Page 6 - AB INBEV 2018 Model Answer 2

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help us communicate same to lower levels. Our new head (Vice President) for Africa could organize
road shows, meeting various employee groups across SABMiller, to explain the vision. All staff should
be encouraged to ask any questions to avoid any confusion. Staff should be re-assured that per

commitment with regulatory authorities, there will be no job losses for at least five years -and that no
indirect methods will be used to force them to resign. Behaviours that need to change to fit with the
new culture will need to be explained. Meetings should be held with key suppliers and customers (e.g.
Makro, Pick n’ Pay, Shoprite) to help elicit their concerns, and ensure all prior commitments with

SABMiller are kept, especially on payment terms with suppliers. New incentives to suppliers (e.g. set-
up of US$5 billion supplier development fund) and customers should be explained! Include Makro’s
(and Walmart’s) concerns about our e-commerce strategy on the agenda! Acquiring SABMiller –and
with that, increasing our bargaining power over them, plus considering e-commerce -and in effect,

potentially bypassing them, is a huge threat to their business! More supermarkets could follow to cut
back shelf space and Heineken must be waiting on the side to ‘grab the spoils’! We cannot afford this,
as we consider our innovation strategy (see issue 5 for more input on this)!

Step 2: Participation and involvement: We notice that none of the SABMiller executives are included
in the proposed top global leadership team –it may be helpful and inclusive to recognize their

tremendous success with building SABMiller to the success it became –so, re-consider this carefully!
Furthermore, instead of imposing a top-down strategic control style on them, lets recognize that culture
in Africa, and presumably at SABMiller, is one where consultation is highly valued. Without their co-
operation, it could be tricky to trace/find all the cost synergies necessary for this deal to succeed. They

understand better the regulatory terrain and the challenges of doing business in Africa; we will need
to organize them into teams to present to a high-level structure, on the areas we can find synergies -
and help us identify execution risks and challenges. We could appoint a global consulting firm to help
us facilitate a series of workshops for this purpose. We must recognize that they may want to preserve

certain aspects that have become entrenched rituals, and symbolic of how they culturally identify with
‘their’ company (e.g. trade marks, fringe benefits, internal systems, policies, etc.). We could provide
limited support for this, if not for their value, but to show them some respect. But most -we definitely
need to dissolve, in order to ‘impose’ our way of business. For example, we could retain trademarks

and brands (e.g. Castel Lager), but we cannot negotiate on our ZBB approach to cost management –
otherwise our reputation for margins will be lost! We should also recognize that the trademark:
‘SABMiller’ is quite iconic in South Africa, so to generate the continued goodwill of its people, we

should preserve the brand and maintain a secondary listing on the JSE.

Step 3: Facilitation and support: We actually need to set-up a series of appraisal meetings with their

executives, to discuss the opportunities for career advancement in the group –in and outside of Africa,
and set objectives going forward. In this process, be prepared to explain why for now, no executive
from their team are included in the global leadership team, especially if you do not accept our counsel
to reconsider this as above. We may need to scrap some of their internal systems and migrate their
Developed by The CharterQuest Institute for 'The CFO Case Study Competition 2018'
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