Operations Management At New Belgium Brewing Business Essay

Operations Management At new-sprung(prenominal)-made Belgium Brewing Business EssayIn 1991 after Jeff Lebesch was not able to get a add from the bank he started a beer brew telephoner with his wife Kim Jordon is the basement of their home with only a sm altogether capital investment. They delivered their beer in their station wagon. With the bread they generated their company soon outgrew the besetment, and moved to another location in a railroad depot, and finally in 1995 they built a state of the art bespoke facility which cost $21.5 million. They spent $11.5 million on a 55,000 squargon foot building, and $10 million on new equipment. Until 2005 NBBs close effective phase of advertising has been word of mouth. Indeed before sensitive Belgium beers were widely distributed throughout Colorado, one liquor store owner in Telluride is purported to gather in offered people gunman money if they would stop by and pick up new-fashioned Belgium on their way through Ft. Collins. While NBBC has not deviated from its original principles, the methods and people who operate the brewery impart become more formal and professional. Production managers and continuous-improvement experts from outside the craft-brewing community have been recruited. As they reshape the manufacturing practices and identify projects with the best re change forms and highest impact, theyre c areful not to squelch rung involvement.By starting in thither basement as a small company they were able to focus on the quality of the beer rather than the bar of it. peeled Belgium check offs that quality at the plant is monitored closely. Through the process the quality of the inputs as they are transformed is examined. Quality assurance is a critical ingredient of the operations management. However it is difficult and a challenge to maintain a consistent product. The quality of the product should never suffer as a payoff of the size of the company. When a company is epic it is more of the essence(p) than ever that the quality of the product stays the same, because the product is sold to more people. At New Belgium the entire process form receiving the hops, to brewing, and bottling is monitored constantly, to insure that the product is at the highest quality. Even though the quality of the inputs change, the quality of the product should not change. They maximize productivity by fully utilizing their technology. New Belgium closely monitors the quality at the plant. The new technology forget cut through to be efficient, high tech, and environmentally friendly. implementing a compassionate pedigree model that aims to steward the resources of Earth and nourish its employees, New Belgium has in addition been successful in maintaining healthy financials. They like to say that they are profitable, not in malignity of their social and environmental efforts, but because of them. Sustainable production is not merely a whole step-good effort its a pocketbook issue f or NBBCs 350 give outers subsequently one course of study of employment with the company, the employees become employee-owners. All employees are considered area leaders, and everyone is responsible for ensuring that the quality remains high. The employees of New Belgium own 43% of the company through their Employee Stock will superpower Plan or ESOP. While giving employees ownership in the company sets the foundation for an engaged workforce, the real connections occur beyond the Share Statements.The reason for New Belgiums success are the companies Purpose and Core Values Beliefs Coupled with the structure and support at the executive level, employee engagement is the key ingredient in utmost Involvement Culture.With their employees connected to the key functions of the business, They solicit ideas from over 300 unique perspectives.This dishs the brewery to operate more intelligently while recognizing everyones unique gifts.These are the practices they have utilise to buil d New Belgiums distinctive culture. New Belgium opens all of the books to it employs and provides financial training so people can understand the business of doing business.At monthly All-Staff meetings they check into the financials, and employees have the opportunities to ask questions and provide feedback.Each employee makes decisions in his or her role that affects New Belgiums profitability, whether it is about a capital expansion project or expiration a faucet running while they wash their hands.It all adds up.When a employee is connected to the higher purpose of the company and educated on the financial outcomes of their actions, they are authorise to make decisions that benefit the business as a whole. Trusting each other with this level of detail also helps us to feel appreciated, empowered, and at last more fulfilled. These practices galvanize coworkers to be engaged in New Belgium, to claim the companys Core Values and Beliefs which call them to honor nature at every turn of the business as their own. What is good for the environment is ultimately good for business. They dont want to leave the faucet running or the lights turned on because it costs money and natural resources.In addition to the practices which promote High Involvement Culture, they also work to engage employees in environmental stewardship.The first two beers that they produced were Fat Tire, and Abbey, which are salve sold instantly. The new building will feature an automated, high-speed bottling line which will increase output to 700 bottles a minute compared to the 300 bottles a minute. The current production is at 400,000 barrels per year, with expansion that is expected to increase up to 800,000 barrels per year. Since 2008, they have opened up distribution in 7 new states Georgia, North Carolina, North Dakota, Indiana, South Carolina, South Dakota, and Tennessee.Added to their existing states of distribution (Arizona, Arkansas, California, Colorado, Idaho, Illinois, Iowa , Kansas, Minnesota, Missouri, Montana, Nebraska, Nevada, New Mexico, Oregon, Texas, Tennessee, Washington and Wyoming), New Belgium now lots beer in 26 states, but all of this beer is brewed in Fort Collins, Colorado. New Belgium receives numerous e-mails and phone calls everyday inquiring when it will be available elsewhere.In 1995 when the Philanthropy program was conceived, they began donating 1 vaulting horse for every barrel of beer produced to non-profit organizations in the communities where they do business.Since its inception, New Belgium Brewing has donated more than $2.5million through our Philanthropy program. There coworkers have also donated many propose hours to non-profits organizations in the region. There coworkers are given one hour of (paid time off) for every two hours they volunteer with philanthropic organizations.Question 2Why is it important to engage employees in ownership to enhance quality and efficiency?In todays economy, brewing fine ale and creatin g a valued trademark in the competitive brewing industry is a hard task to achieve. You need to ensure uniform quality in the countless bottles you produce, have dedicated and hardworking staff to ensure smooth and efficient operations, and always look for better methods of exceeding the consumers expectations. New Belgium Brewery understands this, and came up with a simple solution that would ensure all of these points are met. After one year employment at New Belgium, an employees status is upgraded to employee-owner and they are rewarded with company shares.New Belgium realized that the pros of making their employees into owners were countless. The promotion alone insures employees coming into work motivated to do their assigned duties to their full potential, and creates a more productive work environment with everyone focused on meeting the same goals. The motivator cosmos that if the business does well, their pay increases. With this incentive, employees will ensure the qual ity of the beer is exceptional and will strive to exceed standards this helps maintain the companys vision in creating higher quality brews. The employee-owner incentive program used at New Belgium not only gives the company a competitive edge with enhanced quality but also help in employee retention which in turn reduces the costs of hiring and training employees.Now, not only does New Belgium have hard working, dedicated employees, they have a large workforce concentrated on how to improve the business. As part owners, an employee can bring up any idea on what could make the company sell more, produce more, or in some cases what needs to be fixed and how it could be done. It wouldnt matter what department you are in, if you had an innovative idea on how to help the company, you have the ability to voice your ideas to senior management. For example, if they produce new ale with a full smooth taste yet is somehow not selling as much as it should the marketing team could have overlo oked the fact that their ales label could be mistaken for a crude picture, employees who have no friendship of marketing could set up a meeting and bring light to the marketing misstep as the probable cause for lack of sales.We believe there is still one additional reason why New Belgium has made this decision. A major problem companies have is creating an integrated workforce where the issues and concerns employees have may not be correctly handled. New Belgium has ensured the safety of the companys business and the happiness of employees by introducing employee-owners. It also thwarted the possibility of added costs from employees who would have to use walk-outs or union representation to be heard by their managers.The question most businesses ask is why should you give employees partial ownership? Yet New Belgium proves that it should be, why would you cripple your business by not?Question 3What does alternatively empowered mean to you?After reviewing the information provided b y the New Belgium Brewery website, I have come to view alternatively empowered as a means of giving back to the environment b y stressing preservation and including environmental righteousness in the strategic planning process. In todays modern industrial society, companies who grow bigger usually do so at the cost of the environment, because in most cases as companies grow the costs related to environmental stewardship increases as well. On the other hand New Belgium Breweries continues to expand at an impressive pace their rank in the US Beer industry has been getting better and better as they age, while their growth has been ahead by at least 1% in comparison to other craft brewing companies in the industry, all the while keeping their carbon footprint at a low. This is what being alternatively empowered means.Comment on what New Belgium Beliefs are related to being Environmental Stewards.The New Belgium Beliefs are eight guidelines that define what environmental stewardship mea ns to the company. More specifically in terms of what New Belgium believes it has to do as a company to considered environmental stewards. These include caring for the environment. Minimizing waste, so that the minimum amounts of natural resources are wastefully used, and reducing dependence on non environmental friendly methods of electricity, through means of self generating power and purchasing clean top power. Conservatively employ the uptight mountain water resources. Maximize conservation and efficiency. Increase use of new technologies. To make environmentalism a fun way of doing hackgs and not the hard or expensive manner of doing things.New Belgium Brewery is working towards achieving these guidelines through there alternatively empowered efforts. They have nine efforts that incorporate these guidelines. These include increasing efficiency by using new technologies such as Steineckers Merlin, which reuses the competency from the last batch in the next in the form of heat. They try to minimize the use of lighting by taking good of three hundred and sixty days of sunlight and the cooling needs are satisfied through evaporative cooling rather than electricity guzzling compressors. They also use wastewater treatment to reduce load on environment and get by products. This process also provides them with a source of electricity. By making environmental decisions only with the consensus of the employees they ensure that nobody feels they are being forced to do something that they do not want to. (New Belgium Brewery, 2010)In the subsection entitled Alternatively Empowered Efforts, Choose two of the efforts and discuss how they fit into overall sustainability mandate of the company as outlined in the 2007 sustainability reports letter from the Sustainability Director.One of the most important factors discussed in the directors letter is that though they claimed that the muscle used by them is 100% travel generated it is instead less than half and th is will change through their efforts. The two efforts most closely linked to this mandate are the followingOn-Site Energy ProductionAny industry today requires a large amount of electricity to operate and it is next to impossible to get all of it from wind generated sources as they are not so quick available and costly. On-Site Energy production would reduce the demand for electricity from outside sources and thus enable the company to meet more of its energy requirements from wind powered sources. This method of energy production reduces electricity intake by 15%, thus bringing their level of wind powered sources to more than 50%, which with further improvements could go higher.Wind-Powered Electricity since 1999An important factor is the agreement signed with the Colorado government in 1998, which meant the company would be supplied as much power as possible through wind generation even though the cost would be more. This agreement allowed the government to put up more wind turbi nes, thus increasing the power available through wind generated sources, which is another step towards the mandate provided by the director. (Orgolini, 2007)Question 4Do you think New Belgiums focus on environmental responsibility and sustainability in its production process is a major cost or a benefit that enhances the profits of the company?The New Belgium brewery website states that they are profitable not in spite of our social and environmental efforts but because of them (New Belgium Brewery, 2010) the following paper aims to illustrate this statement by describing how their conservation efforts have enhanced the profits and brand image of the company.New Belgium is the third largest regional craft brewery with production steadily increasing since 2005 this success has been achieved while still keeping sustainability and environmental responsibility at the forefront of their strategic planning process. New Belgium has implemented a sustainability management system which bring s a structured forward motion to environmental and conservation efforts. Through accurate gathering and representation of the negative impact there manufacturing process has on the environment New Belgium was able to goat specific areas for improvement. New Belgium brewery puts this practice into action by investing in efficient equipment most notably there brew kettle the Steinecker Merlin which heats thin sheets of wort rather than the whole kettle and stores steam and vapor thats allows the wort to heat at a quickened pace reducing the amount of primary energy used. New Belgiums energy conservation efforts dont stop there their site claims that the most sustainable double-u is the watt never used (New Belgium Brewery, 2010) and theyve introduced various initiatives that stress conservation including taking advantage of natural light with light tubes and light shelves, and switching to HVAC evaporative coolers that use much less energy. By designing with conservation in mind ne w Belgium has increased its efficiency and reduced the energy input needed in their manufacturing process this ultimately translates to a positive increase to their profits and public image. New Belgium also uses a closed loop system by pumping methane gas generated from their waste treatment facility to a 292Kw co-gen engine that produces up to 15% of their energy needs. Though the system had malfunctioned in the past a partnership with Woodward led to the installation of new controls that have led to even greater efficiency. This illustrates another case of New Belgiums commitment to environmental reasonability by actively seeking out support to optimize their equipment theyve reduced their environmental impact and built lasting and efficacious relations with various business and government sponsored conservation programs. This can also be seen in New Belgiums appointment of outside consultants when developing there SMS system. In 2010 new Belgium commissioned the construction o f a solar array on the top of the packaging hall, at the time it was the largest private solar array in Colorado and displays New Belgiums innovative attempts to harness sustainable energy. The solar array currently provides over 3% of new Belgiums energy needs and will continue to far into the future. In 1999 the New Belgium employee-owners voted unanimously to switch their purchased energy entirely to wind power. Though this included a 2.5cent premium on every watt produced effectively reducing the employee-owners bonus pool the unanimous vote showed that New Belgiums efforts to reduce their carbon foot print had supported from everyone in the company. Even though the switch to wind power reduced profits in the short run the unifying vote and positive effects to employee morale ( employees are happier when they feel they have a voice in their workplace) may eventually offset the loss with increased efficiency and employee retention. New Belgiums switch to wind power also had a rip ple effect through derived demand allowing Fort Collins Utilities to become the first utilities company in Colorado to offer wind power.In conclusion New Belgiums continued efforts to reduce their carbon foot print and deep commitment to sustainable production has been an overall benefit to the company by decreasing inputs to their manufacturing process and improving brand image.