Title Page – S
This indicates your title for the report. You may also wish to include a logo, your group or individual name, module name and code, term, date, “Prepared for: and “Prepared by:” and a preparation date.
Executive Summary -Y
Carefully written executive summary that briefly presents the choice of methodologies results and recommendation
This is a summary of the report assignment, e intent of the executive summary is to provide the time-constrained manager with the important facts and findings derived from the study. It summarizes your findings and conclusions, along with any recommendations, and places them at the beginning of the study. This placement provides easy access to the more important information relevant to any decision that a manager must make. If the manager is interested in any further details, he or she may consult the main body of the report.
Table of Contents -S
Label all Headings and Sub-headings using decimals in order to make a proper Table of Contents
The Heineken Company
In today’s society, a good beer is commonly available and enjoyed by many consumers in most countries and their unique cultures around the world. The Heineken Company is a Dutch Brewing Company that produces Heineken Lager beer or known to the world as just “Heineken”. It is an international well known beer for its unique green bottle and red star. They are also one of the experts of beer brewing and have a number of special beers around the world. Heineken is internationally presented through numerous global networks of breweries and distributors.
The Heineken Company was founded in 1864 by Gerard Adriaan Heineken in which the headquarters lies in Amsterdam, Netherlands and is known to be one of the global leading brewers around the world. Heineken is very confident and very committed in remaining an independent and strong brand.In addition Heineken manages one of the world’s leading portfolios of beer brands in dealing with the sales margin and the profitability from its sales. Furthermore being a great success for so long and remaining one of the world leading consumer and corporate brand for more than 130 years. As a result it became Europe’s favorite beer brand which became a huge success allowing the exportation of beer to every part of the world which became a huge success.
Because, Heineken is one of the most leading beer brand in the world and its very successful business, and in order for all of that to have happened, a team of well-talented, well-resourced set of people who started the company from the beginning and continued to run the company to this very day making it grow and shine to be the beer brand it turned out to be, a successful one. Listed below is the organizational chart for Heineken:
Furthermore each person on the board which is categorized in sections has their own responsibilities to make the company run. Sections such as the Executive Board which is responsible managing the events and well beings of Heineken. The Executive Team of Heineken consists of two board members which includes the president and chief officers the forms the teams. They support the development of policies and implements the most important priorities and strategies in the organization. Finally the Supervisory Board in which the Executive Board reports directly to and advised by the supervisory board in accordance with law and the Articles of Association of Heineken N.V. according to (www.theheinekencompany.com) The positions are uniquely filled by each individual from different parts of the world, such as Mexico, Britain, Australia ,America, Dutch, Turkey ,and Belgium, just to name a few countries around the world.Discussion/Analysis
For SWOT analysis, It is very important for every company to know and identify there strengths, weakness, opportunity’s and threats which can be used for identifying the problems and how they can grow and better themselves as a company itself. In addition for the SWOT analysis is for a company to get managers to see the potential and growth of their company. If the SWOT is not taken into consideration, it can lead to poor decision making with business decisions. Listed below is the SWOT analysis for The Heineken Company.
– Heinekens has a leading brand portfolio which includes over 170 international premium, regional, local and specialty beer.
Because Heineken has a large network of brewers, it owns over 125 breweries in over 70 countries around the world.
Having a strong network of breweries it helps the company to improve customer satisfaction and the reduction of the costs.
Because breweries are located close to the area markets, the company is able to serve fresh beer to the customers wherever they are located.
Heineken is geographical on the map, therefore reducing transportation cost of service.
Because Heineken is a leader of beers, it can have its difficulties to fake imitation products rather than the authentic version.
Maintaining Heinekens corporate values, images and quality standards in numerous countries can be a challenge.
Heineken have opportunities to expand their product line, meaning they have room for new areas to fit in changes in the taste, preference and looks of the brand.
The tax regulations on the beer industry
Dealing with the legal problems of dealing with underage drinking meaning store owner’s licenses can be revoked or suspended if misused.
The many competitors of different beer brands that Heineken may have to face or deal with; Competitors such as Millers, Coors and Anheusen-Busch
II. MICHEAL PORTER’s 5 FORCES
How Heineken obtains its competitive advantage refers to several innovative and flexible management information systems. Based on Michael Porter’s 5 Forces, the competitive rivalry will be analyzed for Heineken:
Threat of New Entry: Since Heineken is very successful company and the threat of new entry to the beer industry is not high enough to worry about. Heineken has earned customer loyalty over the years and many consumers would prefer quality over quantity, which refers to even new entries keep the beer products price low, this does not affect Heineken. Since the company always tries to be innovative and efficient in terms of its internal operations as well as marketing.
Buyer Power: Heineken pays attention to buyer power a lot. Buyers are intermediaries and retailers. The company understands that Buyer power is very important to be preferred among consumers in terms of pricing, beer quality and other factors. To keep up with new trends or holiday sales, Buyers have a power to control Heineken’s sales. Therefore, Heineken outs a lot of efforts in intermediaries and retailers on Heineken’s side to get extra attention to Heineken’s products.
Threat of Substitution: To ensure Heineken’s competitive advantage, the company works on innovative management systems that only top beer companies use to manage its operations. The system is vey flexible and avoids extra costs in its supply chain. Meanwhile, Heineken works on quality of its production. Raw materials and the process of production are the key areas that maintain Heineken’s competitive power over its competitors in the beer industry.
Supplier Power: Heineken is already one of the top beer companies in the worlds. To keep the track, the company manages its supply chain very efficiently. Knowing the supplier and making great deals with them over best-qualified raw materials is one of the reasons behind Heineken’s sustainable profitability. The quality of raw materials for producing the beer is as important as marketing the finished the product. Heineken outsource the ingredients of beer production and the bottle and other products that are required by design team to make the finished Heineken product.
What Heineken tries to do is to build strong brands, consumer pool. This is the reason for consumers choose Heineken products over other competitors. That is why Heineken spends more than billion US dollars on marketing directed towards consumers since consumers are asking for it. Next reason of Heineken’s competitive advantage comes from Buyer Power force, which means that the company puts a lot of effort on getting intermediaries and retailers on theirs side so intermediaries and retailers give a lot of extra attention to Heineken. For instance, in any retailer store, the Heineken products should be located in more visible area that catches consumers’ attention and lead them to purchase. This kind of psychological tips that retailers and intermediaries use lead to increase sales. Therefore, Heineken really works on buyer power to make Heineken’s beers more preferred over other competitors in the beer industry.
Here is the summary of Heineken’s framework based on MICHEAL PORTER’s FIVE FORCES:
III. Heineken’s Value Chain Analysis
Heineken’s value chain consist of five stages that starts from buying process of raw materials and ends with collaborations with distribution partners.
1. Buying Raw Materials: The process includes finding suppliers that provide ingredients for beer production. Besides ingredients, raw materials are needed for bottles of beers and many more. The company focuses on quality of raw materials very much.
2. Production Process: After buying raw materials, the manufacturing- productions process starts in Heineken’s factories. To control all operations during the process, the company makes sure that everyone has the same understanding of each step in all countries. Especially, when it comes to using management information systems for recording the process, it is essential to have the same understanding of the terms in every country Heineken operates.
3. Finished Products: After manufacturing, the finished beers are ready to sales. The finished goods will be places in the warehouses. The company tries to reduce its inventory cost like other companies and the next margin process comes to reduce costs.
4. Margin Process: the process includes collaborative pricing strategy between Heineken and its buyers. Heineken negotiates how much the company should get and how much the buyers will get from the sales. Heineken’s buyers are retailers, bar, restaurant, club, hotel owners and other intermediaries that can be defined as Heineken’s distribution partners.
5. Collaboration Process with Distribution Partners: After dealing with pricing, Heineken is open to collaborate with its distribution partners. The best deals are what everyone is into. The company works with those who can provide long-term stable profitability for the company. This process is the final part of Heineken’s value chain that ends with distribution partners. However, Heineken controls the distribution’s reputations during the sales to make sure that Heineken is earning customer’s loyalty and trust. Not to damage the brand image, distribution partners are also responsible for delivering Heineken’s products to customers in the best way.
Heineken uses management information systems to control and manage its value chain effectively and efficiently. This leads the company to reduce extra costs and become more profitable and productive in the long-term.
IV. Discuss how their information systems help enhancing their effectiveness
SAP ERP System
The manage of Heineken said they are using SAP system for their management information system. SAP is a German-based software incorporate that stands for “Systems, Applications and Products in data processing” and offers developed enterprise resource planning (ERP) software to its customers. Heineken international company employs enterprise resource planning (ERP) software that executes the key function of an organization including accounting, sales and distribution, production planning, controlling, human resources etc.(Rana Brata De, 2013). The whole business modules get integrated in one flow of informations so that all data are interconnected with each other. Therefore, it enables Heineken international company to get the effective use of resources such as reduced material cost, eliminated the duplication in data, increased production capacities, and better inventory quality etc. In this report, it investigates how Heineken enterprise’s information system facilitates to enhance the effectiveness through analyzing each department.
SAP ERP Overview of Heineken international incorporate:
SAP ERP Operations of Heineken international incorporate
SAP ERP Operation is handling the core process in business consisting of selling, producing, stocking, shopping and transporting input and output and is solely integrated in database (Jochen Böder). it includes the following modules:
Sales and Distribution (SD) : offers a complete sales management solution to the company and is one part of logistics that copes with the materials such as the making sales orders, checking of the availability of the demanded products, shipping and billing. It facilitates the Heineken international company to check and foresee overall sales price and requested orders etc. (Margaret Rouse, 2017)
Materials Management (MM) : is the backbone of logistics that assists to manage the procurement such as material management. It includes production planning, plant maintenance, verifying incoming invoices, warehouse management. In order to get high productivity and reduced costs, this function analyzes and examines that there is any shortage of materials or any gap in between supply and demand chain process.
Production Planning (PP): creates the plan of production, execution, and monitoring and mainly uses in the manufacturing area. It is consisting of routing which is about scheduling of operations, work center, material master, and bill of materials (BOM). This production planning process enables company to plan for increased revenue growth and ensures customers to deliver products or services on time (Rouse M., 2017).
Logistics Execution (LE): deals with the controlling and organizing the migration of materials including warehouse management, shipping, and transportations (Jochen Böder).
Quality Management (QM): is a combined component of supply chain and logistics functions including quality planning, materials management, quality inspection and quality control (Jochen Böder). This quality management process helps to detect and prevent negative issues before they take place.
SAP ERP Financials of Heineken international incorporate
SAP Financial modules enable company to create the financial truth and offer real-time capability across other functions. It consists of following components:
Financial Accounting (FI): provides a real-time financial transaction to the company and facilitates to identify the financial conditions in the market. It has sub-components such as general ledger, accounts receivable, accounts payable, and bank accounting etc. This module documents every business transactions, and creates not only the balance sheets but also the profit and loss financial statements.(Jochen Böder) Therefore, company enables to do effective decision making.
Management Accounting (CO): is dealing with the internal flow of costs and revenues within a company and helps to support management decisions. It includes cost center accounting, internal orders, product costing, and profitability analysis etc. The CEO or CFO in organizations makes organizational decision based on this module as well.
Financial Supply Chain Management (FSCM): anticipates cash flow and reduces working capital as well as operating expenses through analyzing the financial and information flow between the company and its business partners.
SAP ERP Human Capital Management of Heineken international incorporate
SAP human capital management develops an organized management in the company and helps to reduce manual work and increase productivity. It has the following sub-components:
Organizational Management: is dealing with the human resources to provide different kinds of work to employee under same platform. It ensures people in the organization to manage their time efficiently and jobs effectively trough giving their own ID, name, and designations etc.
E-Recruitment: is based on web-based recruiting process and an innovative way of hiring the employee. It does not demand for the redesign of the entire process and supports to maximize the recruitment process.
Time management: records and identifies the whole human resource things such as absence, presence, wages, log-in and log-out report etc. through cloud deployment, and automated time and attendance management. It helps optimize their work-time scheduling and analyzing the daily costs for each person in the organization.V. Discuss how the company uses information systems to support their decision making
Heineken international incorporate is using a powerful tool which is ERP system to support and manage their decision making. Through this system, managers in Heineken international incorporate do not have to look up and go into the rigid documents or excels. Here is how they process their decision making:
Analyzing the cost-benefit in real time: Through the ERP software, all data such as profit margins, revenue cycles, and flow of costs etc. are precisely examined and anticipated and then automatically provide the visibility of financial growth to the organization. Consequently, it tells how to improve the profitability and customer satisfaction instantly and which part needs to complement in operating process.
Permit smart access to data: It facilitates to anticipate the hypothetical outcomes through analyzing and combining the data which are stored in integrated databases. Furthermore, it provides real-time information across departments such as employee ID, product levels, and delivery time etc. so that every department enables to control and look at the business process. Since the data are not overlapped and become seamless, the company makes decision rapidly with accurate data.
Collect the information in one place: Through data-driven decision management (DDDM), every data is gathered into same format so that every employee approaches the common data or profits (Des Nnochiri, 2017). It helps business users to obtain the current conditions, possible risks, and anticipated outcomes through integrating document flows. Therefore the productivity increases, human resource management is getting effective, and inventory management gets better quality.
VI. Description of the Information Technology System of the company presenting their strengths and weaknesses
Heineken international employs the SAP ERP System in their management information technology that is the integrated software including operational process, accounting, and human resource etc.. According to the Peter who is the Heineken international manager, SAP ERP software is suitable for their company and it is significantly flexible and accurate. However it simultaneously has weakness that is high-costed. This report examines what are the strength and weakness of SAP system specifically and those are in below:
Strengths of the Heineken’s information technology
Flexibility: is the one of strongest advantages in SAP system. It enables Heineken company to build their needs and rules into the one integrated structure. It automatically examines and analyzes the whole systems and shows whether the transaction is acceptable or unacceptable (Kathy Adams McIntosh). Furthermore, every employee around the world gets access to the same data, same informations, and same reports through integrated SAP databases in real time.
Well-structured business process: allows Heineken international corporate to have accurate data from any source and fulfill collaborative decision making across the functions. The data and informations are well-organized and well-analyzed in every single module and indicates the company that what are their needs.
Weakness of the Heineken’s information technology
Exorbitant cost : Buying and implementing the SAP tools are high-cost that costs approximately $500,000 -$750,000 for medium business to big enterprise such as Heineken international. Once the company executes the software, all of employee have to be trained how to use the software. Moreover, the company needs to pay regularly for ongoing costs such as software maintenance and upgrading.
Conclusion – A
Present the logical conclusions of your investigation of ‘the problem’. Bring it all together and maybe offer options for the way forward. Many people will read this section. Write it in plain English. If you have included a discussion then this section may be quite short.
Recommendation – Y
Recommendations focusing on the strengths and weaknesses discovered in earlier sections
What do you suggest should be done? Don’t be shy; you did the work so state your recommendations in order of priority, and in plain English.
Put the heavy details here, the information that only specialists are likely to want to see. As a guide, if some detail is essential to your argument then include it in the main body, if it merely supports the argument then it could go in an appendix.
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