Heinekens Internal Processes,Mission and Vision - Research Paper Example

Heineken Company Analysis Heineken International is a Dutch brewing multinational with 150 years of operation in key markets across the world. Gerard Adriaan Heineken founded the company in 1864 in Amsterdam. As of 2013, the multinational owns almost 130 breweries situated in over 70 nations across the world. Heineken brews and sells hundreds of universal premium brands as well as regional, domestic and specialty alcoholic beverages, including Cruzcampo, Tiger Beer, Ochota, Murphy’s, and Star. The company is ranked third globally among top brewers after Anheuser-Busch InBev and SABMiller, in terms of the level of production (Heineken International, 2014). Despite its origin in Dutch, Heineken has made a significant presence in the two Americas, owing to the massive business opportunities in the region. The company entered the American market and Latin America in the early 20th century following the slackening of regulations in the region. And in 2010, Heineken entered into strategic acquisitions of beer companies in the United States, Brazil and Mexico. In the latter two countries Heineken settled for FEMSA (Stirling, Chow, and Yates, 2011). Heineken’s internal processes The organization’s internal processes revolve around managing risks through effective control systems. These measures, according to the company, ease its identification of the risks for better interventions in order to realize its operational and pecuniary goals (Stirling, Chow, and Yates, 2011). In addition, these internal mechanisms enable the company’s operations to be in line with relevant laws and policies in the countries within the two Americas. The company relies on a system of control for proper processing and release of financial statements. In light of these, Heineken’s internal control mechanisms form the central part of their internal management processes. Heineken is renowned for its push for quality of goods and financial restraint. The company encourages an entrepreneurial culture across organizational levels so as to obtain opportunities that foster continuity in terms of business development and creativity, whilst absorbing controlled risks. Heineken International (2014) argues that the carefully structured customized portfolio per country and the rigorous balance sheet depict the brewer’s risk appetite. Regardless, in competitive markets like the North America’s and the emerging South America’s, achieving financial restraint where proper marketing expenditure pays out has been relatively counterproductive to Heineken (Needles, Powers, and Crosson, 2008). Heineken is a company that deals in a single line of products. This has enabled it to replicate a number of its internal processes for its business operations in North America, and Latin America, especially in the latter’s emerging economies (Lembeck, 2014). However, the varying levels of risks and uncertainties in different markets have negatively impacted the standardized processes. These uncertainties have precipitated material impacts on certain specific plants in the American region, with the ripple effect being felt as far as Amsterdam. Regardless of such risks, Heineken banks on the fortunes earned from its branches situated elsewhere in the world to contain any revenue dip in the two Americas. Mission and Vision Heineken prides itself in great brewing in the entire world. In light of this, the company’s commitment to development has remained high on the agenda since its inception (Heineken International, 2014). The company’s strives to bring its brands to consumers and prospects in almost every nation across the world. As one of the globe’s most profitable international premium beer brand, Heineken intends to remain in that position by maintaining high quality products (Johnson, 2013). The company’s primary international brand is Heineken, however more than 200 subsidiary products such as Amstel, Primus, Kingfisher, and Newcastle Brown Ale are being produced and supplied to customers in different markets within the Americas (Lembeck, 2014). Heineken intends to maintain well-established presence in both highly viable and fledged markets, and following recent pacts and planned acquisitions in Latin America, Heineken believes it will grow in developing beer markets in the region and fend-off competition in fledged markets like the United States’. With these challenges and viable opportunities, Heineken relies upon an effective organizational structure to survive. Organizational culture Heineken’s primary cultural goal is to guarantee its key stakeholders of quality, respect and enjoyment. The company achieves these values by following internal policies which are in line with the Risk Management System. These internal programs set the confines within which all Heineken branches and subsidiaries should carry out their business processes. An administrative structure and activities guaranteeing continuous mindfulness and conformity to the rules are in place (Johnson, 2013). These processes are handled by the firm’s Company Rules Network, meeting twice in a year. Moreover, the annual Assurance Letter guarantees the organization of a smooth release of financial statements and certain Company Rules. The document reaches all Heineken branches through Regional Presidents who must sign them. In addition, Heineken uses high-tech systems to execute internal processes in order to enhance operational efficiency (Lembeck, 2014). Employee recruitment is one of the internal processes supported by the systems. The company strives to get the right employees through the wide online platform; test their ‘natural’ culture and arrive at the best candidates with the right expertise and values which are compatible with the organizational culture of offering quality, respect and enjoyment of the products (Needles, Powers, and Crosson, 2008). Organization structure Heineken’s Executive Board is charged with the responsibility of overseeing the company’s affairs. The two members of the Executive Board as well as Heineken’s Regional Presidents and Chief Officers make up the Executive Committee. The Committee is the organization’s top-most decision-making body. Being a multinational, Heineken has divided the global economy into five distinct regions of operation: Western Europe, Central and Eastern Europe, The Americas, the Middle East and Asia Pacific and Africa. Notably, North America and Latin America fall within “the Americas” (fig.1) (Heineken International, 2014). Conclusion Heineken is an important player in the international beer market. With more than 200 products under its banner, and its presence in more than 70 countries, Heineken is surely a force to reckon with in the Americas. The company’s strength is evident in its ranking in the third position globally in terms of the volume of beer production. Heineken has put in place internal risk assessment and management processes that have seen it withstand 150 years of competition since its inception. The company’s mission and vision have booked the company a position among top-notch beer brands in the world. With information systems and a management structure that is divided into regions, Heineken is sure of consistency and devolution in its operations. References Heineken International. 2014. Management Structure. Retrieved from http://www.theheinekencompany.com/about-us/management [Accessed Feb. 13 2014]. Johnson, J. 2013. Beer 2013: State-of-The-Industry Report. Beverage Dynamics, 125(5), pp.30-38. Lembeck, H.2014. Sell Cider and Spare the Donuts. Beverage Dynamics, 126(1), p.10. Needles, B.E., Powers, M., and Crosson, S.V. 2008. Financial and Managerial Accounting. New York: Cengage Learning. Stirling T., Chow J., and Yates, M. 2011. Heineken: FEMSA and 'TCM2' Should Drive Superior EPS Growth. Bernstein Black Book - The Best of Bernstein: Global Edition, pp.69-74. Read More