Exploration On The Transformation Of Traditional Industries: Swire Coca Cola Creates Whole Chain Digitalization

Driven by the digital wave, more and more traditional leading enterprises choose to transform.

Recently, Swire Coca Cola, one of the two largest bottling companies in Greater China, launched its first digital production line in China in Hangzhou. It is reported that this digital production line adopts the manufacturing information system (MIS) developed jointly with Siemens, and will cover 18 factories and 100 production lines of Swire Coca Cola in China within two years.

"Once the coverage is completed, it will be equivalent to two more production lines in terms of efficiency, that is, about 550 million bottles / can of drinks will be produced in one year." Su Wei, President of Swire Coca Cola, told the 21st century economic report that "at the same time, after the coverage is completed, there will be a huge space for imagination in terms of energy control and production regulation."

She said Swire has listed digitization as one of its five core strategies. "Digitalization enables us to connect with consumers, customers and the supply chain, bringing great efficiency and value." "Only digitalization can produce our competitive advantage," said Su Wei

For Swire Coca Cola, the implementation of this system means that the whole chain digitization of "front-end sales, middle stage, logistics and storage, beverage production" can be realized. Since then, Swire Coca Cola has become a completely digital beverage enterprise.

For Siemens, the promotion of its industrial digital services in China for many years is basically a "lighthouse factory" type of demonstration or demonstration projects, and the implementation of the MIS system can be called the first large-scale digital solution project of Siemens, which has made new breakthroughs in the R & D and design of the system and the business model.

Swire Coca Cola and Siemens have jointly invested in the development of MIS system, thus digitizing the whole chain of time. -Information

Whole chain digitization

For a food and beverage enterprise, what does it mean to pursue the whole chain digitization?

In fact, the traditional beverage industry is an end-to-end cycle. In short, the beverage is produced, sent to the store through logistics, and finally purchased by consumers.

Under this cycle, the core competence of an enterprise is to test its product power, brand power and channel control ability. To produce high-quality products, shape a brand that consumers love, and spread the products to every corner of the country as far as possible.

However, with the iteration of consumers, the new generation of consumers is different from the previous ones. The rise of online channels and personalized consumption requires beverage enterprises to establish their own consumer portraits, analyze the consumption habits of scenarios, and then launch products that are more in line with consumers' preferences and put them in the right scene at the right time.

To build these capabilities, we must rely on digital capabilities to achieve.

In mid-2019, Swire Coca Cola and zero eye intelligence reached a strategic cooperation, using the latter's AI image recognition technology to cover the retail channel system, and at present, it has connected all 800000 retail refrigerators online; in mid-2020, it has reached a cooperation with Alibaba cloud, which will systematically promote production, supply chain, logistics and marketing based on the latter's data technology, Zhongtai, AI, aiot and other technologies Full link digitization to member system.

"Before that, we had zero eyes in the retail end. Zhongtai and Alibaba cloud have reached a cooperation, and logistics and warehousing use our own TMS and DMS systems. Therefore, only the production end is left to realize the digitization of our whole industrial chain." Feng Ke, chief digital and information officer of Swire Coca Cola, told reporters, "this is the most important and challenging step for beverage enterprises to realize digitalization."

On the one hand, it is important to improve the operation efficiency of the production line, reduce the time of equipment maintenance, and reduce carbon emissions and energy consumption; on the other hand, it can feedback the data collected from the sales end and the warehouse logistics end, adjust the product line and production rhythm, so as to make the beverage production more flexible and flexible.

The main difficulty in the development of digital system is that the equipment era span of Swire Coca Cola production line is huge. From the 1990s to 2020, the equipment standards of production lines in each era are different. This system must realize the coverage of production lines spanning nearly 30 years without any difference.

It is reported that before MIS, Swire Coca Cola has iterated over two generations of digital production system. Before, a small machine room was set up next to the production line, but because the production environment is high temperature and humidity, this method can not last long and is not safe enough. Especially in the case that 5g technology has been gradually applied, it is necessary to realize wireless data collection and transmission.

Therefore, Swire Coca Cola finally chose Siemens as the strategic partner to jointly invest in the development of MIS system, so as to realize the digitalization of the whole chain.

Achieve multiple innovations

The conclusion of the strategic cooperation agreement between the two sides is not a whim, but based on the trust foundation previously possessed by both sides.

"A few years ago, Siemens and our factories cooperated on some small projects," said Zhang Xiaodong, general manager of supply chain of Swire Coca Cola in China. "When we are ready to start digital production, we need to find a stronger partner who can help us realize the production behavior accurately. Finally, we will start to cooperate with Siemens through us and global procurement."

He said that the MIS system can make the data of different equipment on the production line transparent, analyze the data based on these data, realize functions such as predictive maintenance, and improve the production efficiency by 2% - 3%. "In addition, we can achieve better quality, energy management, and flexible production."

For Siemens, it is a very different attempt to build MIS system.

"Before Siemens built a lot of digital lighthouse projects, mainly for the purpose of digital enterprise demonstration, demonstration and verification." Wang Haibin, general manager of Siemens Greater China digital industry group, told reporters, "the MIS system cooperated with Swire Coca Cola is a practice of large-scale promotion of digital solutions."

He said that the MIS system is the latest, replicable and standardized technology platform. Different from various information systems in the past, the biggest feature of this system is that it can be replicated in 18 factories of Swire Coca Cola.

The future system can be based on both on-site devices and on the cloud. Anyone with authorization can see the real-time data of any factory and any production line of Swire Coca Cola on his mobile phone anytime, anywhere.

"The current MIS is the first generation system. In the future, there will be real-time iterations in the process of replication. Siemens will also launch an edge computing platform in the future." Wang Haibin said, "in the process, some technology may be found to solve the problems that have not been found before. When the promotion is completed, the imagination space in sensors, data and software is huge."

In this process, MIS should also realize the integration of it (Information Technology) and ot (operation technology) of Swire Coca Cola itself, so that the data generated from workshops and production lines can help enterprises to make business insight and decision, and then explore the potential of improving production efficiency.

"Our business model is undergoing transformation and exploration, and the cooperation mode with Swire Coca Cola is different from that before." Zhu Zhenzhong, general manager of factory automation of Siemens Industrial Service Division, told reporters. In terms of platform development, both sides are jointly created in terms of technology, human resources and resources. At the same time, the software and hardware deployment of each production line platform is purchased by Swire Coca Cola as the fixed assets of the latter.

"Finally, we will develop various iterative applications on the MIS platform in the future. Just like app, there will be a variety of business models, such as purchase, subscription, lease or sharing, which will be selected according to the specific situation." Zhu Zhenzhong said.

Digital service transformation

In 2020, under the influence of the epidemic situation, the domestic beverage industry will encounter a cold winter. However, carbonated drinks, which have been declining due to the trend of healthy consumption, will achieve reverse market growth.

According to the annual report of Swire (00019. HK) in 2020, Swire Coca Cola's revenue in mainland China reached 19.7 billion yuan, an increase of 3.9% year-on-year. It also set a record high in mainland China's revenue, with a net profit of 870 million yuan. Excluding one-time income, the year-on-year growth of 22% was achieved, of which the sales of domestic soft drinks in China increased by 6%.

"The growth of soda is beyond our expectation. The operating profit in mainland China has achieved double-digit growth in the past two years." Su Wei said, "although we are the leader in the soda category, we have been innovating in the field of soda. Last year, the sugar free category achieved a high growth, driving the overall growth of soda."

Although Su Wei did not disclose the specific growth rate of sugar free and zero degree Coca Cola, she said that in the past two years, nine new production lines and capacity expansion have been successively launched in mainland China. The epidemic has changed consumers' consumption scenes and habits, and also brought new local soda brands into consumers' view.

"The beverage industry has always been a very competitive industry, and there are a lot of new products appearing every year, which is not surprising." Su Wei said, "consumers have a very high demand for quality. Some niche brands that do not meet the standards will be phased out by the market."

Whether it is the growth of beverage output or the pursuit of new products by consumers, the digital transformation of enterprises can enhance the competitiveness of enterprises in all aspects, and adapt to the new battlefield of the future beverage industry in the digital field.

Su Wei told reporters that since this year, raw materials at home and abroad are on the rise, which will bring pressure on the management of beverage enterprises. The improvement of production efficiency brought by digitalization is a way to resolve the cost increase. At the same time, digitalization can make the past beverage sampling inspection into normal management, which can reduce the defective rate and improve the product quality to the greatest extent.

"At the same time, by using the current Internet technology and digital tools, we can connect millions of consumers and end customers, forming a closed loop." "There will be a lot of data value that can be extracted from the data and become consumer marketing behavior, which is the competitive advantage generated by digitization," she said

"As a benchmark enterprise in the beverage industry, Swire Coca Cola has been committed to promoting the digital transformation of the beverage industry, hoping to explore new advantages in business development through Internet technology and digital tools." Suwei said.