Strategic planning at East African Breweries Limited
Abstract
The research was undertaken in order to understand strategic planning at East African Breweries
Limited. The objective of the study was to investigate and document the strategic planning
system at East African Breweries Limited. A number of studies have been done in Kenya
regarding strategic planning practices in several industries and companies.
East African Breweries Limited (EABL), has continued to carry out outstandingly profitable
operations in the region. Despite its complex, multi business and multi-country nature, it is
ranked among the top performing firms in the region. It was therefore deemed of importance to
understand the sort of EABL's strategic planning system that makes this organization successful
in a constantly changing environment. It is for this reason that the study was done.
In depth interviews were carried out on senior managers who played key roles in strategic
planning. Although eight respondents were contacted, only seven interviews were conducted.
The respondents were highly experienced people in corporate management.
There is no uniform approach to strategic planning, different companies apply different
approaches. It was evident from the research that East African Breweries Limited has put in
place a strategic planning system that is unique to its context. The strategy development process
is informal, continuous and is integrated into everyday aspects of work. The strategic planning
process is an annual event that is highly formalized, rational and analytical. The two processes
run in parallel. EABL's planning system integrates business experience and intuition with
rigorous analysis.
Factors such as organizational size, complexity, degree of competition, the need for internal
consistency and comprehensiveness will determine how formal or informal a planning system
will be.
The group-managing director plays a dominant role in strategic planning and is a very influential
figure in providing the right culture. However, the board's influence is minimal.
Strategic plans are developed by top management, functional and operational staff. The planning
horizon for these plans was one year due to the constantly changing environment, though
company's planning cycle is 3 years. The marketing function plays a key role in strategic
planning. Diverse sophisticated tools are utilized in due process 01 strategic planning. However,
much emphasis is placed on marketing research and financial analysis tools.
Strategic planning at EABL, takes place at both corporate and business levels. However
strategies at both levels are interrelated. All the parts of the business work to accomplish the
over-riding EABL's corporate mission. Implementation of results is routinely and rigorously
measured and creative methods for encouraging breakthrough thinking are used to collect data to
feed on to strategy development.
Strategic planning at EABL is not without its complications and challenges. This is due to the
complex nature, size, different environments and multiple businesses that pose problems during
strategic formulation and implementation stages.
Citation
MBASponsorhip
University of NairobiPublisher
University of Nairobi School of Business, College of Humanities and Social Sciences