Working Research Project

The South African Breweries, plc (SAB) is listed in London as a FTSE 100 organization with beer, beverage, hotel, and gaming interests that p 21 countries across Africa, Asia and Europe. The Group also exports products to 45 countries internationally and is currently engaged in extensive expansion of its global beer interests. SAB ranks within the top four brewing companies in the world, together with Anheuser-Busch, Heineken, and the Miller Brewing Company.

SAB’s latest acquisition of the Pilsener-Urquell and Radegist breweries in the Czech Republic arguably places its volume in excess of 50m hectolitres. The total beverage volumes including carbonated soft drinks, however, amount to approximately 80m hectolitres (which translates into approximately 18 billion drinks served per annum). This case study focuses on the SAB, Ltd. operation in South Africa, which is the largest single country operation, and the original basis from which the international interests have grown.

The unique competitive capability of SAB in South Africa has translated into an organization whose practices benchmark favourably with the top five brewing companies in the world in all areas of the value chain – from manufacturing, sales, and distribution, to support services such as finance, systems, human resources, procurement, and marketing. With regard to the current share of the market, SAB holds 98 per cent of the beer market and 57 per cent of total alcohol consumed in South Africa.

The key focus of the organization is to increase its share of throat, which translates into increased share of alcohol and beverages consumed. The competitive capability of the organization has translated into approximately 70 per cent of total margin of alcohol consumed and 80 per cent of market capitalization value of the South Africa liquor industry. This is the result of decades of sustained improvement in productivity and economic value added.

SAB, Ltd. manufactures and distributes 14 brands in South Africa from seven breweries and eight regions. Some of the key environmental factors that impact upon SAB, Ltd. are shown in Table 1 below: BOP operators, process operators, and process artisans report directly to the team leader. This team is fully self-sufficient in that there is no external (day-shift-based) support for the team in the form of artisans or quality control technicians. The team is autonomous and equipped for the full range of its outputs. Tremendous work has taken place to anchor the new work practices post implementation, including a focus on performance management and competency acquisition.

Following the line 12 pilot, this structure has been rolled out to five of the six major packaging lines in SAB. This process will continue in 2000. Organization development resourcing (1998) To ensure a professional approach to implementing change interventions, and specifically to the change management aspects involved, an organization development role was added into the central office HR structure in 1998. A change management process has been developed (based on the work by John Kotter) to ensure appropriate focus on both the pre- and post-implementation challenges.

Staff Equity (affirmative action) SAB has been involved in Equity as a strategic initiative since 1971. At that time, 1 per cent of all salaried staff were Black, Asian or Coloured (hereinafter referred to as Black). By 1978, Black employees constituted 13 per cent of salaried staff. This was achieved by appointing Black employees into real jobs (no tokenism, no tolerance for a different set of standards). Today, 55 per cent of total salaried staff and 22 per cent of all executives are Black.

Both the external environment as well as internal demands on SAB have changed dramatically over the last 25 years, necessitating the ongoing adaptation of Equity to keep it on track.
Take responsibility for own career development. Support employees in their career development, including communicating employee career information to others as needed. Communicate business mission, objectives and strategies, so that realistic career development can occur.

Set goals to meet performance requirements of current job. Establish and communicate job requirements and responsibilities via goal setting and coaching. Provide information on career requirements, organizational opportunities, and developmental systems. Engage in realistic self-assessment. Provide open and honest ongoing performance feedback and coaching. Implement an effective manager-employee career development discussion process.

Obtain and utilize feedback on career options in line with potential. Provide organizational career information and realistic feedback on employee career aspirations. Train managers to coach, evaluate and conduct employee career discussions. Communicate career interests and discuss developmental needs with manager. Conduct career development discussions with subordinates prior to the career discussions with the career development consultant (a divisional resource). Provide employees with the resources necessary for development, to include on-the-job experiences, training, and education. Actively follow through on developmental plans. Encourage and support implementation of the employee’s developmental plans. Ensure integration of career development components into a comprehensive system.