The Heineken family entered the beer business in 18641, when Sir Gerard Adriaan Heineken bought a brewery in the heart of Amsterdam. Over the past 140 years, three generations of the Heineken family have built and expanded the brand and the company worldwide. In recent figures, the company has pursued a leader position in Europe and taken the third place in the world, behind ABInBev and SABMiller. Thus, the present report extensively analyzes the strategies
and processes in which Heineken's major success relies.
Firstly, it is important to analyze the Macro environmental factors that influence the brewing
industry as a whole and the Micro environment which directly affects Heineken's performance.
Moreover, by analyzing the environment that surrounds the company, it is possible to identify opportunities to be seized and threats that must be minimized. Thus, threats have been increasing; besides fierce competition, stricter laws and popularity of non‐alcoholic drinks make it harder to succeed in the beer market. Nevertheless, there is also a promising flush of opportunities such as the green and health trends, and the exploration of emerging markets. The present report also focuses on an intensive Heineken's organizational analysis and strategy formulation. The goal is to gain a deeper understanding of the strengths and weaknesses of the company as well as the strategies and activities that lead to its great triumph in the international beer industry.
Heineken's ultimate goal is to build a stronger, more competitive global business and provide superior value to the customers. And it has been able to do so by "harnessing our core strengths: the commitment and excellence of our people, the strength of our brands and our ambition to build profitable future growth" (Jean Francois von Boxmeer, Heineken CEO).
[...] More focus is put on the Heineken brand than any other as this strategy is closely tied to the strong brand equity, recognized as the main growth driver Value Based Management . Furthermore, this strategy is in harmony with the corporate strategy of balancing growth through acquisition with organic growth; and, with the goal of maintain profitable and strong market positions through strong local brands with Heineken at the helm as the leading premium beer . Regarding the four types of differentiation described in the above shown matrix, one might argue that Heineken does not commit to a single type of differentiation. [...]
[...] Figure 31 Internal and External Development Value Based Management . The concept of Organizational Development involves the extensively discussed previously four strategic dimensions: Products‐Markets, Vertical Integration, Internationalization and Diversification the latter is not a part of Heineken's strategy as the company does not bet on investing in new industries . The remaining dimensions concern both Internal and External Development as illustrated in Figure In order to enhance and achieve Organic Growth, Heineken seeks to attain Top‐line Growth, Efficiency and Cost Reduction as well as Cash Generation throughout well‐based strategies regarding products‐markets and vertical integration. [...]
[...] To Heineken, Learning & Development are essential components of daily work, hence the most powerful learning experiences happen in the work place Value Based Management . o IGP International Graduate Program 18 month program for those focused on a long term international career; used as a recruiting tool for the company . Heineken received last year, in France, the award of the Company employer”, thanks to their HR Policy . Financial Resources . Heineken presents a strong, secure and stable capital structure and financial resources, due to: Ownership structure Heineken Holding N.V. [...]
[...] According to the segmentation given earlier the Five Forces Analysis will be accomplished for the four different segments: Premium, Mainstream, Economy, Trendy Figure 6 Heineken's Main Competitors . Value Based Management Premium Segment Mainstream Segment . For the Mainstream segment, a medium attractiveness can be concluded THREAT OF ENTRY LOW Mature segment not avractve for new players High marketng efforts needed POWER OF BUYERS LOW Consumers: high number of organized individuals, switching costs are low Retailers: wide number of fragmented, but partly organized retailers; favourable . frame contracts with brewers high switching costs . [...]
[...] (2010, February 18) . Heineken kicks off Brazil push . Retrieved from http://www.just‐ drinks.com/the‐just‐drinks‐blog/heineken‐kicks‐off‐brazil‐push_id1648.aspx Morgan Stanley Conference. (2007, November 14). Heineken . New York Value Based Management . APPENDIX . Appendix 1 Heineken History . Appendix 2 Financial Analysis Key Figures Value Based Management . Appendix 3 UBL in India . [...]
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