Cautious optimism about future Every picture tells a story. So does every business. Each Heineken operating company has its own story to tell, about its past and its future. Heineken International Magazine paid a visit to El Aguila (Spanish for: The Eagle) and discovered that this brewery, one of Spain's oldest, had more than just a story to tell.The story turned out to be one of a business showing a new zest for life as it crawls up out of a deep abyss. But 'crawls' is hardly the right word. Under the Heineken banner El Aguila with its 3,600 employees is zooming towards recovery at rocket-like speed. Hard work and inventiveness: these are the slogans of the management team in Madrid. And yet the team members temper their optimism with the right dose of caution. "We've still got a long way to go" is one remark we frequently heard. But Heineken International Magazine found out that El Aguila is at least heading in the right direction. Improvisation Efficient History Antiquated No forced redundancies PLENTY OF NEW FI2 AT EL AGUILA IN SP General manager R. Strobos: "Heineken has created confidence in Spain. Production manager M. Kakebeeke: "Investing in improving quality and productivity. Speed seems to be the keyword at El Aguila. From the moment that Heineken acquired a 38% shareholding (and management control) in September 1984, Spain's biggest brewery group has been moving along at breakneck speed. But it clearly knows where it's heading, the aim being to return to profit by 1989. R. Strobos, El Aguila's general manager, has this to say about the speed of action: "In the first couple of years you have to push through the plans you feel are urgent. But, once you've settled in, you no longer tend to do that.In August last year Heineken acquired the majority of the shares. El Aguila is now 51% Heineken-owned. The changes at El Aguila over the past two years can almost be described as a revolution.The Spanish employees can take credit for part of this success. "As a Heineken management you may want to get all sorts of things done, but if there's no willingness from the Spanish side to accept new developments, then you might just as well forget it. We've found that the Spaniards can adapt very quickly and are very good at improvisation.Those are the qualities that work to El Aguila's advantage", says marketing manager F. Bot. When it acquired El Aguila in 1984, Heineken was fully aware that a great deal needed to be done. By Heineken's standards El Aguila was a highly archaic business. Two examples to illustrate this: the accounts ledger was still being written by hand, and there were no electric typewriters. To enable efficient working practices, changes needed to be made in all sectors of the business. The biggest changes took place in El Aguila's seven breweries. In the past each brewery had been headed by a general manager. He was in charge of both marketing and production. Not much influence was brought to bear on him from the head office in Madrid. And so each manager was able to follow up his own ideas about the beer's quality and taste, about advertising and selling. This meant that El Aguila's image and presentation differed depending on the region. In other words: a glass of Aguila beer brewed in Cordoba did not taste or look the same as one from the Valencia brewery. This organisation structure - far from ideal by Heineken standards - had its roots in El Aguila's past history. El Aguila was founded in Madrid at the beginning of this century. Over the years the business grew strongly by taking over existing breweries and building new production units of its own. For many decades El Aguila was Spain's biggest brewer. In 1970 the business was the market leader; one- quarter of Spain's total beer output came from the seven Aguila breweries. During the 1970s the brewery got into difficulties.The market was expanding, but El Aguila failed to seize its chances. As management responsibilities were spread so thinly between the various brewery units, the central management in Madrid was unable to take the necessary steps to benefit from this growth market.Though the business was still the country's biggest brewer, it was operating at a loss. In the early 1980s, mainly because of the very high interest rates, the financial problems worsened. One of the consequences of those financial problems was a backlog in the maintenance of machines. El Aguila had made no new investments in new machines for more than ten years. Its seven breweries - in Algete The brewhouse in Algete. Apart from the familiar copper brewing kettles, stainless steel kettles have o (20 kilometres north of Madrid), Cordoba, Valencia, Zaragoza, Merida, Cartagena and Alicante - were antiquated.The new management from Heineken spent several months studying the question: how many breweries do we need so that we can at least maintain the capacity (4.5 million hectolitres), whilst not forgetting the commercial and social factors involved. Various options were examined and the ultimate decision was that the breweries in Merida, Cartagena and Alicante would have to be closed. M. Kakebeeke, responsible for production at El Aguila, explains why: "Those three breweries were the oldest and smallest ones in the group. Renovating them would have cost too Bottles of Aguila are filled with great speed. muchSo we transferred their capacity to the four remaining breweries. A major capital expenditure programme has been drawn up for the modernisation of those four breweries. Up to 1991 some Ir.£124 million will be invested in improving quality and productivity. Let me give an example: in earlier days the seven breweries had as many as 25 bottling lines, for the simple reason that each separate brewery bottled and packed all types of Aguila beer. Now exactly the same capacity can be handled by a mere seven lines in the four breweries." The closedown of three breweries obviously had consequences for their Bottles of Aguila beer, ready for

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Heineken International Magazine | 1987 | | pagina 4