Coca-Cola Employs SAP’s Blockchain to Enhance Supply Chain Productivity

Coke One North America (CONA), the IT platform of the North American beverages company giant Coca-Cola, is implementing the blockchain technology of the German software firm SAP.

The aim is to improve the company’s complex production process and supply chain operation by increasing efficiency, bringing transparency in inventory and enabling faster payment processing.

Blockchain has been around for a decade now and many business entities and organizations, including corporate giants like Microsoft and Amazon, have found it extremely useful and accordingly filed patents of various applications of this latest technology.

These firms have also executed blockchain technology with their current products and services. However, there is still a point of doubt about whether firms from non-financial and non-tech domains can employ blockchain technology to improve operations and raise productivity. Now it appears that Coca-Cola has found a practical way to utilize blockchain technology for its distribution network.

Coca-Cola is endeavoring to apply blockchain in order to bring significant improvements to its production process and supply chain operation with SAP’s distributed ledger technology. With SAP’s blockchain platform, the company is planning to enhance the transaction process conducted across 70 different franchises each month and bring more transparency to the humongous franchise network regarding the inventories and purchases.

Andrei Semenov, a senior manager at Coke One North America (CONA), told Business Insider:

“There are a number of transactions that are cross-companies and multiparty that are inefficient. They go through intermediaries; they are very slow. And we felt that we could improve this and save some money.”

Coca-Cola manages the marketing of its signature drinks and owns the proprietary recipes; however, it partnered with CONA to handle Coca-Cola’s bottling sites in all North America which stands at 500+. CONA also looks after the complex network of franchises that manufacture, bottle, and ship nearly 160,000 orders a day. Without surprise, it is quite difficult for CONA and other bottlers to have keen eyes on the supply chain and that’s where blockchain comes into action.

More Productivity, Fewer Costs with Blockchain

Blockchain will make the inventories more transparent and will allow franchisees to see the available stock of bottles at different locations to meet the demand of orders. Thus, CONA will make the payment process faster and is optimistic about increasing the bottlers’ efficiency which might bring greater productivity, cost-effectiveness and enhanced cash flow between the franchises.

“What we achieved here with blockchain is creating a document flow across the supply chain,” said Torsten Zube, the head of the SAP Innovation Center Network.

The pilot has currently started between the two bottlers only; namely Coca-Cola United and C.C. Clark but already there are expansion plans underway to spread this technology throughout the network of other franchises as well.

Productivity and Quality Office