CHINHOYI UNIVERSITY OF TECHNOLOGY

SCHOOL OF ENTREPRENEURSHIP AND BUSINESS SCIENCES

GRADUATE BUSINESS SCHOOL
MASTER OF SCIENCE IN STRATEGIC MANAGEMENT
OPERATIONS AND VALUE CHAIN MANAGEMENT (MSCSCM 646)

INDIVIDUAL ASSIGNMENT QUESTION

Visit a poorly performing manufacturing firm and establish operations
challenges facing it. Demonstrate by way of a model or framework how that
firm can adopt and achieve sustainable operations management.

BY
BOTHWELL NGIRIVANA
(C…)

18 JULY 2023
 TABLE OF CONTENTS

1.0 Introduction.....................................................................................................................1
1.1 Background of the organisation......................................................................................1
1.2 Operational challenges faced at Pungwe Breweries.......................................................1
1.2.1 Product quality challenges..............................................................................................2
1.2.2 Lack of Business Planning..............................................................................................3
1.2.3 Poor Technology Development and a Lack of ERP system...........................................3
1.2.4 High production costs.....................................................................................................4
1.2.5 Weak Sales and Market Development Operations..........................................................4
1.2.6 Poor Human Resources Operations................................................................................5
1.2.7 Lack of sound Financial operations................................................................................6
1.2.8 Weak Supply Chain Operations......................................................................................7
2.0 Proposed model to achieve sustainable competitive advantage......................................8
2.1 Value Chain Model.........................................................................................................8
2.1.1 Sustainable sourcing........................................................................................................9
2.1.2 Supply chain management............................................................................................10
3.0 Conclusions and Recommendations.............................................................................11
References................................................................................................................................13

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1.0 Introduction

Operations are the activities, decisions, functions, and processes that transform inputs into
outputs. Chase et al. (2006) recognise the need for planning, organising, leading,
coordinating, and controlling the entire transformation process for efficient resource
utilisation and meeting targets towards organisational profitability. Put differently, operations
represent the activities where corporate strategies are implemented and synchronised at
different departments within an organisational structure (Al-Dhaafri and Alosani, 2020). The
generic operational or functional departments that are tasked with the responsibility of
executing strategies are marketing operations and finance (Kasprzak, Lally, Schoonover,
Gallicchio, Haynes-Maslow, Vermont, Ammerman, Raja, Tumiel-Berhalter, Tirabassi, and
Leone, 2022). This paper explores the operations challenges encountered by Pungwe
Breweries across its value chain model of strategic thinking towards bringing a sustainable
competitive advantage to the business and shareholder.

1.1 Background of the organisation

The assignment is premised on Pungwe Breweries Private Limited, a company that is wholly
owned by the Mutare City Council and operates within the beverage industry (Jena,
Marongere, Hickonicko, and Zingi, 2022). Pungwe Breweries & Marketing (Private) Limited
is situated at 21 Vhumba Road in the light industrial area of Mutare. It is a commercialised
strategic business unit wholly owned by the Municipality of Mutare that manufactures and
distributes opaque beer (Jena, Marongere, Hickonicko, and Zingi, 2022). The organisation
was created as an additional stream of revenue for the municipality that could supplement
income generated from rates payable by rate payers and residents in Mutare to enhance the
quality of service delivery.

Pungwe beer has a sorghum malt-dominant flavour with a biting taste and a shelf life of 5
days. Before 1993, it manufactured and distributed Pungwe bulk beer in its own beerhalls in
Mutare before expanding its pack portfolio to the brown litre HDPE returnable pack when it
expanded its market reach to the greater Manicaland province of Zimbabwe. As sales
continued to decline, Pungwe expanded its market reach outside Manicaland.

1.2 Operational challenges faced at Pungwe Breweries

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Pungwe Breweries has become a liability to the local authority due to a variety of operations
challenges that have affected its revenue generation capabilities and profitability. While the
organisational structure at Pungwe Breweries follows Porter’s value chain model, support
functions in the value chain also affect the integration and synchrony of business success.
The operations challenges faced by Pungwe are broadly a result of a lack of a sound business
plan, poor financial discipline leading to high process waste, product quality challenges,
weak sales and market development, excess staffing and skills gaps, limited distribution
options, and operating a redundant business model in a dynamic environment.

1.2.1 Product quality challenges

Pungwe produces and sells only opaque beer in a 2-litre package with a shelf life of about 5
days. A scan into the competition environment shows that its main rival Delta Beverages,
through new product development, increased its product portfolio with the non-returnable,
appealing, smoother, higher profit margin 1.25 litre Chibuku Super with extended shelf life,
coming in different flavour variants such as Chibuku Original (unflavored), Chibuku Choco
(chocolate), and Chibuku Banana. The translucent pack offering also addressed the perennial
challenge of foreign objects. The recent commissioning of the Harare Chibuku Super Plant
affirms that demand is outstripping supply, which is a sign of exponential growth in the
market prospects of the brand. However, similar sentiments cannot be saved for the Pungwe
Breweries brand.

Introduced in 1993, the 2-litre Pungwe bottle has lost equity. In contrast, competition
renewed and repositioned the Scud pack, whose life cycle was approaching twilight, by
downgrading the size to 1.5 litres, changing the bottle design, and, in the process, addressing
the challenges of capping to offer improved tamper proofing for its increasingly health-
conscious consumers. The Delta Beverages product strategy demonstrates the mastery of
product rejuvenation throughout its life cycle. Despite these changes in the operating
environment, Pungwe Breweries maintained its 2-litre pack as its major product offering to
the market. This failure to develop new products and services for the market resulted in their
loss of marketing appeal and redundancy (Ufer, Ortega, and Wolf, 2022). There is a need for
Pungwe to conduct market research that can inform on prevailing market trends with respect
to preferred products and services in the beverage industry (Verma, Sharma, Deb, and Maitra,
2021).

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The cost of poor quality far outweighs the cost of preventing poor quality. Quality is
consistent conformance to customers’ expectations and a major influence on customer
satisfaction or dissatisfaction. Quality is the most visible part of what an operation does
(Slack) A review of the Pungwe value chain observed a month-on-month, year-on-year
decline in the volumes brewed against packaged and sales volumes. The quality assurance
department is underequipped and lacks expertise in executing this function. According to
Deming (Slack, 2021), the cost of doing things wrong takes away 30-35% of revenues. Low
national sorghum grain stocks saw Aspindale Maltings plant (wholly owned by Delta
beverages) stopping sorghum malt supplies to Pungwe Breweries in 2021. In an endeavor to
ensure product supply, Pungwe resorted to traditional floor malting own sorghum malt. The
malt produced was of an inferior quality as there was limited/no technical knowledge and
capacity of the malting process to produce a good quality intermediary. This greatly affected
its final product quality offering to the market resulting in customer dissatisfaction which
reflected in high non-conformance costs – lost sales, increasing product recall costs and
ballooning scrapping costs. To mitigate this risk, Pungwe needs to introspect its procurement
processes and increase its supplier base for critical materials like sorghum malt. The quality
control function needs to formulate standard operating procedures and measurable for raw
materials receiving to guarantee final product quality.

1.2.2 Lack of Business Planning.

Pungwe Breweries does not have a business plan. According to Benjamin Franklin, “if you
fail to plan, you are planning to fail”. Success is not accidental. Business processes need
planning, organizing and controlling. There is need to devote time and resources towards
planning – this requires metrication of current business performance, environmental scanning
and doing a SWOT analysis across the entire value chain functions. The reviews and
environmental analysis allow organizations to be able to project sales volumes and allocate
resources (budgeting) for a leveraged competitive advantage

1.2.3 Poor Technology Development and a Lack of ERP system

The weak internal control framework and financial misappropriation can be attributed to the
lack of an ERP system at Pungwe Breweries. Financial transactions are difficult to track and
supervise as the system is highly manualized. Enterprise Resource Planning (ERP) enhances
administrative efficiency within organizations through fully integrating essential supply chain

3
functions such as planning, procurement, production, sales, finance and inventory
management while providing a picture of real-time global business performance.
Implementation of an ERP system at Pungwe will reduce the risk of human error and
redundancy with opportunities to further reduce manning levels.

The operations of Pungwe Breweries are significantly impacted by poor technology

development, which has an adverse influence on its productivity, efficiency, quality control,
innovation, and overall sustainability (Blut and Wang, 2020). Productivity loss is one of the
main effects of inadequate technology development. Inefficient or insufficient technology
caused bottlenecks and inefficiencies in a number of operational processes, including
production, packaging, inventory control, and distribution (Bahrini and Qaffas, 2019). This
made it harder for Pungwe Breweries to satisfy customer demand and complete orders on
time since it caused longer lead times, more downtime, and decreased output.

Additionally, ineffective technological advancement reduced operational effectiveness. Older

systems required a lot of human effort, were time-consuming, and were susceptible to
mistakes. As a result, there may be a larger likelihood of bottlenecks or other operational
disturbances, higher error rates, and higher workforce expenses (Nkosi, Gupta and Mashinini
2020). Pungwe Breweries’ quality control was hampered by poor technology development.
Incompatible technology lacked the capacity needed to efficiently monitor and regulate the
product quality of Pungwe Breweries. This led to erratic product quality, a higher risk of
contamination, and the possibility of product recalls or unhappy customers.

The quality of the beer produced by Pungwe Breweries was impacted by operational issues
(Jena et al., 2022). Ineffective quality control resulted in variable flavours, production
changes, or product recalls. This damaged the brand’s reputation, which led to a decline in
patron loyalty and confidence. On the other hand, a brewery can set itself apart from rivals
and create a long-lasting competitive advantage by placing a significant emphasis on quality
control and ongoing improvement.

1.2.4 High production costs.

Pungwe used a diesel fired boiler that directly adds $4.00/hl produced to its total cost of
manufacturing (TCM) against $1.00/hl for coal fired boiler. This high TCM reduces its price
leverage capabilities and profit margins against players in the same industry. While boilers
are major capital investments, there is great impetus to invest in coal fired boilers as coal is
locally available in Zimbabwe compared to diesel.

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1.2.5 Weak Sales and Market Development Operations

The genesis of operational challenges at Pungwe Breweries can be attributed to poor sales
and market development operations. The company was formed at a time when the
entertainment industry had not fully developed. The standard model when it came to
entertainment during the formulation of Pungwe Breweries revolved around beer hall
business concepts. Musical groups and other forms of entertainment were usually held in beer
halls. However, the entertainment industry has gone through major transformational changes
over time, which have resulted in a paradigm shift from beer halls towards bottle stores and
nightclubs. These changes have influenced the distribution, promotional, and product
strategies of beverage companies that have aligned their marketing strategies with changing
environmental trends (Cipollaro, Fabbrizzi, Sottini, Fabbri and Menghini, 2021).

Despite these changes in the operating environment, Pungwe Breweries maintained its
opaque beer as its major product offering to the market. This is a demonstration of the failure
to conduct market intelligence and market research that could inform on prevailing market
trends with respect to preferred products and services in the beverage industry (Verma,
Sharma, Deb and Maitra, 2021). In addition to this shortcoming, Pungwe Breweries also
maintains beer halls as its unique distribution strategy despite the decline in popularity of
municipally run beer halls in the market. The failure of the Pungwe Breweries to develop new
products and services for the market resulted in their loss of marketing appeal and
redundancy (Ufer, Ortega and Wolf, 2022).

1.2.6 Poor Human Resources Operations

The engagement of unskilled personnel for political mileage by elements of the board created
a high headcount burden against its manning level requirements in so doing affecting the
company’s labor productivities. Solutions towards the disposal of the loss-making retail arm
can potentially reduce manning levels by half and double labor productivities and reduce
payroll costs. Additionally, there are opportunities to reduce the manning levels in
production to further strengthen labor productivities. Over the years, the employees have
gone on industrial action seeking redress on low salaries. Rationalizing the labor
requirements can also enable adjustments on the otherwise low remuneration standards for
the business

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Pungwe Breweries faces poor industrial relations due to unfair remuneration, including
contract employees who went without salaries for nearly eight months. Top management,
including counsellors involved in fraudulent activities, misappropriated funds. Poor human
resources practices contradict the principles of creating a healthy industrial relations climate.
Human resources possess dynamic capabilities, enabling them to adapt and transform
organizations in turbulent operating conditions (Newman, Fast and Harmon, 2020).

The magnitude of operational challenges in human resources operations emanated from

recruitment strategies that were mainly based on nepotism and familiar relationships rather
than meritocracy. This meant that high-ranking officials within Pungwe Breweries could
employ their family members and friends based on their familiarity with them and not on the
basis of any qualifications, skills, or competencies that could be leveraged to add value to the
company (Karim, Choudhury and Latif, 2019). Such people who are recruited on the basis of
nepotism usually do not have the required skills, and due to their links with high-ranking
officials, they might be unwilling to take instructions from their supervisors in a manner that
disrupts operations in the organisation (De Clercq, Kundi, Sarkar and Shahid, 2021).

The industrial relations context with respect to employee training and development within the
organisation is very poor. Given that, Pungwe Breweries has not embarked on any active in-
house or outsourced training initiatives that can enhance the level of skills, capacity building,
or awareness of employees with regards to the dynamic trends in the broad industry, which
they are supposed to internalise with the purpose of igniting the required innovation and
creativity necessary to reposition the competitiveness of Pungwe Breweries within the
brewery industry. In addition, the company has been in the limelight over unfair employment
practices that includes unfair demotion and dismissal of employees (Jena et al., 2022).

Delta Beverages invests in training initiatives to improve employee skills and competence.
The company offers three training centers, graduate and technical programs, and industrial
attachments for college and university students. However, Pungwe Breweries’ human
resources strategy falls short of acceptable practices, affecting the company’s operations. This
lack of motivation and empowerment hinders creativity and innovation, hindering Pungwe
Breweries’ competitiveness in the Zimbabwean beverage industry.

1.2.7 Lack of sound Financial operations

Due to its inability to generate income from properties that the Mutare City Council might
benefit on if privatised, Pungwe Breweries has grown to be an expense for the municipality.

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In relation to operating beer halls, Pungwe Breweries owed Mutare Council nearly
US$400,000 in overdue rentals. In light of enormous deficits that were emptying the council
coffers, efforts were made in order to lease out every pub that Pungwe was running. The main
issues preventing endeavours to restart Pungwe Breweries have been cited as being
accusations of ineptitude and mismanagement. The Mutare City Council at one point
obtained a loan to save the company, although it is claimed that the money was wasted.
Pungwe also tried to find partners to help it resume operations, but no one responded to the
tenders.

Legacy debt is a significant financial issue affecting Pungwe Breweries’ productivity and
financial health. The company must pay back interest on its debt, which limits its ability to
invest in expansion projects and maintain long-term viability (Kose, Ohnsorge and Sugawara,
2022). Additionally, high debt loads make it difficult for Pungwe Breweries to obtain new
loans or financing, making it more vulnerable to economic downturns and business changes.
This debt burden also affects Pungwe Breweries’ reputation and connections with vendors,
distributors, and stakeholders, leading to strained relationships and potential financial trouble.
The company’s inability to pay debts has negatively impacted its ability to operate effectively
and efficiently (Solgi and Ghahraei, 2022).

Pungwe Breweries’ financial stability is negatively impacted by financial misappropriation,

which involves illegal or inappropriate use of money or resources for personal or non-
commercial purposes. This can result from theft, dishonesty, or unethical behavior. Financial
misappropriation depletes the company’s limited resources, reducing profitability and cash
flow issues. The money diverted from essential costs like raw materials, equipment, and staff
disrupts regular business operations, affecting productivity, product quality, and customer
satisfaction.

The misappropriation of cash compromised Pungwe Breweries' credibility and goodwill,

which resulted in a decline in the company's standing with clients, partners, and other
stakeholders (Jena et al., 2022). Long-term effects included lower sales, trouble recruiting
investments, and difficulties cultivating partnerships with vendors. Misappropriation of cash
also caused Pungwe Breweries to face legal and regulatory problems. Mismanagement of
finances can result in fines, sanctions, or even legal action because it breaches accounting
standards, tax laws, and other legal obligations. The costly and time-consuming legal

7
repercussions distracted management from key operations and had a detrimental effect on
overall business performance (Komsomol, Owusu, Bekoe and Oquaye, 2020).

Internal controls and governance frameworks at Pungwe Breweries are also threatened by the
theft of funds. It draws attention to weaknesses in the company's internal control framework,
including the supervision and tracking of financial transactions and the division of labour. As
a result, trust between co-workers may deteriorate, which could have an impact on output,
employee satisfaction, and organisational culture as a whole (Koomson et al., 2020).

1.2.8 Weak Supply Chain Operations

The supply chain plays a crucial role in a brewery’s ability to meet customer demand and
maintain sustainability. Issues with supply chain management, such as locating raw
ingredients and managing inventory, can lead to manufacturing delays, stock outs, and
exorbitant inventory carrying expenses. A well-managed and optimized supply chain can
increase value chain synergies, raise customer service standards, and save costs, improving
Pungwe Breweries’ capacity to compete and ensure prompt delivery and product availability.

Weaker supply chain operations negatively impact Pungwe Breweries’ sustainability, as

access to raw materials, components, and packaging materials is variable and unreliable.
These issues jeopardize the company’s reputation, revenue, and clients. Inefficient supply
chain activities also result in increased costs along the value chain, as well as product quality
problems caused by inconsistent inputs, incorrect handling, storage, and insufficient quality
control procedures. Sustainability is increasingly important for consumers, governing
agencies, and stakeholders, and subpar supply chain management can hinder the
implementation of sustainable practices. This can involve difficulties in finding eco-friendly
products, using eco-friendly packaging, and effectively managing waste and energy. Failure
to address sustainability issues can result in customer loss, reputational harm, and regulatory
compliance problems (Karim, Choudhury and Latif, 2019).

In today’s global and competitive marketplace, companies with weak supply chain operations
face a disadvantage compared to those with robust and efficient networks. Inefficient
operations lead to higher costs, slower response times, and lower product quality, making it
difficult for Pungwe Breweries to compete effectively with rivals, resulting in a loss of
market share and decreased overall sustainability in the long term.

2.0 Proposed model to achieve sustainable competitive advantage

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The value Chain model was selected as an ideal framework to resolve the operational
challenges facing the organisation.

2.1 Value Chain Model

The value chain model is a crucial element of organisational strategy to make certain that the
various partners in the supply network offer considerable value to a product by boosting
economic viability, cutting costs, and raising the bar for innovation. Porter (1985) is credited
with developing the value chain model. Porter defined the idea as a structure that examines a
number of actions that a firm must carry out in the course of developing and providing the
good or service in question to customers (Girdwichai and Sriviboon, 2020).

The fact that the value chain model includes both primary and support activities, which are
two different sorts of activities, makes it significant within the context of Pungwe Breweries.
According to Fernqvist and Göransson (2021), main activities are those that are directly
involved in producing and delivering a good or service. Support activities enable primary
activities. Receiving, storing, and distributing the basic components and other production
inputs are the main tasks involved in inbound logistics. The delivery of equipment, raw
materials, and other components may fall under the category of inbound logistics in the
context of Pungwe Breweries (Shyrock, 2014).

Operations include the activities of the brewery itself. The primary activity in the process of
creating value is this. The storage and distribution of the completed item to clients is a part of
outbound logistics. In the context of Pungwe Breweries, outbound logistics represent the
procedures used to guarantee that the quality of the product is maintained up until it is used
by the final consumer (Ruml, Ragasa, and Qaim, 2021). In order to create demand for the
goods, marketing and sales are two important primary operations. There are a number of
retail locations and online marketplaces inside the Pungwe Breweries structure where buyers
and sellers can connect.

Giving consumers support and after-sales care is part of offering service. This calls for the
development of a long-lasting partnership between Pungwe Breweries and the marketplace.
Infrastructure management, advances in technology, management of human resources, and
purchasing are examples of support activities. The purchasing of resources including raw
materials, machinery, and services is a component of procurement. Technology development
is the process of conducting studies and experiments to enhance a good or service and the

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manufacturing procedure. The recruiting, training, and administration of personnel are all part
of human resources management (Armstrong, 2018).

The value chain model enables Pungwe Breweries to pinpoint its core and auxiliary functions
as well as comprehend their interdependencies and connections. This comprehensive
viewpoint aids the business in identifying its areas of potential and vulnerability, prioritising
its assets, and efficiently allocating them. Pungwe Breweries can leverage the value chain
model in generating sustainable operations by identifying and optimizing the processes that
contribute to the creation of value while minimizing waste, reducing environmental impact,
and enhancing social responsibility. The value chain model is a tool that helps businesses
understand the various activities that are involved in creating a product or service, from the
initial raw materials to the final delivery to customers.

2.1.1 Sustainable sourcing

Pungwe Breweries can improve its operational viability by streamlining production,

negotiating favorable conditions with suppliers, implementing cost-saving initiatives
throughout the value chain, and optimizing operating processes. Sustainable sourcing aims to
reduce ecological damage caused by resource extraction, manufacturing, and transportation.
By using locally sourced ingredients and sustainable business practices, Pungwe Breweries
can reduce their carbon footprint, water use, and trash creation. Long-term cost savings are
often achieved through sustainable sourcing techniques, such as reducing transportation costs
and reliance on imports. Investing in environmentally friendly farming practices, such as
organic farming, can lead to lower input prices, increasing operational efficiency, and cutting
costs.

As consumer demand and awareness of sustainability grow, Pungwe Breweries can capitalize
on this trend and set themselves apart from rivals. By focusing on social and environmental
sustainability, Pungwe Breweries can improve their brand’s reputation, attract eco-conscious
customers, and increase market share. Sustainable sourcing also strengthens supply networks,
reducing the risk of disruptions caused by geopolitical tensions, transportation issues, or
natural disasters. Diversifying suppliers and buying from regional producers ensures a steady
and dependable supply of materials, allowing the brewery to continue operating without
significant difficulties.

The value chain model can significantly improve Pungwe Breweries’ sustainability by
enabling systematic analysis and optimization of its internal processes and activities (Gurtu

10
and Johny, 2021). This leads to increased productivity, cost effectiveness, and overall
operational performance. Pungwe Breweries can optimize production processes to reduce
waste, improve energy and water efficiency, and implement recycling programs. The value
chain model can also identify inefficiencies and bottlenecks, allowing the company to
implement strategies to simplify procedures, eliminate bottlenecks, and enhance overall
operational effectiveness (Kano, Tsang and Yeung, 2020).

Pungwe Breweries can identify key operations that impact company competitiveness by
analyzing the value chain and focusing on enhancing or optimizing those areas for optimum
operational viability. The value chain model can also help Pungwe Breweries identify
opportunities for value creation and differentiation, allowing the company to stand out from
competitors by focusing on cutting-edge brewing methods, premium ingredients, and
environmentally friendly practices. This differentiation increases customer satisfaction,
loyalty, sales, and revenue, ultimately ensuring the brewery’s operational viability (Kano,
Tsang and Yeung, 2020).

2.1.2 Supply chain management

Pungwe Breweries can work with suppliers and logistics providers to ensure that their
products are transported in a sustainable manner, such as using eco-friendly packaging and
reducing carbon emissions during transportation. The value chain approach also makes it
easier to collaborate and plan with suppliers and transportation partners (Gurtu and Johny,
2021). Pungwe Breweries can create beneficial collaborations that optimise the movement of
goods, save costs, and boost the overall effectiveness of operations by understanding the
relationships and interactions between activities. This cooperative strategy helps Pungwe
Breweries remain operationally viable by assuring dependable and prompt access to inputs
and effective distribution channels.

The value chain approach is extremely important in enhancing Pungwe Breweries' operating
viability. It permits a thorough examination of internal procedures and activities, aids in
pinpointing problem areas, encourages cost-cutting, allows for differentiation, locates
bottlenecks and ineffectiveness, and fosters collaboration and communication with
stakeholders. Pungwe Breweries can improve operational performance, boost its standing in
the marketplace, and achieve sustainability over the long term throughout its brewing
business by utilising the value chain model. (Gurtu and Johny, 2021).

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3.0 Conclusions and Recommendations

Operational challenges such as inefficient production processes, material wastage, or supply

chain disruptions can increase costs for the Pungwe Breweries. This can erode its competitive
advantage if it is unable to maintain cost efficiency compared to its rivals. By addressing
these challenges and improving the efficiency of its operations, the company can maintain or
enhance its cost advantage over competitors, leading to sustainable competitive advantage.
The relevance of legacy debt on the operations of a Pungwe Breweries is significant. It can
restrict the company’s financial flexibility, limit access to financing, hinder growth initiatives,
increase vulnerability, and impact relationships with stakeholders. Therefore, it is crucial for
brewery companies to actively manage and address their legacy debt burdens to ensure a
healthy and sustainable future.

Overall, the relevance of weak supply chain operations cannot be understated in evaluating
the sustainability of Pungwe Breweries. Inefficiencies and shortcomings in supply chain
operations can lead to detrimental effects on production, costs, quality, sustainability
practices, and competitive positioning. It is essential for Pungwe Breweries to address these
weaknesses, optimize its supply chain operations, and build resilience to ensure the long-term
sustainability and success of the company. Implementing cutting-edge technology solutions
can increase environmental sustainability, save operating expenses, and enhance Pungwe
Breweries’ social responsibility.

To mitigate the relevance of misappropriation of funds, Pungwe Breweries should implement

robust internal controls and risk management practises. This includes segregation of duties,
strong oversight of financial transactions, regular audits, and implementing effective whistle-
blower mechanisms to encourage reporting of any suspicious activities. An ethical
organisational culture that emphasises transparency, integrity, and accountability is also vital
in preventing and detecting misappropriation of funds. Regular ethics training and awareness
programmes can help employees understand the importance of ethical behaviour and the
consequences of financial misconduct. Additionally, implementing technology-based
solutions such as advanced financial management systems and real-time monitoring tools can
enhance the company’s ability to detect and prevent fraudulent activities. These systems can
provide early warning signs of irregularities, deviations from established procedures, or
unusual financial transactions, allowing swift action to be taken.

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Pungwe Breweries should prioritise innovation in technology and invest in cutting-edge,
integrated solutions and infrastructure that can improve its efficiency, productivity, and
strategic position in the brewing sector in order to lessen these effects and maintain long-term
sustainability.

The theft of funds has a significant impact on Pungwe Breweries' capacity to continue
operating. Internal controls may be compromised, reputation may be harmed, and legal
problems may arise. Strong internal controls, the promotion of an ethical culture, and the use
of technology for improved monitoring and fraud detection are all ways that Pungwe
Breweries can reduce this risk. A Pungwe Breweries can preserve financial stability,
safeguard its reputation, and assure sustainable operations by dealing with money
misappropriation properly.

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