Heineken

BSMH 5093

Managing Change & Communication

Case Study

Organizational Change

Heineken Inc.

By

814284 - PRIDHIVRAJ NAIDU

18th March 2013

1.0 Company Profile

Heineken is one of the world's leading brewers, in terms of sales volume and profitability. The company has a wide international presence through a global network of distributors and breweries. Heineken is also the largest brewer and beverage distributor in Europe in terms of volume. The company brews and sells more than 170 varieties of international premiums, regional, local and specialty beers (Drink Market watch, 2009)

2.0 Punctuated Equilibrium model applied in Heineken Inc.

The punctuated equilibrium model of organizational transformation (Tushman & Romanelli, 1985) has recently emerged as a prominent theoretical framework for characterizing and investigating fundamental organizational change. As described by its proponents, punctuated equilibrium theory depicts organizations as evolving through relatively long periods of stability, equilibrium periods in their basic patterns of activity that are punctuated by relatively short bursts of fundamental change.

As explained further by Stinchcomhe, (1965), the general theory argues that the common state of organizational activity is one of stability or equilibrium. Organizations establish an initial pattern of activity based on the environmental conditions prevailing and the managerial decisions made during their time of founding. The modal explanation shown by the diagram as follows;

In Heineken, there has been business as usual status being the top brewers and retailers of beer until the 1950’s, the grandson of the Heineken founder, Freddy Heineken observed the consumption patterns change radically in coming years. The change was an initial radical change as shown by Figure 1. Following the immediate change in the initial stage, there was an incremental change seen in the organization among middle level managers...