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What mechanism are used to reinforce such a common culture ?

What mechanism are used to reinforce such a common culture ?

Understanding Business
Understanding Business
12th Edition
ISBN:9781259929434
Author:William Nickels
Publisher:William Nickels
Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment
Section: Chapter Questions
Problem 1CE
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What mechanism are used to reinforce such a common culture ?
WHAT IS CULTURE AND WHY IS IT IMPORTANT ILLUSTRATION 6.2 Dream. People. Culture. "Brito', Chief Executive of the world's largest brewery, has culture as one of his three buzzwords. AB InBev's clumsy name reflects the manner of its either like it or don't like it. Zero-based budgeting is growth. It has its origins in the 1999 merger of two practised, with all budgets negotiated from scratch at Brazilian brewers, Antarctica (founded in 1880) and the beginning of each year. Costs and performance are Brahma (founded in 1886). The new 'AmBev' then monitored closely. On buying Anheuser-Busch, Brito merged with Belgian brewer InterBrew to become fired 1400 staff, with the whole top tier of manag- InBev in 2004, before taking over the American giant ers going: according to Brito, "Some were too rich to Anheuser-Busch in 2008. By 2015, AB InBev was the care, some were too old to work, some wouldn't fit the largest brewer in the world, with its headquarters in culture anyway." Throughout the company, employee Belgium and a 25 per cent share of the global beer metrics are all public and managers are subject to 360 business. Its brands included Beck's, Budweiser, degree feedback systems. The internal joke is that to Corona and Stella Artois. AB InBev employed 155,000 get promoted, you have to kill three people. people in 25 countries. The company had its eyes on But the rewards are high for good performers, and taking over one of its last major rivals, the South Afri- promotion fast. Young managers rarely spend more can brewer SABMiller. AB InBev's Chief Executive was the Brazilian Carlos on as soon as they start to get comfortable. In 2014, Brito, known simply as "Brito' (never Carlos, never Mr more than 100,000 people applied for 147 gradu- Brito). He had originally begged the former Brazilian ate level jobs. Brito personally addresses each class tennis champion and investor Jorge Paolo Lemann to of graduate trainees, looking for talent. He always fund his MBA at Stanford University. On completion encourages his trainees to 'dream big". Luiz Fernando of his MBA, he had joined Brahma, a brewery that Edmond, head of sales worldwide, was on the compa- Lemann had just bought. By 2004, Brito was CEO of ny's first management trainee programme in Brazil in AmBev. With the InterBrew merger, he played second 1990. He remarks: 1 came here with nothing. If you fiddle initially, but by 2005 - aged 45 - he emerged work hard, you focus on your results and you work with as CEO of the newly-created company InBev. Brito's three buzzwords, repeated by executives than you, you have a chance to become a CEO of the throughout the company, are: "Dream. People. Cul- company." ture'. The culture he has sought to create at AB InBev Sources Fortune, 15 Apost 2013, Financial Times, June 15 and is intense. He himself is away from home travelling 16, 201s on business more than half the year. He claims no hobbies, unless a daily 30 minutes on the treadmill counts. He and his top team fly economy class except on the longest haul flights and they all use mid-market hotels. The top team's desks are placed at the centre of open-plan offices. Lemann (with a 12.5 per cent stake in the com- pany) describes the culture of AB Inbev thus "You are 2 What mechanisms are used to reinforce such always running, always close to the limit. You're work a common culture (see also Chapter 14). ing very hard and being evaluated all the time. People than two or three years in a single posting, moved people, bring people together, promote people better Questions 1 Why do you think that creating a common culture might be important for a company like AB InBev? 173
Transcribed Image Text:WHAT IS CULTURE AND WHY IS IT IMPORTANT ILLUSTRATION 6.2 Dream. People. Culture. "Brito', Chief Executive of the world's largest brewery, has culture as one of his three buzzwords. AB InBev's clumsy name reflects the manner of its either like it or don't like it. Zero-based budgeting is growth. It has its origins in the 1999 merger of two practised, with all budgets negotiated from scratch at Brazilian brewers, Antarctica (founded in 1880) and the beginning of each year. Costs and performance are Brahma (founded in 1886). The new 'AmBev' then monitored closely. On buying Anheuser-Busch, Brito merged with Belgian brewer InterBrew to become fired 1400 staff, with the whole top tier of manag- InBev in 2004, before taking over the American giant ers going: according to Brito, "Some were too rich to Anheuser-Busch in 2008. By 2015, AB InBev was the care, some were too old to work, some wouldn't fit the largest brewer in the world, with its headquarters in culture anyway." Throughout the company, employee Belgium and a 25 per cent share of the global beer metrics are all public and managers are subject to 360 business. Its brands included Beck's, Budweiser, degree feedback systems. The internal joke is that to Corona and Stella Artois. AB InBev employed 155,000 get promoted, you have to kill three people. people in 25 countries. The company had its eyes on But the rewards are high for good performers, and taking over one of its last major rivals, the South Afri- promotion fast. Young managers rarely spend more can brewer SABMiller. AB InBev's Chief Executive was the Brazilian Carlos on as soon as they start to get comfortable. In 2014, Brito, known simply as "Brito' (never Carlos, never Mr more than 100,000 people applied for 147 gradu- Brito). He had originally begged the former Brazilian ate level jobs. Brito personally addresses each class tennis champion and investor Jorge Paolo Lemann to of graduate trainees, looking for talent. He always fund his MBA at Stanford University. On completion encourages his trainees to 'dream big". Luiz Fernando of his MBA, he had joined Brahma, a brewery that Edmond, head of sales worldwide, was on the compa- Lemann had just bought. By 2004, Brito was CEO of ny's first management trainee programme in Brazil in AmBev. With the InterBrew merger, he played second 1990. He remarks: 1 came here with nothing. If you fiddle initially, but by 2005 - aged 45 - he emerged work hard, you focus on your results and you work with as CEO of the newly-created company InBev. Brito's three buzzwords, repeated by executives than you, you have a chance to become a CEO of the throughout the company, are: "Dream. People. Cul- company." ture'. The culture he has sought to create at AB InBev Sources Fortune, 15 Apost 2013, Financial Times, June 15 and is intense. He himself is away from home travelling 16, 201s on business more than half the year. He claims no hobbies, unless a daily 30 minutes on the treadmill counts. He and his top team fly economy class except on the longest haul flights and they all use mid-market hotels. The top team's desks are placed at the centre of open-plan offices. Lemann (with a 12.5 per cent stake in the com- pany) describes the culture of AB Inbev thus "You are 2 What mechanisms are used to reinforce such always running, always close to the limit. You're work a common culture (see also Chapter 14). ing very hard and being evaluated all the time. People than two or three years in a single posting, moved people, bring people together, promote people better Questions 1 Why do you think that creating a common culture might be important for a company like AB InBev? 173
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