last year. We also said that we would maximize our local brand footprint to leverage our sweet spot in the industry. Today we are reporting international growth of 9%, which is our highest quarterly international growth rate since 2000.

 We also said that we would grow our core sparkling beverages whilst expanding the footprint of our still portfolio. Today, we are reporting an increase of 5% in sparkling beverages, led by 4% growth in trademark Coca-Cola. That growth includes the rollout of Coca-Cola Zero to 20 additional markets including Mexico, Brazil, Argentina, and France amongst others.

 Still beverages increased 9%. The solid growth resulted in share being gained or maintained in key nonalcoholic ready to drink categories, including sparkling, bottled water, juice and juice drinks, sports drinks, and ready to drink tea. So, for the quarter, we've delivered on our commitments.

 Now I'd like to give you a new commitment. We will win again in our home market. It will not come quickly and we continue to expect 2007 to be weak, but we do expect to begin seeing sequential improvement in the second half of the year as we execute against our key goals.

 Muhtar will address this topic in more detail in a moment, but I want to underscore my absolute focus on North America. We delivered strong financial results this quarter, even with this decline in North America. Strong top line growth resulted in ongoing currency neutral operating income growth of 11%, which is ahead of our long-term growth targets.

 The geographic sources of profit growth were, in fact, more balanced as well. Additionally, we delivered solid operating expense leverage, even as we continued to invest to support our brands and build capabilities within our own company-owned bottling operations. Certainly a strong performance to start the year.

 So now, let me turn the call over to our Chief Operating Officer, Muhtar Kent, who will provide you with more details.

 Muhtar Kent

  It has been just over 120 days since I assumed my new role. What I would like to cover this morning are my key priorities for 2007.   These priorities are designed around a simple strategy: continue to innovate, take smart risks, and work closely with our bottlers to drive growth in sparkling and still beverages.

 The first priority is to sustain and drive progress in our international business. Second, address the issues in North America, where I've been spending a great deal of time these past four months. Third, increase productivity across the organization and drive leverage on the P&L. Fourth and last, compress and accelerate the commercialization rate of innovation and best practice sharing.

 Let's start with the first one, sustaining and driving progress in our international business. Our quarterly results clearly display the strength of our global portfolio and our ability to execute across the entire system, with most of our key markets delivering solid performance. We will continue to build on these results by growing our core sparkling beverages, expanding our still offerings, and executing with precision.

 Unit case volume growth was again led by our key emerging markets including China, Russia, Eastern Europe, Southern Eurasia, South Africa and across Latin America. Also, some of our emerging market weak spots from last year continued to rebound as India and Nigeria both delivered solid results for the quarter.

 In addition -- and equally encouraging -- is the strength of some of our more developed markets. One of our most consistent performers, Mexico, increased unit case volume 2%, cycling 8% in the prior year on the strength of trademark Coca-Cola driving total sparkling beverage share gain. This is the third consecutive quarter of improvement in Japan, with unit case volume up 3%. Although cycling a 2% decline from prior quarter, the performance across brand portfolios is particularly encouraging and demonstrates the changes we put in place last year. The strategy we are now pursuing there is really paying off. Solid growth in trademarks Coca-Cola, Fanta, Sprite, Enviga Green Tea and Aquarius drove the results, with each gaining share.

As expected, our business in the Philippines continued to face challenges and experienced declines in the quarter. However, we are taking a number of critical actions to address these issues. At the end of February, we completed the acquisition of the bottling operations in the Philippines previously held by San Miguel Corporation. The bottler will now have full access to the expertise of our management, as well as be fully integrated with our company's overall objectives. With a robust business plan being implemented and an experienced management team in place under Irial Finan’s leadership, the leading share position and strong brand metrics, we believe we are well positioned to return the Philippines market to its former standing as one of our top performers. During 2007, as our program gains traction, we expect to see sequential improvement in unit case volume and return to growth in 2008. Gary will provide more details on the financial impact on 2007 in a moment.

  Coke Zero and our new grip bottle, properly directed marketing initiatives such as the integrated activation of the Coke Side of Life at Coca-Cola.com, and efforts to win at the point of sale are prime examples of how we will use innovation and our close partnership with our bottlers to develop marketing campaigns that drive growth.

Success requires a robust and rational portfolio. We continue to evaluate all of our options and when necessary, we will selectively make acquisitions for additional speed, scale, as well as capability. A large competitive advantage for us, of course, is our relationship with our bottlers and the strength of our distribution channels. We've seen solid progress in our company-owned bottling operations, which in terms of volume is now the second-largest bottler in the world. The back to basics approach, an improved in-market execution can clearly be seen in our results in Germany as well as in India, amongst many other places.

 Now let me focus on my second priority, which is to reestablish consistent growth in our home market, North America. 

 In the first quarter we demonstrated our commitment to driving growth in trademark Coca-Cola as we activated solid campaigns for Coca-Cola Classic, Diet Coke, and Coke Zero. Integrated campaigns for all three brands included events television advertising linked to retail activation. 

 The next round of innovation you will see in the second quarter is the introduction of Diet Coke Plus, our first venture under the Coca-Cola trademark for a sparkling, calorie-free beverage with vitamins and minerals. 

 Overall, we remain totally committed to winning in North America and have an active plan to address the business issues. We are focused on building our system execution capability by developing working relationships with our bottlers based on cooperation and collaboration.
Now let me turn to productivity. A very important component to our success in North America as well as around the globe is ensuring we increase productivity. We are delayering and simplifying our structure so we can improve our speed of execution and improve leverage. This will enable us to better align the architecture of the organization to the three pillars that are the core drivers of our top line growth: consumer marketing, commercial leadership and franchise leadership. This is a targeted effort to enable the organization to be more effective, efficient and to remove bureaucracy.

 All of our efforts center around avoiding waste and removing distractions that cause us to lose focus on the three pillars mentioned above. These initiatives will result in some cost savings, but importantly will improve clarity on decision-making which will allow for more time to be focused on revenue-generating activities.

 Other efforts are longer term and involve driving system efficiencies. There are projects around the global supply chain and common IT platforms. The bottlers have already been doing an excellent job in many respects and it can be seen in the improvement of their returns. We've already experienced success in global procurement of key commodity inputs as well as in Japan with the supply chain management company, where we are using those lessons to build similar models in China and Mexico, particularly as we gain scale in the still beverages. But there is still significant room for improvement across our entire system. As we reintegrate the organization and realize the productivity gains, we'll selectively reinvest behind our three pillars to drive further top line growth.

 My fourth priority is compressing the innovation pipeline. This really gets at our speed to market. Our organization has never lacked for innovative ideas. What we've lacked is a discipline to commercialize expeditiously. We are focused on doing fewer things and doing them better. A clear example has been the global success of Coke Zero, which will reach 40 markets representing 75% of total trademark Coca-Cola volume by the end of 2007.

 But we are taking a broader view of innovation. It's not just simply product formulations, it also includes such things as the new Coca-Cola grip bottle, which will be available to over 50% of the world's population by the end of 2007; the Coke Side of Life campaign, which will be in over 200 markets; we're using M&A to augment scale and capabilities, for example with Fuse here in North America. It's also brand, price, packaging and channel optimization that we are jointly developing with our bottling partners. And, it is the way we're working with our bottlers to agree on long-term plans for profitable system growth and equitable value share.

 While I've identified four distinct priorities,
In summary, both Neville and I are pleased with the solid start to 2007, but we are not satisfied. 

Now, let me turn the call over to Gary Fayard.

 Gary Fayard

 Thanks, Muhtar and good morning, everyone. As Neville and Muhtar indicated, we are starting the year with a strong financial performance. 


 SG&A increased 13% in the quarter, so let me take a moment and walk you through that increase. About 8 points of that 13 point increase were due to the bottler acquisitions, and that is from increased selling and service expenses as we invested for growth in bottling operations, and due to currency. The remaining 5 points we continued to invest solidly behind our brands, and control G&A expenses as we continue to focus on productivity and expense management.
As with the first quarter, we would again expect our consolidated bottling operations to be a positive contributor, as we continue to build world-class operations. 
http://www.iuf.org/coca-cola/2007/04/cocacola_q1_2007_earnings_call.html
http://www.iuf.org/coca-cola/2007/04/


Suzhou - Smart Factory of Coca Cola

The ‘digital factory’ project introduced at the pilot plant in Suzhou not only realised impressive savings, but also walked away with the 2017 Coca-Cola China Operational Excellence Award.


Since 2005, Coca-Cola Supply Chain Management Company (SCMC) has engaged in a strategic partnership with Competitive Capabilities International (CCi) to build their world class operations (WCO) model through the TRACC Integrative Improvement System.

In Suzhou, a major city in southeast Jiangsu Province, SCMC operates one of its most successful non-carbonated bottling plants. Managed by one of its subsidiaries, Coca-Cola Bottlers Manufacturing Co. Ltd., SCMC selected this as the pilot plant. It was  a plant with a high enough level of maturity in operational excellence. If operational maturity is not at a sufficiently high level, an organisation will struggle to gain the benefits of any new technology.

The aim of Phase 1 of the project, led by a cross-functional team consisting of members from SCMC’s technical team (operational excellence) and IT, plus members of the plant’s Quality function, was to:

Interconnect the production line equipment, peripheral auxiliary equipment and online quality inspection unit.
Computerise the report forms of key areas so that production, quality control (QC) and engineering personnel can capture real-time information on quality, line performance and equipment condition
Drive a timely response of focused improvement by improving short-term visual management to improve quality, output and reduce manufacturing cost
Develop a complete data flow (using the big data platform as basis) across workstations, production lines, departments, plants and group and connect it to the ERP system

 when Phase 1 was officially implemented.  The Suzhou plant came through with flying colours as plant personnel embraced the new digital approach with gusto.


Production forms no longer need to be completed manually. Whenever the QC data exceeds the upper or lower limit of normal value, or abnormalities are detected by statistical process control (SPC), an alarm is triggered and sent directly to QC personnel. When a machine-connected condition-based maintenance (CBM) detection probe finds an abnormal condition, a warning message will be generated and displayed in the system so that relevant engineers are instantly alerted to machine faults.

Critical data of production processes are now displayed centrally on a big screen on site, giving managers a sweeping view of relevant information. The key control points of the production process are also displayed centrally so that abnormal situations can be monitored in real time. With the SAP Plant Maintenance (PM) system, engineers used to send out work orders triggered by natural time and then collected them later to manually enter into the system to form a closed loop. Now, based on equipment state or its actual running time, CBM will automatically trigger work orders directly to a handheld terminal of relevant engineers. Work orders will be closed automatically once engineers fill in the required information.

The real-time display of system and CBM data makes it easier for personnel to understand the operational status of the key components of critical equipment. Engineers can draw up relevant maintenance plans according to actual conditions of the equipment. Therefore, over-maintenance and unplanned downtime are being reduced, and production equipment utilisation is being enhanced. Also, the up-to-date information of the running state of the equipment is helping to reduce spare part inventory. This makes maintenance of all equipment more timely, efficient and productive.

With the implementation of the digital factory project at the Suzhou plant, manual report forms have dropped by 20% while machine efficiency (ME) of the production line has improved by 2% – culminating in annual savings of close to RMB1 million. As the total investment in this project was less than RMB300 000, the ROI was significant. To top it all, the project was awarded first place in the 2017 Coca-Cola China Operational Excellence Award.

Done correctly, digital factory building can reduce workload substantially, increase line efficiency and bring about impressive overall savings. However, a digital factory is far from an unmanned factory. It requires employees to be more capable and skilled and, as such, will remain people-orientated.

The building of best management practices is a prerequisite for digital factories, because only optimised processes can ensure correct data.

Competitive capability will  come from  the adaptation and creative use of automation or technology. The fundamental people engagement practices — teamwork, leadership, goal alignment, and so on — are even more important as technology becomes more sophisticated. These practices, combined with innovation in management principles and processes, can create long-lasting advantage and produce dramatic shifts in competitive position.



COMPANY BACKGROUND
Founded in 2002, Coca-Cola Supply Chain Management Company (SCMC) is the only non-carbonated beverage manufacturer in the Chinese market. The company is a Sino-foreign joint venture owned by Coca-Cola South Asia Holdings, Mount Limited; COFCO Beverages Limited; and Coca-Cola China Industries (Beverages) Limited. When SCMC was established, the company had seven hot filling lines and one can line across its one plant and a few contract manufacturers. SCMC mainly produced hot filling beverage products with an annual output of less than 300 000 tons. Today, the company has 32 world class aseptic lines, two hot filling lines and one can line across a total of seven of its own plants, and seven co-owned plants with Coca-Cola bottlers and three contract manufacturers. Its annual output exceeds three million tons.

https://traccsolution.com/resources/smart-factory/

In supply chain metrics that matter - about coca cola revenue per employee
$434,000 revenue per employee in 2004 to $350,000 revenue per employee in 2013.
https://books.google.co.in/books?id=tJTVBQAAQBAJ&pg=PA56#v=onepage&q&f=false


Updated on 22.4.2023,  13.5.2022, 11.3.2022.
10 August 2021, 15 January 2020,  3 January 2020, 15 December 2019, 15 October 2019, 
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