CAPACITY PLANNING AND PERFORMANCE IN THE NIGERIAN BREWING INDUSTRY IN SOUTHEASTERN NIGERIA

 CAPACITY PLANNING AND PERFORMANCE IN THE NIGERIAN BREWING INDUSTRY IN SOUTHEASTERN NIGERIA

ABSTRACT

The study investigated the influence of capacity planning on the performance of brewery firms in South Eastern States of Nigeria. The specific objectives of the study were to determine the extent to which capacity planning enhanced the level of performance in the brewing industry in South Eastern Nigeria. The study examined the nature of the relationship between capacity requirement planning and materials requirements planning, to ascertain the extent to which capacity planning sustains organizations competitive advantage, thereby determining the relationship between capacity planning and capacity building, determining the steps toward developing a capacity planning that affects the profitability in the brewing firms in the area studied. The research design adopted in the study was a combination of the survey, oral interview and model modifications. Hypothesis 1,3 and 5 were tested using Z test of population proportions and 2 and 4 using Spearman’s Rank Correlations revealed that capacity planning to a large extent enhanced the performance in the brewing industry in Southeastern Nigeria, that there was a significant capacity planning to a large extent (p< 0.05) enhanced the performance in the brewery industry in the area studied. Capacity requirement had positive relationship (p< 0.05)with materials requirements planning. Capacity planning to large extent (p< 0.05) sustained the organizations competitive position. There was significant positive relationship (p< 0.05) between capacity planning and capacity building. The steps of the capacity plan positively (p< 0.05) affected profitability. Positive relationship between capacity requirements planning and materials requirements planning, that capacity planning to a large extent sustained the organizational competitive advantage, that there is a positive relationship between capacity planning and capacity building, that the 12 steps of the capacity plans were developed that positively affected the profitability in the brewing industry in the area studied. In conclusion, the finding that capacity planning enhanced the performance in the brewing industry in Southeastern Nigeria implied that it made the brewing companies studied to achieve their organizational goals and objectives. The finding that there was a significant positive relationship between capacity requirements planning and materials requirements planning implied that there was a positive correlation between them. This means that materials requirements planning which was a method of coordinating the detailed production plans could lead to an enhancement of capacity requirements planning which meant taking future decisions on the items needed for the production capability of the brewing facility…..

CHAPTER ONE

1.1 BACKGROUND TO THE STUDY

Capacity Planning has enhanced the performance of the brewing industry in Nigeria right from 1946 when Nigerian Breweries Limited set up the First Brewery in Nigeria (Nigerian Breweries PLC, 2011). The direction has been to increase the number of breweries. Guinness Nigeria Plc set up a Brewery in Lagos in 1963. The magnitude is now five breweries located at Ikeja, Ogba, Benin, Jos and Aba (Guinness Nigeria Plc; 2011). Capacity has continued to be the production capability of a facility in terms of the inputs, throughput and outputs.

In 1989, the Federal Government policy of using local inputs such as sorghum and corn instead of malled barley negatively affected a lot of the breweries. Both Nigerian Breweries Plc and Guinness Nigeria Plc depended on the assistance of the Parent Companies. The Brewing Industry in Nigeria have relied on capacity planning for meeting the increased demand for beer, stout and malt products through Demand Forecasting and Capacity Requirements Planning (Guinness Nigeria Plc, 2011; Nigerian Breweries Plc, 2011).

Capacity building has followed capacity planning in the creation of the enabling environment with appropriate policy and legal frameworks, institutional development including community development (of women in particular). Human Resource Development and strengthening of managerial systems, adding that, UNDP recognizes that capacity building is a long-term, continuing process, in which all stakeholders participate (ministries, local authorities, non-governmental organizations and water user groups, professional associations, academics and other (citation: UNDP). Capacity building is very necessary for capacity planning. Planning is deciding in advance what is to be done, when, where, how and whom it is to be done. In that it bridges the gap from where we are to where we want to go in any business building and performance. It is continuous, periodic managerial activities and reduces uncertainty. Capacity is the production capability of a facility and it is measured in terms of inputs, throughput and outputs. Manufacturing is that aspect of industry in which products, waste products and services are produced (UNDP, 2012).

By 1992, capacity building became a central concept in Agenda 21 and in other United Nations Conference on Environmental and Development (UNCED) Agreements. By 1998, the UN General Assembly had commissioned and received evaluations of the impact of the UN system’s…..

 CAPACITY PLANNING AND PERFORMANCE IN THE NIGERIAN BREWING INDUSTRY IN SOUTHEASTERN NIGERIA