In Conversation:
Mlungisi Mathonsi, Managing Director of Coca-Cola Shanduka Beverages
Coca-Cola Shanduka Beverages (CCSB) is one of four Coca-Cola Franchised Bottlers currently operating within South Africa. Bottling over 17 million cases a year, CCSB's franchise territory spans across Mpumalanga (65%); Gauteng (15%) and Limpopo (3%). Operating from a central hub in Mpumalanga, CCSB's main manufacturing plants are located in Witbank and Nigel. In addition, there are strategically situated sales centres in Steelpoort, Groblersdal, Ermelo and Standerton.
FTC was recently tasked with conducting a comprehensive review of CCSB's market, business and operational strategy and to implement a Value Engineering (VE) process. This was based on the recommendations developed alongside a gauge of CCSB's ability to implement them. The process was aimed at equipping CCSB with the tools necessary to drive a high performance culture – a critical ingredient to CCSB's ability to move forward in line with business and operational strategy.
Malusi Mathonsi
How has the business changed over the last 18 months?
When I first joined the organisation, we were making the transition from that of a family-business to a corporation. The organisation needed to evolve without losing the "family atmosphere". Whilst developing the strategy to move forward was relatively straightforward, the challenge lay in getting the associates and other key stakeholders to buy-in and align them with it.
In parallel, systems were undergoing re-engineering, increasing pressure on associates to align themselves to new systems while undergoing a simultaneous change in the dynamic of the organisation.
How did you go about aligning the strategy throughout the organisation?
The Management team, with the assistance of FTC, introduced a process called "Value Engineering" (VE). This process enabled us to translate executive level goals and objectives into targets that could be understood across all levels of the organisation.
Targets were set per shift, per day, per month etc, and actual performance was tracked relative to these targets. This performance management enabled associates, supervisors, team leads, managers and EXCO members to know - at any point in time, in any area of operations – how the business was faring relative to targets.
If targets were not met, not only were we able to swiftly identify reasons underlying performance, but also establish processes to assist teams in meeting targets.
Value Engineering enhanced our management routines and instilled a culture of discipline in the business. It enabled us to translate financial and strategic targets, set at Board level, into straightforward targets that could be understood on the floor. It also enabled us to identify and understand trends within the operation, thus allowing us to adapt quickly to meet customer needs.
What was the thinking behind Value Engineering?
It is great having a car engine capable of running at 200km/hour but, without the right wheels and chassis, you are not going anywhere. At CCSB, we realised that we needed to ensure that we had the fundamentals in place if we were to get to our destination.
For example, we had a great ERP system in place but it was a numbers exercise. People were merely keying the figures into the system, without any understanding of how their role contributed to achieving organisational objectives. The principle of VE enabled people to understand what was happening in the business, and the inter-dependencies between areas.
How did you change the culture of the organisation?
The principles contained within the concept of VE were great. However, we needed to ensure that we developed both as individuals within CCSB and as an organisation. We strove to incorporate the concept of VE into our daily operations, and instill a culture of high performance, driven by rewards and feedback. The bonus / incentive system was clearly defined and everyone was able to participate in the pool. Interactive events, such as family days, were organised to enhance the culture of collaboration, and let employees know they are valued. Such events enabled us to retain the "family business" culture within our organisation.
What is ahead for CCSB?
Our territory is in the heart of South Africa – we feel the pulse of what is happening and it feels like we are heading into exciting times.
We have the fundamentals in place – the systems, the processes, and the culture. We are now at a point where we can start looking at re-investing in our manufacturing and distribution assets to fuel greater growth. These are exciting times for us and CCSB is on a wonderful journey.