1. Lao Brewery Co., Ltd-LBC (presentation step 3) Presented by: INTHAVONG Saynakhone NGO HUY Thang DETCHANTHACHACK Khamthavisay

2. 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

3. Company recap Carlsberg Breweries of Denmark TCC Carlsberg Asia LBC 50%

4. Two ways to form an alliance Emergence of a privileged relationship Targeted resources Formal search Chance encounter Active and deliberate quest 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)

5. Four manœuvres for three moves (Page 117)

6. Partner selection criteria Carlsberg Asia Lao side Financial assetsNY Complementarities of capabilitiesYY Unique competenciesYY Industry attractivenessYY Cost of alternativesYN Market knowledge/accessYN Intangible assetsNY Managerial capabilitiesNY Capabilities to provide quality products/servicesNN Willingness to share expertiseYY Previous alliance experienceYY Special skills that you can learn from your partnerNY Technical capabilitiesNY (page 133)

7. 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 6 8 9 8 7 9 10 7 9 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 1.00 1.05 1.62 SCORE1.008.07 (Modified from page 137)

8. 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)

9. Special area for cooperation (Page 141) cooperation Stages of Value Chain covered Modes for Organizing tasks Time frame Focus on one stageEntire activity Duplication Distribution Centralization Bound Unrestricted *LBC cooperation area follows in red arrow

10. 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

11. 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

12. Any questions?