San Miguel Corporation
San Miguel Corporation
I. CURRENT SITUATION
A. Current Performance
According to Soriano, the companies had developed their budgeting and long-range planning system several year earlier but, despite the many advantages these gave them, they still were not satisfied with their ability to respond to the rapid changes in the environment around them. They, therefor, search for a process that would enable them to upgrade their planning capability.
B. Strategic Posture
San Miguel Corporation, Inc. is committed to the empowerment of San Miguel host communities and various stockholders by harnessing corporate social responsibility among the various San Miguel businesses in pursuing mutually beneficial program that lead to self-reliance and sustainability.
To be constantly aware of the aspiration of the people and of the nation, and to ensure that San Miguel continues to make a major contribution toward the achievements of these aspiration. To manufacture, distribute and sell throughout the Philippines food products, beverages, product and animal feeds, being ready at all time to add, modify or discontinue product in accordance with changes in the market. To diversity into fields which will ensure optimum utilization of management resource and substantial contribution to corporate profit. To seek and developed export markets for new product as well as for those already being produce by the corporation. To generate a return on funds employed sufficient to ensure an adequate rate of growth for the corporation, and to provide satisfactory returns to stockholders. To provide an environment which is conductive to the development of the individual and which encourage employees to realized their full capabilities.
To assess the attractiveness of each specific BUSINESS FAMILY and BUSINESS ELEMENT as well as the organization competitive strength in each of these business.
Strengthen and maintain the dominant position held up in the market by its various products. By involving itself in faster growing industries which boost the margin by delivering 15% return in equity annually. SMC is capitalizing on its unique strength in brands and distribution to wave its product more deeply into the fabric of everyday life.
II. STRATEGIC MANAGERS
A. Board of Directors
1. Andres Soriano, Jr.
2. ANSCOR Group – 24,00 employees
3. SMC – 19,00 employees
B. Top Management
1. Not only examined the validity of the objectives submitted by each team, but also considered the fit of these business objectives in portfolio. 2. The CEO in particular must be fully comfortable with an supportive of such new planning approach. 3. In the ANSCOR group and SMC the chairman of the board was firmly involved from the beginning. 4. Can push the organization to face up to some narrowing down to difficult strategic option open to each business 5. Willingness to face critical issues and the reconciliation of view point are essential to make sure that there is sufficient agreement on the key issue presented
III. EXTERNAL ENVIRONMENT
A. Societal Environment
a. Philippines economic freedom score 58.2, making is economy the 97 freest.
a. High skilled IT workers and high in technology.
b. Technology allows producing product at the cheaper price.
a. Political and market factors worked in favour of the company. b. Asian Free Trade Area (AFTA)
c. TAX incentives
a. Company is a true blend of culture
b. History of American rule and contact with merchants
B. Task Environment
1. For large complex organization, such as the ANSCOR Group and the SMC, the task of coping with change becomes exceedingly challenging.
IV. INTERNAL ENVIRONMENT
A. Corporate Structure
1. The company’s operation extend beyond its home base of Philippines to china (including Hong Kong), Vietnam, Indonesia, Malaysia, Thailand and Australia. 2. Through strategic partnership it has forged with major international companies 3. San Miguel has gained to managerial expertise, international practice and advance technology, thereby enhancing its performance and establishing itself as a world-class company B. Corporate Resources
Budgeting is concerned with the development of a more detailed set of action steps to be undertaken during the coming year so as to implement the parts of a strategic programs scheduled to be achieved during this period. A strategy cannot be implemented unless it is firmly reflected in the budget and resources are allocated so that the organization can carry out its strategic program activities in parallel with the day-to-day.
The raise d’ etre of the operating structure is to provide specialized function and clear responsibilities for operating task. Provide a framework to enable the organization to operate more efficiently.
The strategic planning has taken a firm and meaningful hold in both companies It takes to succeed in today’s changing environment.
The driving force behind the delineation of Business Families should be based on what might make the most sense in term of creating viable competitive strategies. The firms relative priorities vis-à-vis its different business may change as well, modifications in the line-up of Business Families should be seen as natural.
5. Human Resources
Have the ability to respond more meaningful and promptly when the opportunity is there Better positions to upgrade their objectives and strategic programs depending on what happens in the environment.
6. Information System
Distributive of the product or services
Status of any publicly-announced new product and service royalty etc.
Patents, trademarks, copyrights, licenses, franchises,
Need for any government approval of principal products and services Effects of existing or probable governmental regulation on the business.
V. ANALYSIS OF STRATEDIC FACTORS
A. Situational Analysis
Strong brand equity
Strong financial position
Market share leadership
Participation of employees
Personnel willingness to accept changes
Newness of planning process
Acceptance of the employees towards the process
No on line presence
Lack of scale
Product and services expansion
Emerging market and expansion abroad
Result social, mental, personal impact to the employees
Economic slow down
External changes (government, politics, taxes, etc)
Maturing categories, product or services
Inappropriate appointment of task and responsibilities
B. Review of Current Mission and Objectives
1. Current mission appears appropriate
2. Some objectives are really goals and need to be quantified and given time horizons.
VI. STRATEGIC ALTERNATIVES AND RECOMMENDED STRATEGY
A. Strategic Alternatives
1. Make an assessment on the new strategic planning process Pros;
This will determine the weakness and strength of the process Cons;
This will be time consuming.
B. Recommended Strategy
1. They must be able to adapt to new environmental opportunities and realities 2. They may do this not only by developing new and attractive niches within existing businesses but also by pursuing entirely new products and/or new markets.
A. The planning process, I believe provided a common language for more open and effective communication throughout the ANSCOR Group and SMC. B. The action step necessary to introduce new product, penetrate new markets and succeed in the environment have been more clearly identified. C. The process has led to a more involved, keener team spirit, and a sense of team responsibility for successful implementation of the objectives and strategies programs. D. Should have more open communication among managers in the corporation as a result of cross-functional membership in Business Families. E. The planning process should be provided the mechanism for top management to be more exposed to a broader set of people particularly high potential.
VIII. EVALUATION AND CONTROL
A. They must be able to adapt to new environment opportunities and realities. B. Must provide strategic direction by operating organization and executed by its members, it is important not to exclude key members of the operating organization who otherwise might block the strategy implementation efforts.