Tuesday, September 10, 2013
Managing the Supply Chain of Mother Nature
A person can walk into a grocery store in Duluth, Minnesota, on a snowy Tuesday in December and purchase Minute Maid fresh squeezed orange juice. This convenience was not always possible without improvements in many areas including supply chain management. Every food manufacturing organization is faced with managing its inventories. However, the difficulty of that task is exponentially increased when you are dealing with fresh produce that has a designated growing season of roughly three months. This was the problem that faced Coca-Cola who owns Minute Maid who is tasked with producing orange juice for the nation on a year-round basis. In order to proactively deal with uncertainties of supply such as drought, hurricanes, and varying demand, Coca-Cola applied a Black Book algorithm to deliver an optimal blend of oranges to provide year round orange juice. According to a Coca-Cola analyst, this method analyzes over one quintillion variables ranging from the supply of every ingredient in their juice to the myriad of weather patterns in a give year. All this is done to ensure that Minnesotans can have fresh squeezed juice in the middle of winter.