Pepsi Operations Management Problems

Operations management is recognized as an important department of study evenly in the organization world in addition to in academics. Reference to academics, functions management, is a central part of in the curriculum of management studies. In the other words, maybe it's seen as the theoretical base that a particular manager if not an executive desires to deal with the issues of the company are trained in the curriculum. The subject; Businesses management is again an integral part in an firm or business (Special, Franklyn H. 1964, pp 89-90). A full-blown division or section of the business is assigned to care for this need of the organization or business. Additionally to this, concern is maintained that the issues that the organizations face in the subject of operations team or section is resolved at the initial, as a result that the development and the as quality of the products that go out of the company does not obstruct the development and image of the organization or business. Functions management studies the inner working and work process of a company. Indeed it could be said that the look, producing and making of the products of the business or business is smoothen by a range of operations of the functions department or section of any company or business (Lovely, Franklyn H. 1964, pp 89-90). The complex aspects of a business or business are taken care of of by the functions management of that organization. Indeed every one of organizations and businesses has functions management officials and full-blown departments to care for this aspect of the business. Thus, a business or business will take the marketing strategies that make an important area of the businesses management. Scholars and market experts are already having conducted package of studies and researches in operations management field and also have proven that the concepts and theories of functions management and strategies are well-matched in virtually any organization or business and in any sector (Ackoff, R. , Rivett, P. (1963), pp. 45-77).

In the 18th century, maybe it's seen the intro of the functions management theory. Down the road also in the complete of Industrial Trend, a variety of new theories of businesses management and other ideals were used. These ideas allow to a huge increase in the business enterprise of organizations or businesses and all at once ensure that the a variety of approaches developed as part of the functions management ideas were employed by the business. Out of any lot of sub ideas and approaches which were made within businesses management are; "Waltham-Lowell system", "Assembly collection practice", etc. Aswell as this, the technological management and the introduction of the theories and ideas of the operations management systems make sure these help the business leads success and flourish (Ackoff and Rivett, 1963).

One of such business found in the uk that is one of the well known brands in conditions of taste and quality and many moreThis firm was endured huge losses anticipated to miss-management and issues in the "procedures management section". The company is the renowned beverage manufacturer "Pepsi Company". This is a global renowned name in neuro-scientific carbonated beverage business. Pepsi advanced to be one of the most recent types of confectioneries (O 'Sullivan, N. , Wong, P. (1991), pp. 139-55). Pepsi Company is today discovered among the most reliable brands, because of the strategic planning and management and marketing strategies that it has been utilizing since way back when. As a result, it could be said that the procedures section of Pepsi Company must play an integral role in the establishment of the Pepsi brand among the most adamantine brands in this sector. Alternatively, even such a well-defined functions department of Pepsi Company was struggling to handle the quality of the Cadbury products (Nice, Franklyn H. 1964, pp 89-90). There was news in the many of Medias that the Pepsi Cola was contaminated with pesticides. This rumor spread out everywhere in the world such as a wildfire. This carelessness by the businesses team of Pepsi Company exaggerated the organization in conditions of money value and the as in conditions of lack of brand trust and brand name (Peters, T. and Waterman, R. 1982, pp. 12-23). This to be sure came up as a stress to the whole nation as nobody has expected that the highly respected brands like Pepsi can haven't encountered such as concern. All the world was sensitized as of this, as this enjoyed as a opportunity for other competitive brands to generate solid place in the market and the for new brands to worry. Therefore this dilemma of the Pepsi Company and it become more alert to the significant of quality and an improved operations management team or section (Nice, Franklyn H. 1964, pp 89-90).

An brief description of the procedure at issue in the Pepsi group and the process map

Even though the finding of pesticide residuals in the Pepsi Cola was world information and it was in progress being forbidden in the majority of the places. All stock of Pepsi Cola was in guardianship. Those in the factories were stopped from appearing out of the business (Special, Franklyn H. 1964, pp 89-90). This made question for the already readily available operations management types of procedures that would be utilized and dominant in the Cola industry. This also insisted on the management of Pepsi Cola to consider of the procedures which already existed in the business. As well the quality assurances of the functions in addition to the legitimacy of these operations were under concern and assessed. Pepsi Cola has whatsoever time's levied importance in the maintenance and updating of the quality processes which were already existing in the business. The quality procedures that were being utilized were under strict monitoring and try. While this problem relating to the quality of Pepsi Cola emerged up, from then on an indication of the process map started out taking shape (Chaffee, 1985). The number of techniques that already existed in the organization is listed below

Manufacturing of soft drink: In the beginning the ingredients essential for making the soft drink are ready to be accessible. These materials are consisted with vanilla beans, flavor natural oils, kola nuts and sweeteners. Stringent treatment was paid these items are best in the quality and that the drinking water employed in it are distilled and free of all pollutants (Chaffee, 1985).

Transferring to the presentation house: subsequent to the soda is ready; there are taken to the packaging places in cans (Chaffee, 1985). Special attention is also taken in transporting on these steps, as not any chemicals are blended with the soda. So the amount of soda pop in soft drink is not evolved. As well as this, the best technology is applied at this time to make certain that the quality remains unchanged as that are while in manufacturing (Chaffee, 1985).

Packaging: This is actually the third step that also requires best health care of maintaining the quality of the soda. It is ensured that the closing of the Pepsi Cola cans are such that they may be air restricted and there is not any potential for leakage. Aswell as this, the cartons, caps and the CO2 used to carbonate carbonated drinks are in the optimum quantity. Special good care is put in carbonating the drink as the real quality if the soda depends upon the carbonating. Special equipment and tools are brought in use to take out the cans.

Pepsi Storage: highest care and attention is also put in the safe-keeping of the cans. Since it was assumed that while under the store, the cans were stepped on by rats and other small insects. This may be caused a number of diseases to the people. It really is ensure that the cans are packed properly and machines do the shifting and storing of the cans before they can be sent to the merchants and stores (Peters and Waterman, 1982)

Analysis of the Problem

It is simple to research of the problems, if the issues are posted or displayed in that manner they can be easily read, then the can be easily studied (Peters and Waterman, 1982). Therefore, high treatment would be studied that the examination of the issues is easy. The various measures that require to be taken to solve the challenge. This organized resolving of problems is vital so that the problems are first broken down directly into smaller parts so that their main causes can be traced (Hamel and Prahalad, 1994).

Ideas Generation

Ideas generation is very important to resolve the problem. As an example, the operations that should be used for the adjustment of the issues are first break down and then the ideas are generated as part of the tea or at personal levels that would help in the resolving of the problems. Such thinking is brings about cropping up of excellent and effective ideas so the problems are dealt with in a increased way and the root causes of the problems are revealed.

Ideas testing

Generation of ideas in important but the process does not end there. Following the listing and jotting down of the ideas, they are simply tested whether the ideas can demonstrate helpful in dealing with the problems. In addition to that, the stages where the ideas are to be used also differed and so they shouldn't be implemented without testing the (Peters and Waterman, 1982). Thus, the potency of these ideas is first analyzed and then with regards to the results, they can be finally applied. The assessment of ideas is similar to a pilot survey that is manufactured because the actual execution of the ideas. This helps in gauging the effects of the execution of the ideas in handling the issues beforehand (Hamel and Prahalad, 1994). Without assessment of ideas, it is not generally used immediately in any group.

Implementing Ideas

Testing the ideas give an idea of the type of feedback that will be generated after the ideas are actually integrated. Thus following this pilot research the results is first analyzed and when the results are as desired, the ideas are executed (Peters, T. and Waterman, R. 1982, pp. 12-23). After the execution of the ideas, it is clear that the businesses program is now able to be tacked in a way that the organization will not face similar problems again in future.

Checking the Results

This is the previous and the finals level of the execution of the TQM techniques. Even though the ideas were first analyzed because of their potential results and the carried out, a check is usually required at the ultimate stage. Thus, even following the implementation of the ideas to solve the operational problems, a check must gauge the results of the execution of the ideas. After getting the results after implementing the ideas, an assessment or evaluation of the results is performed. Thus giving a responses of the effectiveness of the ideas and helps decide whether the ideas are necessary for the future processes or not.

Fish bone theory

Developing the fish bone theory and the fish bone diagram was done by Kaoru Ishikawa. It is seen that because this theory was developed by her, the theory was also known as Ishikawa diagram. The root of the theory is the fact that problems need to investigate by jotting down the issues over a sheet of paper and then relating it to the reason and the result (Heskett, 1989). This theory was later in used by various disciplined and branches of academic studied.

The fish bone diagram now forms an important part of management studies and ensures that the problems an organization faces is first jotted down and then examined. This gives the problems a pictorial appears and so ensures a fairly easy and clear understanding of the problems.

This diagram when seen following the completion gives an impression of being attracted on the style of a fish. In fact the diagram is of the condition of a seafood. A spine of the seafood is drawn which the plane in which the problems are written extending towards the outer sides. The problems are jotted over the sides giving an impression that these will be the bone fragments of the seafood (Peters, and Waterman, 1982). This pictorial representation makes the knowledge of the problems easy. Furthermore, while listing the issues they are began form the grassroots level and decided into various categories. For instance, the various categories of the organization that could be responsible for the operation problems cropping up in the business are made the decision and then the issues that can be placed in these areas are stated. This gives an obvious impression of the issues and when this is presented before the higher management, it become easy for them to web page link the reason and effect and then work at solving the problem. In addition to this another important reason because of which the fish bone theory functions as an important tool in the examination of the businesses problems is the fact it divided the problems into smaller sub areas. This makes the condition seem to be easy as when a problem is bigger no chance to break that down is found. However, when the issues got broken into smaller parts they appear easy. In addition to this, the linking of the situation to the reason an impact also makes the problems easy to identify. Another pertinent reason that recommends the utilization of the fish bone theory is that it's generally made in an organization. Thus it cats as a medium through which various ideas and knowledge of differing people are channelized into one single chart (Peters and Waterman, 1982). Thus the chart itself is very helpful as the thoughts and opinions of men and women from different activities and history

A contrast of the theory with the actual practice in the Pepsi Company

It was seen that the fish bone diagram and the TQM techniques gave a concept of the various problems that Pepsi faced. Furthermore, the Fish bone diagram also listed the various strategies tat are already area of the Pepsi group. These theories hint that the functional team of Pepsi possessed taken up strict measures for preserving the grade of the products of Pepsi. However, it is seen that there still were loop gap in these procedures because of which there were issues in the quality of the Pepsi Company. The many loopholes in the procedures that were although identified in the guideline and quality confidence of the Pepsi Company but were not followed in practice receive below

1. Although various hi there tech machines were used for the purification of this particular that us being used in the production of Pepsi, there is issues in the grade of the water. When an investigation committee was create to discuss the reason why that led to the finding of pesticides in the packed cans of Pepsi, it was found put that the bottom water was found to be contaminated (Kearney, 1992). Various normal water purifiers are available in the Pepsi Company and they boost useful of high boiling canisters that free this. In fact necessary to resist procedure for Pepsi says that not filtered but distilled normal water can be used for setting up the soft drink. Had this technique be really implemented the truth is Pepsi would have not endured huge deficits and spoiled the name and reputation of the organization. Thus it was seen that purification of water was one miss match where Pepsi didn't keep up the quality assurance stages that was streamlines in its work plan (Kearney, 1992).

2. It has been defined in the task plan of the business that the store and the stock where the very soft drink must be manufactured are free from all sorts of heat and wetness issues. In fact, the organization revealed that various new and increased storage canisters and rooms have been specifically designed so the soft drink after making is put in better stores before they are really packaged. However, this process was not looked after properly and it was later inferred that the machines and storage room which were made weren't of the mandatory quality. This made the soft drink being alter in their chemical substance composition in the temperature differences in a variety of countries. Thus, due to theism there have been chemical substance reactions and microbes were able to breed in them and so contaminate this (Kearney, 1992).

3. Although Pepsi Company says they have hygienic and special ceils to store the soft drink for very long time till they are really finally packed and delivered, they did not take proper measures to make this practically happen. It was seen that after the Pepsi was produced they not stored in hygienic and frigid storages. This change in temp and the unhygienic conditions of the theories resulted in the contaminants of Pepsi.

4. Although Pepsi boost of having an extremely well trained staff, they failed to provide proper quality management training to their staff and employees. Due to this they were unaware of making certain none of the variance in temperatures level, etc should be achieved as it dramatically affects the grade of the drinks (Kearney, 1992). The employees and staff of the Pepsi Company being unaware, ignorant and negligent of the issues ended up in contaminating the drink.

Consideration of its impact on quality and/or customer focus

These problems definitely experienced a greater influence on the business. Pepsi was a bigger name in the drink industry and none of them of the firms were as popular as it is and present it tough competition. However, with the spread of the new of the Pepsi drink made up of pesticides, this acted as a major loss to the organization. Pepsi was prohibited in all universities and college on the uk. Furthermore, various factories of Pepsi were seized and the drink that was already well prepared was seized. This new also pass on in other areas of the world. Actually all countries halted the selling of the Pepsi. Furthermore this affect in the business, the customers also got sensitized by this new. They themselves became much aware of the contamination and abstained from ingesting this drink (Kearney, 1992). In addition they barred their friends and children from having this drink. This indeed acted as a great set back to the Pepsi Company and ruined its business. Moreover the trust which it had managed to create one of the people was lost. Even till date many people avoid enjoying the Pepsi products as the shock that they received regarding its contamination is not out of their thoughts still.


After learning and analyzing the ideas in the operational management office of Pepsi co, one of clear of the issues that the organization was facing and the reasons that resulted in these problems were diagnosed. Thus, the various recommendations that may be given to the Pepsi co group are the following

1. It could be inferred that the majority of the problems that cropped up regarding the quality of the merchandise is due to the negligence of the employees. It had been seen that the personnel and crew that were part of the manufacturing department weren't well trained and well skilled. Due to this they did not understand the importance of maintaining appropriate temp and pressure. They do nit understand that minimal changes in the amount of heat and pressure while purifying this particular etc can result in drastic disasters as it happen regarding Pepsi. Thus Pepsi must be sure that all their employees is properly trained before they become part of the manufacturing and operational team of the business (Kearney, 1992).

2. The business should also understand that when the product they are producing are consumable items special care and attention is taken that they are hygienic and do not cause any side effects. It is because a slight carelessness on the part of the company can lead to severe results on the health problem and so subsequently may be disastrous to the life span of the business and they may even end up sacrificing their permit. Thus, Pepsi should ensure that the machines they are using in the development and purifying of drinking water should be the best of quality. More and more high quality machines need to be taken to test the presence of microbes and other such business and at the lowest possible level (Chaffee, 1985).

3. Quality confidence can be an important part of the operational management team in Pepsi. This office has to take up the duty of making certain the merchandise of the business are best of the quality and they are handed down through various rounds of quality inspections such that the merchandise that finally distribute of the business are best of the quality (Chaffee, 1985).

4. The management also needs to be sensitized towards this cause. They have to ensure that the work process of the organization must be transformed as there are loopholes along the way. Plus the loop openings are such that they resulted in blunders foe the business, Thus, the management needs to incorporate more levels of quality investigations and ensure that there is strictly monitoring whatsoever levels.


Thus, it is seen that Pepsi confronted several problems because of the neglectfulness by the operational management department. Furthermore there were several other problems that resulted in such huge lack of eh firm (Chaffee, 1985). However with various theories and techniques of the management of the organization, the main problems that the organization encountered were identified. In addition to the identification, the techniques and theories that require to be utilized in order to rectify these problems are highlighted. It really is through the use of these theories that Pepsi could get back its lost trust and business.

Also We Can Offer!

Other services that we offer

If you don’t see the necessary subject, paper type, or topic in our list of available services and examples, don’t worry! We have a number of other academic disciplines to suit the needs of anyone who visits this website looking for help.

How to ...

We made your life easier with putting together a big number of articles and guidelines on how to plan and write different types of assignments (Essay, Research Paper, Dissertation etc)