British American Tobacco Bangladesh

Brief description of British American Tobacco

British American Tobacco Bangladesh is one of the oldest and largest multinational companies operating for over 100 years in Bangladesh. British American Tobacco Bangladesh is a member of the British American Tobacco Group that is based in UK and one of the leading players in the global tobacco business. With a long established reputation for providing its consumers with consistently high quality brands, British American Tobacco Group was formed at the turn of the 20th century with the objective of establishing a worldwide business. British American Tobacco is Worlds most global tobacco company. BAT has 85,000 employees selling more than 300 brands in more than 180 markets worldwide. Today, the company produces some 2 billion cigarettes every day. More than a billion people across the globe enjoy smoking tobacco. One in every eight chooses a British American Tobacco brand. In order to support the companys business goals, the merger of British American Tobacco with Rothmans International had been announced on 11 January 1999. This global merger was completed on 7th June 1999. This brings together the number 2 and 4 players which together will boast a combined volume exceeding 900 billion cigarettes around the world with some 120,000 employees and a world-wide market share of 16 percent (Phillip Morris has a 17 percent share). The merger is a major step forward in British American Tobaccos vision of becoming the worlds leading International Tobacco Company. British American Tobacco Bangladesh Company Limited, a market leader in the country, is a subsidiary of British American Tobacco PLC and is one of the 66 countries in which the British American Tobacco Group has manufacturing plants. British American Tobacco Bangladesh has operated in Bangladesh since pre-independence and has its headquarter in Dhaka, with a tobacco leaf processing operation in Kushtia. It is one of the oldest, largest and most respected multinational companies operating in Bangladesh. BATB markets major international cigarette brands like Benson & Hedges, State Express 555, John Player Gold Leaf and Pall Mall, which are complemented by local brands such as Capstan, STAR and Scissors. The company also exports processed tobacco leaf in the

international market, mainly in the European Countries with its effort to create an international market of its products. British American Tobacco Bangladesh currently employs more than 1,300 people and provides indirect employment to a further 24,500 farmers, distributors and suppliers. Currently, British American Tobacco Bangladesh has two factories in Bangladesh. The Cigarette Manufacturing Factory (Dhaka Factory) is located on the same premises as the Head Office in Mohakhali, Dhaka. The Green Leaf Threshing Plant (GLTP) is situated in Kushtia. In line with the global identity change of British American Tobacco PLC, BTC was renamed as British American Tobacco Bangladesh Company Limited (BATB) in 1998. The Company is listed on both the Dhaka and Chittagong stock exchanges in the country.

Competitive advantage of British American Tobacco Bangladesh

Competitive advantage is the unique position that an organization develops in relation to competitors that allows it to outperform them consistently (Hofer and Schendel, 1978). As this definition suggests, advantage can only be achieved by establishing a clear and favorable differentiation from competitors. This inference must be tangible and measurable, and it must be preferable over time (South, 1981). To compete in the market BAT Bangladesh has potential to hold their position .BAT Bangladesh and Dhaka Tobacco Industries together hold more than 80% of the cigarette market share. So it is really difficult for the competitor to easily penetrate in the market.

Fifteen Practices of British American Tobacco Bangladesh

1. Employee Security BAT always said that for an organization to be successful it will have to hire, train, maintain, and reward, the best employees, so that they provide the best services to customers, which lead to employee satisfaction and retention. It also leads to increased profits for the organization. Possible reason for the success of BAT in light of such human resource practices.

2. Selectivity in Recruiting: BAT Bangladesh is all the time serious about obtaining profits through people will expand the effort needed to ensure that they recruit the right people in the first place. BAT has a large recruitment pool from where they recruit employees for the accurate position. They are extremely careful and selective in its recruiting practices. BAT also follows a long process to recruit people. After passing the preliminary test and screening process applicants will need to go to a series of interview and they must agree to have a background check, this is to make sure about the authenticity of their personality according to human resource staff 3. High Wages: Although labor markets are far from perfectly efficient, it is nonetheless the case that some relationship exists between what a firm pays and the quality of the work force it attracts. It is amusing to see firms announce simultaneously that first, they compete on the basis of their people and that their goal is to have the very best work force in their industry, and second, that they intend to pay at the median wage for comparable people in the industry. The level of salaries sends a message to the firm's work forcethey are truly valued or they are not. 4. Incentive Pay BAT Bangladesh offer range of incentive pay to the employees. Among them: Domestic Aids
Wage, Utilities / Maintenance, Transport Allowance, Medical Allowance, Personal / Special / Other incentives, Meal Allowance, Children Education Allowance

5. Employee ownership: Providing the employee with stock option has positive effect on employee. It provide employee with more commitment with the organization and BAT is providing the employees with the opportunity to become the part of this organization. 6. Information Sharing: BAT follows a very open culture and information is decentralized so employees get to do their work according to the decision made by the higher level authority. This creates a positive image for the employees.

7. Participation and Empowerment: The company is a British company and it is guided by their principles. Their corporate culture and organizational behavior reflects the British culture and they embraced their home country culture in their Bangladeshi subsidiary as well. A key part of their work is helping nurture an open, confident and winning culture, where they are all aligned in delivering employee satisfaction. 8. Self Managed Team: One of the most interesting things among BAT is that they follow a complete self managed team. This helps them to have contribution from an every member of the team and this concept is a very effective concept. 9. Training and Skill Development: An integral part of most new work system is a great contribution towards training and development. Training and development creates skilled and knowledgeable work force. BAT Bangladesh provides On-the-job Training, apprenticeship Training On-the-job Training, apprenticeship Training program to the employee.

10. Cross-Utilization and Cross- Training: Cross training program has a greater benefit to the organization because it makes employee to be more productive and able to complete multiple task. Employees of this organization are active and able handle the biggest percentage of market share is the market. 11. Symbolic Egalitarianism: BAT is an example of todays corporate culture. They are able to minimize the gap between the owner and employee. This relation is critical for the employee to sustain in the organization. 12. Wage Compression:
To evaluate the various components of the total compensation package BAT Bangladesh offer cafeteria benefit to the employees. Employee gets to choose from combination of Benefit packages and this creates wide variation in salaries. Employees recognize the importance of wage compression because wage compression increase wage dispersion.

13. Promotion from Within: When it comes promoting employee they are very concern about that fact because they belief is employee equality. For a vacant post first they search eligible candidate from the organization and next alternative is to hire the market. 14. Taking the Long View: The Vision that motivates BAT Bangladesh employees and drives their operation is the desire to extend the market leadership through world class performance across all areas of BAT Bangladesh business. The company is a British company and it is guided by their principles. Their corporate culture and organizational behavior reflects the British culture and they embraced their home country culture in their Bangladeshi subsidiary as well. 15. Measurement of the Practices: Measuring the activity of the organization is another vital factor for BAT because evry work has to be accountable to their respective authority so this reduces the misunderstanding and increases unity among the organization. On the other hand this increases the productivity o the employee. 16. Overarching Philosophy: Overarching philosophy is a fundamental issue that is essential organization a organization. Moreover, such philosophy explain what organization are doing, justify it, and mobilize support from external and internal constituencies.

References:
1. Hofer, C. and Schendel, D. Strategy Formulation: Analytical Concepts, (St. Paul, MN: West, 1978). 2., S.E. "Competitive Advantage: The Cornerstone of Strategic Thinking." The Journal of Business Strategy, 1(4), pp. 15-25.