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AE 24 Module 1 Lesson 6

1) The document discusses the business strategies of three major Philippine companies: Alaska Milk Corporation, Del Monte Philippines, and San Miguel Corporation. 2) Alaska Milk Corporation has focused on its core milk business and niche markets. It has remained committed to nourishing Filipino families. 3) Del Monte Philippines credits its success to empowering employees through progressive labor policies and compensation. This has led to increased efficiency and productivity. 4) San Miguel Corporation utilizes synergy across its business lines in beverages, food, and packaging to expand markets and provide customers with quality products. It aims to become a leading regional player in Southeast Asia.

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Queeny Mae Cantre Reuta
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97 views3 pages

AE 24 Module 1 Lesson 6

1) The document discusses the business strategies of three major Philippine companies: Alaska Milk Corporation, Del Monte Philippines, and San Miguel Corporation. 2) Alaska Milk Corporation has focused on its core milk business and niche markets. It has remained committed to nourishing Filipino families. 3) Del Monte Philippines credits its success to empowering employees through progressive labor policies and compensation. This has led to increased efficiency and productivity. 4) San Miguel Corporation utilizes synergy across its business lines in beverages, food, and packaging to expand markets and provide customers with quality products. It aims to become a leading regional player in Southeast Asia.

Uploaded by

Queeny Mae Cantre Reuta
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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DALUBHASAAN NG LUNSOD NG SAN PABLO

AE 24 STRATEGIC BUSINESS ANALYSIS


Module 1
Lesson 6: Some Known Local Business Strategies page 1

References: Business World Report


Annual Anniversary Report, 2013
A. Milking the Business (Alaska Milk Corporation)
The Alaska brand is probably among the most ubiquitous Filipino products. With celebrity endorsers who
by now haven’t tried or at least heard about -- Alaska
Of course, it helps that the Alaska Milk Corporation has been in the business since 1972. Alaska products
were initially manufactured in the Philippines by Holland Milk Products, Inc., a partnership between Dutch
dairy Canned Milk B.V. and General Milling Corp., a company founded by Wilfred Uytengsu, now Alaska Milk
Corp., chairman and chief executive. General Milling was into flour feed, soybean milling and various food
products. Holland Milk Products was later merged with General Milling and operated the latter’s milk products
division. Because of strong growth in the milk division, the unit was spun off into a separate entity in 1994,
giving birth to Alaska Milk Corp.
Alaska Milk Corp. tapped the equity market by listing at the Philippines Stock Exchange in 1995. In 1997,
General Milling and Alaska Milk corp. split into two separate companies. General Milling, which was the major
stockholder of Alaska, divested off all its interest in the milk corporation. Alaska Milk Corp. is now majority
owned by the Uytengsu family and strategic partners, with combined 56% share.
The changes in the corporate set up has led to the direction of the company’s vision. While still
committed to nourishing the Filipino family, Alaska Milk Corp. has now focused its attention to the milk
business. The business has worked in targeting the niche market within the dairy category. General Milling is
more of an industrial company, manufacturing four, feeds, soybeans. Alaska Milk s more of consumer type of
business. Initially, its products were canned milk. In 1996, the company came out with fresh milk, and low-fat
milk. Recently, it launched its high-calcium powdered milk.
The company has three (3) principal lines of business, namely, liquid canned milk, powdered milk, and
UHT milk. After listing in 1995, the company absorbed its third-party exclusive distributor to ensure the
efficient delivery of its products. Now, Alaska Milk products are distributed nationwide via 15 strategically
located warehouses. From the beginning, our milk products were distributed by a third party. In 1998, they
decided to absorb the third party distributor so we can have control over our distribution.
We were no exception. We experienced difficulties. We use imported raw materials, and we have to face
foreign exchange fluctuation. It was a challenging that we have to cope. One of the key factors is sticking to
the core or main business. The company stuck to what it knew. It never went outside of core business. It did
not go into telecommunication or real estate or banking. There was a dip, there is no deliberate move to cut
down. The company is very lean in terms of management organization. There was no need to downsize or lay
off. The company will continue to focus their efforts at improving the current line of products and add more
portfolio to tap other segments within the local dairy market.
Wilfred Steven Uytengsu Jr., Alaska President and Chief Operating Officer
Page 2

B. Employee Empowerment (Del Monte Philippines, Inc.)


Breakthrough in labor- management relations and employee development and compensation policies
are what managers of Del Monte Philippines, Inc. (DMPI) believe the key factors for the company’s
success in its more than 75 years of operations in the Cagayan de Oro-Bukidnon areas. DMPI under the
Lorenzo group, after former employee, Luis Lorenzo Sr., also founder of Lapanday Group took control of
the company more than decades ago.
Established in 1926, the company has grown to become one of the largest in the country, exporting more
than 100 types of fresh and processed fruit products to countries in five (5) continents. Del Monte operates
the world’s largest pineapple plantations, located in the vast tracts of land in the province of Bukidnon in
Mindanao. There was a time the company employs around 5,500 personnel working in its plantations and in
its huge processing and canning plant in Bugo, Cagayan de Oro City. More than of Del Monte products
produced annually are for export. In the Philippines, it also command a huge share of the market and the Del
Monte brand become a familiar name in Filipino household. Mr. Jose S. Diaz, senior manage for cannery
management, and some of the managers believe that the success of the company is closely related to its
employee policies. Following a radical change in the company’s labor-management cooperation (LMC)
program, the company experienced a significant increase in its efficiency, an example of which is its pineapple
harvest yield of rate of more than 80 tons (1,000 kilos = 1 ton), a world record.
The company’ labor policies are products of long years of consultations and negotiations between the
workers’union leaders and top management of Del Monte. The parties agreed to form a consultative council
composed of representatives from both sides. Their goal: to continually work for the improvement of workers
benefits and production output.

C. Local Giant Step Out of its Comfort Zone (San Miguel Corp.)
Synergy is the backbone of the financial growth and strengthened market position of the food and beverage
giant San Miguel Corp. (SMC). This business strategy was first used by the conglomerate’s founder Don
Enrique Ma. Baretto y de Ycasa a Spanish businessman who has obtained a Royal Grant from Spain for the
manufacture of beer in the country. The conglomerate was established in 1890 as the La Fabrica de Cerveza
de San Miguel. Its name was taken from its location at the San Miguel district in Manila. The brewer is the first
business kind not only in the country but in Southeast Asia as well. In 1893, the Spanish businessman changed
the business from single-proprietorship to co-partnership named San Miguel Brewer Inc. This as the demand
for beer increased.

The business later diversified into soft drinks, ice cream, and glass bottles. The name San Miguel Corp. was
used in 1963 to reflect its diversified business line. This as the conglomerate ventures into animal feeds,
poultry and dairy products and other packaging materials.
Page 3

Synergy as business strategy has been retained by the present army of businessmen running the
conglomerate. At present, SMC has three (3) business line; beverage, food and agribusiness and packaging.
The fine stroke of synergy as strategy in the conglomerate’s beverage line is exemplified in the combined
operations of Coca-Cola Bottlers, Inc. and Cosmos Bottling Corp. This integration of sales forces is seen to
expand the soft drink market in the Philippines. The mixed bag in food group includes two leading brands; San
Miguel and Pure Foods. The integration of this product line is aimed at giving customers a wide variety of
quality products. SMC affiliated brands Coca-Cola, Ginebra San Miguel, Magnolia, Purefoods and Monterey
have been the most trusted names of Filipino consumers. The conglomerate flagship product San Miguel Beer,
has remained the market leader in the Philippines and is also one of the most recognized brands in Asia
SMC’s financial results were achieved as the company intensified operating execution across all businesses,
pushing for greater efficiencies , the streamlining of general and administrative functions and the maximizing
of synergies in selling and marketing. The conglomerate financial achievement was also attributed to its labor
force. SMC is backed by an army of 27,000 personnel in more than 100 major plants and offices. The human
capital is considered the force behind the strong market position of SMC’s 350 products. Much of San Miguel
success lies on company’s rich and reliable human resource composed of a deep pool of managerial talents
and potent employee force. In every hand involved in SMC’s operation, the principle “Calidad por encima de
todo” (quality above everything)
The passion of delivering quality products and services today manifest itself in the Corporate Policy on Quality
defined by SMC Chairman and Chief Executive Officer Eduardo “Danding” M. Cojuangco Jr. He personally
runs the conglomerate to beef up the company’s position as a regional player. His goal is for SMC to be a
regional player in the beverage, food and packaging industry, extending its reach beyond the Philippines.

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