Lao Brewery Co., Ltd-LBC(presentation step 3)

Presented by:INTHAVONG SaynakhoneNGO HUY ThangDETCHANTHACHACK Khamthavisay

Agenda

Company recap

Two ways to form an alliance

Partners selection criteria

Evaluation sheet for a potential partner (Lao side)

Four manœuvres for three

How demanding is the environment?

Specified area for cooperation

Advantages/disadvantages of the alliance

Conclusion

Company recap

Carlsberg Breweries

of Denmark

TCC

Carlsberg Asia LBC

50% 50%

Two ways to form an alliance

Emergence of a privileged relationship

Targeted resources

Formal search Chance encounter

Active and deliberatequest for a partner

Test for congruence & search for an agreement

First alliance draft

External support

* Case of LBC is highlighted in the red path

(Page 132)

Four manœuvres for three moves(Page 117)

Partner selection criteria

  Carlsberg Asia

Lao side

Financial assets N Y

Complementarities of capabilities Y Y

Unique competencies Y Y

Industry attractiveness Y Y

Cost of alternatives Y N

Market knowledge/access Y N

Intangible assets N Y

Managerial capabilities N Y

Capabilities to provide quality products/services N N

Willingness to share expertise Y Y

Previous alliance experience Y Y

Special skills that you can learn from your partner N Y

Technical capabilities N Y

(page 133)

Evaluation sheet for a potential partner(Lao side)

Compatibility (between partners)– Socio-political environments– Objectives– HRM policies– Dividend policies– Reinvestment policies– Marketing practices– Financial and accounting practices– Culture and management styles– Attitudes towards profit and growth

Commitment

– Motivation– Trust– Financial commitment

688899879

1079

Assessment(1-10)

Weighting(0 - 1) A X W

.12

.05

.03

.08

.05

.04

.05

.08

.07

.10

.15

.18

.72

.40

.24

.64

.45

.36

.40

.56

.63

1.001.051.62

SCORE 1.00 8.07

(Modified from page 137)

How demanding is the environment

Environmental Criteria

Calm (1)

Business uncertainty

Limited (1)

Governmental policies

Business frontiers

Funds required

Innovation pace

Low (1)

Rigid (1)

Liberal (1)

Open (1) Constraining(5)

Interventionnist(5)

Moving (5)

High (5)

Fast (5)

High (5)

Market situation

(Page 125)

Special area for cooperation(Page 141)

cooperation

Stages of Value Chain covered

Modes for Organizing tasksTime frame

Focus on one stage Entire activity

Duplication

Distribution

Centralization

BoundUnrestricted

*LBC cooperation area follows in red arrow

Advantages/disadvantages of the alliance

Advantages

– HRM: Improved staff working system

– Technical development: joint and exchange R&D

– High technology utilization – Increase production

capacity and higher standard

– Sharing knowledge – Increase product portfolio– Strong in financial asset– LBC becomes stronger

Disadvantages

– Top management conflict: long process decision making lead to be slow down an operation

– Culture misunderstanding– Share benefit

Conclusion

LBC lies in the case of equity joint venture.Comparing between two partners profiles, they are exogamous.Functional and operational activities are managed by Lao side, only strategic level is managed together.LBC cooperation are based on centralization, focuses on one stage (strategic level).Selection before agreeing to join together were made formally and carefully.

Sources: Mr. Sounthone PHOMMACHACK (deputy managing director of LBC), information obtained through emails and direct telephone calls.www. Beer-lao.com

Any questions?