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Coke's Largest Bottler Taps Microsoft For SaaS

Coca-Cola Enterprises signs the largest deal yet for Microsoft's online collaboration and e-mail services.
IT SELF INTEREST
CCE is 35% owned by the Coca-Cola Co., and Sezer and his counterpart at Coke, Jean-Michel Arès, talk regularly about business goals. CCE provides Coke with some consolidated demand data, and the companies have federated some of their systems. But Sezer's IT agenda is driven by his company's needs, not the Coca-Cola Co.'s.

Like Coke, CCE has been under pressure as people seek out healthier drinks over soda, and commodity costs squeeze profits. CCE lost $4.8 billion in the second quarter, due mostly to a one-time asset write-down based on an expected decline in North American operating income, and North American sales fell 1.5% as steep gas prices hurt convenience store business in 20-ounce bottles of soda and Dasani water.

A change agenda across the $21 billion-a-year company has goals of keeping it No. 1 or 2 in every market it's in, overhauling its distribution, and acquiring talent to drive growth. The communication tools are a starting point. "It became clear that we had to communicate these changes quickly," says Key. "The quick shift is the competitive differentiation, because the market is changing."

In the last 18 months, CCE has increased the number of products it handles by 30%, thanks to a partnership with V8 and Coke buying Glacéau, maker of Vitaminwater. That increases pressure on everyone, from salespeople to warehouse workers.

Business intelligence tools from SAP should help CCE's salespeople in the field target pitches effectively, instead of just taking orders. Customers want different drinks from a tony grocery store and a roadside gas station, and Web-published BI reports can help salespeople focus on the most profitable mix.

In the warehouses, CCE worked with Cisco, Microsoft, SAP, and startup Datria Systems on a voice-guided system called Voice Pick that tells employees where in the building to pick up stock for delivery. Shipping accuracy increased from "well below 90%" to 99.78%, Sezer says, and the company was able to get rid of "checkers," employees whose sole purpose was to make sure trucks were loaded with the right drinks.

Coca-Cola Enterprises is pushing a green effort, with projects to conserve water, use less plastic in bottles, and roll out a fleet of hydrogen-electric trucks. That's sparking a slate of green IT projects: consolidating data centers, virtualizing storage and servers (and eventually desktops and apps), eliminating unnecessary printers, measuring IT's electricity usage, and setting targets for the future.

To count Sezer's change efforts, from consolidating data centers to buying hosted collaboration software by subscription, as a success, that green will have to show up in CCE's quarterly results, not just energy efficiency.

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Brian T. Horowitz, Contributing Reporter
Samuel Greengard, Contributing Reporter
Nathan Eddy, Freelance Writer
Brandon Taylor, Digital Editorial Program Manager
Jessica Davis, Senior Editor
Cynthia Harvey, Freelance Journalist, InformationWeek
Sara Peters, Editor-in-Chief, InformationWeek / Network Computing