SABMiller's Human Capital Proposition - Institutionalizing a Performance
Culture
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Case Details:
Case Code : HROB085
Case Length : 15 Pages
Period : 2001-2006
Pub Date : 2006
Teaching Note : Available
Organization : SABMiller Plc.
Industry : Beverage
Countries : South Africa, USA, Europe
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"Today, SABMiller competes successfully in the global beer
industry and is proud to acknowledge that one of our key points of
differentiation is our Human Resource Proposition. Whilst virtually all our
competitors leverage a brand-led or capital resource-led expansion strategy, our
international expansion is driven by our unique people proposition."1
- SABMiller Plc's website, in 2006.
"At Miller, we approach the shaping of a performance
culture in two ways. Firstly, we use a performance management process to help
translate strategic priorities into goals for all teams and individuals.
Secondly, we ensure that the structures, processes, roles and skill profiles are
in place to ensure that we are able to deliver our strategic priorities."2
- Denise Smith (Smith), Senior Vice President, Human
Resources at Miller Brewing Co., in 2006.
Banking on its People
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For the fiscal year 2005, SABMiller Plc. (SABMiller), the second largest brewery
company in the world by volume, announced revenues of US$14.54 billion, up 15
percent from the US$12.65 billion it recorded in 2004. Its profit for the year
was US$1.14 billion, up 77 percent compared to US$0.65 billion in the fiscal
year 2004. These figures signified a clear improvement in the company's
financials since the early 2000s. (Refer to Exhibit I for SABMiller's key
financials from 1999 to 2005) Announcing the results, Meyer Kahn, Chairman of
SABMiller, said, "Thanks to sustained and careful investment [in its portfolio
of businesses, productive assets, brands and people] over many years, we've
enjoyed a third successive year of outstanding results... Most of all, we've
benefited from our investment in people.
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We devote considerable effort to training and developing our employees,
building the skills we need for the future, meeting our responsibilities as
an employer and making sure our structures and management reflect the
societies in which we operate."3
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Analysts opined that SABMiller seemed to have transformed itself
from a South African company into a successful global beer company.
The company said its growth was led by its Human Capital Proposition
(HCP), which created a unique performance culture at SABMiller. It
had also successfully reshaped the organizational culture of Miller
Brewing Company (MBC), a major brewery in the US, which it had
acquired in 2002 (Refer to Exhibit II for Financial summary of MBC).
The company was banking on its people to deliver the goods in the
future as well, by institutionalizing best operating practices and
"SAB Ways" in all its global operations. |
The "SAB Ways" was a proven approach to performance
management and reward at South African Brewing Company (SAB) and had been very
successful in maintaining the unique performance culture at SAB.
SABMiller's Human Capital Proposition - Institutionalizing a Performance Culture
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