Impact of ERP Systems on Business Operations: A Case Study of Coca Cola Amatil

This report discusses the implementation of ERP systems in Coca Cola Amatil, Australia, and its impact on business operations. It covers the challenges faced by the company, the cost benefit analysis, and the solutions provided by the implementation of ERP systems. The report also discusses the company overview, including its mission and vision. The subject of the report is Management Information System.

Running head: MANAGEMENT INFORMATION SYSTEM
Management Information System
Name of the Student
Name of the University
Author’s Note

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Table of Contents
Introduction......................................................................................................................................3
Company Overview.........................................................................................................................3
Enterprise Resource Planning..........................................................................................................4
Cost benefit Analysis of the Coca Cola Amatil...........................................................................6
Conclusion.....................................................................................................................................10
References......................................................................................................................................12

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Introduction
Digitalization approach has been capturing organizations in all over the world. Various
businesses have been depending on technology for helping them for enhancing their business
processes. Data and information has been an important asset for any company in the market.
Resources of a company need to be properly managed and accessed (Zach, Munkvold and Olsen
2014). This report has focused on Coca Cola Amatil, Australia. The problems and challenges in
the business operations have been discussed in the report. The implementation of ERP systems
in the company have been explained in the report. Solutions provided by the implementation of
ERP systems in the company have been discussed in the report. The purpose of the report is
address impact of ERP systems on business operations.
Company Overview
Coca Cola Amatil is one of the largest distributors and bottlers of non-alcoholic ready to
drink beverages in the Asia pacific. There are 14,000 employees working in Australia, New
Zealand, Fiji, Papua New Guinea and Indonesia. The company has been working diversely group
in six different countries. The company has accessed around 270 million consumers more than
950,000 active customers in the market. The company has a huge product range including spring
water, soft drinks, sports and energy drinks, fruit juices, flavored milk, beer, tea and packaged
vegetables and snacks. Therefore, the consumers of these products have been increased
gradually.
The mission of the company is to refresh body, spirit and mind of all people in the world
and inspiring moments of happiness and optimism by their brands and actions. The vision of the

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company is to achieve the goal that has been set for development of company. The company has
focused on its leadership values in their team for shaping a fruitful future.
Enterprise Resource Planning
Enterprise Resource Planning (ERP) systems have been helping in shaping future of the
businesses in the market. However, ERP has played a major role in improvising computing. The
implementation of ERP has been helping in increasing the speed of information flow in the
organization (Shatat 2015). The ERP system in the Coca Cola Amatil has been helping in
minimizing issues faced by the company in market. The use of ERP system has been
standardizing processes within this organization.
The communication system of the company has been linked with the CCA system in
various respect. Various vendors and systems have been extremely tight deadlines for
completing any project in the company (Rajnoha, Kádárová and Kádár 2014). Resources of
company have been misused in various purposes as they were no proper planning in their
systems. Therefore, quality of projects done by the company have been degrading in recent
years. This have been creating problem for the company in the market. The quality of products
has been decreasing in the market. Therefore, there has been challenges created due to this factor
in the company (Leyh and Sander 2015). The company has decided to implement the ERP
systems in the operations for maintaining a keen approach to the development of organization in
the market. An ERP system is a complete integrated business management system that helps in
in covering functional areas of the company including the logistics, finance, production, human
resources and accounting. It helps in organizing and integrating operation processes and data
flow. For making an optimum use of the resources, various management systems in the
company. There has been various opportunities created with implementation of ERP systems in

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the IS/IT sector of company. The interventions in the company have been maintaining an
appropriate approach to the development of company in the market. The market of ERP systems
shave been growing gradually that has covered SMEs and big companies. In this case, Coca
Cola has been defending market analyses report in order to make profit in the market (Ali and
Miller 2017). The use of ERP systems has helped in gaining competitive advantages by
improving business performance. The integration of supply chain management and inventory
management in company have helped in enhancing the decision making system for supporting
strategic goals. The top management of company needs to be supportive to the implementation
of the ERP systems.
ERP systems helps in facilitating in the horizontal and vertical integration of the business
in the market. The ERP systems have two distinct features including causal connection between
the software implementation procedure and the business approach and ensuring the data
integrity, integration and security of the data and information in the company. The
implementation of the ERP system in Coca Cola has been a time taking process (Jagoda and
Samaranayake 2017). The ERP system has to be integrated in each of the business processes of
the company. However, the implementation of ERP systems might increase budget of the
company in the market. Therefore, the price of the products in the market might get increased as
the manufacturing cost of the company get increased. The benefit of the ERP systems can be
observed in the operations only of it is properly implemented in each of the business approaches.
Stakeholders of the company goals an important role in implementing the ERP systems in the
company. The stakeholders of the Coca Cola Company have been encouraging and motivating
the operations for implementation of ERP in the company (Sykes 2015). The motivation
provided by the stakeholders have been helping in growth of company in the market. Adoption

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of ERP systems by company have helped in meeting strategic needs and tactical consideration sf
the employees and customers in the market. The company. It helps in organizing and integrating
operation processes and data flow. For making an optimum use of the resources, various
management systems in the company.
There has been various opportunities created with implementation of ERP systems in the
IS/IT sector of company. The interventions in the company have been maintaining an
appropriate approach to development of company. The market of ERP systems shave been
growing gradually that has covered SMEs and big companies. The company size plays a tactical
role in the development of the ERP systems in the company. Large companies including Coca
Cola helps in employing more ERP systems s as compared to the small companies. The use of
ERP software including SAP have helped in maintaining the business processes of the company.
In this case, Coca Cola has implemented SAP as an ERP software in the company (Chou et al.,
2014). This have helped managing the financial documents and assets of company in the market.
The implementation of SAP software have been hoeing in incremental approach towards
the development of company in the market. The SAP software has helped in analysis the cost
benefit approach in market (Chang et al. 2015). Therefore, revenue invested in market by the
company can be tracked. The profit and loss statement of the company can be prepared easily
with the help of the SAP software. The supply chain management system of the company I also
handled by the SAP software. This management helps sin satisfying customer in the market.
Cost benefit Analysis of the Coca Cola Amatil
The cost benefit is the comparison of costs and benefits of goods and services provided
by the company in market. This analysis helps in maintaining budget of company in market.
The IT management of company has been enhanced by use of the SAP software. The cost benefit

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process has been integrated with the SAP software that provide technical perspective to the
calculation of the costs and revenue model of the company.
Cost benefit analysis
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5
Profit $0 $25,000,00
0
$25,000,00
0
$30,000,00
0
$30,000,00
0
$40,000,00
0
Decrease in
expenditure
$0 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000
Development
cost
($20,000,00
0)
($500,000) ($500,000) ($500,000) ($500,000) ($500,000)
Capital
Expenditure
$0 ($10,000,00
0)
($10,000,00
0)
($10,000,00
0)
($10,000,00
0)
($10,000,00
0)
Annual
Expenses
$0 ($15,000,00
0)
($15,000,00
0)
($15,000,00
0)
($15,000,00
0)
($15,000,00
0)
Net cash flow ($20,000,00
0)
$500,000 $500,000 $5,500,000 $5,500,000 $15,500,00
0
Discount
factors
Discount rate 5%
Year Index 0 1 2 3 4 5
Discount factor 1 0.95 0.91 0.86 0.82 0.78

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Discounted
flows
Cost ($20,000,00
0)
($24,285,71
4)
($23,129,25
2)
($22,027,85
9)
($20,978,91
3)
($19,979,91
7)
Benefit $0 $24,761,90
5
$23,582,76
6
$26,778,96
6
$25,503,77
7
$32,124,57
3
Net ($20,000,00
0)
$476,190 $453,515 $4,751,107 $4,524,864 $12,144,65
6
Cummulative ($20,000,00
0)
($19,523,81
0)
($19,070,29
5)
($14,319,18
8)
($9,794,324
)
$2,350,331
Net present
value
$2,350,331
Feasibility study
Coca Cola Amantil
Forecasted revenue

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Units
sold
annually
Average
price per
unit
Annual
revenue
per product
Product 1 255 12
5.00
31,87
5.00
Product 2 450 10
0.00
45,00
0.00
Product 3 230 65
.00
14,95
0.00
Product 4 530 25
.00
13,25
0.00
Total of forecasted revenue 105,0
75.00
Cost of goods sold
Expecte
d
gross
margin
Annual
cost of
goods sold
Product 1 25% 7,96
8.75
Product 2 25% 11,25
0.00

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Product 3 25% 3,73
7.50
Product 4 30% 3,97
5.00
Toatl cost of goods sold 26,93
1.25
Annual maintenance, repair and overhaul
Factor (%) on capital equipment 15%
Asset depreciation
Number of Years 5
Tax
Annual Tax Rate 30%
Inflation
Annual Inflation Rate 2%
Product price increase
Annual Price Increase 2%
Funding
Loan Amount 50,000

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.00
Annual interest rate 5.00%
Term of loan (months)
60
Monthly rate 0.41%
Payment 941
.02
Total Amount Payable 56,461
.20
Financial Studies in Australia
2017 ($M) 2016 ($M) Variance %
Trading revenue 2,535.2 2,621.2 (3.3)
Trading revenue per unit case 8.15 8.22 (0.9)
Volume (million unit cases 311.1 319.0 (2.5)
Underlying earnings before
interest and tax
412.6 440.9 (6.4)
EBIT margin on trading
revenue
16.3% 16.8% (0.5) points
Return on capital employed 36.1% 38.7% (2.6) points
Volume summary – unit cases
Sparkling

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Beverages 206.7 213.6 (3.2)
Frozen 25.2 22.9 10.0
Stills 79.2 82.5 (4.0)
Total 311.1 319.0 (2.5)
(Source: Coca Cola Amantil, 2018)
The above tables shows about cost and benefit of the company in 2016 and 2017. The
revenue of the company has been decreased 3.3 per cent and volume decreased by 2.5 in year
2017. The EBIT declined 6.4 per cent in the year. Revenue, EBIT and volume trajectory has
been improved in the second half (Supramaniam, Abdullah and Ponnan 2014). The competitive
pressure in Coca Cola and Water categories, a shift has been continuing in channel mix away
from state of consumption channel (Abdinnour and Saeed 2015). In sparkling beverages,
volume has been declined 3.2 per cent for the year. However, there was an improvement of the
3.8 per cent has been declined in the first half.
During 2017, the company has been focusing in the South pacific region for accelerating
Australian Growth Plan. However, the plan has been focusing in the development of the portfolio
in order to route-to-market strategy (Alles, Brennan Kogan and Vasarhelyi 2018). The cost
optimizing policy of company has been helping in maintaining the cost and benefit from
revenue. In year 2018, the company has been focusing in the cost optimizing plan for the
development of the company in the market. There has been some of the critical factors that might
help in maintaining the success of the implementation of the SAP software in the company.
These factors include ERP teamwork and composition, Study well, Support from top
management, proper project management and monitoring and evaluation.

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Conclusion
It can be concluded that the ERP system of the company has been helping in enriching
the development of the company in the marmite. Various problems in the operation of the Coca
Cola Amatil has been discussed in the report. The implementation of the SAP software in the
ERP system has been explained in the report. The company size plays a tactical role in the
development of ERP systems in company. The use of ERP software including SAP have helped
in maintaining business processes of company. The performance of company in the market has
been increased in recent years. The use of the SAP software has been helping in maintaining the
cost benefit analysis of the company. Large companies including Coca Cola helps in employing
more ERP systems s as compared to the small companies.

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