UNIVERSITY OF CENTRAL PUNJAB
SPRING 2025
Course Title: Fundamentals of Operations
Management
Course Code: BAMG 2823
Assignment No. 2
Course Instructor: Syeda Uzma Tahira
Section: BA5 Program: BSBA Date: 14th April 2025
Submission Date: 21st April 2025 Maximum Marks: 10
Course Objective:
Program Objective: PO1-4 Course Learning Objective: CLO1
CO1
TO BE FILLED IN BY THE STUDENT
Student Name: Registration No: Sr. No:
Instructions:
This is a group assignment. Make a group of two students.
The assignment must be a typed document of at least three to five pages excluding title
page and references
The document must contain a title page, main text and references
The formatting must be as Times New Roman, font Size12, line spacing 1.5, all justified
header footer 0.5 each
Headings must be bold with font size14
Marks will be deducted for late submission, poor formatting and insufficient information.
Zero marks will be awarded in case of cheating or copy paste.
Marks will be allocated based on following criteria.
o Excellent (9-10): Demonstrates a deep understanding of concepts with practical,
innovative solutions.
Page 1 of 3 Assignment-2
o Good (7-8): Covers most key points well, but with minor gaps or less detail.
o Satisfactory (5-6): Meets the basic requirements but lacks depth and full
understanding.
o Needs Improvement (3-4): Shows incomplete understanding or analysis; requires
further development.
o Poor (0-2): Fails to grasp key concepts or provide practical solutions.
Assignment Topic & Details:
Topic: Design of Goods & Services
Details: Read the case study and answer the following questions.
Frito-Lay, a subsidiary of PepsiCo, is a global leader in the snack food industry, producing well-
known brands like Lay’s, Doritos, Cheetos, Ruffles, and Tostitos. With operations in over 40
countries and distribution in nearly every part of the world, Frito-Lay's success is attributed to a
well-balanced focus on both product design and service design. This case explores how Frito-
Lay applies principles of design to create appealing products while delivering them efficiently
and sustainably to consumers.
Product design at Frito-Lay is an intensive and structured process. It begins with understanding
consumer preferences, which are identified through market research, focus groups, and social
media insights. The company emphasizes the “Voice of the Customer” (VOC) approach, which
ensures that customer needs and desires shape the final product. For example, the rise in health-
conscious eating habits led Frito-Lay to develop healthier snack options such as Lay’s Baked,
Smart food popcorn, and products with reduced sodium or no artificial flavors. The company
also experiments with new flavors inspired by regional cuisines, offering limited-time flavors to
test market responses. These flavor innovations not only create excitement but also allow Frito-
Lay to stay ahead of competitors.
The cross-functional collaboration is another important aspect of the company’s product
development strategy. Teams from marketing, food science, quality assurance, and operations
work together to ensure that each new product idea is feasible, scalable, and aligned with brand
values. The use of prototyping and pilot testing helps minimize risks and ensures that products
meet safety and quality standards. Packaging design also plays a major role—Frito-Lay focuses
on user-friendly, resealable, and eco-friendly packaging, recognizing that packaging is a key
driver of purchase decisions.
Beyond product design, Frito-Lay invests heavily in service design, which refers to the
operational systems and processes that deliver products efficiently to customers. The company
operates some of the largest and most automated snack food production plants in the world. For
instance, its Dallas, Texas facility is a model of modern manufacturing, incorporating robotics,
solar energy, and water recycling systems. These lean manufacturing principles reduce waste,
improve consistency, and lower costs—all while maintaining high product quality.
Page 2 of 3 Assignment-2
The distribution network is another critical component of Frito-Lay’s service design. The
company uses a Direct Store Delivery (DSD) model, which allows its route sales representatives
to deliver products directly to retail shelves, monitor stock levels, and manage in-store displays.
This model enhances customer service and allows Frito-Lay to respond quickly to shifts in
demand. Sales representatives are equipped with handheld devices that provide real-time sales
and inventory data, enabling quick decisions on replenishment and promotions.
Sustainability is integrated into both product and service design. Frito-Lay has made significant
progress in reducing its environmental footprint through eco-friendly packaging, reducing
emissions in transportation, and conserving water in manufacturing. Its Modesto, California
facility became the first “Near Net Zero” snack plant, using renewable energy sources and
significantly reducing reliance on fossil fuels. These efforts are in line with PepsiCo’s broader
sustainability goals and reflect growing consumer expectations for responsible business
practices.
Despite its success, Frito-Lay faces ongoing challenges such as changing consumer preferences,
rising raw material costs, and increased competition from local and niche snack producers. To
maintain its leadership, the company must continuously innovate in both product offerings and
operational efficiency. It must also ensure that sustainability remains a core part of its design
philosophy, as younger consumers increasingly value brands that align with ethical and
environmental standards.
Frito-Lay's approach demonstrates the importance of integrating product and service design to
create a comprehensive value proposition. By doing so, the company not only delights
consumers with innovative snacks but also ensures those products are made and delivered
efficiently, consistently, and responsibly.
Questions:
1) Identify and explain the key elements of Frito-Lay’s product design strategy. How does
the company ensure that new product ideas meet customer needs and brand expectations?
2) How does Frito-Lay use service design to enhance its operational efficiency and customer
satisfaction? Provide examples from the case that show the integration of technology and
logistics.
3) Discuss how Frito-Lay incorporates sustainability in both its product and service design.
Why is this important for the company's long-term success?
4) Assume you are part of Frito-Lay’s product development team. Propose a new snack
product that reflects current consumer trends (e.g., plant-based, high-protein, regional
flavors). What service design elements would be essential to support its successful launch
and distribution?
Page 3 of 3 Assignment-2
