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Simply Orange is Anything But Simple


Image: Jeremyville

Actually, it's quite complex. You see, Simply Orange, which is made by Coca-Cola, is a highly industrial product engineered according to a complex algorithm called the "Black Book":

Revenue Analytics consultant Bob Cross, architect of Coke’s juice model, also built the model Delta Air Lines (DAL) uses to maximize its revenue per mile flown. Orange juice, says Cross, “is definitely one of the most complex applications of business analytics. It requires analyzing up to 1 quintillion decision variables to consistently deliver the optimal blend, despite the whims of Mother Nature.”

The Black Book model includes detailed data about the myriad flavors—more than 600 in all—that make up an orange, and consumer preferences. Those data are matched to a profile detailing acidity, sweetness, and other attributes of each batch of raw juice. The algorithm then tells Coke how to blend batches to replicate a certain taste and consistency, right down to pulp content. Another part of Black Book incorporates external factors such as weather patterns, expected crop yields, and cost pressures. This helps Coke plan so that supplies will be on hand as far ahead as 15 months. “If we have a hurricane or a freeze,” Bippert says, “we can quickly replan the business in 5 or 10 minutes just because we’ve mathematically modeled it.”

Duane Stanford of Bloomberg Business News has the post that'll go perfectly with a tall glass of orange juice: Link


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