Improving of the efficiency through benchmarking: a case of Ukrainian breweries

Abstract

Purpose -The purpose of this paper is to investigate the use of competitive and international performance benchmarking in order to estimate efficiency, determine key factors, find the internal and foreign benchmarks, and reveal the full reserves of inputs reduction and potential growth efficiency for brewing companies. Design/methodology/approach -Data envelopment analysis (DEA) and other tools of performance benchmarking are used to analyse the efficiency of brewing companies. Some key factors are examined for their impact on efficiency: the scale, regional location, proprietors and other endogenous and exogenous factors. The results are based on the samples of 34 Ukrainian brewing companies and 20 foreign brewing companies. Findings -Only one domestic company can be recognized as a world-class efficient company. The proprietors, location and the scale factors exert sufficient influence on efficiency of the brewing companies. The international benchmarking allows to widen essentially the capability of reduced consumption of various inputs and provides considerable benefit to Ukrainian breweries and industry efficiency. Some variants for improving of the efficiency of Ukrainian breweries and industry, including cooperation, mergers or friendly acquisitions, are proposed.Research limitations/implications -The research is limited by single industry that is explained by requirement of technology (product) homogeneity while using DEA tools. Practical implications -The results of the study contain data and recommendations that can be practicable for brewing companies' management, present and potential investors and proprietors. The foreign and domestic benchmarks most suitable for benchmarking implementation are established for each of the Ukrainian brewing companies. Originality/value -This is the first study that adopts the various DEA models for measuring of efficiency in the brewing industry with the tools of competitive and international benchmarking.

Efficiency of winemaking in developing countries

“…This set of inputs and output variables is well justified in previous studies, for example, for breweries (Goncharuk, 2009b) and sugar plants (Goncharuk, 2009a).…”

“…Among existing DEA models in the context of a given research, it is expedient to use the following: To estimate an efficiency score for each wine company, the common input-oriented model with a constant returns of scale (CRS) (Charnes et al , 1978) and input-oriented model with a variable returns of scale (VRS) (Banker et al , 1984) will be used. To estimate an influence of production scale on the winery efficiency and to define RTS for each winery, the parameter of scale efficiency will be defined on the following ratio: where TE CRS is technical efficiency score for CRS model and TE VRS is technical efficiency score for VRS model (Goncharuk, 2009b). To make full ranking of wine companies, the DEA model of super-efficiency, offered by Anderson and Petersen (1993), will be used.…”

“…where TE CRS is technical efficiency score for CRS model and TE VRS is technical efficiency score for VRS model (Goncharuk, 2009b).…”

Chinese liquor company management efficiency from a social responsibility perspective: a two stage dynamic directional distance function

“…DEA models have also been applied to study the influence of endogenous and exogenous factors on liquor company efficiency. For example, Goncharuk (2009) analysed the efficiencies and explored the key factors affecting efficiency: scale, location, operations, and other internal and external factors: in 34 Ukrainian brewing companies and 20 foreign brewing companies, from which it was found that only one company in Ukraine was world-class and efficient. Li et al (2013) measured the Distribution Centre productivity using DEA to determine the relationships between the different influencing variables in 108 distribution centres of a large beverage company, finding that high productivity did not always guarantee a good earnings performance.…”

Measuring executive and underlying cognitive functions in schoolchildren in Ukraine

“…Furthermore, beer is worldwide one of the most consumed beverages and the preference of 11-15 years old adolescents (Currie, 2004;WHO, 2014). On top of that beer consumption in Ukraine has tripled between [2002][2003][2004][2005][2006][2007][2008][2009] (Goncharuk, 2009). In Ukraine 9.3% of boys and 3.1% of girls of 11 years old drink alcohol weekly (Currie, 2004).…”