Case study analysis of organizational theories and applications

¶ … Sabmiller Brewer Company

The building of the SABMiller as one of the largest and most competitive companies not only in Africa but also all over the world is an outcome of several factors relating to management competencies and resourcefulness in tackling serious market challenges (Stone, 2001). The growth of SABMiller has taken an increasing expansion and acquisition of potential markets in addition to well-organized market strategies (Hoskison, 2004). From London to South Africa for the first time, establishing itself amidst political and economic challenges, SABMiller has then proved beyond reasonable doubts its ability to construct huge market base and stability. It has not only established itself in Africa, Asia, but also all over Europe the North and South America. Its ability to deal with financial challenges is indeed exceptional explaining its tolerance against financial and market crises (Babor, 2010).

This case study seeks to analyze the impact of proper management and ambition driven expertise in running a large-scale business (Stone, 2001). Identification and exploitation of market opportunities and potentials is one of the most important aspects for a business success. This work seeks to analyze the strategic priorities adopted by SABMiller as at 2007 with a clear identification of external environmental impacts accompanied by the capabilities, competencies and the expectation of stakeholders. Besides, it will also be very articulate in the response to outline and justify the available strategic options that would be fundamental in the company's success.

SABMiller's Strategic Positions as at 2007.

In the wake of 2006, SABMiller sought to define and outline its strateg0ic priorities through its annual report. This it identified as the cornerstone upon which it had been able to realize its success. First, it emphasized on how it believed in the creation of a balanced and attractive global spread of business (Hoskison, 2004). This is strategy that is evidently achieved through the establishment of potential markets in almost all over the world. Starting from Africa, where it was up to 2006 when the annual report was read. SABMiller had realized the fragmentation of beer market in less developed countries and capitalized on that environmental deficit of beer supply to the people. Most of the beer providi8jng or producing companies were less developed and small in size hardly hitting the mark of large scale producers (Babor, 2010). This gave advantage to dominate the markets within less developed countries of Africa, Asia, and South America. There was the need and interests to acquire markets in the developed count6ries (Stone, 2001). This was an interest brought forward by investors, who piled more pressure and desired more participation in the developed market. consequently, it acquired Hungary largest brewing company known as Deher, established operations in China, Romania, Poland, Slovakia, Russia and Czech Republic just to give but a few of examples. The main reason that led to the interest in developed countries was to enhance capital acquisition for more expansion of the business. It is also important to note that, markets within South Africa were becoming insufficient as SABMiller had already grown large enough. This is also another reason that led to striving to invest in external markets (Hoskison, 2004).

The second of its strategic priorities was the development of strong and relevant brand portfolios in the relevant market. In its 2006 annual report SABMiller reiterated that it had completed a three-year turnaround plan building grounds for future growth and expansion. To impress this strategy, the flagship Miller Lite brand was identified to be growing as the company maintained its year on pricing (Hoskison, 2004). The company was also enjoying markets as it continued to develop strong relevant brands in European countries including Romania, Russia, and Poland. This indicated its presence in the developed economies. As the SABMiller's CEO, 2006 noted, the company's ability to develop in the developing countries, contributed to its competitive advantage to the world spectrum due to the African originated skills (Stone, 2001). The third of the strategy was constant raise of the performance of the local business. SABMiller appreciates its African-originated background due to many years of serving the local market. As explained earlier, it had capitalized on the fragmented market of beer and pushed its performance to world stage even during and after turbulent moments of crises (Babor, 2010). After acquisition of the developed markets, the company plans on concentration on local business carrying out consolidation and satisfying the needs of the local demand.

Lastly, the leveraging of the global scale was seen through buying of the Millers to expand the gains or the possible losses (Stone, 2001). The investment made on the developed countries was also an undertaking that merited this strategy. For instance substantial gains have been made through the investment done on other countries, while the company's decision to be listed in London Stoke Exchange (LSE) saw it suffer loss with its share price losing15.55percentage relative to FTSE 100in the year to end November. All the above mentioned strategies have been achieved due to the expertise and experience of the SABMiller's management (Hoskison, 2004). Their capabilities and competence is identified in the manner in which they handle the market issues. This involves identification of potential market and taking steps towards investment in such countries.

Range Of Possible strategic options open To SABMiller

In the evolution of its strategies, SABMiller had sought to stop acquisition of markets but to work on the consolidation of its already existing affiliations. In accordance to Ansoff matrix, which presents to the marketing manager with options to consider, it is therefore logical that the company remain in the existing markets as far as the markets are concerned. Through doing that, it can either continue to sell the existing products only or compliment them by introducing new ones (Stone, 2001). This can be carried out in the context of selling more of the existing products in the existing markets or selling newly introduced products into the existing markets. Extension of the existing markets is also possible for reasons of expanding sales, which may mean the increase of product volumes into the market. SAB can also undertake the development of the product by developing the existing product into the existing markets (Hoskison, 2004).