Coca-Cola Amatil January 2020

COCA-COLA AMATIL: TRANSFORMING THE PNG SUPPLY CHAIN

COCA-COL 02

TRANSFORMI SUPPLY

LA AMATIL 03

ING THE PNG Y CHAIN w w w.c c a ma t il. com

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SIMON ROBINSON, HEAD OF SUPPLY CHAIN, PNG, DETAILS THE TRANSFORMATION THAT HAS RETURNED COCA-COLA AMATIL TO GROWTH IN THE COUNTRY

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ne of the world’s major Coca-Cola bottling companies, Coca-Cola Amatil (CCA) serves the Oceania region, incor-

porating Australia, New Zealand, Indonesia, Fiji, Papua New Guinea (PNG) and Samoa. Simon Robinson is Head of Supply Chain in PNG, operating across production, planning, logistics, quality, safety, environment, engineering and capital pro04

jects, and previously served as National Logistics Manager in Indonesia. It’s an experience Robinson brought to his current role, where, with support from the Indonesian team and local suppliers, he has transformed the Supply Chain and returned CCA PNG to double digit growth.

CCA has been operating in PNG for 28 years with a Supply Chain network consisting of two plants, five production lines, six distribution centres, 40 products and over 800 customers. Despite strong consumer demand and high market share, volume growth stalled primarily due to an inability to supply. Internal process issues across manufacturing efficiency, inventory accuracy, planning and logistics were affecting growth and the supply chain had become a growth inhibitor.

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To resolve these issues, the busi-

“Implementing daily stand up meetings,

ness implemented a back to basics

control boards and disciplined routines

operational excellence framework.

was an important part of the program.

Supported by a team of subject matter

Implementing controls around raw

experts from Indonesia, sponsored

materials ordering, demand planning,

by Gigy Philip, Supply Chain Director

procurement and inventory man-

(Indonesia) and led by Agus Salim,

agement, was important to stop the

Technical Manager (Indonesia), who

leakage of profit out of the business.”

focused on optimising the end-to-end

A major focus for the team was on

supply chain. “One issue was just

operational excellence within manufac-

around process and control, trying

turing. “There was a dedicated team

to give some structure to all of the

working on building local capability,

basic processes that are required to

optimising the equipment and upgrad-

run a supply chain,” says Robinson.

ing utilities within manufacturing to

CLICK TO WATCH : ‘COCA-COLA AMATIL BRAND VIDEO’ 07

get the lines operating at the speeds

guys could see, on a week-to-week

that they’re capable of running at,”

basis, the improvements that they were

says Robinson. “That was the real

making, and it wasn’t led by manage-

crux of the way we’ve changed the

ment, it was led by this small group

business around. In a business where,

of subject matter experts.” In the end,

historically, demand exceeds supply,

he says, “it was about collaboration.

every 1% improvement in operational

Each function had been working in

efficiency goes straight to volume and

a silo and we had poor relationships

revenue. Improving the efficiency of

with suppliers. The creation of that

those lines was the major driver of the

collaboration and interdependence of

growth in 2019.”

all the functions as well as improving

Robinson credits the introduction

partner supply agreements enabled

of the small team with injecting a new

a business turnaround. Now, almost

level of energy and enthusiasm. “The

12 months later, operational efficiency w w w.c c a ma t il. com

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has improved around 15%, driving an

about regaining respect and pride in

even higher growth in volume and reve-

the business from both our suppliers

nue in a relatively flat economic market.”

and our people. The process also

Operations weren’t the only piece

involved reaching out to engage those

of the puzzle, however, with a focus on

who had previously been ignored. “We

culture also prevailing. “We did a lot of

started to conduct town-halls where

work around engagement in a bid to

we listened to the people in order to

bring people together,” says Robinson.

understand what they were trying to

“We had a philosophy of ‘one team,

tell us. We have groups in each region,

one goal, no limits’, and that became

at a local level, understanding what the

a theme which was able to galvanise

team and the people are telling us, and

everyone in the organisation. We were

then building that back into the initia-

obviously trying to achieve volume

tives that we’re doing in those regions.”

and revenue targets, but it was also

Aside from listening, Coca-Cola Amatil

also endeavoured to educate. “Another initiative originally from Indonesia was our Supply Chain Training Academy.

It’s about building technical capability at the base operator level right up to supervisors, and up-skilling the entire workforce over a 12 to 18 month period.”

In July 2019, PNG was awarded the

“ WE HAD A PHILOSOPHY OF ‘ONE TEAM, ONE GOAL, NO LIMITS’” — Simon Robinson, Head of Supply Chain, PNG, Coca-Cola Amatil

Supply Chain Best Practise Award at

E XE CU T I VE PRO FI LE

Simon Robinson Simon Robinson is an experienced Supply Chain Manager with more than 20 years’ experience across global FMCG businesses, including Coca Cola Amatil (CCA), Lion Nathan and Mitsubishi Motors. He has specific expertise across Sales and Operations Planning, Logistics and Route to Market, Business Transformation, Digital Supply Chain and Customer Service. Before joining the PNG business in 2019, he recently completed a major transformation of Route to Market and Logistics for the Coca Cola Amatil Indonesia business resulting in significant savings and customer service improvements. He is an advocate for digital supply chain transformation having initiated and managed several major SAP implementations across warehouse, transport and asset management systems, and sees technology as a core enabler for delivering both sustainable process change across large organisations and breakthrough improvements in efficiency and customer service.

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13 the Coca Cola Asian Supply Chain

system which tracks line performance

Conference, in recognition of the

by the hour,” explains Robinson. “If we

transformation achieved in the first half

should have made 2000 cases, but

of 2019, beating out over 20 others

we only made 1000, it will report the

including large bottlers from Japan,

issues behind that on an hourly basis

China and Australia.

and allow us to track and address it.”

Despite the challenges in a country

Quinsys, meanwhile, is about auditing

such as PNG, technology has had a

good manufacturing practice. “People

significant part to play in the transfor-

can go around the plant and put into

mation. Two complementary systems

the system any hazards or issues

originally introduced in Indonesia

that they find. It gives us a really good

were brought in, the Electronic Short

tool to manage our safety and quality.”

Interval Control (ESIC), and the Quality

Going live in January 2020 is a new

Information System (Quinsys). “ESIC

ERP, Microsoft Dynamics. Replacing

is a homegrown production control

existing legacy systems, Robinson is w w w.c c a ma t il. com

C O C A - C O L A A M AT I L

“ IT’S HARD TO DESCRIBE HOW IMPORTANT THE COCA-COLA BRAND IS TO THIS MARKET” — Simon Robinson, Head of Supply Chain, PNG, Coca-Cola Amatil

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SUPPLY CHAIN MANAGEMENT

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TRANSPORT LOGISTICS

SUPPLY CHAIN SOLUTIONS

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confident that “the new ERP system

bills to the shipping companies,” says

will make sure that everybody is work-

Robinson. “Now we’ve put trackers

ing off of the same plan. By putting

on all the containers so that we know

in Microsoft Dynamics we’ll give our-

whether they have reached the desti-

selves an ERP system that will enable

nation, which also enables us to track

us to integrate all our data onto one

them all the way back.”

platform, manage process compliance and sustainable change.”

There are also a few technologies

Another initiative was based around transforming relations with suppliers from transactional relationships to

with region-specific utility, particularly

business partners. “Good examples of

GPS trackers. “We essentially deliver

those improving supplier relationships

everything in shipping containers, but

are demonstrated by key suppliers such

after delivery, we tended to lose track

as Orora (cans) and BOC (Carbon

of them and end up paying detention

Dioxide), where we were able to move w w w.c c a ma t il. com

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1960

Year founded (PNG)

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Provinces reached in PNG

670

Number of employees

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from regular supply issues, due to poor

consolidated our transport and ship-

planning and communication, to value

ping suppliers into companies such

added relationships where we are

as Bismark (a local vessel cargo sup-

proactively working together to drive

plier) and East West Transport which

shared growth and cost efficiency

is giving us better control, capacity

through design innovation and joint

and scaled efficiency to support our

long term planning,” says Robinson.

growth. On the production side we

“Labelmakers Group is our new label

engaged our plant suppliers such as

supplier, and brings innovative ecom-

Krones to provide technical and engi-

merce and design capabilities, such as

neering support to maximise output.

digital printing, which we are looking to

These relationships were all instrumen-

exploit for our 2020 consumer promo-

tal in turning around performance.”

tional programs. In logistics we have

“In summary, what we learnt is that

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frameworks like operational excel-

chain improvements and investments

lence can still drive total business

to ensure its supply matches the vora-

performance,” says Robinson. “They

cious demand in the region. “It’s hard

are proven methodologies, replica-

to describe how important the Coca-

ble and low cost. Engagement and

Cola brand is to this market. Right

capability building, internally and

now, we can sell every can of Coke

externally, with suppliers was key to

we can make for the foreseeable future

delivering sustainable improvement

– it’s just an amazingly popular PNG-

and using digitalisation and technology

made product.”

is important to deliver compliance and sustainability to the change.”

As for the future, the company is planning its next phase of supply w w w.c c a ma t il. com

Coca-Cola Amatil Papua New Guinea T +675 472 1033 www.ccamatil.com