Employee Ownership and Leadership at New Belgium Brewing

Categories: Business Management Management

Essay, Pages 5 (1177 words)

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Operations Management, Employee Ownership, and Leadership at New Belgium Brewing are highly organized thanks to the management provided by Founders Jeff Lebesch and Kim Jordan. They introduced an open-management system in 1996 that encourages employee involvement in company operations. Employees receive training to gain a thorough understanding of the financial aspects of New Belgium Brewery's operations.

Kim believes that understanding the financials helps employees pay closer attention to them. Employee Doug Miller states that transparency regarding the company's finances motivates employees to keep track of everything, from kegs to damaged cases.

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After a year of employment, each employee receives a share and is treated as a shareholder. This grants employees decision-making power in the company's direction and fosters collaboration with the owners. As a result, employees have a vested interest in the company's continued success.

The owners value all employee decisions and input as crucial for the company's success. According to Chief Financial Officer, Jennifer V. Orgolini, caring about the daily tasks is essential when there is a larger purpose behind them.

As employees are also shareholders, their stake in the company increases with its profitability, fostering a culture of employee-owners committed to the company's success. While employees work in distinct departments at similar levels, some departments may need to share information with others, but no individual in the company holds more authority than another.

In a decentralized organization, tasks are delegated to lower levels of the chain of command, empowering employees to make necessary changes without managerial approval. Co-founder Kim Jordan highlights the positive impact on employee satisfaction and productivity at New Belgium Brewery, pointing to customer feedback praising the brewery's great atmosphere.

Jordan emphasizes that prioritizing happiness, genuine relationships, and excellence fosters a special environment at the brewery.

Environmental Responsibility and Sustainability
New Belgium has taken significant steps in recent years to enhance its environmental responsibility and sustainability. The company successfully lowered its energy consumption from 158 MJ/hl in 2008 to 138 MJ/hl by 2011, with a target of reaching 125 MJ/hl by 2018. This achievement was made possible through various strategies including reducing reliance on electricity, investing in energy-efficient equipment, installing heat exchangers, and incorporating conservation-focused designs into its facilities. Moreover, in 2010 New Belgium implemented a Smart Grid system to facilitate two-way communication between the company and the electricity provider.

The electricity provider can detect when New Belgium is using a non-essential function and will instruct them to turn it off. In January 2010, New Belgium installed solar panels in their packaging hall, producing over 264,000 kWh per year and making up more than 3% of the company's power supply. Both energy-saving projects were supported by FortZED. Furthermore, New Belgium operates a Process Water Treatment Plant on-site.

The Five Functions of Management, which are Planning, Organizing, Staffing, Directing, and Controlling, involve setting the company’s goals and strategies for achieving them. Goals represent the desired outcomes established by an organization based on its mission, which defines a company’s core purpose and fundamental beliefs. Achieving goals requires strategic, tactical, and operational plans. Strategic plans establish the long-term goals and strategies necessary to accomplish missions.

Strategic plans assess an organization's internal factors, such as strengths and weaknesses, as well as external factors like opportunities and threats. Strengths give a competitive advantage, weaknesses create obstacles, opportunities provide room for growth, and threats bring about risks to achieving success.

Tactical Plans are short-term strategies aligned with the goals of the strategic plan to guide the company effectively. These plans allow for quick responses to unforeseen events and must be regularly reviewed and adjusted by management. Operational Plans outline specific tasks for teams, individuals, or departments to achieve tactical objectives, emphasizing crisis management and contingency planning as integral aspects of preparation.

This section focuses on the possibility of facing disasters, whether they are natural or within the company. Some companies have a crisis management team dedicated to handling these situations, enabling managers to remain focused on their usual responsibilities. New Belgium Brewery's strategic goal is to have content employee-owners who take pride in their work and strive to ensure the company's success.

The company is successfully implementing their strategic plan by converting employees into owners, educating them about finances, and providing access to financial records. By granting employees company shares after one year, they are treated as stakeholders. They collaborate with owners who value and take into account employee feedback. As shareholders, employees are motivated to maximize the company's success.

Organizing involves structuring resources and activities to achieve objectives efficiently and effectively. Managers review plans, determine necessary activities for implementation, divide tasks into smaller units, and assign them to specific departments, individuals, or groups. Teams are often formed to handle core processes rather than organizing around traditional departments such as marketing and production. This method helps create synergy, where the collective output is greater than the individual contributions.

Organization at New Belgium Brewery involves establishing lines of authority, improving communication, preventing duplication of resources, and enhancing competitiveness by expediting decision-making. Unlike traditional businesses, there is no hierarchical structure with individuals holding more power and authority over others. Departments specialize in specific areas of the company to promote efficiency and effectiveness.

Each department's staff works together autonomously, making changes as needed without managerial oversight. Staffing involves finding suitable candidates for the organization's needs, with managers determining required skills and hiring employees accordingly.

Managers play a key role in impacting employee motivation, training, compensation, benefits, and career development. Staffing decisions may involve downsizing - letting go of multiple employees. At New Belgium Brewery, the focus is on hiring individuals who match the company's culture by being eager to learn, hardworking, and having strong interpersonal skills.

New Belgium enforces a policy where employees must wait one year before being granted a share in the company, giving owners time to assess their loyalty and compatibility. Leading involves inspiring and guiding employees towards meeting the organization's objectives. While employers can motivate staff with rewards like promotions or pay raises, workers also seek acknowledgment for their ideas and contributions to the business. Effective managers understand the importance of consistently involving employees in decision-making.

New Belgium motivates its employees and makes them feel valued by involving workers in decision making and giving them shares in the company. This approach benefits the organization by encouraging staff to steer the company in a positive direction, ultimately reaping rewards along with the owners, Jeff and Kim. Controlling involves evaluating and correcting organizational activities to ensure they stay on track, which includes measuring performance.

2. Comparing present performance with standards or objectives. 3. Identifying deviations from the standards. 4. Investigating the causes of deviations. 5. Taking corrective action when necessary. Controlling is closely linked to planning as it sets the goals and standards, while controlling evaluates current performance against them to assess if performance aligns with the goals and standards.

Employers must identify the root problem and develop a plan to improve performance. At New Belgium, employees work without traditional managers and on an equal level, allowing for quick adjustments to ensure the company continues progressing.

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